Martin Quinlan, LONDON:
Germany’s Oiltanking is to buy the Helios oil
storage terminal on Jurong island, Singapore, from Chemoil. The
acquisition will increase Oiltanking’s petroleum
capacity in the booming Singapore storage business by 37%,
although it will still be number-two in the port to Vopak.
Oiltanking will pay $285 million for the Helios terminal,
which – having started-up in 2008 – is one of
Singapore’s newer facilities. The terminal has a
capacity of 503,000 cubic metres (cm), and was purpose-designed
for the storage and blending of fuel oil. Its six-berth jetty
can handle tankers of Suezmax size, with two mooring at the
Chemoil, a marine fuels supplier, is to continue to operate
its bunkering business from the Helios terminal by leasing
capacity in the facility – which is also used by other
fuel oil traders, including Itochu, Brightoil and Petrobras.
When opening the terminal Chemoil said its operations would
benefit from having control of the supply-chain, but it now
says structural changes in the marine fuels market will "favour
an asset-light business model that is more able to respond
quickly to volatility in volumes and margins".
The Helios terminal was built when Chemoil was headed Robert
Chandran, who founded the company in 1981. Chandran died in
2008 following a helicopter accident, after which the company
– controlled by members of his family – saw
changes of course. But in 2010 the family interests were sold
to trading company Glencore, which now holds 89%.
The purchase of Helios will lift Oiltanking’s
petroleum capacity in Singapore to 1.87 million cm –
the company’s main terminal on Jurong has a
capacity of 1.37 million cm, and it also has a chemicals
terminal. Vopak has 2.52 million cm of petroleum capacity in
terminals at Banyan and Sebarok, and also two chemicals
Demand for storage capacity in Singapore has been increasing
for many years, driven in part by China’s growing
imports, and fees have strengthened accordingly (PE
Winter/11, p30). With no land available for new terminals,
several bunker suppliers are using moored tankers and storage
capacity is also being constructed nearby in Johor, Malaysia
– but capacity in Singapore’s land-based
facilities attracts a premium.