(http://www.augustenergy.biz/, July 3, Friday) --- With permission from Platts...
Singapore (Platts)--25Jun2009/705 am EDT/1105 GMT
The Maldives is determined to build a bunker fuel supply business that will undercut the bunkering business in rival Sri Lanka, and wants a major trader to help it start up, a top official with Maldives National Oil Co. said in Singapore on Thursday.
Ahmed Muneez, a director of both MNOC and the Maldives' giant State Trading Organization, said his country was determined to grab a slice of the bunker business passing by its window.
More than 1,200 ships call at major harbors in the Maldives during international voyages, which could translate into demand for 7,000-10,000 mt/month of bunker fuel if they can be coaxed into refueling while in the tropical resort.
That would be about one-third the size of the Sri Lankan bunker fuel market, where more than 30,000 mt of bunker fuel is supplied to passing ships at the port of Colombo every month.
Muneez said the first step to building a bunker business would be to charter or buy floating storage to hold fuel oil. For now, the country doesn't import fuel oil, a big obstacle to setting up a bunker business.
"Fuel oil bunker is not available for delivery because the Maldives does not yet import fuel oil," said Muneez, who was speaking at a bunker fuel conference organized in Singapore by August Energy.
"We're calling for an experienced partner to help us set up floating storage," said Muneez, who added that the company would be talking to some potential partners in Singapore this week. "What we really need is an experienced partner," he added.
The company was hoping to start talks with potential partners in Singapore this week. It also hoped that plans by MNOC to build a $150 million, 6 million cubic meter onshore oil terminal on one of its islands will spur trade.
About 75% of the storage available would be dedicated to storing crude oil for international companies, while the rest would be made available for refined products.
TAKES AIM AT SRI LANKA BUNKER BUSINESS
Muneez said the Maldives was not content to watch Sri Lanka -- a giant island nation that lies offshore India's southeastern tip -- take so much of the bunker business from ships sailing around India.
"The business logic is to compete with Colombo harbor," said the official. "Our opinion is that there is room to undercut Sri Lanka and still invest."
He estimated that Colombo bunker prices were typically 6%-8% higher on any given day than prices in Singapore, the world's biggest bunker fuel market, where more than 70 suppliers compete for share of a market where almost 3 million mt of fuel is supplied to ships every month.
The Maldives, like Sri Lanka, would expect to import fuel oil from suppliers at the Indian port of Cochin to jump start its bunker fuel business.
The Maldives is a scattering of more than 1,200 islands grouped off India's southwestern tip, opposite Sri Lanka.
The country already imports around 250,000 mt/year of gasoil for use as marine fuel for the hundreds of ships that ferry people and goods between the 300,000 people who live on its atolls. It imports about 35,000 mt/year of gasoline -- boats far outnumber cars in the nation -- and brings in relatively small quantities of A-1 jet fuel for use at its airports.
The Maldives government set up a new oil supply company, Fuel Supplies Maldives, in 2000 to carry out the oil supply business around the area. FSM is 99% owned by STO, and 1% owned by MNOC.
BIG PROBLEMS FACING MALDIVES
But even as the Maldives tries to mark itself a place on the world's bunkering map, it has long-term concerns about keeping its place on the world map.
The country is officially the lowest in the world, with an average land level of 1.5 meters above sea level, and a maximum height of only 2.3 meters above sea level. At such low levels the Maldives is worried about being completely flooded within 50 years, due to global warming.
On Thursday, at the same time Muneez was announcing plans to build a bunkering business nestled among the Maldives' scenic atolls, Ahmed Naseem, the Maldives' foreign affairs minister, told a Global Humanitarian Forum meeting in Geneva that the Maldives might be "forfeiting its very right to exist" within a generation, according to the online edition of one local Maldives newspaper.
In November last year, Maldives president Mohamed Nasheed said his government was looking into buying land in India, Sri Lanka and Australia to help the 300,000 or more people living in the Maldives to relocate in case the country is left under water by rising seas.
Muneez was optimistic that the bunker concept would catch on, despite the big challenges of starting it from scratch, in a nation whose own short-term future is uncertain.
"Even though the bunker business is relatively small, we see tremendous potential," said Muneez. "If it is handled the right way." -- Dave Ernsberger, dave_ernsberger@platts.com
Singapore (Platts)--25Jun2009/705 am EDT/1105 GMT
The Maldives is determined to build a bunker fuel supply business that will undercut the bunkering business in rival Sri Lanka, and wants a major trader to help it start up, a top official with Maldives National Oil Co. said in Singapore on Thursday.
Ahmed Muneez, a director of both MNOC and the Maldives' giant State Trading Organization, said his country was determined to grab a slice of the bunker business passing by its window.
More than 1,200 ships call at major harbors in the Maldives during international voyages, which could translate into demand for 7,000-10,000 mt/month of bunker fuel if they can be coaxed into refueling while in the tropical resort.
That would be about one-third the size of the Sri Lankan bunker fuel market, where more than 30,000 mt of bunker fuel is supplied to passing ships at the port of Colombo every month.
Muneez said the first step to building a bunker business would be to charter or buy floating storage to hold fuel oil. For now, the country doesn't import fuel oil, a big obstacle to setting up a bunker business.
"Fuel oil bunker is not available for delivery because the Maldives does not yet import fuel oil," said Muneez, who was speaking at a bunker fuel conference organized in Singapore by August Energy.
"We're calling for an experienced partner to help us set up floating storage," said Muneez, who added that the company would be talking to some potential partners in Singapore this week. "What we really need is an experienced partner," he added.
The company was hoping to start talks with potential partners in Singapore this week. It also hoped that plans by MNOC to build a $150 million, 6 million cubic meter onshore oil terminal on one of its islands will spur trade.
About 75% of the storage available would be dedicated to storing crude oil for international companies, while the rest would be made available for refined products.
TAKES AIM AT SRI LANKA BUNKER BUSINESS
Muneez said the Maldives was not content to watch Sri Lanka -- a giant island nation that lies offshore India's southeastern tip -- take so much of the bunker business from ships sailing around India.
"The business logic is to compete with Colombo harbor," said the official. "Our opinion is that there is room to undercut Sri Lanka and still invest."
He estimated that Colombo bunker prices were typically 6%-8% higher on any given day than prices in Singapore, the world's biggest bunker fuel market, where more than 70 suppliers compete for share of a market where almost 3 million mt of fuel is supplied to ships every month.
The Maldives, like Sri Lanka, would expect to import fuel oil from suppliers at the Indian port of Cochin to jump start its bunker fuel business.
The Maldives is a scattering of more than 1,200 islands grouped off India's southwestern tip, opposite Sri Lanka.
The country already imports around 250,000 mt/year of gasoil for use as marine fuel for the hundreds of ships that ferry people and goods between the 300,000 people who live on its atolls. It imports about 35,000 mt/year of gasoline -- boats far outnumber cars in the nation -- and brings in relatively small quantities of A-1 jet fuel for use at its airports.
The Maldives government set up a new oil supply company, Fuel Supplies Maldives, in 2000 to carry out the oil supply business around the area. FSM is 99% owned by STO, and 1% owned by MNOC.
BIG PROBLEMS FACING MALDIVES
But even as the Maldives tries to mark itself a place on the world's bunkering map, it has long-term concerns about keeping its place on the world map.
The country is officially the lowest in the world, with an average land level of 1.5 meters above sea level, and a maximum height of only 2.3 meters above sea level. At such low levels the Maldives is worried about being completely flooded within 50 years, due to global warming.
On Thursday, at the same time Muneez was announcing plans to build a bunkering business nestled among the Maldives' scenic atolls, Ahmed Naseem, the Maldives' foreign affairs minister, told a Global Humanitarian Forum meeting in Geneva that the Maldives might be "forfeiting its very right to exist" within a generation, according to the online edition of one local Maldives newspaper.
In November last year, Maldives president Mohamed Nasheed said his government was looking into buying land in India, Sri Lanka and Australia to help the 300,000 or more people living in the Maldives to relocate in case the country is left under water by rising seas.
Muneez was optimistic that the bunker concept would catch on, despite the big challenges of starting it from scratch, in a nation whose own short-term future is uncertain.
"Even though the bunker business is relatively small, we see tremendous potential," said Muneez. "If it is handled the right way." -- Dave Ernsberger, dave_ernsberger@platts.com
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