Sinopec's storage arm to double capacity outside China by 2020

December 11, 2013 - 8:44:11 am

SINGAPORE: The storage arm of Asia's top refiner, Sinopec Corp, plans to double its storage capacity outside China by 2020, a senior company official said.

Sinopec Kantons Holdings has set its eyes on Africa and North and South America to double its capacity from the more than 5 million cubic metres expected in 2016, said Xu Ruiqing, chief commercial director of Sinopec Kantons.

"Currently there's no major oil terminal in west Africa although it's a big producer and exporter of crude," he said on the sidelines of a storage conference on Wednesday.

"Other areas like Brazil and Argentina are also exporting crude and there might be production increase, so somewhere between north America and south America could be a strategic location."

"We are basically looking at areas where there is an active trading business."

The company is currently in the design and pre-engineering phase to build a 2.6 million-cubic-metre storage terminal in Indonesia's Batam free trade zone.

The terminal is expected to become operational by mid-2016.

On a land size of 75 hectares, the terminal will store 1.876 million cubic metres of crude oil and fuel oil and 730,000 cubic metres of diesel, gasoline and jet fuel.

The company will focus on building the terminal for now, and has not decided if it will go ahead with a refinery project in the area as was originally planned, Xu said.

"Refinery plans will depend on demand scenario and whether it's worth building the refinery or not," Xu said. "That's not decided."

Sinopec Kantons is also building a terminal in Fujairah in a joint venture with Concorde energy and a local partner, with a storage capacity of 1.15 million cubic metres.

The terminal, which is expected to be operational by November 2014, will be able to store 580,000 cubic metres of crude oil and fuel oil and 575,000 cubic metres of fuel oil, gasoil, gasoline, naphtha and jet fuel.

"There's a huge market as far as the bunker business is concerned in the UAE," he said.

"And also potentially in the future, there might be possibility for crude oil volumes and trading volumes to increase in the port."

Sinopec acquired 50 percent of the Vesta Terminals from Mercuria Energy Group in Belgium, Netherlands and Estonia last year, with a total capacity of about 1.6 million cubic metres.

The company currently has no plans to build more storage in Asia or Europe, Xu said. (Reuters)

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