* Applications in line with trend towards integrated companies
* Aim to cash in on stricter global marine fuel standards
* Number of suppliers in Singapore shrank by quarter since 2015
* Port authorities raise the bar for prospective suppliers
By Roslan Khasawneh
SINGAPORE, Feb 5 (Reuters) - Trading companies Mercuria, Trafigura and United Arab Emirates-based GP Global have applied for licences to supply marine fuel to ships in Singapore, the world’s top bunkering hub, three sources with knowledge of the matter said.
Their entry would further shake up a market that is increasingly becoming dominated by integrated companies with a role across the supply chain at the expense of smaller specialist firms providing marine fuels, known as bunkers.
It comes as the industry is adapting to new global rules from Jan. 1 mandating the use of low-sulphur fuels, which are attracting high premiums because of strong demand and limited supplies. The switch has also led to bottlenecks at major bunkering hubs, due to a shortage of refuelling barges to cope with the changeover.
At least two China-based companies have also submitted bunkering applications to the Maritime and Port Authority of Singapore (MPA). Applications closed at the end of January and may take more than two months to be processed, the sources said.
Singapore accounts for about 20% of a global ship refuelling market that sells tens of billions of dollars a year of fuel.
A Mercuria source confirmed that the company had applied for a licence.
Trafigura, which said last year it planned to set up a bunkering joint venture called TFG Marine with two shipping companies, declined to comment. The Geneva-based firm is already the largest bunker fuel supplier in Africa.
GP Global and the MPA did not respond to a request for comment.
Any new licences would be the first issued since 2017, MPA data showed. Tough market conditions and a crackdown on industry malpractice have seen the pool of suppliers in Singapore shrink in recent years, with mostly smaller players exiting.
“We’re going to see the list (of suppliers) shift in favour of the oil majors and big trading houses with a presence across the value chain as they push in a big way into bunkers,” said one of the trade sources, citing stricter MPA requirements for awarding licences.
To get a licence, companies must commit to obtaining both bunker supplier and bunker craft operator licences, according to the MPA website, rather than one or both as at present.
The new measure would help avoid disputes between the two arms of bunkering and improve accountability and transparency in the notoriously opaque industry, trade sources said.
Applicants must also own and operate at least two bunker tankers capable of running on duel-fuels, according to the MPA, in an apparent push to promote the use of cleaner marine fuels such as such as liquefied natural gas (LNG) at the world’s largest bunkering hub, the sources said.
“Basically, they want legitimate players,” said a second trade source.
Commodities trader Vitol has also tapped into Singapore’s bunkering market with the acquisition late last year of Sinanju Marine Services, according to a source at Vitol with direct knowledge of the matter. (Reporting by Roslan Khasawneh; Editing by Florence Tan and Richard Pullin)