Asia/Pacific News
Simon Neo: A $1 Bunker Price Premium Will Recover Singapore Mass Flow Meter Costs in 6 Months
Adding a $1 per metric tonne (pmt) premium to bunker prices will allow Singapore's suppliers to recover the cost of installing Mass Flow Meters (MFMs) in around six months, Simon Neo, Executive Director, Piroj International has told Ship & Bunker.
In April the Maritime and Port Authority of Singapore (MPA) announced that from January 1, 2017 it will be mandatory to use an MPA approved MFM system for Marine Fuel Oil (MFO) bunkering in Singapore, a move some players have said will lead to prices being raised as much as $50 pmt to cover the cost of the technology.
However the industry veteran and former International Bunker Industry Association (IBIA) Chairman says that this figure is grossly overstated.
"All Bunker Tankers in Singapore need to do about 8 to 10 turnarounds a month to be in business," said Neo.
"Say if your tanker loads 5,000 mt each time that will means 40,000 to 50,000 mt each month. So you add on $1 per mt onto your delivered price, then in six months time that will mean $240,000 to $300,000. Then the cost of the Mass Flow Meter will be covered."
MPA is also offering a lump sum incentive of S$80,000 ($63,500) per MFO bunker tanker to help offset the cost of the new systems.
