Storage activity heats up

Aug. 14, 2000
Three of the world's largest petroleum and chemical storage and terminal lessors and service providers-Oiltanking, Vopak, and GATX-have expanded their Singapore operations this year.

SINGAPORE ACTIVITY

Pipelay progresses in early 2000 as part of increased activity around the Singapore harbor. Here, a bundle of product lines and fiber-optic cables is pulled across the Sinki fairway between Pulau Bukom and Jurong Island as part of Shell Eastern Petroleum's $100 million project in the area. (See following article for details of the pipelay project; photograph from Kvaerner E&C, Singapore.)
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Three of the world's largest petroleum and chemical storage and terminal lessors and service providers-Oiltanking, Vopak, and GATX-have expanded their Singapore operations this year.

With a combined storage capacity of some 3,142,000 cu m of petroleum and chemical products in Singapore, these companies have been enjoying growth aided by a change in market conditions.

The burgeoning petrochemical and specialty chemicals industry, especially on Jurong Island, has led to a greater requirement for feedstocks and in turn chemical storage and related services.

Oiltanking Singapore Pte Ltd. signed a contract worth some $74 million earlier this year for new facilities to be built on its Pulau Seraya site on Jurong Island. Vopak, which had recently sold its 50% share in Tankstore to GATX, had revealed plans to construct a greenfield chemicals hub on Jurong Island.

Long-term agreement

In February, Oiltanking had announced plans to boost significantly the scope of its operations, in particular chemical storage and handling, engaging Singapore firm Rotary Engineering to construct slightly more than 240,000 cu m of petroleum, petrochemical, and chemical tankage and related infrastructure.

The company, a 100% subsidiary of Oiltanking GmbH, had signed a long-term agreement on chemical logistics with Seraya Chemicals (SCSL), a wholly owned subsidary of Shell Eastern Petroleum (SEPL).

SCSL, which has existing styrene monomer and propylene oxide manufacturing facilities on Jurong Island, will also operate the facilities of the new business enterprise, Bassell Eastern, a 50:50 joint venture between BASF South East Asia and SEPL.

Oiltanking will provide logistical services to both the existing and future facilities operated by SCSL at Seraya.

In line with this agreement, Oiltanking is investing more than $60 million in facilities for storing and handling of chemicals. New jetties for chemical tankers will be constructed as well as 120,500 cu m of specialized tanks.

Facilities will also be built for loading tanker trucks and ISO containers together with drumming facilities, ensuring fully integrated logistical services.

Work on the project began Mar. 1, 2000, and will be completed in 18 months when more than 2 million tonnes of products will be handled annually.

In addition to the chemical investment, Oiltanking Singapore will spend more than $14 million for construction of 120,000 cu m of Class I tanks for petroleum and petrochemical feedstocks. These tanks will be fully integrated with Oiltanking's existing petroleum terminal in Singapore, increasing total mineral oil tankage to 855,000 cu m.

Located on the eastern edge of Jurong Island, Oiltanking Singapore currently owns and operates 735,000 cu m of tankage for petroleum products and petrochemical feedstocks, which includes 135,000 cu m of tankage operated in a joint venture with neighboring electrical power generating plant PowerSeraya.

This joint venture, Oiltanking Seraya, also offers additional logistical services through infrastructure integrated with Oiltanking.

Pipelines

In addition to the fuel-oil pipeline to PowerSeraya, there is a second pipeline from Oiltanking to the Petrochemical Corp. of Singapore, also on Jurong Island, supplying naphtha. The network will be further enhanced with the completion of subsea pipelines, now under construction, to Shell's refinery on neighboring island Pulau Bukom.

Oiltanking has said it is now connected by pipeline for various petroleum products to the Shell Bukom refinery. It said that a 4.6-km subsea pipeline bundle consisting of eight lines has been commissioned by Shell. (See following article.) Oiltanking is a partner in this project.

With a total storage capacity of 9.4 million cu m, Oiltanking GmbH is one of the world's largest providers of storage services in the petroleum and petrochemical sectors. The group handles almost 60 million tonnes of products annually and has extensive storage facilities in Europe, South America, the US, and Asia.

Due to its location, Oiltanking says it is well positioned to benefit from the rapidly expanding petrochemical industry on Jurong Island. The new chemical projects, including linking up by pipeline with the major refiners on the island, are planned with further investments in Singapore expected in the next 2 years.

Restructuring; merger

Along with acquisition of Van Ommeren's worldwide network of more than 50 terminals, Vopak has also restructured its holdings in Singapore, selling its 50% shareholding in Tankstore Ltd to GATX and embarking on investment in new chemical storage and handling facilities on Jurong Island.

This new development will augment the company's existing 960,000 cu m of chemicals and petroleum products storage on the island of Pulau Sebarok and 250,000 cu m of chemicals tankage on Pulau Sakra, on the south central coast of Jurong Island.

In early November 1999, Van Ommeren and Pakhoed merged and are now known as Vopak.

Subsequently, Vopak then reached an agreement with GATX Terminals Corp. in February 2000 regarding a swap of their respective interests in three joint-venture companies they held together in the UK, Belgium, and Singapore.

The transaction became effective from Jan. 1, 2000, with Vopak receiving approximately $53 million.

This involved the sale to GATX of Vopak's 50% interest in Tankstore (Singapore) and its 50% interest in Gatamex (Belgium), a terminal for both petroleum and chemical products in Antwerp with a capacity of 486,000 cu m.

In turn, GATX Terminals sold its 50% interest in the UK's Tees Storage, which owns a terminal facility in Middlesborough, UK, to Vopak. In Singapore, the former Van Ommeren shareholders, the Development Bank of Singapore and Intraco Pte Ltd., were bought out, leaving Vopak with a 69.5% stake and the Port of Singapore Authority Corp. (PSA) the 30.5% balance in both Vopak Terminal Sebarok and Vopak Terminal Sakra and the future Vopak Terminal Tembusu.

A greenfield project is now planned for the Tembusu sector of Jurong Island, to be located on the southwestern coast on a 24-hectare site in the process of being reclaimed as part of the third and final stage of the island's reclamation process.

Discussions are under way with the Jurong Town Corp. and the Economic Development Board (both of Singapore) for construction of a one-stop, chemicals-only facility that will not only provide solid and liquid and feedstock storage, transport, and distribution services but such facilities as cooling water, wastewater treatment, and plant air.

Tankage at the Tembusu site will eventually total 350,000 cu m. The first phase will involve the development of 45,000 cu m of chemical storage and supporting infrastructure. Access will be by vessel, barge, truck/ISO container, and pipeline.

Now probably the world leader in oil logistics and chemical distribution for both the chemical and oil industries and end-users of chemicals, Vopak has a total of 75 terminals with combined storage capacity of approximately 7 million cu m of chemicals and 16 million cu m of petroleum.

Its central storage and distribution facilities in Singapore are a hub for Southeast Asia, says the company, from which it expects to launch significant growth in the region.

Major acquisition

A wholly owned subsidiary of GATX Terminals Corp. and its regional office for Asia, GATX Terminals Asia Pte Ltd., has taken a major step regionally with the acquisition of 100% ownership of Tankstore Ltd., formerly operated in a 50-50 joint venture with Paktank, before the latter's merger with Van Ommeren into Vopak.

In Singapore, GATX now has, in addition to 152,450 cu m of chemical storage in the Port of Singapore at Jurong, on the southwest coast of the mainland, full control of the 929,500-cu m petroleum and chemicals tank complex on Pulau Busing, a terminal mainly for petroleum products, just off the southwest coast of Singapore and not far from Jurong Island.

GATX Terminals Corp., one of the world's largest providers of bulk liquid storage and distribution to petroleum and chemical customers, operates a network of liquid storage and pipeline distribution services. It handles more than 800 million bbl of customers' products in 36 facilities with more than 9 million cu m of storage capacity in the US, Latin America, Europe, and Asia.