Fujairah's bunker market has received increasing interest over the past year. File Image / Pixabay
A Brooge Energy subsidiary has signed a deal with an oil trading firm to operate a modular refinery in Fujairah focusing on VLSFO production.
Under the deal the unnamed oil trading firm will pay to build a 25,000 b/d modular refinery, while Brooge Petroleum and Gas Investment Company will operate it, Brooge said in a statement on its website on Monday. The deal will be renewed every five years over the next two decades.
"With the UAE adding to its oil production capacity, which we anticipate will drive demand for refining services for both the domestic and export market, we believe this is an opportune time to enter this segment of the oil industry," Nicholas Paardenkooper, CEO of Brooge, said in the statement.
"This agreement is a low-risk approach to advancing these plans, as the oil trading partner will own the asset and take on the cost of construction and any oil-price risk, while our focus remains in our area of expertise as the operator of the facility."