Brooge Energy Ltd., through its subsidiaries Brooge Petroleum and Gas Investment Co. FZE (BPIC) and Brooge Petroleum and Gas Investment Company Phase III FZE (BPGIC III) is moving forward with construction of its proposed Phase 3 refinery and storage expansion at its existing terminal operations in Fujairah, UAE, outside the Strait of Hormuz, adjacent to the East coast port of Fujairah on the Gulf of Oman (OGJ Online, Aug. 6, 2020).
With results of a recently completed feasibility study supporting financial viability of the project, Brooge looks forward to potentially starting the anticipated 2-year construction period for Phase 3 as early as second-half 2021 for a targeted commissioning date sometime in 2023, Nicolaas L. Paardenkooper, CEO of Brooge Energy and BPGIC, said on July 28.
Completion of the feasibility study by Ernst & Young follows the 2020 conclusion of front-end engineering design and start of preconstruction work—including the soil investigation and environmental impact assessment report—for Phase 3 (OGJ Online, Feb. 16, 2021; Oct. 22, 2020).
Alongside adding up to 3.5 million cu m—or 22 million bbl—of fresh oil storage capacity to make Brooge Energy the Port of Fujairah’s largest independent oil storage and service provider, Phase 3 also will include a new 25,000-b/d modular refinery to produce very low-sulfur fuel oil, as well as construction of a 180,000-b/d conventional crude oil refinery, according to the operator.
Confirmation of Phase 3’s ongoing development follows BPGIC’s early July agreement with an unidentified oil trading company for the project’s planned modular refinery.
As part of the modular refinery agreement, BPGIC will sublease land to the oil trader, which will be responsible for building and paying all construction costs for the refinery, for which BPGIC will act as operator, earning revenue from tolling fees on a take-or-pay basis, according to a July 9 release from Brooge.
The agreement between BPGIC and the oil trader includes a 20-year tolling contract consisting of a 5-year contract beginning upon completion of the refinery’s construction and three 5-year renewal periods, Brooge said.