The facility, which will have an initial storage capacity of 760,000 cbm, is being built to meet the incremental storage needs of the Singapore trading area. Oiltanking Karimun will be managed and operated by Oiltanking as an independent commercial storage facility. Gunvor will take a minority equity stake and rent part of the capacity. 

Singapore has historically been the maritime hub of the vibrant Asia-Pacific region. In light of the dynamic and robust growth of the developing Asian countries, petroleum demand in the region has been growing steadily. Expanding refining capacities are fueling incremental flows of petroleum products that are finding their way to the Asian demand centers. This growth in supply and demand is resulting in additional flows of products into the region through the Malacca Strait. This trend is projected to persist over the coming years, resulting in additional storage demand in Singapore. 

While Singapore’s storage capacity has been growing steadily over the last decade, further growth is hampered by the scarcity of waterfront and lack of land available for new expansions. As an alternative to the tightening storage in Singapore, Oiltanking has selected the island of Karimun (Riau Islands, Indonesia) as the optimal location for a green field terminal. The location is ideal due to its proximity to Jurong Island (Singapore’s industrial petroleum and petrochemical hub) and the existing ship-to-ship operations off the coast of Karimun, its favorable nautical conditions and availability of ready-to-build land. 

The terminal, which is expected to be operational by the 2nd quarter of 2015, will cater to the storage and handling of both clean petroleum products and black oil. The initial capacity will be supported by four jetties capable of accommodating vessels of up to VLCC dimensions. The terminal has ample land for further expansion.