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NEWS ARCHIVE - 01.07.2011

Bunkering Forum in Saint Petersburg became the largest annual event in the industry.

The fourth Russian Forum “Current State and prospects for Development of Russian Bunker Services Market” was held on June 23-24, 2011, in Saint Petersburg. The number of participants beat the records of the previous years – there were no vacant seats in the hall at the opening. Yuri Molchanov, Saint Petersburg vice-governor, greeted the Forum participants.

New problems which aroused recently and are not expected to be easily solved in the nearest future couldn’t shade high spirits of the participants. Albert Vygovsky of North-Western Shipping Company noted diesel price soaring reduced profitability of river transportation significantly. To meet this challenge ship owners modernize their tanker fuel delivery systems to consume less expensive heavy fuels.

Companies offering marine fuel to vessels delivering cargos around SEKA areas still can’t clearly understand how they should get ready for services after January 1, 2015, when restrictions concerning fuel sulphur concentration less than 0.1% will enter into force.

Apparently refineries owned by Russian vertically integrated companies are not ready to cover demand for low-sulphur mazut. There is still shortage of deep processing oil lines and necessary plants can’t be installed to meet the deadline. Under these circumstances fuel prices are hard to predict. In experts’ opinion, the best possible way out may be switch to diesel fuel. But it is still unknown whether ship owners are ready to reequip their vessels and how their decision will affect bunkering fleet modernization program according to MARPOL requirements (transportation of light fuel doesn't require double hull).

Vladimir Kapustin of VNIPIneft presented detailed analysis of Russian oil processing facilities. In his opinion, manufacturing of fuel with both sulphur content 0.1% and heavy fuel quality is not a problem from technical point of view. Plants for deep oil processing are needed for this purpose. But despite state programs were adopted it time, they were not implemented. It is unlikely vertically integrated oil companies will put extraordinary investments to achieve this goal.

Currently the major players at low-sulphur mazut market are independent refineries with low and medium annual capacity in the range from several hundred thousand tons to 3 million tons. Mikhail Turukanov of Kortes news agency, Moscow, presented detailed analysis of condition in this industry. In 2010 small and medium refineries produced 2,221,000 tons of mazut containing less than 1.5% sulphur which covers about 20% of Russian market. About 20% of the product is consumed at domestic market, the rest, is exported. In previous years demand for mazut in Russia gradually reduced in all industries (power supplies, transport, etc.) excluding bunkering industry. In 2005 bunkering companies delivered 5.1 million tons of mazut, in 2010 – 5.5 million tons. Kortes expert estimated low-sulphur mazut demand in 2015 when all Russian ports will be surrounded by SEKA zones in 7-8 million tons annually. In theory this amount may be produced by independent refineries but legislation amendments may cause complications in performance of these companies, many of them may stop operations.

Another acute problem – permanent changes in bunker fuel declaring procedure - was discussed by Dmitriy Smirnov of Baltic Customs. Federal Customs Agency proposed a new simplified bunkering fuel declaration procedure which currently is considered in Belorussia and Kazakhstan, members of the Custom Union. Temporary procedure “export 00” is used now since January 1, 2011. But there is also an opinion that all energy resources should be declared at Energy Customs, so uncertainty still exists.

Eduard Mohnatkin of Analytical Center for Ecological Standards and Fuel Testing warned that Russian bunkering companies may find themselves unprepared to requirements of Technical Regulations of Eurasian Economical Community which will come into force on January 1, 2011. He strongly recommended bunkering companies should prepare and register safety certificates for their products to avoid problems with watchdog agencies at the beginning of the next year. As usual, there were discussions over bunkering fuel quality. Speech delivered by Rudolf Em, director of Fuel Department of Far East Shipping Company, got special response from participants because suppliers’ and ship owners’ interests are often in conflict. Mr. Em described a five steps control system which allowed his company to reduce the number bunker operations with quality deviations 4% in 2006 to 0.3% in 2010.

Trade awards set up by Association were presented at the Forum for the first time. Crystal Pearl for “Personal contribution to Russian bunkering market” was handed over to Alexander Golovizin, the former director of Baltic Bunkering Company. Discussions and socializing continued during ceremonial dinner in one of the best Saint Petersburg restaurants. President of Russian Association of Marine and River Bunkering Suppliers proposed a toast to industry prosperity and wished every success to all Forum participants.



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