June 11, 2022 [Reuters] – Dutch tank storage company Vopak (VOPA.AS) on Wednesday revealed plans to devote more of its capital to industrial and gas storage by 2025, while the share for oil and chemical business will gradually decline.
The company plans by 2030 to allocate 1 billion euros ($1.07 billion) to expand its base in industrial and gas terminals and another 1 billion to new energies and sustainable feedstocks.
The group’s capital outlay related to oil storage assets accounts for roughly a third of its portfolio.
“There is a very natural transition,” Chief Executive Officer Dick Richelle told Reuters in a call during the company’s capital markets day on Wednesday.
He said Vopak would assess where it can transform part of its portfolio to ensure an operating cash return of at least 10% by 2025.
“Most of the news we had foreseen but a lower priority for chemicals in its strategy was not expected,” ING analyst Quirijn Mulder wrote in a note.
Vopak shares moved higher initially, but then reversed course and were down by 3% at 0845 GMT.
Mulder also flagged that Vopak’s long-term view was “quite far away for investors”.
“With regard to gas, investing €110m in industrial terminals annually until FY30 is also a challenge,” he said.
Richelle was asked about the impact of the European Union’s plan to cut 90% of oil imports from Russia by the end of this year in its latest round of sanctions on Russia over the Ukraine conflict.
“I think the market was somehow expecting this to come,” he said. “It will have an effect on the products that are currently flowing to Rotterdam, substitutes have to be found.”
He added that Vopak had a process to track and trace any sanctioned product that would potentially enter its terminals, as it has previously experienced it in other parts of the world.
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