EMEA News
Gunvor Mulls Clean Marine Fuel Refinery Investment
Cargo trader Gunvor is considering investing in a Rotterdam refinery with the aim of producing clean bunker fuel although details about the project are thin on the ground, according to press reports.
Dutch financial publication Het Financieele Dagblad reports that the move surfaced via an application made to the authorities by the trading company although the company declined to comment.
The investment could amount hundreds of millions of euros and involve a coking unit, according to maritime news provider Tradewinds.
The background to the move, if it happens, is the global sulfur cap on bunker fuel which drops to 0.5% in just under two years' time with the question of sufficient availability of compliant fuel still outstanding.
Shipowners may install scrubbing technology in greater numbers than seen in the market so far. If they do, demand for high sulfur fuel oil will remain buoyant.
Similarly, the alternative bunker fuel, liquified natural gas (LNG), may suck demand out of the conventional bunker fuel market. However, the adoption of both these technologies are in the early stages of development.
A period of price volatility is expected once the new sulfur cap kicks, at least over the short to medium term as demand for high sulfur material is expected to be low while demandfor low sulfur fuel is expected to be high.
A coking unit processes residual oil from the vacuum distillation column into low molecular weight hydrocarbon gases including light and heavy gas oils.
Gunvor sold its stake in Maasvlakte oil terminal in Rotterdam last year.
