World Bunkering > News > Winter 2009 > Looking to the future

Bunkering in South America has been heavily hit by the slowdown in the global economy. As container lines cut calls and dry bulk languished, demand for bunker fuels fell accordingly. Despite the slowdown, some major investments in infrastructure are coming into play, particularly on the supply side, that are likely to make bunkering faster and more convenient at the point where trade picks up again (and according to Braemar, there are signs that this is already taking place, with lines introducing a range of new services). Increasing competition at the supply end, as local companies expand across the region, or as multinationals such as Aegean, spot opportunities for expansion, has had a major influence on the development of the industry over the past year. Venezuela has been exporting large quantities of fuel oil to China – an average of 385,000 tonnes per month in the first half of 2009.

In September, it signed a $16 billion deal which, according to Reuters, will mean that ‘almost all’ of Venezuela’s fuel oil output up to and including 2012 will be shipped to China, although it remains to be seen what effect this will have on prices.

Caribbean

The Caribbean offers a growing and attractive market

Valero has announced that it is not planning to reopen its refinery in Aruba, following what was intended to be a short-term shutdown for maintenance in June. The company said that profits on low-margin distillates and heavy fuels were not sufficient to sustain production, and the refinery will remain closed indefinitely, although it has not ruled out reopening it at a future date. The refinery provided ex-pipe bunkering for tankers loading at the refinery. Despite this, new entries and investments in the Caribbean market show a strong degree of optimism for the future.

Earlier this year, Caribbean Fuels launched a new barge service in the East and South Caribbean region, with deliveries from a 1,500 cu m barge. The area covered includes offshore deliveries at several places between the Grenadines and the Virgin Islands, and in-port delivery at Pointe-à-Pitre (Guadeloupe) and Fort-de-France (Martinique). At a later stage the service will be extended to Oranjestad (Aruba) and offshore Aruba. “The barge will distribute MGO and IFO in this part of the Caribbean where it is usually impossible to get a good quality bunker at competitive price by barge,” said managing director Denis Beavarlet.

Caribbean Fuels also intends to launch a 7,000 cu m double-hulled bunker tanker within the next few months which will ensure a continuous service in the East Caribbean and the ABC islands. Aegean has made a further move into the Caribbean market this year, after successfully launching bunkering services in Jamaica in 2005. Two of the newbuildings to be delivered to Aegean this year were marked for use in the company’s new market in Trinidad and Tobago.

These are the 6,272 dwt double-hull bunkering tanker Kalymnos, built in Qingdao Hyundai shipyard in China, which began operations in the area in June this year, and its sister ship, the Kefalonia, which was delivered to Aegean in October, although it has yet to enter service. Announcing the move into the Caribbean president E. Nikolas Tavlarios said that Trinidad and Tobago offered a “new and attractive market”. The service will focus on providing offshore bunkering. Ex-pipe and ex-barge supplies are available in Trinidad’s Point Lisa from established local supplier, Ventrin.

Panama

Transits through the Panama Canal remain steady, but bunker volumes are down

Again, the downturn is having a noticeable effect on bunker volumes in Panama. There was only a marginal decline in canal transits during fiscal 2009 (October 2008-2009), which were down by 2.45%. However, the fall in bunker volume is considerably greater than the drop in transits would suggest, given that it is estimated that approximately a third of vessels take bunker fuel while awaiting transit. According to figures published in Lloyds List, some 1.2 million tonnes of fuel oil were delivered during the first half of 2009, down 25% from the 1.8 million tonnes delivered over a similar period in 2008. Terpel offers barging services at Balboa and Cristobal, as well as widespread tank deliveries on both the Atlantic and the Pacific coast. Ex-pipe delivery is available at Vacamonte and Rodman.

Colombia

A new gas oil barge is operating in Cartagena

In March this year, Bunkers International launched a dedicated gas oil barge to serve ports on Colombia’s east coast. The Opita, operated in collaboration with Bunkers International’s joint venture partner Vanoil S.A., is a dedicated gas oil barge with 1,300 mts capacity capable of pumping 300-400 tonnes per hour. It will serve Cartagena port and surrounding areas. “We are excited about the launch of the Opita,” said John Canal, president of Bunkers International. “We now have a barge that is capable of pumping 1,000 mts of MGO to a ship in just a few hours.

Prior to the launch of the Opita, this kind of operation would have take 10-15 hours with the other barges available in Colombia. We have also expanded many of our IFO barges to carry 200-300 mts of MGO, eliminating the need for two-barge deliveries.” The launch of the new barge was further proof of Bunkers International’s dedication to the Colombian market after it began offering services in the port of Baranquilla in January this year. Colombian bunker supplier, CI International Fuels, expanded its operations in Buenaventura this year, basing a floating storage unit and two supply tankers in the port.

Chile

Valparaiso – Chile’s major port

As in much of South America, volumes are suffering as a result of the downturn. Total volume last year was some 1.15 million tonnes, while total sales up to September in 2009 were 640,000 tonnes, indicating a drop of some 30% year-on-year if sales continue at the same level. The Chilean market is dominated by three physical suppliers: Petroleos Marinos de Chile (PMC) and Terpel, who operate in the central zone of the country, and Copec which operates in the central and southern zones. Colombia-based Terpel is a relative newcomer to the market, having started barging operations in June this year, and there are rumours that Petrobras is also looking to enter the market as a supplier.

Other players include OW Bunker Chile. In the north, major ports are San Antonio, Quintero and Valparaiso. All three major operators provide barging services here, PMC owns and operates a 610,000 bbl marine fuels terminal at Puerto Ventanas, in the heart of Quintero Bay, located on the central Chile coast about 30 kilometers north of Valparaiso, and 90 kilometers north of San Antonio. The terminal was constructed in the late 90s, and commenced operation in September 1999. PMC operates two barges: PACSA I (3,000 dwt) and PACSA II (3,600 dwt), servicing the all three main ports in the region. In addition, the Puerto Ventans dock has bunkering manifolds at each berth, permitting concurrent ex-pipe bunkering and cargo transfer operations. In the south, Copec provides barging services at San Vicente, Coronel and Talcahuano, although ex-pipe and road tanker deliveries are available at a number of other ports.

IFO 380 is not generally available in the south of the country. For Copec, Valparaiso is the major port, representing some 63% of all bunker sales, says Cristian Montero. San Antonio represents 12% of sales, and San Vicente, in the southern region, 7%. The north of Chile, however, is generally not very well served by the major bunker firms. This is a region which Montero sees as offering opportunities for future expansion. “For 2010 we will have tanks in Mejillones in the north for the bunker and industrial sector, so we will also open this market with a new barge,” he says.

Copec is investing widely in infrastructure, with a number of projects set to come on line over the next few years. “This year Copec is going to inaugurate our new bunker storage plant in Quintero – 12,000 cu m storage for IFO and 2,500 cu m for MGO, with tanks connected continuously with the refinery, so we can supply these tank non-stop,” says Montero. In addition, Copec intends to place a new barge of some 6,000 dwt to reinforce the company’s position in the central region. It is also considering establishing a storage farm for bunker fuel at Coronel. If the project goes ahead, the planned date for completion is 2011.

Brazil

Brazil is also looking to expand its bunkering infrastructure. Transpetro, the tanker arm of Petrobras, has signed contracts to build a fleet of 10 vessels, including three bunker tankers.