China Aviation Oil starts operation of storage investment in South Korea
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E-mail Xinhua, April 1, 2013
China Aviation Oil (Singapore) Corporation Ltd (CAO), the major physical jet fuel trader in the Asia Pacific region, said on Monday that its new oil storage terminal facility with total capacity of 1.3 million cubic meters in Yeosu of South Korea has started commercial operations.
The terminal is developed by CAO's associated company, Oilhub Korea Yeosu Co., Ltd (OKYC), 26 percent of whose stakes are owned by the CAO.
The oil storage terminal, under construction for a period of two years and with a total construction cost of about 500 million U.S. dollars, comprises 36 storage tanks with sizes ranging from 6, 000 cubic meters to 80,000 cubic meters.
It is capable of handling crude oil and the full range of refined petroleum products, the company said in the announcement handing to the Singapore Exchange.
The CAO represents the second largest shareholder of the joint venture, while Korean National Oil Corporation is the largest shareholder with stakes of 29 percent. Other shareholders include SK Energy, GS Caltex, Samsung C&T Corp, LG International Corp and Seoul Line Corp, the company added.
The CAO invested about 34 billion won (32 million U.S. dollars) for the 26 percent equity stake of the joint venture in October of 2011.
The terminal is only 1.88 days by sea from Tianjin and 1.21 days from Shanghai, respectively. It is also able to support trading activities to the west coast of the United States and Southeast Asia, the CAO said.
Meng Fanqiu, the Chief Executive Officer said: "As Korea is CAO 's main source of jet fuel supply and located geographically close to its key customers in China, securing oil storage at OKYC's terminal has significantly strengthened CAO's ability to ensure certainty of jet fuel supply to China."
He said the company has inked an eight-year storage lease with OKYC for middle distillates.
"The addition of the storage facility at OKYC's terminal will not only complement CAO's jet fuel trading business but will also enhance CAO's network of oil storage facilities in Asia Pacific, providing effective support to our jet fuel supply and trading business," Meng added. Endi
