China-based Sinopec will begin building a new oil storage terminal at the Batam free trade zone in Indonesia.
Sinopec, which is Asia’s top refiner, has invested $850m in what will be Asia’s largest oil storage terminal.
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A unit of the Sinopec Group, Sinopec Kantons Holdings, will own a 95% stake in the PT West Point Terminal project, which will be the company first facility near the Asian oil trading hub of Singapore.
The facility will have a capacity of 16 million barrels of crude and refined fuels.
Managing director of Singapore’s IHS Purvin and Gertz, a provider of critical information and insight for the oil and gas and power generation industries, Victor Shum, said, "Sinopec has a trading presence in Singapore and I imagine having a storage terminal in Batam, bordering Singapore, would be used to support their trading activity in the region."
In the second phase of the project a refinery and petrochemical project is being considered for which 360ha of land in Batam’s Free Trade Zone has been set aside.
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By GlobalDataAn unnamed Indonesian official was quoted by Reuters as saying the immediate priority is to get the storage facility built, but the refining and petrochemical projects are not in execution phase.
"This has been a project which they (Sinopec) had been thinking about for a while now … OK, at least two years in the making, this project is on a cluster of islands where some reclamation has taken place," said the official.
The new storage facility will be complete in 18 – 24 months.
