"Ulsan Port is the optimal port to respond to the Arctic Route era, equipped with various ship fuel supply infrastructures, including liquefied natural gas (LNG), ammonia, and methanol."
On November 6, during a meeting with the Korean Maritime Reporters Association in Ulsan, Byun Jae-young, president of the Ulsan Port Authority (UPA), discussed the port's competitiveness in the upcoming Arctic Route era.
Byun outlined a vision to elevate Ulsan Port as a core hub for global energy logistics in line with the commercialization of the Arctic Route. He emphasized the port's strengths as the largest liquid cargo handling port in South Korea and its strategy to capture new logistics demands from the Arctic Route by leveraging its eco-friendly ship fuel supply infrastructure.
"The Arctic Route is a national agenda, so we are continuously monitoring and preparing for it," Byun said. He noted that while Ulsan Port currently offers incentives such as docking fee reductions to shipping companies receiving fuel, there are plans to extend these incentives to cargo owners as well.
The 'cargo owner incentives' aim to increase the number of ships using Ulsan Port along the Arctic Route and secure new cargo volumes. This is particularly important for bulk carriers, where cargo owners often decide on transportation through charter contracts, making their participation crucial.
Ulsan Port has been steadily increasing its record of ship arrivals via the Arctic Route. According to UPA, from 2016 to last year, a total of 18 ships entered Ulsan Port via the Arctic Route. This year, an additional four ships have arrived, bringing the cumulative total to 22, the highest among South Korean ports.
UPA is also pursuing collaborations with foreign shipping companies. It plans to partner with Royal Wagenborg, a Dutch shipping company with the most extensive Arctic Route operational experience, to gain expertise in polar navigation. Recently, UPA signed a tripartite memorandum of understanding (MOU) with Royal Wagenborg and the Korea Maritime Promotion Corporation to enhance cooperation on Arctic Route operations.
The Arctic Route is gaining attention for its potential to significantly shorten transportation distances compared to traditional routes via the Suez Canal. UPA reports that using the northeastern route from Ulsan to Europe can reduce the sailing distance by approximately 35% compared to the Suez Canal route, leading to expected savings in fuel costs and transportation time.
However, the Arctic Route has limitations due to seasonal operational constraints. In winter, ship operations can be restricted due to ice and freezing conditions, which may incur additional costs for icebreaking support and ensuring navigation safety.
In response, UPA is exploring the potential for cargo volume through the northwestern route in addition to the northeastern route. Currently, Ulsan Port handles about 3.5 million tons of North American-related cargo annually, which could represent a significant transportation demand if the northwestern route is utilized more extensively in the future.
UPA's confidence is rooted in its 'eco-friendly ship fuel supply chain.' Ulsan Port is the third-largest port in South Korea, handling approximately 197 million tons of cargo annually, with about 80% or 157 million tons being liquid cargo. With the largest liquid cargo handling infrastructure and a supporting oil refining and petrochemical industrial complex, Ulsan Port can store and supply various ship fuels.
In April of this year, Ulsan Port successfully conducted commercial ammonia bunkering for gas carriers, and last month, it completed ammonia bunkering for a very large gas carrier, accumulating experience in supplying next-generation ship fuels.
Kim Byeong-woo, head of UPA's Eco-friendly Energy Division and Arctic Route Task Force, stated, "Ulsan Port is advancing as a hub for eco-friendly ship fuel and a key port for the Arctic Route based on its foundation as the largest liquid energy port in South Korea. To protect the pristine Arctic seas, eco-friendly ship fuel is essential, and we aim to grow both initiatives to enhance the competitiveness of South Korea's shipping and port sectors."
[This article was supported by the Sea's Gift Foundation and the Korean Maritime Reporters Association.]
* This article has been translated by AI.
Copyright ⓒ Aju Press All rights reserved.