Thursday, 9 September 2010
Saudi's Arabtank boosts fuel storage at Yanbu
Wednesday, 17 March 2010 at 15:47, Reuters, Dubai
Saudi Arabia's Arabtank Terminal (ATTL) is boosting its oil storage capacity at the Red Sea coast port of Yanbu by 580,000 cubic metres, industry sources said on Wednesday.
The new storage facility will take capacity at the terminal to 851,200 cubic metres, of which more than 90 percent is expected to be designated for oil products.
"This will be for oil mostly, and it will be segregated ... which is for both clean and heavy oil products," a source familiar with the project said.
Construction of the new storage tanks will start in the fourth quarter and will take about 24 months to complete, sources said.
Kuwait-based trader Independent Petroleum Group (IPG), which has a 36.5 per cent share in Arabtank, is expected to be the primary lease holder of the new tanks at the terminal.
Wall Street bank Morgan Stanley was also expected to sublease the tanks to facilitate its trading operations in the region, sources said.
"Well the principal at the new terminal will likely be IPG and Morgan Stanley, they have an active relationship trading gasoline in the Red Sea," a Middle East based trader said.
Morgan Stanley declined to comment. IPG was not immediately available for comment.
It was not clear immediately just how much capacity Morgan Stanley was going to lease, traders said.
"Additional storage is only going to extend Morgan's reach in the region," a trader said.
"It will give them greater flexibility in a region where tankage is extremely tight."
Morgan Stanley and IPG set up a gasoline trading cooperation agreement in 2008.
Morgan Stanley signed a lease in 2009 to take 75,000 to 80,000 cubic metres (about 500,000 barrels) of oil storage for refined fuel products in the United Arab Emirates (UAE) port of Fujairah.
The US bank also has a joint-venture storage lease of around 80,000 cubic metres with IPG at Vopak Horizon's commercial terminal at the port, industry sources said.
Morgan Stanley's gasoline co-operation arrangement with IPG was an important factor in the Kuwait trader's supply operations to Iraq, IPG said in its 2009 annual report.
Morgan Stanley and Goldman Sachs have dominated global energy derivatives trading for decades. Morgan Stanley has also developed a niche in the physical oil market.
It has for years run a large business buying, selling, transporting and storing jet fuel and gas oil, and is one of the largest importers into the United States.
The new storage facility will take capacity at the terminal to 851,200 cubic metres, of which more than 90 percent is expected to be designated for oil products.
"This will be for oil mostly, and it will be segregated ... which is for both clean and heavy oil products," a source familiar with the project said.
Construction of the new storage tanks will start in the fourth quarter and will take about 24 months to complete, sources said.
Kuwait-based trader Independent Petroleum Group (IPG), which has a 36.5 per cent share in Arabtank, is expected to be the primary lease holder of the new tanks at the terminal.
Wall Street bank Morgan Stanley was also expected to sublease the tanks to facilitate its trading operations in the region, sources said.
"Well the principal at the new terminal will likely be IPG and Morgan Stanley, they have an active relationship trading gasoline in the Red Sea," a Middle East based trader said.
Morgan Stanley declined to comment. IPG was not immediately available for comment.
It was not clear immediately just how much capacity Morgan Stanley was going to lease, traders said.
"Additional storage is only going to extend Morgan's reach in the region," a trader said.
"It will give them greater flexibility in a region where tankage is extremely tight."
Morgan Stanley and IPG set up a gasoline trading cooperation agreement in 2008.
Morgan Stanley signed a lease in 2009 to take 75,000 to 80,000 cubic metres (about 500,000 barrels) of oil storage for refined fuel products in the United Arab Emirates (UAE) port of Fujairah.
The US bank also has a joint-venture storage lease of around 80,000 cubic metres with IPG at Vopak Horizon's commercial terminal at the port, industry sources said.
Morgan Stanley's gasoline co-operation arrangement with IPG was an important factor in the Kuwait trader's supply operations to Iraq, IPG said in its 2009 annual report.
Morgan Stanley and Goldman Sachs have dominated global energy derivatives trading for decades. Morgan Stanley has also developed a niche in the physical oil market.
It has for years run a large business buying, selling, transporting and storing jet fuel and gas oil, and is one of the largest importers into the United States.
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