Alternative Fuels

SIBCON 2022 Interview: Clyde & Co discusses handling of bunker fuel quality disputes, alt fuels contracts

‘There are some important differences between VLSFO and biofuels, and as a result, parties should consider whether additional changes should be made to biofuel bunker contracts,’ says Paul Collier.

Published

4 years ago

September 28, 2022

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The following interview with Paul Collier, Legal Director, Clyde & Co is part of coverage for the upcoming Singapore International Bunkering Conference and Exhibition (SIBCON) 2022, where Manifold Times is an official media partner.

Collier shares his insights on disputes related to marine fuel quality and bunker contamination, and provides helpful recommendations in handling off-specification bunker claims while touching on alternative fuels:

MT: How have bunker contamination cases at Singapore changed the legal landscape?

Bunker contaminations affecting multiple vessels are not uncommon, and much like the 2018 “Houston” contamination cases, and those originating from the US Gulf Coast in 2013 and 2007, the 2022 Singapore cases have renewed focus on whether basic ISO 8217 tests carried out on bunker samples are sufficient to identify off-specification bunkers. The underlying difficulty is that basic ISO 8217 tests carried out on bunker samples may not be capable of identifying all possible contaminants which could potentially risk causing damage to vessel engines. However, against this, there may be difficulties with parties carrying out more advanced testing (including GC/MS analysis) on bunker samples before their consumption, due to cost and time restraints, meaning that bunker fuel may be consumed before it has been identified as being off-specification. This has caused a significant number of cases of engine damage.

Bunker contamination cases have therefore raised a question as to whether fuel may be off-specification under clause 5 of ISO 8217, even if the fuel has been identified as being in compliance with ISO 8217 Table 1 or 2 parameters. In this regard, clause 5 of ISO 8217:2017 offers some protection to buyers, in that it provides that “the fuel shall be free from any material at a concentration that causes the fuel to be unacceptable for use” and “is not at a concentration that is harmful to personnel, jeopardises the safety of the ship, or adversely affects the performance of the machinery”, and buyers have relied on this to advance quality claims against bunker suppliers where tests have identified contaminants which do not form part of the Table 1 and Table 2 tests.

One interesting question will be how the ISO standards develop to deal with recent bunker contamination cases, and whether further parameters will be added to Table 1 and 2. However, it may not be straightforward for consensus to be reached as to the content of new ISO 8217 standards, given that there is a lack of technical consensus as to when the level of some compounds become “unsafe”, in circumstances where bunker supplies are non-standardised and typically contain hydrocarbons from several points of origin.

MT: What are the key factors determining legal success of a plaintiff and defendant in a marine fuel quality / bunker contamination suit? Are there any simple operational steps players can include to protect themselves?

In general, the most important factor affecting the legal outcome in off-specification bunker claims is the quality of the evidence. If a party has good evidence supporting their position, then this significantly increases their prospect of success in any legal proceedings. In addition, good evidence will improve their settlement prospects (which may also increase the chance of a claim being settled at an early stage).

For this reason, it is worth all parties involved with a bunker supply collating and retaining evidence which could support their position.

The most important evidence is the collection of samples, with it being widely accepted that the most accurate samples are taken by drip sample at the receiving vessel’s manifold (ideally, witnessed by surveyor). However, parties should also consider whether they can retain any other contemporaneous evidence that supports their position. In the case of vessel owners, it is worth the Master and the crew ensuring that good records of engine maintenance and fuel management are kept, to assist in responding to any argument that engine damage was caused by another bunker stem or by poor management of the vessel’s engines.

MT: What is the first action a shipowner / bunker supplier / bunker trader should take when finding out contaminated bunker fuel has been involved in their delivery operation?

The first step that parties should take where there are suspected bunker contamination cases is to arrange for tests to be carried out on the fuel supplied. Whilst test results are awaited, the fuel should not be consumed, to avoid the risk of engine damage taking place in the interim. In addition, any bunker supplies which may be suspected as being off-specification should be kept segregated from other fuel.

If the test results are off-specification, the parties will then need to consider whether the fuel can be safely consumed or not, and whether any other steps need to be taken to mitigate their position. In this circumstance, parties should obtain both technical and legal advice on how to proceed.

MT: Alternative fuels such as methanol, biofuels, LNG, ammonia, hydrogen are expected to be within the marine fuels mix moving into IMO 2030/2050. Do you think current ISO 8217 standards need to be further developed to cover acceptable parameters for use of these material as bunker fuels? If not, what potential issues may arise when trading these materials with current ISO 8217 specs?

The ISO 8217 standards are primarily intended to be used for petroleum products, and additional standards will need to be developed to cover the full range of alternative fuels which are likely to be subject to increasing use by vessels. Whilst there are some standards in place for some alternative fuels, including ISO 23306 for LNG, further development of standards is needed, particularly in relation to “new” technologies such as hydrogen.

Parties should carefully consider whether it is appropriate to trade alternative fuels using ISO 8217, given that it is primarily intended to be used for petroleum products, and consider whether express reference should also be made to other standards (for example, EN14214 / ASTM D6751 in relation to biodiesel). If inappropriate specifications are used in a bunker supply contract, this will likely complicate the legal position and make it more difficult for buyers to contend that fuel supplied is off-specification.

MT: Biofuels, a popular option, seem to be the easiest route for shipowners to meet the IMO 2030 target. What are the contractual differences between a VLSFO and biofuel bunker contract and are there any specific clauses buyers and suppliers of biofuel bunkers should include to protect themselves during operations?

There are some important differences between VLSFO and biofuels, and as a result, parties should consider whether additional changes should be made to biofuel bunker contracts.

As a starting point, if buyers are seeking to use biofuels as a “green” energy source, the buyers may wish to consider pressing for sustainability warranties to be included in the contract. In this regard, there are concerns that the production of biofuels may have a negative impact on food security or have been produced by otherwise clearing lands beneficial to the environment. If this is a concern to the buyers, they may wish to place the supplier under contractual obligations to provide sustainable biofuels.

In addition, parties should consider the provisions regarding both the specifications and testing requirements, given the differences between VLSFO and biofuels. For example, parties may wish to consider whether joint testing should take place at a laboratory specifically accredited for testing biofuels.

Given that biofuels deteriorate faster than traditional hydrocarbon fuels, the supplier may also wish to press for short time bars and an exclusion of liability for any damage suffered by the vessel engines if the fuel is not promptly consumed.

A list of other interviews conducted by Singapore bunkering publication Manifold Times on occasion of SIBCON 2022 are as follows:

Photo credit: Clyde & Co
Published: 28 September, 2022

LNG Bunkering

Shell expands LNG bunkering footprint in Spain with Valencia

As one of the region’s key maritime hubs, the company said Valencia expands the options available to shipowners seeking LNG supply along major shipping routes.

Published

2 days ago

August 14, 2026

Admin

Shell expands LNG bunkering footprint in Spain with Valencia

British oil giant Shell on Thursday (13 August) said Valencia has joined its growing network of bunkering locations, making LNG available as a marine fuel.

The successful completion of the first LNG bunkering operation in Valencia marked an important milestone for Spain and further strengthened Shell’s LNG supply capabilities across the Mediterranean.

In a video shared by the company, bunkering vessel Alice Consulich was shown supplying an undisclosed volume of LNG to the container ship MSC Sabrina.

“As one of the region’s key maritime hubs, Valencia expands the options available to shipowners seeking LNG supply along major shipping routes,” Shell said in a social media post.

Shell said the achievement reflected the strong collaboration across the maritime value chain, including MSC Mediterranean Shipping Company, the Port of Valencia and Fratelli Cosulich Group.

“We look forward to making more LNG bunker deliveries in Valencia and across the Mediterranean as LNG infrastructure and capabilities continue to expand,” the company said.

Photo credit: Shell
Published: 14 August, 2026

LNG Bunkering

Énestas and Power LNG join forces on Galveston bunkering

Énestas will provide capital, LNG transport and storage equipment, and downstream expertise to support Power LNG’s planned liquefaction and marine bunkering facility on Pelican Island.

Published

2 days ago

August 14, 2026

Admin

Stabilis Solutions enter 10-year LNG bunkering supply deal for Port of Galveston

Power LNG (Power LNG) and Mexico’s LNG infrastructure and downstream natural gas company Énestas on Wednesday (12 August) announced the execution of definitive agreements establishing a strategic partnership to accelerate the development of LNG infrastructure at the Port of Galveston.

Under the agreement, Énestas will provide capital, LNG transportation and storage equipment, and downstream operating expertise to support the development of the Harborside Terminal and Project Seawolf, Power LNG’s planned LNG liquefaction and marine bunkering facility on Pelican Island.

The partnership creates an immediate pathway to begin LNG distribution by truck while Project Seawolf is under development, supporting marine fueling, virtual pipeline customers, industrial users, and LNG exports throughout the Gulf Coast, Latin America, and the Caribbean.

“Our vision has always been to establish Galveston as the premier LNG hub for the Gulf Coast,” said Austin Terry, Founder and CEO of Power LNG.

“Énestas brings years of operational experience, proven LNG infrastructure, and a talented team that understands how to deliver LNG safely and efficiently. Together, we can immediately begin serving customers while laying the foundation for one of the most strategic LNG bunkering facilities in North America.”

Project Seawolf will provide LNG for marine bunkering, truck loading, virtual pipeline distribution, and international exports. The facility is strategically located at the Port of Galveston, serving one of the fastest-growing cruise, cargo, and energy corridors in the United States.

For Énestas, the transaction represented an important milestone in the company’s international growth strategy.

“This partnership represents a natural evolution for Énestas as we expand our downstream LNG business into the United States,” said Caio Zapata, Chief Executive Officer of Énestas.

“For more than a decade, Énestas has developed and operated LNG infrastructure throughout Mexico, helping customers transition to cleaner, more reliable energy. Partnering with Power LNG allows us to leverage that experience in one of the most attractive LNG markets in North America. We see tremendous opportunities in marine bunkering, virtual pipeline logistics, industrial LNG supply, and exports to Latin America and the Caribbean, and we are excited to build that future together.”

The companies expect the partnership to support near-term LNG truck loading operations while advancing the long-term development of Project Seawolf, which is designed to become a regional hub for LNG production, marine fueling, and distribution.

The collaboration also establishes a platform to pursue additional downstream LNG opportunities throughout the Gulf Coast, utilising Énestas’ operational expertise together with Power LNG’s project development capabilities.

Photo credit: Port of Galveston
Published: 14 August, 2026

LNG Bunkering

Stabilis delivers more than 150,000 cbm of LNG bunker fuel at Galveston

Company says the advancement of its proposed Stabilis Galveston LNG Facility is a natural progression of its established LNG bunkering footprint in Galveston.

Published

2 days ago

August 14, 2026

Admin

Stabilis delivers more than 150,000 cbm of LNG bunker fuel at Galveston

Clean energy production solutions provider Stabilis Solutions (Stabilis) on Thursday (13 August) said it has completed 97 LNG bunkering operations and delivered more than 150,000 m³ of LNG to customers in the Port of Galveston.

“As the only physical supplier of LNG on the Gulf Coast to reach this milestone, we’ve earned a reputation as a trusted, proven operator — both with local Galveston stakeholders and with the world’s largest cruise operator,” the company said in a social media post.

“That trust is reflected in the 10-year LNG offtake agreement we executed in December 2025.”

The company said the advancement of its proposed Stabilis Galveston LNG Facility is a natural progression of its established LNG bunkering footprint in Galveston.

“As a Houston-based company, we believe in the Texas economy and the future growth of the Port of Galveston,” it added.

“That belief is why we’ve invested heavily over the past four years in the planning, permitting, and engineering design work to develop the most advanced, derisked, shovel-ready small-scale LNG liquefaction project on the Gulf Coast.”

Manifold Times previously reported Stabilis stating that the proposed Stabilis Galveston LNG Facility is anticipated to be in production by the third quarter of 2028.

It will come complete with the delivery of the first new-build, dedicated Jones Act-compliant LNG bunker barge in the Galveston/Houston area.

This comes following Stabilis receiving a Letter of Recommendation from the US Coast Guard following their formal review of the proposed Stabilis Galveston LNG Facility and associated waterfront LNG loading, marine transportation, and LNG bunkering operations in the Port of Galveston.

Photo credit: Stabilis Solutions
Published: 14 August, 2026