EMEA News
Oil Storage Demand Rises at Fujairah As Port Expands Capacity
Demand for oil storage capacity is rising at the Port of Fujairah as buyers hurry to stockpile cheap crude, which may be fortuitous timing as the port is actively expanding its storage capacity, reports Arab media.
According to Gulf Petrochem’s global head of terminals, Muthukrishnan Prabakaran, Fujairah's terminals were at 70 percent capacity and rising at the end of 2014.
Storage capacity is already up 30 percent over the past five years, with previous governmental figures pinning capacity to rise to 12 million cubic metres by 2017.
Estimates from other bodies such as terminal operator GPS Chemoil have reported more modest numbers, predicting 10.2 million cubic metres by the same date.
Space is already slated to be expanded to 8.67 million cubic metres by the end of the year, up from today's 6.72 million cubic metres.
Tarun Arora, general manager of GPS Chemoil, said that demand was expected to rise even further due to a planned refinery operated by the The International Petroleum Investment Company (IPIC) which is expected to add an extra processing capacity of 200,000 barrels per day beginning in 2016.
“That [refinery] is the main driver for business in Fujairah so if that gets delayed, all of our projects get delayed,” he said.
Volatility in the commodities markets also will not deter future expansion plans at the port, according to United Arab Emirates (UAE) Energy Minister Suhail Al Mazrouei, who said that investments in infrastructure and upgrades "have to continue."
“The UAE is a major oil producer and our investments are intact to make sure that our stand as a major producer stays, and that’s why we’ll continue to upgrade our facilities," he said.
Along with the boost for storage facilities, earlier this month crashing crude oil prices also elevated very large crude carrier (VLCC) rates as buyers were hiring tankers to serve as floating storage.
