Navigating the increasingly complex business environment surrounding the bunkering industry is the key to future development.


Bunkering in the West African market

April 20, 2021

Anders Ostergaard, group CEO of Monjasa, and Eduardo Costa, the company’s general manager for Angola, talk to The Energy Year about the company’s strategic approach to bunkering in West Africa and how Angola’s oil and energy sector will benefit from the IMO 2020 fuel transition. Monjasa is a global logistics company providing bunkering and cargo trading services.

How do you assess the resilience of Angola’s energy and power sector and its key stakeholders?
Anders OSTERGAARD: From a marine fuels point of view, Angola, together with nations like Nigeria, Ghana and Ivory Coast, entered a new era as an oil producing country as of January 1, 2020. As such, the new IMO 2020 low-sulphur fuel requirements are favouring straight run fuel oil widely available in the West Africa region.
We believe that this uptick in demand from oil and shipping companies will contribute to optimising industry production and refineries over time. Already, we can see that the Angolan sourcing opportunities are increasing and for Monjasa this is something that fits well with our preference for sourcing locally refined oil products no matter where in the world we service our customers.
It is our strong belief that the local oil and energy sector will benefit greatly from this fuel transition and that it will lead to overall improvements across the sector and ultimately for the population of Angola.

How is Angola positioned to compete against regional contenders to become a bunkering hub? What are the challenges for the development of its bunkering sector?
AO: Angola holds many opportunities as Africa’s second-largest oil producing nation and recent developments are pushing for further progress.
One of the most important elements in advancing Angola’s opportunity to become a regional bunkering hub is supply availability. The current local production levels and import restrictions on oil products are not favouring the overall development of the bunkering sector in Angola. Supply and demand define the attractiveness of the single bunkering markets and we see overall product availability as the main challenge for competing with neighbouring West Africa markets.

Where do you see the future of the bunkering business heading and how is Monjasa Group adapting to the current business circumstances?
AO: There is little doubt that navigating the increasingly complex business environment surrounding the bunkering industry is the key to future development. Right now, we are experiencing shifts in fuel grades and the overall product landscape, ever-changing compliance and HSEQ frameworks, and increasing financing requirements – all indispensable parts of the daily business that require a strong corporate backbone.
At Monjasa, we are confident that we are well positioned to face this increasing complexity. We are benefitting from our skilled global organisation, our size of operations and our 20 years of experience working across challenging markets. West Africa is a good example of a region that is evolving positively and at the same time adding a lot of new regulations.
With a fleet of 10 tankers and two offices in the region, we are thankful for having been the first bunker company introducing global ISO and OHSAS management standards back in 2014 to ensure continuous quality improvements across our operations. If we were to start all over today and face the current business complexities, it would have been impossible to enter the market.

What is the company’s main business strategy in Angola and what role does the Monjasa Chaser play in it?
Eduardo COSTA: Monjasa’s priorities in Angola mirror those of the Monjasa Group as a whole. We are focusing on making our business personal and being locally present in our markets. In 2020, we established our Luanda office to offer new opportunities to the local oil and shipping market. At the same time, bringing our 5,800-dwt tanker Monjasa Chaser to Angola, we believe that we also hold the quality tonnage to service our customers and complement Sonangol’s bunkering service when needed.

What is Monjasa’s involvement in the domestic oil and gas industry?
EC: Our ambition is that Monjasa must further contribute to the development of the domestic oil sector, when it comes to both Sonangol and the exploration blocks – many of the operating companies of which are already doing business with Monjasa in different parts of the world.


What role can alternative fuels play in the bunkering sector in the short term?
EC: It is indeed interesting times in oil and shipping. New thinking is put forward and progress is being made to decarbonise shipping, but it is still early days. We do not expect alternative fuels to materialise in the short term. In the longer run, it is likely that the quest for cleaner fuels will be an upstream issue rather than a downstream issue. This means, in the longer run, scrubbers as an example are likely to be phased out as new fuels enter the market.

How has the company adjusted to the IMO 2020 regulation limiting sulphur content?
EC: Monjasa prepared extensively for IMO 2020 – across our trading and operations departments and across our fleet of 20 tankers to match the new VLSFO demand. The transition to low-sulphur fuels has been an overall success and as a supplier we see close to zero demand for HSFO from vessels without scrubbers. Such inquiries are dismissed by our trading and compliance departments as part of Monjasa’s internal IMO 2020 measures.
It has been great to see how the shipping community has come together and proven that collective efforts are possible to transition to a greener future in shipping.

How does Monjasa assess the possibility of acquiring an onshore fuel storage capacity?
EC: Monjasa is keen to explore new opportunities and we hold the capabilities to proceed with local investments in Angola. Onshore storage is indeed a valid future solution to our business in connection with a softening of the existing import restrictions on oil products.

What are the company’s mid- and long-term objectives in Angola?
EC: Despite many years of doing business in Angola, we just recently established ourselves firmly in Luanda. Monjasa has a long-term perspective on doing our part to further develop the local bunker market and support domestic refineries and oil production with combined resources from our worldwide operations and local knowledge in West Africa.


Photo and media image courtesy of Monjasa

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