The latest news will further push back Port Everglades’ plan to add products storage capacity, following lengthy delays due to bidding issues since 2009. However, Port Everglades may decide to pursue other uses for that unused terminal site.

The pull-out news came as a surprise as Vitol had previously laid a master plan to expand aggressively in the Florida jet fuel supply and trading market.

“We need to draft a memo to the Broward County Commission to let them know that Vitol/Blueknight has withdrawn,” said an official at Port Everglades.

“Then we need to determine if we want to go back out with a bid request. We may decide to use the land for other purposes. This has not been decided,” he said.

According to James Dyer, VP Business Development, Vitol and CEO of Blueknight Energy Partners, there are key issues that could not be resolved.

Port Everglades was informed of Vitol’s pull-out late last week.
Vitol cited “indemnification against third-party environmental claims and the valuation of the improvements in the events of a termination for a breach by the County as one reason for the project cancellation.
Vitol did not highlight any concerns about demand and supply in the Southeast market.
In June, Vitol won the tender issued by Broward County to restart a products terminal at Port Everglades.   The Port Everglades terminal would have been the second terminal for Vitol in Florida.   
Vitol owns and operates an existing jet supply and storage at its 2.8-million-bbl capacity terminal at Port Canaveral, which was opened for business in February 2009. The new terminal project at Port Everglades would cost $31.4 million.     

The privately owned Vitol Inc. had said that it had the financial capacity to fully fund the capital investment required for the proposed new petroleum storage facility at Port Everglades. The company had Shareholder Equity in excess of $1 billion.   Vitol was expected to pay an annual base rent of no less than $1.05 million.   
Unlike the Port Canaveral terminal, which has 24 tanks for gasoline, diesel, jet fuel, liquid propane and fuel oil, the new terminal at Port Everglades was to have an initial storage capacity to store 945,000 bbl of jet fuel and ethanol in 10 tanks.   Initially, Vitol planned to use seven tanks for jet fuel and one or two for ethanol.   
Vitol Aviation planned to expand its business scope by delivering jet fuel to local airports in Fort Lauderdale, Miami, and Palm Beach.   At the outset, all products would be either shipped to local airports or transferred intra-Port Everglades.   
Port Everglades is considered the gateway to the Miami and Fort Lauderdale markets in south Florida. Vitol was not planning on storing diesel fuel or gasoline at Port Everglades.   
However, should the product mix change in the future, Vitol would be willing to provide fuel to the County in the event of an emergency.    
Vitol would receive ethanol from U.S. producers as well as from CBI countries.   
Vitol and Blue Knight Energy Partners, which would operate the terminal, would accept third-party throughput volumes for any storage capacity not utilized for proprietary purposes.