Chemoils planned 675,000m3 oil storage terminal in the United Arab Emirates port of Fujairah has attracted the interest of global commodity trader Glencore and Japanese trading group Itochu Corporation.
The two companies are looking to lease storage when the terminal opens in 2012.
There is a tremendous amount of growth that's going to happen at that port over the next several years and we have positioned the terminal to be flexible on how much we will use for our business and how much we will lease out, Chemoil's CEO Mike Bandy comments.
It is anticipated that Chemoil and joint venture partner Gulf Petrol Supplies (GPS) will each retain some capacity from the terminal for their own operations while the remaining capacity will be leased out to third parties.
Works on phase four of the oil storage terminal are expected take about 20-22 months with completion expected in the second half of 2012.
We've awarded the EPC contract on the construction. This is going to be a multi-product terminal that will have both heavy fuel, marine fuels, distillates and jet fuels. So there'll be a tremendous amount of flexibility, Bandy adds.
The new terminal is Chemoils largest surpassing its flagship Helios Terminal in Singapore which has a storage capacity of 482,000m3.
In related news released on 2 December Chemoil announced it has withdrawn from the joint venture to build storage tanks for bunker fuel at Busan New Port.
Chemoil had a 12% stake in the project along with Hanjin Shipping with 18%, Samsung C&T Corporation with 10%, CL Construction with 10% and financial investors holding 50%.
We looked at a potential opportunity in South Korea and we are not going ahead at this stage, a Chemoil official said. We won't be making any further comment as it is not our policy to make public comments on commercial decisions.
The JV envisaged building and operating jetties, storage tanks, pipelines and water supply facilities on land, covering 63,000m2 which the South Korean government would lease to the operators free of charge.
Construction of the tanks was scheduled to start in December. BPA is still carrying out negotiations with preferred bidders and so a detailed schedule could not be given.
Busan is the largest bunkering port in South Korea with a market share of more than 50% of the country's total sales of 600,000 tonnes/month. Currently, only South Korean refiners SK Energy, GS Caltex and Hyundai Oilbank operate bunker fuel storage tanks at Busan with a total capacity of around 65,000m3.