The Fujairah Oil Terminal (FOT), currently under development in the Port of Fujairah, UAE, is on track to begin commercial operations by the end of 2014, Singapore-based trading company Concord Energy says.
Concord is developing the terminal with a subsidiary of China’s Sinopec and, on 8 January, announced the completion of the sale of a 50% interest in FOT to Sinomart KTS Development.
The oil storage facility will have a total storage capacity of 1,155,000m3. This will consist of eight tanks totalling 569,000m3 for crude oil and fuel oil, four tanks totalling 164,000m3 for fuel oil only, six tanks totalling 152,000m3 for gasoil (diesel) and 14 tanks with a total storage capacity of 270,000m3 for petrol and naphtha.
‘We were awarded the concession to develop the site at the end of 2011, and since then we have cleared the land and prepared the site ready to start construction immediately,’ John Stuart, CEO of Assets Group Concord Energy, tells Tank Storage magazine.
Concord expects 100% of this storage capacity to be contracted prior to the terminal’s start-up, and says it has already had strong interest from a number of traders and oil majors.
‘We have also spent the last nine months raising a $252 million (€193 million) project finance facility and we successfully signed with a consortium of six international banks at the end of December 2012,’ Stuart says. ‘Given the extremely challenging debt markets, we see the signing of this facility as a major endorsement of the very high quality of the project.’
Rotary Engineering has been awarded the EPC contract for the project. Construction will take 21 months and ground is expected to break before the end of January 2013. Stuart explains: ‘The Municipality of Fujairah has already constructed all of the port facilities that FOT will utilise, and with foundations of solid rock, FOT does not face any soil stabilisation risks inherent in many terminal construction projects.’
Fujairah is the second largest bunkering location in the world, behind Singapore and ahead of Rotterdam, and is being developed as the key logistics hub for the UAE. However, Stuart believes the location is not in danger of overcapacity as its coastal mountain range will cap the number of storage terminals developed in the region.
‘Fujairah has one of the highest throughput capacity ratios. Independent storage capacity is forecast to grow from approximately 3.5 million m3 to 7 million m3. Demand for bunkers alone in 2010 was 24 million tonnes. There is also a limitation on the ability to develop further land in Fujairah due to the proximity of the mountain range along the coast,’ he tells us.