KARACHI: Fauji Trans Terminal Limited (FTTL), a joint venture of a local company and US-based freight forwarder, on Friday unveiled a plan to invest $25 million to set up a bulk liquid storage and handling terminal at the Port Qasim.
The project will have a total storage capacity of 280,000 metric tons. It will be built in two phases.
The proposed oil terminal will be designed to handle all the petroleum products, including motor gasoline, diesel, fuel oil, crude and Naphta.
The proposed investment will be made in the first phase for the construction of oil tanks and for the infrastructure development. In the first phase, 108,000MT of storage capacity will be built and operational by March 2018.
The Fauji Trans Terminal Limited is a joint venture between Fauji Oil Terminal
and Distribution
Company (FOTCO) and Trans Group.
An official did not disclose the remaining investment, but said that as soon as the next phase starts the amount will be made public.
Managing Director Lt Gen (Retd) Khalid Nawaz Khan of Fauji Foundation, speaking at a ground-breaking ceremony, said the terminal will be built as per the guidelines of the American Institute of Petroleum and National Fire Protection Association of US and be equipped with the fire fighting systems of the international standards.
“The terminal will be fully integrated with the Fauji Oil Terminal and Distribution Company oil jetty and will also include buffer storage for motor gasoline, diesel and fuel oil to achieve the maximum discharge rates, ensuring the quickest turnaround time for oil tankers,” he said.
Currently, average discharging rates achieved by vessels stand at 1,500 MT/hour, which increases berthing time for the oil tankers, incurring high demurrage costs to importers.
Khan said the terminal will attain the discharge rate of 5,000 MT/hour, “meaning oil tankers will only require 1/3rd of the time to discharge a given parcel of cargo.”
He said oil storage is an integral part of energy infrastructure for any country, which can ensure an adequate and uninterrupted supply of fuel oils to maintain the economic activities and sustained national growth.
Oil marketing companies are required to keep a minimum stock of 20 days to ensure an adequate fuel supply in the country.
“Recently, in a meeting of the economic coordination committee of the cabinet it was noted that there was only nine-day of petrol stocks in the country which put the nation’s supply chain at a great risk, especially given the climate of regional political tensions,” Khan added.
Hassan Sobuctageen, chief financial officer of Fauji Oil Terminal and Distribution Company said an overextended berthing and high demurrage cost is a big issue. Sobuctageen, citing an example, said a ship carrying 50,000MT of gasoline waited for 37 days before was berthed on September 28 due to a lack of oil storage.
The need of integrated oil storage with the Fauji Oil Terminal and Distribution Company terminal was felt for some time.
However, the recent significant increase in import volumes of motor gasoline has necessitated the emergent requirement of not only storage facilities but other measures are also needed to reduce the turnaround time of oil tankers calling at Fauji Oil Terminal and Distribution Company terminal, he added.