The company leased the tank space in the first half of the year to store middle distillates, a company spokeswoman said late on Thursday, declining to give details about the size of the storage facility, or from whom it has been leased.

The move is part of CAO’s four-year plan of global expansion into new outlets, which has led the company to search for storage assets to feed into the outlets.

Traders said CAO, which imports over 95 percent of China’s jet fuel needs, has taken storage at Vopak Terminal in Singapore where firms including Glencore, Reliance Industries, Morgan Stanley, ConocoPhillips and Total are said to have tank space.

“As we expand our geographical regions for trading activities, so long as a potential investment opportunity … is able to create additional trading value to CAO … we will consider (oil storage facilities),” the spokeswoman said in an email response to Reuters.

She added that CAO will focus on new markets such as North America, Europe, Australia and the Middle East.

A Singapore-based trader said capacity was likely to be about 300,000 barrels, similar to the size CAO previously leased at Oiltanking’s facility in Singapore, a storage space it later released.
Neither this figure nor its previous lease in Singapore could immediately be confirmed.

CAO’s total storage capacity in China and South Korea was about 1.4 million barrels as of late last year, the company had earlier said.

Visible Trading Presence

The company has identified three locations to own or lease storage — China, North Asia and the greater Singapore region. These places are either close to the company’s main suppliers, customers, or the region’s central fuel pricing hub.

It announced in October last year it was buying a stake in an 8.18 million barrels terminal in Yeosu, South Korea, to store oil products and crude.

In Malaysia, CAO has formed a joint venture with shipping firm MISC and Dialog Group to build a 380,000 cubic metres (2.39 million barrels) storage tank terminal in southern Johor state’s Tanjung Langsat Port (Langsat Terminals  One, Two, Three). CAO will build and then lease all the tankage to store middle distillates and fuel oil for at least seven years.

CAO has always been a net importer of jet fuel, but it has recently stepped up its trading activities in gasoil, petrochemicals and fuel oil.

CAO was to form a joint-venture with Horizon Terminals to build and operate a facility on Singapore’s Jurong Island until its financial problems forced it to withdraw from the project.