Egypt's $430 Million Fuel Bunkering Hub at Port Said to Command Strategic Routes

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Written by Richard Finlayson, Senior International Editor for Industrial Info Resources (Sugar Land, Texas)--A fuel bunkering terminal and logistics hub to be built in East Port Said, on the north side of the Suez Canal, will serve the global shipping market and serve as a backup to Egypt's national energy security policy.

Mashreq Petroleum, a core platform company of Citadel Capital (Cairo, Egypt), has signed a 30-year concession agreement to build the $430 million terminal, which will have the capacity for 800,000 tons of product, including liquid bulk. The agreement will cover fuel oil, gasoil, naphtha, jet fuel and bunker fuels.

Following approval from the national cabinet this week, the project will be fast-tracked as a priority, because of its backup status for the country's energy security. The original contract for Mashreq was signed in December 2005 after the company was set up in 2004 to build and operate the first tank terminal and logistics hub in the region.

The facility will have an annual storage capacity of 10 million tons and a bunkering capacity of 2 million to 3 million tons. There will be three berths that can handle tankers up to 120,000 deadweight tons and four berths for bunkering barges. The project will be completed in phases.

Markets served will be for liquid bulk in the Far East, Middle East and Mediterranean regions. It also will provide fuel bunkering services for ships traveling through the Suez Canal and will capitalize on the world's busiest maritime route, with more than 20,000 vessels transiting annually. Total traffic through the canal represents 10% of global maritime transport and about 22% of global container trade.

An estimated 110 million tons of petroleum products passed through the canal in 2012, and the traffic volume has been growing at an annual rate of 19% over the previous eight years.

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