Vopak is unlikely to return to its original project plan any time soon despite a prominent gasoline forward price curve due to a strong refinery utilization rate and stable demand, industry sources close to Vopak told OPIS on Monday.

Vopak bought the unused oil terminal and site in 2011, with a plan to resurrect the unused terminal for storage of refined petroleum products and biofuels. The company did not offer a project timetable then, but after a few years passed amid changing market fundamentals of growing domestic crude production and higher U.S. refining margins, it became apparent that the project would not take off due to sluggish gasoline import flow.

A Vopak spokeswoman told OPIS in 2011 that Vopak was planning to begin construction of the new Perth Amboy terminal, which would have included renovation and demolition, within one year of purchasing the site. It would have taken another year to begin operations at the terminal.

The project would have marked Vopak’s entrance into the Northeast oil products storage market, expanding its storage presence from the Gulf Coast, Mid-Atlantic, West Coast and east coast of Canada. It also would have resurrected the oil storage facility, which had been closed since 1994.

Like other terminals in the New York Harbor, Vopak’s Perth Amboy facility would cater to the regional products import and trading market.

Vopak marked an impairment of 10.8 million euros ($13.158 million) for the Perth Amboy terminal project in its fiscal 2013 results, as there was insufficient economic viability due to the changed market circumstances in North America as a result of the unconventional oil and gas developments, the company said.

In July 2014, Vopak said that it had cut back its capital spending and would divest small terminals amid a challenging operating environment in the oversupplied tank storage market.

Vopak said that since 2013, the tank storage market has been adversely impacted by a substantial incremental supply of storage capacity as well as by legislative and geopolitical developments. This has resulted, mainly in Europe, in new market dynamics with different consequences for different product-market combinations and pressure on occupancy rates and pricing.

Additionally, the timing of new profitable expansion projects has become less apparent. As a result, Vopak’s financial outlook for 2014 is no longer fully aligned with the company’s longer-term growth ambitions as defined in the 2010-2012 period. Against this background, Vopak carried out the business review, the company said.

Vopak is specialized in the storage and handling of oil products, liquid chemicals and gasses. The company operates 79 terminals in 29 countries with a combined storage capacity of more than 31 million cubic meters, with an additional 6.6 million cbm under development, to be added by 2017.

On the U.S. Atlantic coast, Houston-based Vopak North America has a terminal in North and South Wilmington, N.C., and Savannah, Ga. Farther north along the Atlantic coastline, Vopak has terminals in Hamilton and Montreal on the eastern seaboard of Canada.

It also has terminals at Galena Park and Deer Park in Texas, as well as terminals at Long Beach and Los Angeles in Southern California. Most Vopak terminals in North America cater to the chemical storage demand, and some could store oil as well.

Separately, NYMEX RBOB shows a contango price spread of about 4cts/gal from January to March, and the front-month WTI crude spread is at about minus 40cts/bbl. The February-March Brent gap was at minus 80cts/bbl.