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Indonesia: Decision to allow domestic consumption of 3.5%S marine fuel ‘makes sense’

Move motivated by several unique operational and commercial factors, explains Albert Susilo of Singapore-based shipbroking, analysis and consultancy firm AE Marine.

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A decision by the Indonesian government to allow its domestic shipping industry to continue consuming 3.5% sulphur limit marine fuel post IMO 2020 “makes sense”, according to a spokesperson of shipbroking, analysis and consultancy firms AE Marine Pte Ltd and Golden Bay Chartering Pte Ltd.

Shipbroker Albert Susilo, who manages both Singapore-based companies, notes the development might seem puzzling to non-Indonesians, but explains the move has been motivated by unique operational and commercial factors currently faced by the Southeast Asian country.

“Unlike the majority of vessels plying international waters, local Indonesia-flagged ships may not be ready to switch over to consume low sulphur fuel oil (LSFO) or its similar IMO 2020 compliant variants,” he told Manifold Times.

“Most of the domestic vessels in Indonesia are generally older tonnages between 15 to 30 years old and have been running on high sulphur fuel oil (HSFO) or gasoil all the time.

“In some cases, various companies manufacturing engine and equipment used by these vessels have probably closed down; even if owners wanted to carry out a ship implementation plan for their vessels they will not know who to approach for technical assistance.”

According to Susilo, the Indonesian government in early 2019 implemented a mandate for the country’s gasoil for marine and industrial use to be blended with 20% of Biodiesel (FAME) content for consumption. To date, this move has cause various issues and complaints amongst some of the domestic vessels consuming marine gas oil (MGO) within its shipping industry.

“If there were reports of local vessels experiencing issues like filter blockages and breakdowns from just the use of this new blend of MGO, one cannot imagine the disruption it will cause for the whole Indonesian maritime sector if it switches entirely to LSFO,” he explains.

“On top of this, the Indonesia shipping industry is largely self-contained; most of the local fleet does business mainly in Indonesia and do not go out into international waters. Just on oil tankers alone, it is estimated there were about 560 actively operating within the country during 2018.”

Meanwhile, Susilo notes Indonesia has stopped imports of High Sulphur Fuel Oil (HSFO) and has refined plans to use locally manufactured oil products from Pertamina to effectively service the country’s needs.

“Indonesia has an excess of HSFO 180 centistokes (cSt) avails. At this moment the government is not issuing an import quota for HSFO 180 cSt product,” he says.

“The Pertamina Cilacap refinery traditionally produces an excess of HSFO 180 cSt which used to be exported to Singapore. Due to recent change in regulations starting early 2019 the Indonesian government has stopped the export of HSFO 180 cSt, which in turn, local importers will have to buy from Pertamina.”

Further, the country may have its own commercial plans for locally produced LSFO which are to be carried out by state-owned Pertamina.

“Honestly, Indonesia does not seem to be short of LSFO; they may just choose to export their LSFO. Two refineries, such as Plaju Refinery and Balikpapan Refinery, are such examples where their LSFO products are regularly targeted for the export market,” notes Susilo.

“It has also been widely reported that Pertamina is in the pipeline to transform Pulau Sambu (TBBM Sambu Island Fuel Terminal) into an international trading and bunker hub, and intends to use this facility to blend and market LSFO as bunkers. As such, it can be safe to assume avails from the Plaju and Balikpapan refineries are likely to head to Pulau Sambu for further blending and sale as marine fuel to the international market.”

To date, the IMO 2020 deadline of 1 January 2020 is about five months away and there is still time for rules to change, suggests Susilo.

“The Indonesian government has always been adaptive to market conditions and quick to respond to changes within the oil and shipping industry,” he concludes.

“In this case, even though its decision to allow domestic players to consume 3.5% sulphur limit marine fuel makes sense, do not be surprised if domestic legislation takes a turn in the future when subject to favourable conditions.”

Related: Indonesia: Use of 3.5% sulphur marine fuel approved for domestic trade
Related: Pertamina enters bunker deal with state-owned mining firms
Related: Pertamina to increase domestic marine fuel oil sales volume
RelatedIndonesia: Energy Minister approaches firms to use Pertamina fuel oil
Related: Indonesia: Freepoint Commodities expands regional bunker business

Published: 24 July, 2019
 

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Ammonia

AM Green plans to build green ammonia plant at Indian port

Initiative also includes development of green ammonia handling, storage and bunkering infrastructure, pilot bunkering operations, safety procedures and training programmes, says VOC Port Authority.

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VO Chidambaranar (VOC) Port Authority on Friday (29 May) said it has signed a Memorandum of Understanding (MoU) with India’s ammonia producer AM Green Ammonia to collaborate in the development of a green ammonia production plant.

The plant will have a capacity of one million tonnes per annum (MTPA) at Tuticorin.

The initiative also includes development of green ammonia handling, storage and bunkering infrastructure, pilot bunkering operations, safety procedures and training programmes. 

The project is expected to support the development of green fuel corridors connecting VOC Port with major ports in Europe and Asia, thereby strengthening India’s position in the global green fuels value chain.

VOC Port also signed a Memorandum of Understanding (MoU) with Bureau Veritas (India) Pvt. Ltd., to collaborate on Green Port certification, emissions accounting, ESG reporting, safety validation, development of green bunkering practices, and establishment of a Centre of Excellence for green fuels and sustainability.

The port also plans for an upcoming 750 m³ green methanol bunkering facility.

 

Photo credit: Naveed Ahmed on Unsplash
Published: 3 June, 2026

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Port & Regulatory

Study: Major drop in ship sulphur emissions confirmed following IMO regulations

National Centre for Atmospheric Science study found that the average sulphur content in ship fuel dropped nearly tenfold in open ocean areas following IMO’s 2020 regulation.

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Recent global regulations have significantly reduced sulphur emissions from ships, helping to improve air quality in coastal regions – confirmed by a recent international study led by researchers at the National Centre for Atmospheric Science. 

The research, published in Environmental Science: Atmospheres, used aircraft and ground-based instruments to measure sulphur dioxide and nitrogen oxides emitted by ships in the North-East Atlantic and European coastal waters between 2019 and 2023.

The team found that the average sulphur content in ship fuel dropped nearly tenfold in open ocean areas following the International Maritime Organization’s 2020 regulation, which capped sulphur content in marine fuel at 0.5%. 

Before the change, many ships exceeded the previous 3.5% limit. After 2020, only a small number of ships were found to breach the new standard.

In European sulphur Emission Control Areas (SECAs), such as the English Channel and the Port of Tyne, sulphur levels were even lower – well below the stricter 0.1% limit. Interestingly, ports outside these zones, like Valencia in Spain, also showed low sulphur levels, likely due to EU rules requiring cleaner fuel when ships are docked for extended periods.

This is the first study to use aircraft-based measurements and predictions from the Ship Traffic Emission Assessment Model (STEAM3) to assess ship emissions outside of sulphur control zones since the 2020 regulation came into effect. The findings support the widely held view that ships now emit around seven times less sulphur than before the rule change – an important step toward cleaner air and healthier coastal environments.

Note: The research, titled ‘SO2 and NOx emissions from ships in North-East Atlantic waters: in situ measurements and comparison with an emission model’ can be found here. 

 

Photo credit: shraga kopstein on Unsplash
Published: 8 December, 2025

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Interview

IBIA Annual Convention 2025: ‘Exciting times’ for post IMO 2020 bunker suppliers, states Equatorial

Choong Sheen Mao, Chief Operating Officer, Equatorial, describes to Manifold Times the pre/post IMO 2020 challenges and evolution of bunker suppliers.

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The International Bunkering Industry Association (IBIA) will be hosting its flagship Annual Convention in Hong Kong at the Hong Kong Convention Exhibition & Convention Centre between 18 to 20 November 2025, as part of Hong Kong Maritime Week.

Choong Sheen Mao, Chief Operating Officer, Equatorial Marine Fuel Management Services (Equatorial), speaks to bunkering publication Manifold Times about the challenges of a post IMO 2020 bunker supplier.

MT: How does Equatorial continue to offer customer assurance and maintenance of marine fuel quality to ISO8217 standards despite increasing complexity of bunker fuel blends?

We maintain our focus to provide compliant, quality and competitively priced products to our customers. There is no shortcut. We source our products from a wide range of cargo producers and suppliers. We continue to be strict and vigilant with our testing programme for our products before delivering them to our customers. Equatorial has deepened our engagement with the wider industry to have a better and up-to-date understanding of the existing and new marine fuels.

MT: Can you share the evolution of commercial marine fuel procurement, blending and trading strategies on the back of increasing fuel types (pre/post IMO 2020)?

Pre IMO 2020, the main types of marine fuel procured and consumed by vessels were high-sulphur fuel oil, marine diesel oil and marine gas oil. Trading strategies were therefore closely linked to that within the oil industry.

However, many of the new fuel types are from other industries. For example, biofuels, methanol and ammonia are mainly products from the chemical and agriculture industries. There are marked differences between these industries and the energy industry (in particular, the marine fuels industry). LNG is from the gas industry which is distinct from the oil industry.

Without an existing liquid paper market for many of these commodities (especially as a marine fuel), the price risk management is less straightforward. Furthermore, commodity prices are no longer the sole consideration for price itself. The price of compliance must be considered. This could range from guaranteeing the origin of the marine fuel, its sulphur properties as well as its carbon intensity. The list goes on.

MT: Operational wise, what are the changing role and responsibilities of a bunker supplier to date, compared to before IMO 2020?

The role and responsibility of a bunker supplier have evolved. Fundamentally, it has been about providing quality marine fuels at competitive prices. Quantity assurance has been a critical concern which led to the mandatory implementation of the mass flow meter system for bunkering in the Port of Singapore. Interestingly, due to the nature of credit terms in the bunker industry, bunker suppliers also performed the role of “bankers” by extending favourable credit terms to shipowners and charterers.

These days, post IMO 2020, things have become even more complicated. Today, a bunker supplier retains the abovementioned roles and responsibilities, and much more – it has to ensure compliance with a plethora of rules and regulations. Compliance not only with sulphur cap requirements, but with international and regional sanctions and restrictions unrelated to the quality of the marine fuel itself. In fact, especially with alternative low- and zero-carbon marine fuels, this means compliance with standards, rules and regulations on sustainability such as the European Renewable Energy Directive and/or International Sustainability and Carbon Certification. There is also the need to comply with increasingly stringent safety regulations on both conventional and alternative marine fuels.

In addition to the above, a post IMO 2020 bunker supplier is still expected to supply compliant and quality fuel at competitive prices.

MT: Equatorial is Singapore’s largest local-born supplier; what is the next big thing for the company?

Equatorial continues to adapt and improve with the times, while maintaining its core values – Integrity, Teamwork, Commitment, Proficiency and Quality, and Safety and Environment. The bunker industry is a highly competitive one, and it is our intention to keep our competitive edge and remain relevant. This means that we have had to step out of our comfort zone and embrace the two mega trends of our time – digitalisation and decarbonisation.

We have been early adopters and developers of the electronic bunkering note as part of our own digital bunkering efforts. We have diversified our product offering to include low carbon marine fuels and are proud to be one of the pioneers for bunkering B100 biofuels earlier this year. This was made possible by the arrival of our IMO Type II chemical and oil bunker tankers. These same bunker tankers are also capable for carrying and delivering methanol. Equatorial has invested in an LNG bunkering vessel (LBV) newbuilding that is set to be delivered in Q3 2027. We are also involved in a study to develop low- or zero-carbon ammonia bunkering in Singapore.

These are exciting times.

Note: Choong Sheen Mao is amongst panellists featured in ‘Session Three: Bunker Sellers Panel’ at the IBIA Annual Convention 2025.

Join the Conversation

With over 300 delegates expected, the IBIA Annual Convention 2025 is set to be a defining moment for the marine fuels industry. Registration is now open via the IBIA Annual Convention website.

 

Photo credit: Manifold Times
Published: 31 October 2025

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