Uniper eyes Fujairah facility debottlenecking ahead of IMO 2020

Germany’s Uniper Energy is considering debottlenecking its ultra-low sulfur fuel oil production facility in Fujairah in preparation for higher demand for the fuel ahead of tighter regulations governing shipping under IMO 2020, a senior company executive told S&P Global Platts.

The company operates a processing plant in the Middle East’s largest bunkering hub, capable of producing low sulfur fuels. The majority of the world’s ships are set to switch to burning 0.5% sulfur fuels towards the end of this year ahead of the IMO’s global marine fuel sulfur limit dropping to 0.5% in 2020, from 3.5%.
Uniper is “looking at debottlenecking the unit,” Uniper Energy Managing Director, Chris Wood, said on the sidelines of IP Week in London.

Debottlenecking is a process of maintenance commonly used by refiners to improve the efficiency of their units and boost output capacity.

“Uniper is taking a very positive role in Fujairah and also in Singapore and Amsterdam-Rotterdam-Antwerp to ensure the shipping industry has a reliable and high quality fuel,” Wood said.

Fujairah is positioning itself as a regional hub for the production, blending and trade of cleaner marine fuels to comply with IMO 2020.

Separately, S&P Global Platts has recently launched a Marine Fuel 0.5% assessment in Singapore, Fujairah and Rotterdam, along with assessments in Houston/New Orleans/Galveston Bay and New York Harbor.

Wood said that so far in 2019, Uniper already has one million tonnes of contracted sales allocated for low-sulfur fuel oil for 0.1% and 0.5% products, indicating strong demand. The company has in excess of 300,000 mt in storage in Fujairah to fulfill these contracts, he added.

Earlier this week, Vitol said new 0.5% shipping fuels will be available from its Fujairah refinery this month.

In a further boost to Fujairah’s growth, Abu Dhabi National Oil Co, the state-owned oil company of Abu Dhabi, signed an agreement on Wednesday with a South Korean engineering firm to build a giant underground oil storage facility in the emirate’s mountains. When completed in 2022, the facility on the east coast of the UAE will hold 42 million barrels of oil in three different caverns.
Source: Platts