November 26, 2014 [Financial Mirror] - Construction company Joannou and Paraskevaides (J&P) will deliver the first phase of a €300 mln fuel storage terminal and docking jetty to its owners, VTT Vasiliko, during a humble ceremony on Friday, with the first tanker ships expected soon after.
The ambitious project, the largest foreign direct investment on the island in the industrial and energy sector, aims to place Cyprus at the centre of the downstream fuel transport routes.
An official inauguration ceremony is expected to take place in early 2015.
The project, a subsidiary of international oil storage terminal operator VTTI B.V., 50% of which is owned by Dutch Vitol, features 28 tanks with a total storage capacity of 543,000 cubic metres of core fuel (diesel, gasoline and jet fuel) a deep water marine jetty as well as road tanker loading facilities in phase one, already completed at a cost of €220 mln. The second phase, scheduled to begin in mid 2015 will create an additional 13 tanks and an extra capacity of 305,000 cubic metres at a cost of €80 mln.
George Papanstasiou, General Manager of VTT Vasiliko Ltd (VTTV), believes that the facility will be attractive to operators as in the wider area there are oil product flows from the Black Sea to the east, from the east to the west and from Europe to the east Mediterranean and the Red Sea, as 250 trans-shipments per year take place in the open sea around Cyprus.
“The Terminal, in conjunction with the island’s strategic location near the Suez Canal, places Cyprus on the map of these fuel transports,” Papanastasiou said in comments earlier this month.
The company, he said, can store crude oil being transported from the Red Sea to Asia’s emerging markets.
Papanastasiou added that the terminal could also act as the storage of Cyprus’ strategic fuel reserves, as well the fuel storage of Cypriot fuel companies, as all fuel depots traditionally located near the now defunct refinery in Larnaca should be relocated by 2016.
He said that despite the global economic downturn, VTTV is expected to conclude contracts by the end of this year that will secure 80% of the terminal’s capacity.
“Our aim is to serve 500 ships a year, a figure that alone corresponds to the Limassol port’s annual commercial activity,” Papanastasiou said.
During a recent fact-finding visit by the leadership of the ruling Democratic Rally (DISY), party leader Averof Neophytou described the project as the largest investment in Cyprus and a good solution for the transfer of oil stocks currently stored in Larnaca. He also expressed his belief that with the increase of competition when the terminal begins operations, fuel costs will be reduced.
