August 31, 2020 [Argus Media] – Trading firms Trafigura and Gunvor have taken over fuel oil storage capacity at Singapore’s Universal Terminal that was previously held by collapsed local company Hin Leong Trading (HLT).
The reassignment of the capacity comes after HLT applied to the Singapore courts for protection against creditors earlier this year.
The amount of storage capacity involved is unknown. Universal Terminal has 2.33mn m³ (14.7mn bl) of storage capacity in total, although it is unclear how much is used for fuel oil. The new leases have not been confirmed by Trafigura or Gunvor.
Hin Leong sought court protection in April because of “severe financial difficulties” caused by falling oil prices, moves by bank lenders to reduce their exposure to the commodity financing industry, and a drop in demand for oil and bunkers caused by the Covid-19 pandemic. The collapse of the company, one of Singapore’s biggest oil trading firms, left banks facing hundreds of millions of dollars in losses and caused a scramble to claim almost 3mn bl of oil products cargoes linked to the firm.
Allegations of fraud have since emerged, and HLT’s founder Lim Oon Kuin was charged with abetting forgery earlier this month.
Hin Leong also has a bunkering arm, Ocean Bunkering Services, which has a major presence in the Singapore bunker market.
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