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The rise and fall of oil prices have resulted in many traders wanting to store oil and sell it later when prices are expected to fetch higher rates. This scenario has prompted a huge demand for oil storage capacity, a boon for Fujairah Port as the demand has helped it garner big investments in oil storage.
Geographically, Fujairah Port is located outside the Strait of Hormuz which has been plagued by threats of blockades due to political tension. Being away from this restive region has helped it receive increased investments. It has now drawn up plans to expand its facilities to help accommodate very large crude carriers.
Recent trends reveal that the oil capacity in the port is expected to rise from its current capacity of 8 million cubic metres to 14 million cubic metres by 2020.
The port is a well-known hub for oil storage and is ranked as the world’s third bunkering hub after Rotterdam and Singapore. Bunker is the fuel used to operate ships while a bunkering port is where ships are provided with this fuel.
A refinery with a processing capacity of 200,000 barrels per day is expected to come up soon along with a liquefied natural gas (LNG) import facility. These developments are expected to transform Fujairah into a major oil and energy hub in the region.
Fujairah is the landing point for the Habshan-Fujairah crude oil pipeline, with the port acting as an export gateway for UAE’s crude oil. The 380-kilometre long pipeline is the largest in the UAE. Carriers which are operating from the ports along the Arabian Gulf and passing through the Strait of Hormuz spend three additional days of journey time and pay more insurance money compared to those carrying shipments from Fujairah.
• Fujairah Port is having plans to expand its oil storage facilities
• It is the world’s third bunkering hub after Rotterdam, Singapore
• A refinery and a liquefied natural gas import facility are in pipeline
Source: S. Dhar, Special to Properties
The writer is a freelancer