French supermajor Total and Pavilion Energy, through their subsidiaries Total Marine Fuels Global Solutions and Pavilion Gas, have signed a heads of agreement (HoA) to jointly develop a liquefied natural gas (LNG) bunker supply chain in the port of Singapore.
The agreement covers the shared long-term time charter of a new generation LNG bunker vessel to be commissioned by Pavilion Gas by 2020. It also includes an LNG supply arrangement between the two companies enabling Total to deliver LNG bunker to its customers.
The agreement follows a memorandum of understanding concluded by both companies in April 2017 on LNG bunkering cooperation in Singapore. The HoA is a significant step forwards and contributes to the development of Singapore as an LNG bunkering hub.
The move toward LNG as a bunker fuel is a suitable solution following the decision of the International Maritime Organisation (IMO) to set limits on sulphur content in marine fuels from 2020. LNG bunker not only produces zero sulphur oxides, but it also represents an available and competitive solution, which contributes to IMO’s long-term strategy on the reduction of greenhouse gas emissions from ships announced in April 2018.
Patrick Pouyanné, chairman and CEO of Total, declared, “The development of infrastructure is one of the key drivers for the take-off of LNG as a marine fuel. For the past few months, Total has been very active in that direction. The agreement signed with Pavilion Energy marks a new step in our commitment to provide our customers with fuels that are more environmentally friendly, particularly in Singapore which is the leading bunkering hub in the world.”
Tan Sri Mohd Hassan Marican, chairman of Pavilion Energy, said, “Pavilion Energy is pleased to work with Total on establishing a robust LNG bunker supply chain in Singapore. Our partnership sets the stage for making LNG bunker readily and reliably available for the market. Together, we mark a decisive step forward in leading the change towards cleaner and more responsible solutions with LNG bunkering in the region.”
Total Marine Fuels Global Solutions is pursuing its ambition to develop the LNG bunker market. The first milestones of its strategy were set in Europe, with the signature of LNG bunker supply contracts for Brittany Ferries and CMA CGM. Pavilion Gas is committed to the development of Singapore as an LNG hub.
