Two entities awarded licences to supply LNG

An LNG tanker seen off the southern coast of Singapore. The MPA said it will work with the new licence-holders to develop the infrastructure to carry out bunker supplying activities by next year.
An LNG tanker seen off the southern coast of Singapore. The MPA said it will work with the new licence-holders to develop the infrastructure to carry out bunker supplying activities by next year.ST FILE PHOTO

Pavilion Gas, joint bid between Keppel O&M and BG Group top proposals

Licences to supply liquefied natural gas (LNG) have been awarded to Pavilion Gas and a joint bid between Keppel Offshore & Marine (Keppel O&M) and BG Group, the Maritime and Port Authority of Singapore (MPA) said yesterday.

The two entities, the top bids out of 12 proposals, will be allowed to supply LNG fuel to ships in the Port of Singapore.

The MPA said it will work with the licence-holders to develop the infrastructure to carry out bunker supplying activities by next year.

It is also working with stakeholders to develop LNG bunkering standards and procedures at both the national and international levels, having signed agreements with the Port of Rotterdam, Antwerp Port Authority and Port of Zeebrugge.

In addition, the MPA is funding up to $12 million for the construction of six LNG-fuelled vessels. The successful applicants will be announced by March.

It is also engaging towage service providers here to consider switching to LNG as a fuel when they commission new tugboats.

"With growing international regulatory requirements and stricter standards for emissions, LNG is likely to be part of the fuel mix for global shipping as it becomes more cost-competitive and supply chain and infrastructures are developed," noted MPA chief executive Andrew Tan.

The granting of the licences, he said, is "the first step in Singapore's efforts to become LNG bunker ready". He added: "We are also keen to work with other major ports and the shipping community to promote LNG bunkering as an alternative marine fuel."

Keppel O&M, in a separate statement, said it will form a 50-50 joint venture with BG Group to "deliver an end-to-end bunkering solution using LNG sourced from BG Group's diversified LNG portfolio and leveraging Keppel O&M's expertise in LNG vessel servicing".

The new venture builds on BG Group's existing role as the exclusive aggregator for Singapore's first three million tonnes a year of LNG demand.

Keppel O&M chief executive Chow Yew Yuen added that the move into LNG bunkering is "in line with Keppel's strategy to provide solutions for the global LNG market". The firm, for instance, set up a new design and technology arm, Gas Technology Development, to develop solutions for the LNG market.

Pavilion Energy's chief executive Seah Moon Ming said: "It is exciting to see the growth of the LNG bunkering industry as it supports Singapore's efforts to be an Asian LNG Hub." Pavilion Energy is the parent company of Pavilion Gas.

The firm received an award from the Oil & Gas Council last night for its innovative efforts within the LNG business, such as its push for the Asian LNG Hub and its small-scale LNG and bunkering initiatives.

A version of this article appeared in the print edition of The Straits Times on January 28, 2016, with the headline 'Two entities awarded licences to supply LNG'. Print Edition | Subscribe