Vitol Secures Three LNG Bunkering Vessels

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Written by Daniel Graeber for Industrial Info Resources (Sugar Land, Texas)--Commodity trading company Vitol (Geneva, Switzerland) said Wednesday that it's doing its part to clean up the maritime shipping industry with new long-term charters for three bunkering vessels for liquefied natural gas (LNG).

Vitol said it booked three LNG bunkering vessels through its shipping arm, Vitol International Shipping Limited. Vessels are secured under seven-to-ten-year time charter agreements with Avenir LNG Limited (London, England).

Vitol said it believes shippers will be able to lower their overall environmental footprint with LNG. When blended with bio-LNG, a product derived from the methane released during the decomposition of organic matter, the company said shipowners will be able to meet increasingly stringent emission regulations.

"Shipowners worldwide are looking to reduce their emissions," said Pablo Galante Escobar, the head of LNG for Vitol. "We are delighted to strengthen our offering to them by investing in LNG/bioLNG bunkering, thereby increasing their options."

A 70,000-square-foot newbuild is included in the time charter agreement with Avenir, with delivery expected in late 2026. From a shipyard in China, Vitol is expecting to secure another vessel similar to the newbuild, as well as a smaller 44,000-square-foot bunkering vessel, with delivery anticipated no earlier than late 2026.

Vitol claims to have the most advantageous position in providing bunker fuels through its subsidiary Vitol Bunkers. Whether it's done on or offshore, bunkering is the process of supplying fuel to ships.

The U.N.-backed International Maritime Organization wants to see shippers cut their carbon emissions by 40%, relative to 2008 levels, by 2030. At least 5% of the fuels used by shippers, meanwhile, need to come from zero or near-zero emission technologies by the end of the decade as well.

Shippers can use a variety of options, from onboard exhaust cleaning systems called scrubbers, to alternative fuels such as LNG, methanol or ammonia.

Shipping giant Trafigura (Singapore) said Monday that it transferred ammonia from a medium gas carrier (MGC) to a smaller vessel near the port of Ceuta in the Strait of Gibraltar, making it the company's first-ever ship-to-ship (STS) transfer of ammonia.

Shippers in the past had relied on heavy fuel oil (HFO) for their voyages, a fuel that's very carbon-intensive.

Vitol, meanwhile, is on pace to cut its carbon emissions by 40%, compared to 2008 levels, this year, pledging to respect the cleanup efforts embraced by the IMO. The company has invested in technologies outside of fuel options to cut emissions, such as improving propeller efficiency and utilizing paints that help a vessel better cut through the water.

Vitol this year introduced its Marine Future bunker vessel that will supply biofuel blends to shippers off Singapore. The company said that, while early in the developmental stage, demand for biofuels in the shipping industry is expected to surge.

Sales volumes surged more than 250% in the region from 2022 to 2023. That said, the company believes that no single technology or fuel can solve the emissions strategy for maritime shippers.

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