March 17, 2010 [Reuters] - Saudi Arabia's Arabtank Terminal (ATTL) is boosting its oil storage capacity at the Red Sea coast port of Yanbu by 580,000 cubic metres, industry sources said on Wednesday.
The new storage facility will take capacity at the terminal to 851,200 cubic metres, of which more than 90 percent is expected to be designated for oil products.
“This will be for oil mostly, and it will be segregated … which is for both clean and heavy oil products,” a source familiar with the project said. Construction of the new storage tanks will start in the fourth quarter and will take about 24 months to complete, sources said.
Kuwait-based trader Independent Petroleum Group (IPG), which has a 36.5 percent share in Arabtank, is expected to be the primary lease holder of the new tanks at the terminal.
Wall Street bank Morgan Stanley (MS.N) was also expected to sublease the tanks to facilitate its trading operations in the region, sources said. “Well the principal at the new terminal will likely be IPG and Morgan Stanley, they have an active relationship trading gasoline in the Red Sea,” a Middle East based trader said. Morgan Stanley declined to comment. IPG was not immediately available for comment.
