Asia/Pacific News
Embracing Tech, Digitalization, Transparency All Key to Success in Singapore Bunker Market, Says New Physical Supplier
CNC Petroleum Pte Ltd (CNC Petroleum), a new physical bunker in Singapore, says embracing digitalization and other technology is key to its success in the world's biggest bunker market.
As Ship & Bunker previously reported, CNC Petroleum received its physical bunker supplier licence from Maritime and Port Authority of Singapore (MPA) as an MGO only bunker supplier effective November 1, 2017.
The entry comes at a time of increasing competition and tough market conditions, with top 20 ranked supplier Aegean Marine Petroleum Network Inc. [NYSE: ANW] (Aegean) last month among those to have noted the "heightened commercial pressures in Singapore."
"CNC Petroleum strongly believes Singapore still has its attractiveness as a premier global hub port and an international maritime centre. Market conditions are challenging now and how CNC Petroleum addresses these challenges is through business transformations including the digitalization of business processes, emphasizing on transparency, accuracy, speed of delivery. All these things ultimately translate into customer values," says CNC Petroleum's Chief Executive Officer, Sean Chua, who recently spoke to Ship & Bunker about the new operation.
"Embracing other technology is also important, such as the Internet of Things; embarking on automated fuel tanking system and monitoring systems to optimize inventory; monitoring of fuel consumption for customers; business intelligence reports from analytics.
"We also believe in leveraging strong partnerships with oil majors in securing volume and supply consistency."
While their Physical Bunker Supplier licence is new, CNC Petroleum has been delivering diesel and other petroleum products to non-maritime industries since 2008.
"CNC Petroleum has also been delivering diesel to marine industry through other bunker operators, this is where we see opportunity in expanding our business," Sean explains.
"In October 2016 the company merged with Singapore-based NSL OilChem Trading Pte Ltd, now called NSL Fuel Management Services Pte Ltd, as part of the expanding synergy between the two companies."
The company currently delivers bunkers ex-truck and in May of this year launched the new Penjuru Jetty, which CNC Petroleum will manage and operate for three years.
"Before we took over, the infrastructure was purely manual and traditional. For example, an attendant would need to be there to roll out the diesel hose to refill the boats. Handwritten receipts were given instead of an electronic version. Such manual handling may result in diesel pilferage," says Mr Ong Chin Han, Operation Manager of Penjuru Jetty.
"Since the implementations of improved processes, customers can now enjoy an efficient and effective service. It is similar to a modern petrol kiosk terminal."
Looking ahead, Sean says next year the company intends to move into ex-barge delivery also, but will remain focused on MGO supply.
"IMO 2020 is nearing and we see the demand for MGO will increase compared to other marine fuels," he says.
Singapore is the world's biggest bunker market and looks on course to sell a record 50 million metric tonnes of product this year. There are 55 licensed bunker suppliers operating in the port.
As to what share of the market CNC Petroleum is aiming for, Sean is clearly confident of success but declines to give specific numbers: "With the many changes in the economy it is hard to forecast the volume for the first year, but we are aiming for above average market growth."
