The early fall timetable for the first gasoline blending operations is slightly later than June-July reported by OPIS in April.

The Perth Amboy terminal has been offering only distillates storage and rack services since Buckeye took over that New York Harbor facility in July 2012.

The start-up of the new gasoline blending operations at Perth Amboy terminal will be gradual as Buckeye is bringing online one gasoline tank at a time.

The ongoing refurbishment of all inactive tanks on site is a long-term project, which is expected to take a few years.

With the gasoline blending operations starting up soon, the Perth Amboy terminal is expected to offer gasoline at its racks for the first time in the fourth quarter. The terminal will also have rail and distribution capabilities for the tanks and racks.

Last week, Buckeye said that it had signed a long-term contract for about 1 million barrels of refined petroleum product storage with a gasoline blender. Buckeye did not identify the gasoline blender.

Buckeye bought the Perth Amboy’s storage facility from Chevron for $260 million in cash. The terminal has 4 million bbl of product tankage, of which 2.7 million bbl is active, while another 1.3 million bbl is refurbishable.

The active storage capacity is currently used for distillates only. Buckeye is targeting a total capacity to 5 million bbl at Perth Amboy in the future.

OPIS reported last year that Buckeye plans to invest $200 million to $225 million in the facility over the next few years, with dock improvements, blending upgrades, and a planned construction of a 16-inch line that would move waterborne material to the Linden terminal.

Buckeye would then be able to capitalize on any increase in imports expected through the decade.

The Perth Amboy facility sits on about 250 acres in Perth Amboy, N.J., and is located only six miles from Buckeye’s Linden, N.J., complex.

Chevron will continue to be a key customer at the terminal under multi-year storage and throughput commitments.

Meanwhile, arbitrage flow of European gasoline to the New York Harbor has been sporadic in the past two years, with the trans-Atlantic window for importing incremental barrels seen unpredictable.

The arbitrage economics, which include blending costs, cargo costs, time money value, forward price curve and freight, have been volatile, but overall, the import trend this summer has been relatively sluggish compared with a year ago.

Since June 2011, the weekly gasoline import volume has cracked the 1 million b/d mark only twice. This is compared with imports surpassing 1 million b/d consistently prior to 2008.

The Northeast is well supplied by Colonial Pipeline, which is continuing to expand its south-north delivery capacity. Also, Northeast refiners are enjoying relatively stronger refining economics as more price-advantaged crude makes its way from the Midcon to the East Coast via rail or barges.