by Dr. R. "Vis" Visweswaran
Analytical Services
& Materials, Inc.
We all know the story
of four blind men and an elephant. One described the elephant as a large
pillar with a rough exterior; he was feeling the leg of the animal. The
next one described it as a flexible, hairy rope-like thing; he was referring
to the tail. And so the story goes on. No one knew what the animal looked
like. We now have a nice word to describe this. No one had a holistic
view!
The analogy is that
each of the "blind men" can be considered a party to a bunker fuel transaction
such as the bunker fuel supplier, bunker broker, bunker trader, bunker
barge owner, ship owner, ship charterer, ship's engineer, engine manufacturer,
insurance companies, bunker fuel testing agencies and others. These parties
to a bunker fuel transaction do not see the problems in the same light.
They do not share the same vision or mission in their transactions. This
is the root cause of all bunker fuel related disputes. Bunker fuel problems
arise from a similar inability to see the complete picture, the holistic
view, the common sense view! This inability arises from wrong perceptions,
no perception, and compartmentalized thinking.
What is needed is a
healthy attitude and a positive approach -- that everyone loses when a
wrong fuel is supplied and everyone wins when the bunker fuel quality
and quantity meet the requirements. There are less disputes, less damage
to ship's machinery, less ship hold-ups in ports and less hassle for the
ship's engineers to run the machinery with a wrong or defective fuel.
Can this enlightened view transcend narrow, petty and selfish short-term
interests of individual players in the bunker game?
Fortunately, the marine
industry has faced similar problems in the past and has improvised solutions
which have become industry standards that are unique to the marine industry.
The example that comes readily to mind is the classification societies
which have helped avoid or at least reduce disputes arising from conflicting
interests. Every one of these conflicting parties accept the findings
of the these impartial classification societies who operate on a not-for-profit
basis.
KEY PLAYERS IN THE BUNKER
CONTENTION:
1. A ship owner spends
over 50% of the operations cost on bunker fuel. An average sized bulk
carrier could be using up 10,000 MT of residual fuel and over 1200 MT
of diesel fuel in a year, costing the owner about 1.2 million dollars
annually.
What is the care he
bestows on this million-dollar recurring purchase expenditure? What
is the knowledge, qualification and experience level of the people entrusted
with this purchase? What is the dollar amount he is willing to expend
to ensure the quality and quantity of this purchase item? What are the
technical specifications and purchase conditions that he lays down on
this important, expensive and recurrent purchase item? How does he deal
with a dispute? Does he have established procedures? Has he made these
clear to the seller of this product? Is he aware of the dimensions of
the potential damage to his principal asset, namely the ship's engines,
as a result of using the wrong fuel?
2. The bunker buyer
who may be a charterer has a contractual obligation to supply fuel to
the agreed specifications. Other than this, he has neither the obligation
nor the commitment. What if the specification provided by the owner
is vague and non-specific? The bunker buyer will take the benefit of
the doubt and get the lowest priced fuel in the market. He again is
a loser in the long run if he tries to pinch pennies and takes advantage
of the ignorance of the ship owner. What if the ship chartered by him
is held up in port for weeks at a time to change parts damaged by usage
of the wrong fuel? Is he not the ultimate loser if the owners
schedule is fouled up, and he fails in his contract of affreightment.
3. What about the
engine manufacturer? What I heard from a senior executive of a major
engine manufacturing firm is very revealing. He said, I do hope they
use the wrong fuel and ruin their engine and keep coming to us for more
spare parts; after all, we don't make much margin on the initial engine
sale which is very competitive.
4. What about the
bunker supplier? His main anxiety is to supply a fuel which will not
qualitatively be one tiny bit more than the requirements of the specification,
and he needs to do this at the lowest price which will ensure his securing
this contract. In other words, there should be no quality give away
in the supply. Of course, there should not be a quantity "give away"
either! If he has a good quality fuel, he feels miserable until he gets
some poor quality stuff which he can obtain at lower prices and add
on to this good fuel, so that the final product is of lower price and
there is no quality "give-away"!
5. There are other
players in this bunker game, who each have their own axe to grind. These
are intermediaries and they may be pardoned if they do not have a global
view of this problem.
Heading a laboratory
that tests thousands of samples of bunker fuel and as an impartial observer
of various bunker-related disputes, and as an individual who has been
a marine engineer on ships and a surveyor for many years in a premier
classification society; and now, during the last five years, as a bunker
fuel analyst I believe I am able to see this with a global perspective.
But perspective by itself is not enough.
Instead of merely talking
about this frustrating bunker scenario, we decided to do something, and
planned a program along with a local bunker fuel supplier on a trial basis.
The shared ideals were a sincere desire to supply good fuel to a customer
willing to pay the price and bring back trust and integrity into this
business. This effort was termed the "QUALITY ASSURANCE BASED BUNKER FUEL
SUPPLY" program. The features of this program include making the following
promises to the bunker
fuel buyer:
a) The supplier
will not add used (waste) lubricating oil to his supply, even if the
addition does not drive the fuel parameters beyond the specification
limits.
b) Every supply
will be tested in full by an independent analytical lab, in this case,
AS&M.
c) The sample drawn
will be one of the custody transfer samples drawn and signed for as
the "official sample" by the representatives of the ship (Chief Engineer),
bunker supplier/barge master and any surveyor who may be appointed
for this purpose.
d) This sample will
be sent to the analytical lab for an immediate analysis for all parameters
including those forming part of the specification and others; 27 in
all. These include all the standard parameters of the specification
and other parameters which will indicate if the fuel contains other
types of contamination. These are: Density, API gravity, Viscosity
at 50oC, Viscosity at 100oC, Upper pour point,
Flash point, Carbon residue, Ash, Water, Sulfur, Vanadium, Sodium,
Aluminum, Silicon, Aluminum + silicon, Calcium, Iron, Lead, Nickel,
Zinc, Phosphorus, Sediment, CCAI, Calorific value, Recommended minimum
transfer temperature, Recommended temperature required at injection,
and AS&Ms Engine Friendliness Number.
e) The bunker fuel
supplier stands committed to whatever the results of the laboratory
analysis are. If they show any out-of-specification parameter, he
will, based on the severity, either negotiate a price reduction or
compensation, or offer to take back the fuel at his cost or deal with
it in any mutually acceptable arrangement.
f) The buyer is
welcome to test the sample in any other lab and, based on the past
records, there has not been a single case of any disputable difference
in the values obtained.
What does this give
the buyer? A full analysis of the official sample almost immediately after
the bunker operation. Often the ship is in port and any dispute is settled
on the spot with the analysis report on hand. In other words, he gets
a fuel with a quality assurance certificate on the spot. For the supplier,
this is an enlightened way of dealing with quality disputes. He says he
has no intention of supplying an inferior fuel and stands committed to
the independent lab report. For the buyer, even if he sent out the sample
to another lab, there will be a delay of 3 to 5 days before he gets the
results. One important point: the buyer pays for the analysis cost. The
seller will only sell his quality certified fuel with this arrangement.
The buyer, with an equal stake in the quality, pays for the analysis cost
as a part of his fuel purchase cost.
This program has worked
out very well and the customers have responded very well. The bunker supplier's
business is up as also his image. For us, as a lab, it has been a happy
experience. Not once has the supplier called us to complain about the
analysis results. On the other hand, several customers who are on their
own fuel testing program have happily confirmed to the supplier that the
analysis results almost coincided with what they received from their lab.
This whole project has
raised the level of integrity of the bunker purchase operation to a new
height and has provided the much-needed quality assurance with each supply.
The author is not claiming that it will be the panacea for all the problems
in the bunker industry. That utopia is still far away. But we must create
little islands of quality and integrity in this vast ocean of suspicion
and disputes.
ENGINE FRIENDLINESS
NUMBER (EFN):
There are two aspects
of bunker fuel quality that need to be studied. One is a contractual part
where the buyer worries only about the transgressions in the specifications
laid down. He does not worry about the extent and kind of deleterious
effects of this fuel on his engines. For the buyer, it is a breach of
contract terms. The second aspect is the actual effect of these breaches
in the quality parameters on the engines, their running and their maintenance.
What about the on-board fuel treatment facilities such as settling and
service tanks, purifiers, clarifiers, filters and fuel treatment chemicals?
Considering how difficult it is to pump out the bunker fuel which has
been pumped in, it is certainly worth looking at every facility available
on board the ship to improve the quality of the fuel before it reaches
the engine. It is therefore important to know what effect each parameter
of the fuel analysis has on the performance of the machinery, especially
from the point of view of maintenance, wear and tear, corrosion and generation
of contaminants.
AS&M proposed a
benchmark of quality called Engine Friendliness Number (EFN) in 1993.
EFN is a sensitive, computer-generated index that measures and evaluates
the overall quality of a fuel from the point of view of engine friendliness,
such as wear rate, maintenance requirement, corrosion, and contaminants
generated. On a scale of 0 to 100: the EFN is good when it approaches
100 and bad when EFN approaches 0. Fuel specification provides a range
for each parameter. For example, sulphur content can be 0 to 5%, however,
we know that a fuel with sulphur nearer to 5% is likely to generate more
corrosion products and therefore it is assigned a low engine friendliness
factor. Each of these parameters are also given a weightage factor based
on how that parameter affects the engine. For instance, Al + Si can cause
excessive wear and tear, and, for this reason, is given a heavy weightage
factor as an "unfriendly" fuel. All these fuel parameters are aggregated
and normalized on a scale of 0 to 100. EFN gives fuel users better insight
into how fuels will perform in service. Over a period of time, EFN provides
a pattern for distinguishing straight distillate fuels from blended fuels
or waste oil contaminated fuels. The EFN pattern identifies suppliers
of quality fuel and would eventually help establish a correlation between
maintenance problems and EFN.
Since the time AS&M
developed this and recorded the EFN of thousands of samples, several features
have emerged:
1) The fuel usually
has some problem if the EFN is less than 35.
2) If the EFN is more
than 55, there is generally no problem with the fuel. Not many samples
crossed an EFN of 65. These fuels were exceptionally good.
3) It is very easy to
assess the performance of purifiers and clarifiers on the ship by analyzing
samples before and after the purification system. The EFN of a good set-up
goes up by 8 to 12 points. If the purification system is not functioning
correctly, or if the gravity disc is not the correct size, EFN will not
improve much.
4) Based on thousands
of samples analyzed, Grade 380 is more engine-friendly than grade 180;
even though the perception of many shipmanagers is that grade 180 is a
better fuel, and they are therefore willing to pay a higher price to get
an inferior fuel.
5) There is a clear
pattern based on geographical regions from where the bunkers are taken
and patterns based on suppliers. For instance, the EFN of bunker fuel
in Japan is almost always very high.
We are currently evaluating
the correlation between EFN and the expenses incurred on maintenance in
the ship. Since the variables are considerable, the study is taking more
time. It is hoped that eventually this EFN will be recognized and accepted
universally, and in particular by the Standards Organizations as a benchmark
of bunker fuel quality.
To conclude, rather
than curse the darkness, we have lit two small lamps. One is the concept
of a benchmark of fuel quality which would readily convey what good or
bad a fuel can do to the plant and machinery. The second is an experimental
project to raise the level of trust in a bunker fuel transaction through
a quality-assurance based supply. We hope that the ideals and concepts
behind these efforts
will be appreciated and emulated by other big players in the bunker field
and all of us will be the beneficiaries of the changes ushered in by these
ideas.
------------------------
DR. R. VISWESWARAN,
better known as "Dr. Vis", is Technical Director of Marine & Materials
Evaluation and Corporate Business Development at ANALYTICAL SERVICES &
MATERIALS, INC., (AS&M) in Hampton, Virginia. He is the director of
a high-tech laboratory for marine fuel oil testing, lubricating oil testing,
and failure analysis; with a rapidly-expanding customer list that includes
ship owners and managers from all over the world.
Dr. Vis is a Marine
Engineer (sailed as Chief Engineer for 8 years), an ABS Surveyor, and
has also specialized in evaluation of materials through destructive and
nondestructive chemical and physical methods. He holds a Ph.D. in Metallurgical
Engineering, with his research work done on fatigue damage assessment
on materials used in offshore structures. He also earned a Masters
Degree in Internal Combustion Engineering and a Bachelors Degree
in Marine Engineering.
Before joining AS&M,
Dr. Vis was a Senior Surveyor with ABS, Inc. Among his responsibilities
were inspection of boilers and pressure vessels built to the ASME code,
and inspection of hulls and machinery of ships and offshore structures.
He was also involved in all aspects of inspection and quality control
involving material testing, gas pipelines, storage tanks, and industrial
plants. He was responsible for ensuring ships conformance to International
Regulations on safety and pollution.
Dr. Vis holds a First
Class Certificate of Competency as Chief Engineer for both steam and motor
vessels. He is a Certified Welding Inspector, and an Authorized Inspector
(AI) of the National Board of Boilers and Pressure Vessels. He was leader
of the Indian delegation at two world conferences on Non-Destructive Testing
in the 1980's. He was placed on the Roster of Experts of the International
Maritime Organization (IMO), London. He recently became a certified Lead
Auditor for ISO-9000. Dr. Vis is also a consultant to the Maritime Administration,
Federal Department of Transportation.