CORRECTED-Proman Stena Bulk refuels ship with methanol for first time in Singapore

(Corrects daily methanol usage to 32-35 tons, not 32,000-35,000 tons in paragraph 12)

By Florence Tan

SINGAPORE, May 24 (Reuters) - Shipping firm Proman Stena Bulk filled one of its dual-fuelled vessels with nearly 1,340 metric tons of methanol in Singapore on Friday, the company's first such operation there.

The operation paves the way for more cleaner-burning fuels to be supplied to ships in Singapore, the world’s largest bunkering port. Shipping generates 3% of global greenhouse gas emissions.

The joint venture (JV) between Swiss methanol producer Proman and Swedish shipping firm Stena Bulk has built six dual-fuelled tankers to drive the use of methanol in powering ships.

The Stena Prosperous, a 49,000-deadweight ton tanker that ships chemicals and refined products, was filled with a 20:80 blend of green and conventional methanol, Singapore's Maritime Port Authority (MPA) said.

Global Energy Trading supplied the fuel to the tanker using chemical barge MT Kara, it added.

"Singapore is one step closer to developing its full capability to deliver methanol bunkering at a commercial scale," the MPA said, adding that another operation for simultaneous methanol bunkering and cargo operations for a container vessel will take place next week.

The green methanol purchased by Proman's marketing arm Valenz originates from China and carries the International Sustainability and Carbon Certification (ISCC), Proman's executive director of marketing, logistics and shipping Anita Gajadhar told reporters at Stena Prosperous' naming ceremony on Thursday.

The conventional methanol was produced at Proman's plant in Oman, she added.

Green methanol costs four to five times more than the conventional version.

The methanol blend will reduce carbon emissions by 31% compared with the same voyage utilising Very Low Sulphur Fuel Oil, Proman Stena Bulk said.

All six ships are in operation and are running fully on methanol, Gajadhar said.

So far, the fleet has refuelled methanol in South Korea, the U.S. and in Trinidad and Tobago, she added. Each vessel uses 32-35 tons of methanol per day, depending on weather and cargo weight, she said.

However, Stena Bulk's CEO Erik Hanell said the JV is unlikely to expand its fleet for now as prices for new ships have sky-rocketed.

"We're basically on par with 2007 when ship prices were at the highest," he said.

Instead, Stena Bulk is exploring with engine makers such as MAN ways to retrofit its existing fleet to burn alternative fuels.

"Methanol will probably be on top of the list of potential fuels that we would like to blend with commercial fuels," Hanell added.

Europe's carbon price will have to rise "a lot" higher than the current $60 per ton to motivate shippers to switch to green methanol, Hanell said.

In Europe, under the Emissions Trading System, shippers pay for each ton of carbon dioxide they emit by surrendering carbon allowances as part of the bloc's efforts to meet its climate targets.

(Reporting by Florence Tan; editing by Rod Nickel)