Work starts on Malaysia's largest bunker hub
The long-standing tussle over who has the right to develop Malaysia's bunkering island off the Port of Tanjung Pelepas (PTP) appears to have come to an end.
Construction officially began today on the Asia Petroleum Hub (APH), an offshore oil storage and bunkering facility on Tanjung Bin, a 100-acre reclaimed island in the southern state of Johor.
Malaysian Prime Minister Abdullah Ahmad Badawi presided over a ground breaking ceremony, confirming that APH will develop and operate the facility.
APH is majority owned and controlled by private firm KIC Group, Malaysia's largest independent terminal operator and already a major bunker player in the country.
PM Badawi said in his speech today that the government supports APH, adding that APH has to make sure it makes the most of this opportunity.
APH aims to have the RM1.4 billion ($413 million) project, with a total storage capacity of one million cubic metres (m³), fully operational by mid-2009.
The terminal is expected to handle over 30 million metric tonnes (mt) of petroleum products a year.
APH is carrying the entire cost of the project, which is being funded via equity and project financing provided by a local bank.
The development rights on Tanjung Bin have been a controversial subject over the past four years, with both APH and Seaport Terminal vying to develop the bunkering facility.
Seaport Terminal, which owns and manages Johor's PTP, is a private firm controlled by Malaysian tycoon Syed Mokhtar Al-Bukhary.
"There is no controversy," Abdul Rashid Mohd Isa Al-Qadiry, executive chairman of APH, told Bunkerworld today.
"The decision has been made by the government in favour of APH. Another friendly company may come in soon to enhance the development," he said, referring the other company as Seaport.
He added that the owner of the reclaimed island is the federal government, and that the government has decided to lease it to APH for no less than 60 years, to construct and operate the bunker hub.
"This hub is the integrated terminal that will handle multiple products from heavy viscosity fuel oil to the finest jet fuel," said Rashid.
He said all the one million m³ of storage capacity has been fully taken up by three clients, including Dutch commodities trading house Trafigura Beheer BV., and two national companies which he did not name.
The new Malaysian bunker hub is seen as essential in meeting the demands for petroleum storage and blending requirements which presently relies on foreign facilities.
Some see it as a potential challenger to neighbouring Singapore, Asia's biggest oil trading hub and the world's leading bunker market. Others believe Malaysia's facilities will complement, rather than compete, with Singapore.
Construction officially began today on the Asia Petroleum Hub (APH), an offshore oil storage and bunkering facility on Tanjung Bin, a 100-acre reclaimed island in the southern state of Johor.
Malaysian Prime Minister Abdullah Ahmad Badawi presided over a ground breaking ceremony, confirming that APH will develop and operate the facility.
APH is majority owned and controlled by private firm KIC Group, Malaysia's largest independent terminal operator and already a major bunker player in the country.
PM Badawi said in his speech today that the government supports APH, adding that APH has to make sure it makes the most of this opportunity.
APH aims to have the RM1.4 billion ($413 million) project, with a total storage capacity of one million cubic metres (m³), fully operational by mid-2009.
The terminal is expected to handle over 30 million metric tonnes (mt) of petroleum products a year.
APH is carrying the entire cost of the project, which is being funded via equity and project financing provided by a local bank.
The development rights on Tanjung Bin have been a controversial subject over the past four years, with both APH and Seaport Terminal vying to develop the bunkering facility.
Seaport Terminal, which owns and manages Johor's PTP, is a private firm controlled by Malaysian tycoon Syed Mokhtar Al-Bukhary.
"There is no controversy," Abdul Rashid Mohd Isa Al-Qadiry, executive chairman of APH, told Bunkerworld today.
"The decision has been made by the government in favour of APH. Another friendly company may come in soon to enhance the development," he said, referring the other company as Seaport.
He added that the owner of the reclaimed island is the federal government, and that the government has decided to lease it to APH for no less than 60 years, to construct and operate the bunker hub.
"This hub is the integrated terminal that will handle multiple products from heavy viscosity fuel oil to the finest jet fuel," said Rashid.
He said all the one million m³ of storage capacity has been fully taken up by three clients, including Dutch commodities trading house Trafigura Beheer BV., and two national companies which he did not name.
The new Malaysian bunker hub is seen as essential in meeting the demands for petroleum storage and blending requirements which presently relies on foreign facilities.
Some see it as a potential challenger to neighbouring Singapore, Asia's biggest oil trading hub and the world's leading bunker market. Others believe Malaysia's facilities will complement, rather than compete, with Singapore.