Aegean Bunkering Pte Ltd will halt physical supply operations in Singapore by January, the company said, becoming the fourth such firm to exit the world’s largest marine refuelling hub after it adopted tougher bunkering procedures this year.
Since adopting mass flow meters (MFM) to streamline operations on marine refuelling, or bunkering, barges at the start of 2017, suppliers in Singapore have seen margins squeezed and competition surge in the battle for market share.
“2017 has seen heightened commercial pressures in Singapore, and as a result, management has determined that Aegean’s resources can be more profitably deployed elsewhere,” its president, Jonathan Mcilroy, said in a statement on Tuesday.
“We had hoped that enforcement of mandatory mass flow meter (MFM)-equipped bunker barging in January would have driven commercial improvement in the Singapore market, allowing Aegean to compete profitably,” he said.
The exit plan surprised some at the company’s Singapore office
, which was “doing okay as far as profits were concerned,” said a source with direct knowledge of the matter, who sought anonymity as the topic is sensitive.
Just one trader was left in Aegean’s Singapore office, the source said. On its website, Aegean says that team consisted of two managers and three traders.
Aegean is in the process of arranging its withdrawal from the physical supply market in Singapore in conjunction with the Maritime and Port Authority
of Singapore (MPA) and its barging and cargo partners in the market, the company said.
“All deliveries and contracts that we have booked with clients’ vessels, cargo providers and barge contractors will be fulfilled,” Mcilroy added.
In 2016, Aegean Bunkering was the 20th largest bunker fuel supplier by volume in Singapore, up from 22nd in 2015, the MPA has said.
Fewer Supplies in 2017
Singapore, in a crackdown on short deliveries to bunker fuel customers, this year became the world’s first port to mandate the use of mass flow meters to minimise inaccuracies and errors in measuring delivered volumes of marine fuels.
The MPA in August declined to renew the bunker supply licenses of Panoil Petroleum Pte Ltd and Universal Energy Pte Ltd after finding they had failed to comply with bunkering procedures.
In September, Uni Petroleum Pte Ltd, which did not apply to port authorities to renew its supply licence, became the third supplier to leave the market this year.
By Oct. 12, there were 55 licensed bunker fuel suppliers in Singapore, MPA data showed.
(Reporting by Roslan Khasawneh; Editing by Clarence Fernandez)