Shandong-based Yantai-Titan Petrochemical Port Development Co (transliteration), a joint venture between Yantai Port Group and Titan Petrochemical, started trial operation of a 360,000-cu-m tank farm for heavy oil and a 50,000-DWT oil jetty in early January, C1 learned from a source with the company. This is the first oil tank farm and jetty for Yantai port.
The tank farm comprises 80,000 cu m of bonded storage capacity for crude and fuel oil in combination, said the source. Both the tank farm and the jetty are expected to begin formal operation in March.
In addition, 300,000-cu-m tanks for heavy oil are under construction, together with two jetties for petroleum products-50,000DWT and 100,000DWT, he revealed. They are scheduled to come on line in June 2011.
Under the phase-I project, Yantai port will have 2.7-mil cu m of storage capacity for crude and fuel oil in combination. It will have 6-7-mil cu m of storage capacity for strategic petroleum reserves and some LPG tanks under the phase-II project, according to the source.
Yantai-Titan Petrochemical Port Development Co also plans to build a 300,000-DWT jetty.
"Sinopec is already in talks with us on renting tanks. And CNOOC has contacted us for investment in tank farm construction in the future," he said.
Sinopec showed interest in this tank farm, probably because of preparation for local bonded bunker business in the future, a market source remarked. But the tank farm is not expected to attract much interest from independent refineries as it is located relatively far away, he said.
"However, as the only port capable of building a 300,000-DWT jetty in northern Shandong, Yantai port has good prospect for the development of oil storage and logistics over the long term. As independent refineries become larger and larger, they need more choices outside Qingdao and Tianjin ports for VLCC cargoes," he added.
Yantai Port Group and Titan Petrochemical hold 55% and 45% of the shares in the joint venture.
