m5v12i4.pdf by Tank Storage Magazine

The voice of the storage terminal industry

AUGUST/SEPTEMBER 2016 Volume 12 Issue No.4

OILTANKING RETURNS TO INDONESIA

Oiltanking Karimun has been designed to serve the growing demand for petroleum products in Asia

WORTH THE INVESTMENT RISK The oil storage business continues to attract infrastructure investment

INCLUDES CHEMICAL STORAGE SUPPLEMENT

REGIONAL FOCUS: ASIA

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AUGUST/SEPTEMBER VOLUME 12 ISSUE NO.4

CONTENTS

Contents News TERMINAL NEWS 09

Europe

12 The Americas 15 Asia 17 Africa & Middle East 18 Incident report

Storage in Asia

Tank terminal update: Asia

Oiltanking returns to Indonesia

Storage equilibrium in Singapore

Logistical expertise to satisfy Asiaâ&#x20AC;&#x2122;s demand

Asia: The global energy driver

Market analysis

AUGUST/SEPTEMBER 2016 VOLUME 12 ISSUE NO.4

The rise of petroleum storage in Asia

Future proofing tank storage operations

Tank storage â&#x20AC;&#x201C; worth the investment risk

CONTENTS

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AUGUST/SEPTEMBER VOLUME 12 ISSUE NO.4

CONTENTS

Contents

53 Speaker interviews 76

Technical features 41

Technical news

Robotics and induction herald greener tank refurbishment

Navigating the spectrum of internal floating roofs

Investing in safe access and loading arms practice

Lowering storage tank emissions

All in one armour for secondary containment

LNG: The energy of tomorrow

Instilling industry-wide NDT best practice

Why jack a tank?

The importance of checking for corrosion under insulation

AUGUST/SEPTEMBER 2016 VOLUME 12 ISSUE NO.4

Insights from a selection of Tank Storage Asia’s industry experts

Events

84 Exploring the energy silk road A preview of some of the exhibitor’s at this year’s Tank Storage Asia in Singapore 97

Mixing business with networking

A meeting of minds on the Mediterranean

100 Upcoming events 101 Advertisers’ index

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AUGUST/SEPTEMBER VOLUME 12 ISSUE NO.4

CONTRIBUTORS

Contributors AUGUST/SEPTEMBER 2016 Volume 12 Issue No.4

The voice of the storage terminal industry

AUGUST/SEPTEMBER 2016 Volume 12 Issue No.4

OILTANKING RETURNS TO INDONESIA

Oiltanking Karimun has been designed to serve the growing demand for petroleum products in Asia

WORTH THE INVESTMENT RISK The oil storage business continues to attract infrastructure investment

INCLUDES CHEMICAL STORAGE SUPPLEMENT

REGIONAL FOCUS: ASIA

Front cover courtesy of Loadtec Engineered Systems Ltd.

PUBLISHER Margaret Dunn t: +44 (0)20 3551 5721 e: margaret@tankstoragemag.com

ONLINE & CONTENT EDITOR Jasmin McDermott t: +44 (0)20 8843 8159 e: jasmin@tankstoragemag.com

INTERNATIONAL SALES MANAGER David Kelly t: +44 (0)20 8843 8161 e: david@tankstoragemag.com

PORTFOLIO MARKETING MANAGER Amy Jordan t: +44 (0)20 8843 8837 e: amy@tankstoragemag.com

DATABASE MANAGER Jourdan Roze t: +44 (0)20 8843 8828 e: jourdan.roze@easyfairs.com

SUBSCRIPTION MANAGER Alison Church t: +44 (0)20 8843 8800 e: alison.church@easyfairs.com

MANAGING DIRECTOR Matt Benyon t: +44 (0)20 8843 8813 e: matt.benyon@easyfairs.com

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ISSN 1750-841X

@tankstorageinfo Tank Storage Magazine Tank Storage Magazine

Tank Storage Magazine (ISSN 1750-841X) is published six times a year (in February, March, May, August, October and November) by Easyfairs UK Ltd, 2nd Floor, Regal House, 70 London Road, Twickenham, TW1 3QS, UK. The 2016 US Institutional subscription price is $240. Airfreight and mailing in the USA by Agent named Air Business, C/O Worldnet Shipping USA Inc., 155-11 146th Street, Jamaica, New York NY11434. Periodical postage pending at Jamaica NY 11431. Subscription records are maintained at Easyfairs UK Ltd, 2nd Floor, Regal House, 70 London Road, Twickenham, TW1 3QS, UK. Air Business Ltd is acting as our mailing agent.

AUGUST/SEPTEMBER 2016 VOLUME 12 ISSUE NO.4

Part of

COMMENT

Worth the risk

he summer months are usually quiet all round from a news perspective as people enjoy their holidays. This year however, the UK’s decision to withdraw from the European Union has thrown the country into uncertainty and left many questioning what the future may hold from a political, economical and social perspective. Nothing is certain at the moment and as we go to print, Article 50 of the Lisbon Treaty has yet to be triggered. It will takes many months, even years, for the country to develop and formalise new economic, political and trade policies. We will be keeping a very close eye as these developments emerge and what their impact could be on the tank storage industry. But, despite these tumultuous times for the EU, the tank storage industry is built on long-term outlooks rather than short-term fluctuations. Over the years oil markets shift from backwardation to contango and the price of oil is also easily changeable. But tank storage is not just about oil. It encompasses chemicals, gases as well as fertilisers and pharmaceuticals. It is this ‘flexibilty’ that makes them an attractive investment for infrastructure funds, who have been making bigger gains in the market and the internal rate of returns for investors of liquid storage is impressive for those willing to take the risk. In this issue, Rahul Saikia, investment banker at Pricewaterhousecopper, provides a compelling overview about what it is

about tank storage that is so appealing to investors. This issue also focuses on the dynamic Asia market which, with its growing population and market growth that demands more energy, will remain a key storage and logistical hub for years to come. Oiltanking has returned to Indonesia with a facility to serve the growing demand for petroleum products. We speak to Sjoerd Boer, VP of Oiltanking Asia about how Oiltanking Karimun will operate in this increasingly competitive environment. We also speak to VTTI about its ATT Tanjung Bin facility, which underwent an expansion in August 2015, about how it is positioned to absorb the growing demand for fuel oil in the region and also catch up with Stolthaven Singapore, who is enjoying a supply chain equilibrium on Jurong Island. You will find this magazine at nearly every tank storage event globally this September. In addition to being the official publication at Tank Storage Asia in Singapore, this issue can also be found at European Bulk Liquid Storage in Tarragona, Spain, NISTM in Texas, Tank Storage Association in Coventry, UK, EPCA in Hungary and Global LNG Tech Summit in Barcelona, Spain! The team will be at Tank Storage Asia and NISTM so it will be good to catch up with you at one of these events. We hope you enjoy the read.

With best wishes, Jasmin

P.S Take a look at page 28 and 29 to read about the all new Tank Storage Awards, launching at StocExpo Europe 2017!

AUGUST/SEPTEMBER VOLUME 12 ISSUE NO.4

COMMENT

Calibration

Data Collection STARS View

AUGUST/SEPTEMBER 2016 VOLUME 12 ISSUE NO.4

Data Analysis

Reporting and Archive

TERMINAL NEWS l CONTENTS

Terminal news All the latest terminal storage news from around the globe

09 BP to sell UK storage terminals

13 LOOP commissions extra crude storage capacity

15 Vopak divests Japanese terminals

Europe

asia

09 Dunkerque LNG facility starts up

15 Prostar buys stake in Chinaâ&#x20AC;&#x2122;s third largest storage terminal

Thames Oilport expands diesel tank storage

BP to sell UK storage terminals

Vopak divests Japanese terminals

16 Benalec given green light for extra land for petroleum storage hub 10 Storage terminal developments help boost Russian oil output

India continues to increase strategic petroleum reserve

Private investment in Chinaâ&#x20AC;&#x2122;s strategic oil reserves welcomed

China plans to grow strategic petroleum reserve storage

Varo Energy to acquire ENVIEM fuel terminal

THE AMERICAS 12 Pin Oak executes contract for 2 million barrel tank storage capacity

Magellan and LBC to expand crude oil storage

13 Strong product throughput boosts NuStar

LOOP commissions extra crude storage capacity

US Gulf Coast petrochemical complex considered

Africa & middle east 17 New downstream company will be second largest in Nigeria

Saudi Aramco and SABIC launch study for crude oil and chemicals complex

For the latest tank storage news visit www.tankstoragemag.com 08

AUGUST/SEPTEMBER 2016 VOLUME 12 ISSUE NO.4

TERMINAL NEWS l EUROPE

Dunkerque LNG facility starts up The first LNG tanker at Dunkerque LNG’s terminal jetty marks the start of the facility’s operations. The Madrid Spirit delivered 130,000 m3 of LNG originating from a liquefaction plant in Boony, Nigeria. Following four-and-a-half years of construction, the last few months involved several test runs of the installation without gas including stress conditions tests, commissioning of utilities and partially cooling with nitrogen down to -110˚C. The tanker was moored and connected to the discharging arm before the facility is gradually cooled to -163˚C. The LNG will then pass through pipes to reach reservoir 3 and then all of the terminal’s storage installations. Once cooled, the terminal storage installations will send the gas out to the GRTgaz transmission network, at a low rate initially to test each of the terminal’s units. The terminal will be tested under normal usage conditions during the summer. At the end of September it is expected that it will be ready to enter into commercial operations and be made available for EDF and Total.

Thames Oilport expands diesel tank storage The amount of diesel tank storage at Thames Oilport will be expanded in early 2017. The company announced that it will be bringing a further 56,000 m3 of capacity online in the first quarter of 2017 in addition to the 175,000 m3 which came on stream in April 2016 and the 64,000 m3 which was commissioned earlier in August. Thames Oilport, the site of shuttered Coryton refinery, is being developed in phases, beginning with diesel storage and then moving onto storage and road loading for other product.

BP to sell UK storage terminals

100 95

BP plans to sell part of its stake in several UK storage terminals and a pipeline system that supplies fuel to some major airports.

According to The Daily Telegraph the oil major also plans to outsource its UK fuel transport operation to Hoyer as part of a strategy to reduce costs on the back of lower oil prices. The company is seeking buyers for its fuel storage terminals in Belfast, Hamble and Northampton as well as its part ownership in the Kingsbury terminal, a joint venture with Shell. The United Kingdom Oil Pipeline connects Shell’s former Shell Haven and Stanlow refiners and supplies more than half of the fuel needs to Gatwick and Heathrow.

AUGUST/SEPTEMBER 2016 VOLUME 12 ISSUE NO.4

25 5 0

Tank Storage Quarter Page AugSept 22 July 2016 10:43:41

TERMINAL NEWS l EUROPE

Storage terminal developments help boost Russian oil output A series of oil and gas upstream and midstream projects promise to sustain Russia’s record-breaking crude oil output.

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In May, the Arctic Gate marine oil terminal was commissioned and provides access for Russia’s Arctic-sourced crude to both European and Asian markets. Anna Belova, senior analyst covering oil and gas at GlobalData says that the opening of the facility was timed to coincide with the commencement of commercial oil production at the Novoportovskoye field. Novoportovskoye is one of five major planned oil fields scheduled to come online by the end of 2016 in Russia, and at their peak, they will bring more than 500,000 barrels per day of crude. Belova says: ‘The five planned projects going into commercial production in Russia this year illustrate intensified capital investment, and the large numbers of pre-drilled wells at each project will allow several of the fields to realise peak production as early as 2017. ‘As is the case with most planned projects in Russia, the investments involved not only drilling campaigns and processing facilities, but also significant midstream components connect crude in the Caspian Sea, Arctic North and East Siberia with domestic and international consumers.’ Construction on pipelines and export infrastructure for the five planned projects saw rapid progress in the first half of 2016. ‘Commercialisation of these projects serves as evidence of the growth approach taken by Russian operators, rather than the freeze advocated by other crude producers,’ adds Belova.

Varo Energy to acquire ENVIEM fuel terminal Varo Energy is set to acquire a 66,000 m3 fuel terminal in Amsterdam from ENVIEM. The conditions of the agreement between the two companies sets out that ENVIEM will continue to own and operate the waste management terminal in the port of Amsterdam while Varo will acquire the fuel terminal located alongside. Additionally, Varo will extend its supply to the full Gulf and TinQ retail network, which is operated by ENVIEM in Belgium and the Netherlands. The acquisition will further strengthen Varo’s position as an integrated logistics service provider to the downstream business across northwest Europe. The company says it is a ‘valuable addition to further improve the services Varo Energy offers to customer in the Dutch market’. The Amsterdam terminal has been operational since 2012 and offers loading, unloading and blending of different fuel grades for vessels, barges and trucks. The transaction closed on August 1.

10 anzeige_halbe_Seite_tsm.indd 1

AUGUST/SEPTEMBER 2016 VOLUME 12 ISSUE NO.4

22.01.2016 10:46:54

TERMINAL NEWS l THE AMERICAS

0151 355 2685 www.fenelontanks.com info@fenelontanks.com

Fenelon Storage Tanks offer customers a unique one-stop shop service for all new build tank projects and repair/refurbishment requirements. Expertise from our in-house Design Department and fully equipped workshop/fabrication facilities provide support for our on-site construction teams.

• Technical advice and support for clients. • Finite Element Analysis reports using the latest Solidworks 3D modelling simulation software. • Calculations and drawings for all types of storage tanks. • All designs carried out to the latest British, European or API tank codes. • Certified EEMUA and API 653 Storage Tank Inspectors. • Professional Project Management/HSQA Department. • Fully qualified & employed Site Management, experienced Tank Erectors and Welders. • Employed Appointed Persons for the planning and supervision of crane lifting operations.

AUGUST/SEPTEMBER 2016 VOLUME 12 ISSUE NO.4

TERMINAL NEWS l THE AMERICAS

Pin Oak executes contract for 2 million barrel tank storage capacity Pin Oak Holdings has embarked on an engineering, procurement and construction contract to build more than two million barrels of tank storage capacity. Pin Oak is constructing tanks to meet its customer contracts which initially include petroleum, gasoline blendstock, ethanol, VGO and fuel oil. The terminal will be able to add additional product types a new contracts are executed. Pin Oak is capable of handling more than 10 million barrels of product. Mike Reed, CEO of Pin Oak, says: ‘Our tank designs will offer many service options to our customers and ensures that Pin Oak will maintain a strong competitive advantage over its competitors.’

Magellan and LBC to expand crude oil storage LBC Tank Terminals and Magellan Midstream Partners plan to expand storage and pipeline infrastructure in the Houston Gulf Coast area. Both companies have entered into a letter of intent for Seabrook Logistics to expand its crude oil and condensate storage, marine capacity and pipeline infrastructure. Seabrook Logistics plans to construct up to four million barrels, or 636,000 m3, of additional storage for a total of nearly 795,000 m3 adjacent to LBC’s existing terminal in Seabrook, Texas. Additionally, plans are in place to connect this storage to Magellan’s Houston crude oil distribution system

with 24-inch diameter pipelines. A one ship dock in addition to the recently constructed ship dock and two barge docks is also planned. Both ship docks will be able to handle Aframax vessels. Some of the additional storage and pipeline assets could be operational by the end of 2017. Work is already underway to construct more than 111,000 m3 of new crude oil storage and a new 18-inch diameter pipeline at Seabrook Logistics.

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TERMINAL NEWS l THE AMERICAS

Strong product throughput boosts NuStar

US Gulf Coast petrochemical complex considered

Strong refined product pipeline throughput volumes along with lower operating expenses contributed to better than expected results for NuStar.

Sabic and Exxon Mobil are examining the potential of a jointly owned petrochemical complex on the US Gulf Coast.

The company’s second quarter 2016 results surpassed its guidance expectations. The company reported that its EBITDA from continuing operations were $144.7 million. Brad Barron, president and CEO, says: ‘Strong refined product pipeline throughput volumes, the benefit from 1.1 million barrels of storage leased at our Pine Point, Maryland facility, along with lower than expected operating expenses, contributed to our better than expected second quarter results. ‘What’s more significant is that we were able to report these solid results despite throughput revenues only slightly above contract minimums on our South Texas crude oil pipeline system.’

The project would either be in Texas or Louisiana near to natural gas feedstock supply and if developed it would include a world-scale steam cracker and derivative units. Both companies are embarking on feasibility studies before making a final investment decision and say they will work with state and local officials to determine a suitable site that has adequate infrastructure access. Neil Chapman, president of ExxonMobil Chemical Company says: ‘We have the capability to design a project with a unique set of attributes that would make it competitive globally. That is vitally important as most of the chemical demand growth in the next several decades is anticipated to come from developing economies.’

LOOP commissions extra crude storage capacity LOOP has commissioned three new above ground crude oil tanks at its Clovelly Hub in Louisiana. Each tank can accommodate more than 355,000 barrels of crude oil and they include electronic level controls, fire detection equipment, advanced security surveillance and around the clock operational monitoring. The tanks were brought into service almost three months ahead of schedule to meet market demands. The entire project, which started in April 2017, is slated to be complete by April 2017, and will comprise seven new tanks totalling 2.5 million barrels of capacity. The deepwater port complex was initially developed to facilitate the imports of crude oil to the US, but it has since grown to be an essential landing point for domestically produced energy.

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AUGUST/SEPTEMBER 2016 VOLUME 12 ISSUE NO.4

TERMINAL NEWS l THE AMERICAS

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AUGUST/SEPTEMBER 2016 VOLUME 12 ISSUE NO.4

TERMINAL NEWS l ASIA

Prostar buys stake in China’s third largest storage terminal Prostar Capital has acquired a 40% interest in China’s third largest independent oil storage terminal for more than $100 million (€88.7 million). The terminal on Zhoushan Island in Zhejiang Province is owned by Tyloo Oil and Gas International Holdings Corporation. The facility has nearly three million m3 of crude oil and refined product storage and is located in one of the largest oil refining and petrochemical regions of China. It has direct access via pipeline to approximately 20% of China’s refining capacity. Since it was commissioned in 2013, the terminal has had customers including Chinese State Owned Enterprises and major global oil traders and has been operating close to 100% capacity utilisation. Prostar’s managing partner Steve Bickerton says that with this acquisition, the company has total capacity in the Asia-Pacific region of more than four million m3. He adds: ‘The strategic location of this terminal in an industrial heartland along with China’s growing domestic energy needs means there will be continuing and rising demand for storage from a range of major domestic and international customers. In addition, there is expansion potential on spare land next to the terminal.’ The investment is being made via a subsidiary of Global Terminal Investment’s, which is Prostar’s storage terminal investment company. Yu Min, chairman of Tyloo, says: ‘I am very pleased to welcome Prostar who we see as a long-term strategic partner bringing significant international best-practice operating, marketing and financing expertise in midstream energy infrastructure generally, and also specifically in the storage terminal sector.’

Vopak divests Japanese terminals

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Vopak’s 40% ownership in Nippon Vopak, which owns five Japanese terminals, has been divested to Macquarie Asia Infrastructure Fund. Nippon Vopak operates the five terminals with a combined operations capacity of 203,200 m3. The divestment follows Vopak’s business review in July 2014, upon which it was agreed that the company would divest 15 of its smaller terminals. Macquarie Asia Infrastructure Fund is Macquarie’s first Asia-wide infrastructure funds – set up to meet the demand for roads, energy plants and water treatment facilities. The fund has been used on projects including a petroleum storage terminal in Singapore as well as a combined heat and power station in South Korea. The agreed net cash proceeds amount to €26 million. Vopak says in a statement that it will use the proceeds to ‘further strengthen Vopak’s flexibility to execute its selective capital disciplined growth strategy and to support its consistent dividend policy, while maintaining a robust financial position’.

AUGUST/SEPTEMBER 2016 VOLUME 12 ISSUE NO.4

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TERMINAL NEWS l ASIA

Benalec given green light for extra land for petroleum storage hub Benalec Holdings has been granted permission to reclaim more than 2,000 acres of land, allowing for the construction of all three phases of the Tanjung Piai Integrated Petroleum and Petrochemical hub. The hub and maritime industrial park also comprises oil storage terminals and related marine facilities, which will be capable of accommodating vessels up to 350,000 DWT. The hub and park will have access to the Straits of Malacca and will be able to handle VLCCs, ULCCs and Vale Max Bulk Carriers. According to local media reports, Datuk Vincent Leaw Seng Hai, group managing director and CEO, says that the company has experienced a positive response from the market in terms of investment demand due to the land’s ‘unique selling point’.

India continues to increase strategic petroleum reserve

Private investment in China’s strategic oil reserves welcomed China’s National Energy Administration says it welcomes private investment in the construction of strategic oil reserve storage facilities. A set of draft rules on the NEA’s website outline the fact that the Chinese government will determine the size of strategic oil reserves based on actual oil consumption and that approval to use the reserves must come from the state council. According to a survey by Reuters, China is expected to add 70-90 million barrels to its strategic crude oil purchases in 2016. By mid-2015 China had stockpiled about 190.5 million barrels under the SPR programme, which equates to around one month of crude oil imports. The goal is to stockpile reserves worth 90 days of net imports. The reserves include crude oil and oil products including petroleum, diesel and jet fuel.

India is seeking to grow its strategic petroleum reserve on the back of the low oil price, which has accelerated the construction and filling of the reserves. The first phase of its SPR includes three facilities in southern India with a combined capacity of 39.1 million barrels of crude oil. The Visakhapatnam facility began filling last summer while the Mangalore and Padur facilities are due to be completed in last 2016. All three will provide an estimate of 13 days of net oil import coverage. According to the EIA, India’s government has unveiled plans to add another 91 million barrels of SPR capacity in a second phase by 2020. It is looking to finance the second phase of its SPR partially through commercial agreements with foreign oil producers who can lease the storage. It is currently negotiating with the UAE’s ADNOC to lease 5.5 million barrels of the Mangalore facility. Kuwait Petroleum Corporation, Saudi Aramco and Shell have also expressed interest in India’s storage facilities. Demand for crude and petroleum products is expected to continue to grow, which increases the country’s oil import dependent. In addition to growing consumption, filling the remainder of the country’s first phase of its SPR will further increase demand. It still relies on Middle Eastern countries for more of its crude oil imports.

China plans to grow strategic petroleum reserve storage Plans are in place to build 70 million m3 of storage for China’s strategic petroleum reserve. Reuters reports that a state-run newspaper has said that the storage project will take place in three construction phases with a total capacity of 441 million barrels, equivalent to 60 days of China current imports. The China Securities Journal reports that the government plans to build 44.6 million m3 of strategic petroleum reserve storage by 2020 according to a draft government plan. Storage that is being built over the next four years would equal 38 days of China’s current oil imports and adds to the country’s existing reserves in seven aboveground facilities and one underground facility. The country, which is the world’s second largest oil consumer, plans to build strategic reserves worth 90 days of net imports.

AUGUST/SEPTEMBER 2016 VOLUME 12 ISSUE NO.4

TERMINAL NEWS l AFRICA & MIDDLE EAST

New downstream company will be second largest in Nigeria A new Nigerian downstream company with 84,000 tonnes of storage could create one of Africa’s largest downstream operations.

Saudi Aramco and SABIC launch study for crude oil and chemicals complex

OVH Energy has been created to hold interests in Oando Marketing Limited, Oando Supply and Trading Limited, Apapa SPM Limited and Oando Trippmark Limited. Oando will have a 49% stake in the company while Vitol, Helio Investment Partners and HV Investments will own 49%. The residual 2% will be owned by a local entity. OVH’s assets include more than 350 service stations in Nigeria with supporting infrastructure including 84,000 tonnes of storage and a newly built inbound logistics jetty as well as LPG filling and distribution, lubricants. It will be the second largest downstream fuels company in Nigeria with a market share of 12%. Oando Group chief executive Wale Tinubu says: ‘Despite global economic headwinds, we have taken the proactive approach to establish a strategic partnership which will leverage Oando’s sector dominance, considerable local knowledge and expertise; together with HVI’s international, and technical capabilities. This partnership will reinvigorate Nigeria’s downstream sector and create one of Africa’s largest downstream operations. We are extremely confident in the success and potential returns this alliance will deliver.’

The crude oil-to-chemicals process will involve innovative configurations with proven conversion technologies to create a fully integrated petrochemical complex to maximise chemical yield, recycles by-products and diversifies the petrochemical feedstock mix in Saudi Arabia. If the joint study reaches a positive conclusion, the agreement document contains key principles of cooperation that will form the basis for the companies to establish a joint venture. Saudi Aramco president and CEO Amin Nasser says: ‘This agreement reflects our vision to build on Saudi Arabia’s global leadership in crude oil production and commodities export by substantially increasing the production of oil-base petrochemicals.’

A feasibility study on the development of a crude oil-to-chemicals complex in Saudi Arabia has been agreed between Saudi Aramco and Saudi Arabian Basic Industries Corporation.

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AUGUST/SEPTEMBER 2016 VOLUME 12 ISSUE NO.4

TERMINAL NEWS l INCIDENT REPORT

Incident report A summary of the recent explosions, fires and leaks in the tank storage industry 14/6/2016

19/7/2016

Hess Corporation

Caldic Chemie

Mountrail County, North Dakota, US

Europoort, Port of Rotterdam, the Netherlands

A failed transfer pump at a tank battery resulted in the leak of 32,000 gallons of oil from a storage facility owned by Hess Corporation. According to the North Dakota Department of Mineral Resources, the tanks overflowed after the pump failed. A state inspector monitored remediation efforts at the site.

A methanol storage tank exploded at Caldic Chemieâ&#x20AC;&#x2122;s facility in Europoort. The incident occurred as methanol was being unloaded from a ship to the storage tank. The tank was foamed and its surrounding tanks cooled in accordance with security procedures. It took less than an hour for the incident to be brought under control. An investigation was launched.

12/8/16 11/7/2016

Greater Chaco Canyon, New Mexico, US WPX Energy

More than 30 oil storage tanks ignited following a large explosion at a fracking site in New Mexico. The site contained six new oil wells and 30 temporary oil storage tanks. All 36 tanks ignited and burned for several days. The company said blaze was allowed to burn itself out due to the intensity of the heat, the number of oil tanks involved and to contain petroleum fluids on the site.

Nederland, Texas Sunoco Logistics

Seven workers were injured following a fire at a construction project at Sunoco Logistics crude oil terminal. Jeffrey Shields, company spokesman, said four of the seven employees of a contractor were critically injured in the flash fire involving a crude oil pipeline connection. The four were taken to burn centres in Houston, Galveston and Beaumont while the other three were treated for minor injuries and released. The US Occupational Safety and Health Administration launched an investigation into the fire.

24/6/2016

Barranca district, Maranon, Peru Petroperu

A rupture in the Nor Peruano pipeline spilled oil into the Amazon river. The company said that it worked quickly to fix the rupture and undertake cleanup efforts to prevent the spilled oil from being absorbed into the ground. The company did not say how much oil had spilled into the river, however previous spills have exacerbated tensions between local residents and Petroperu.

AUGUST/SEPTEMBER 2016 VOLUME 12 ISSUE NO.4

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AUGUST/SEPTEMBER 2016 VOLUME 12 ISSUE NO.4

TANK TERMINAL UPDATE l ASIA

Tank terminal update: Asia ATT Tanjung Bin Location:

Products: Capacity:

Prostar Capital Johor, Malaysia Fuel oil 1.15 million m3

Construction/ expansion/ acquisition:

262,000 m3 storage capacity has been added to the VTTI facility in addition to a new jetty

Comment

The facility originally opened in 2012 with an initial capacity of 893,000 m3

Oiltanking Singapore, Jurong Port Location:

Products: Capacity:

Clean petroleum products, chemicals 430,000 m3 The new terminal will have an initial capacity of 200,000 m3 with the potential to add another 230,000 m3

Comment:

It will be supported by jetties with a draft of 16 meters and will support the storage needs for Asia’s petrochemical industry hub

TonenGeneral Sekiyu K.K, Qube Holdings Products:

Investment:

Construction/ expansion/ acquisition:

Comment:

Investment: $100 million (€88.7 million) Prostar has acquired a 40% interest in China’s third largest independent oil storage terminal The terminal is owned by Tyloo Oil and Gas International Holdings Corporation and has pipeline access to 20% of China’s refining capacity

Oiltanking Karimun Location:

Products: Capacity:

Karimun, Indonesia Clean petroleum products, fuel oil 730,000 m3

Construction/ expansion/ acquisition:

The joint venture between Oiltanking and Gunvor Group will serve the growing demand for petroleum products

Comment

The terminal has four deep-water berths, including VLCC capacity

AUD150 million (€98.7 million)

Location:

The new storage facility will have a potential capacity of 230,000 kilolitres and a fuel marketing and distribution business will be created

The project will enhance TonenGneral’s petroleum products supply chain in Australia together with Qube

Pilipinas Shell Petroleum Cagayan de Oro City, Philippines Diesel, jet fuel 170,000 m3

Construction/ expansion/ acquisition:

Construction/expansion/acquisition: The new terminal can accommodate petroleum imports and work started on the facility in 2013

Comment:

It is hoped that the new facility will help reduce maritime risks and will boost activity at the port

Construction/ expansion/ acquisition:

Almost three million m3

Macquarie Asia Infrastructure Fund

Comment:

Capacity:

Investment:

Crude oil, refined products

Fuel products

Mid to late 2017

Products:

Capacity:

Zhoushan Island, Zhejiang Province, China

Port Kembla, New South Wales, Australia

Completion:

Location:

Products:

Jurong Port, Singapore

Construction/ expansion/ acquisition:

Location:

Capacity:

Investment:

Japan 203,200 m3 Net cash proceeds amount to €26 million

Construction/ expansion/ acquisition:

Macquarie has acquired Vopka’s 40% ownership in Nippon Vopak, which owns five storage terminals

Comment

The divestment follows Vopak’s business review in 2014 where the company agreed to divest 15 of its smaller terminals

Benalec Holdings Location:

Products:

Johor, Malaysia Petroleum, petrochemicals

Construction/ expansion/ acquisition:

The company has been granted permission to reclaim more than 2,000 acres of land for the construction of all three phases of the Tanjung Piai Integrated Petroleum and Petrochemical hub

Comment

The hub will comprise oil storage terminals and related marine facilities

AUGUST/SEPTEMBER 2016 VOLUME 12 ISSUE NO.4

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2016

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MARKET ANALYSIS l ASIAN STORAGE MARKET

I • • • •

THE RISE OF PETROLEUM STORAGE IN ASIA

n the last few years Asian oil markets have experienced significant changes (both from global and local factors). Firstly, we are seeing additional demand drivers as follows: Increasing production and use of biofuels New lower sulphur grades of petroleum products Closure of Australian oil refineries and their increasing reliance on imports Concerns around security of supply, especially from Middle East supply.

These security of supply concerns have manifest themselves as: • A large increase of oil storage in Fujairah • Middle Eastern national oil companies looking at storage opportunities in or near the storage and trading hubs in the Far East • A dramatic increase in strategic storage. STRATEGIC STORAGE Most Asian countries do not have the 90 day strategic petroleum reserves (SPR) mandated by IEA for their member countries, which is also used as a guideline by other, non-member countries With the help of low crude oil prices, both China and India have increased their SPR significantly since 2015. China has been building its SPR since 2007 and is targeting a 90 days reserve by 2020, which equates to somewhere between 475 and 550 million barrels. Its reserve building has slowed down recently as it is now mainly underground cavern storage. In 2015, China reportedly put 160 new 100,000 m3 tanks into operation in seven months. China has recently announced it will allow private companies to build and operate its SPR, presumably so the country can still meet its 2020 target. India started its SPR in 2015, with a first phase of just over 39 million barrels. This is targeted for completion by the end of 2016 and it will provide India with an estimated 12-14 days of net oil imports. The second phase of over 90 million barrels is already planned to be completed by 2020 with more expected to follow. SUPPLY In the late nineties there were only a handful of interested parties in tank storage. Since then we have seen additional interest for investment by such diverse groups as: Ship owners’ whose interest is the synergies with their vessels and

as such, they are mostly interested in the main ports. It is also a much more reliable source of income than the freight market. Traders use storage to improve the performance of their logistics chains and to give them an edge on their competitors for physical trading. National oil companies’ interests are to bring their product closer to the consumer and to help them lock in longer term supply contracts by increasing their customer’s security of supply. Financial institutions, especially the pension funds, find the storage industry’s stable and predictable returns attractive. This first came to their attention during the 2008/9 economic downturn. They usually invest in an operating terminal rather than in ‘greenfield’ projects. Engineering companies usually only take minority interest in new build tank storage, either to help kick start a project, or to assist them getting the engineering, procurement and construction contracts. It also shows project commitment to the majority stakeholders. At the same time, large integrated multinational oil companies have recently been selling their storage assets and returning to their core business, which brings new opportunities to the market. INCREASING VALUE The influx of new players and new money has increased the value of storage assets. Tank storage companies have seen their assets double in value in the last 10-15 years from an average of six times EBITDA to over 12 times. It seems to be the increased interest from the financial institutions that has driven the rise, due to their differing and generally shorter term view on their investments. The construction of new storage terminals and expansions continues in Asia, albeit at a slightly slower pace. Fujairah is still expanding and the Singapore straits is still a ‘hotspot’ for new terminals and expansions, as evidenced by Oiltanking’s new terminal in Karimun as well as recent expansions at Vopak Pengerang, VTTI at Tanjung Bin and at Tankstore Singapore. With analysts saying that the Singapore straits area is expected to remain the trading hub for the Far East, at least two new terminal storage projects are currently being proposed for the area: • Benalec Holdings’ project at Tanjung Piai in Johor for a 600,000 m3 plus facility in the first phase for crude and petroleum products in their own maritime park. • Jurong Port in Singapore for 200,000 m3 of capacity in the first phase for petroleum and petrochemicals

AUGUST/SEPTEMBER 2016 VOLUME 12 ISSUE NO.4

MARKET ANALYSIS l ASIAN STORAGE MARKET

THE CURRENT MARKET The fuel oil market has historically been a strong one in Asia, and Singapore is still used as a sinkhole for excess fuel oil worldwide. Recently, at least 1.5 million tons of Venezuelan fuel oil was reported to have arrived in Singapore between June and July. However, in addition to uncertain economies and fluctuating demand and supply, Asian traders also have to deal with unpredictable China. THE CHINESE INDEPENDENT REFINERIES Fuel oil demand in Asia was severely reduced nearly overnight in mid2015 when deregulation of the market in China allowed a number of independent oil refineries to get import licenses for crude oil. Previously they were mainly operating on imported fuel oil These independents account for around one third of the national refining capacity. The utilisation rates of these refineries was around 25-30% on fuel oil, but are now reported to be running closer to 50% and growing. The effect has been exacerbated as many of the independents have been upgraded and expanded and are enjoying local government support. They are no longer the small ‘teapot refineries’ that they were nicknamed in the past. This has also affected the diesel oil market as the independents predominantly produce petroleum and diesel oil and the demand for diesel in China is significantly less than petroleum. China’s exports of diesel oil have increased significantly from around 150,000 barrels a day in 2015 to an expected 250,000 barrels a day in 2016 on to an already oversupplied and generally weak market. THE BUNKER MARKET A change in the sulphur content for bunker oil that the IMO is reviewing for implementation by either 2020 or 2025 has the potential to significantly affect the bunker fuel market. The low sulphur fuel oil (LSFO) that complies with the low sulphur

specification has been available on the Singapore market since the middle of 2015. However, the Maritime Port Authority (MPA) bunkering statistics show that very little is being sold and that ship owners are buying the cheaper LSGO. If IMO decides to implement the cap by 2020, the bunker fuel market will change to a cleaner product and regional imbalances or changing bunker patterns are possible. While diesel demand and fuel oil is unlikely to decrease significantly in the Singapore straits given its distribution and bunkering role, the petroleum and jet fuel market in Southeast Asia are likely to be the main drivers for additional storage demand in the future. THE FUTURE MARKET In 2015, world oil production grew by 2.8 million b/d, led by increases in the Middle East (+1.5 million b/d) and North America (+0.9 million b/d). In the same year, world oil consumption increased by 1.9 million b/d. The Asia Pacific region accounted for nearly three quarters of that growth, according to BP’s world energy statistical review. The oil world is becoming more disconnected and with OPEC no longer having the ability to direct the pricing it is also less controlled. These factors are bringing fundamental changes to the world oil markets. There is likely to be changes in product use for energy production in the future. However, clean petroleum products will remain the practical fuel of choice for transportation for the foreseeable future anyway. We can therefore expect petroleum to continue to flow, but it is likely to be in differing product volumes and in some cases from different directions. However everything points to storage demand remaining firm in Asia. FOR MORE INFORMATION This article was written by Mike Beviss, director special projects at Eastport Maritime. mb@eastportmar.com, +65 81810209

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AUGUST/SEPTEMBER 2016 VOLUME 12 ISSUE NO.4

MARKET ANALYSIS l API STANDARDS

FUTURE PROOFING TANK STORAGE OPERATIONS T

he US is in the midst of an energy renaissance. Advances in hydraulic fracturing technology have enabled the US to add more than 4.5 million barrels per day of production, bringing total production up to more than nine million barrels per day. This, coupled with global production, has created an abundance of supply and resulted in an increased need for storage. In response, companies are looking to increase their storage efficiency, and one way to do this is to raise the maximum oil levels in tanks. To appropriately manage the risks with these operations, API standards and best industry practices have been developed to assist tank owners and operators. BEST PRACTICE MEASURES One active measure which can improve tank capacity is to use floating roofs that take up less depth and hence create unusable volume in the tank. For example, some operators suspend lightweight aluminum floating roofs with cables to maximise useable bottom inventory. Another method is to design the bottom for a ‘drain dry’ operation where there is no heel. However, in this latter method, air regulations often dictate that some quantity of oil must remain in the bottom when floating roof tanks are used. All of these methodologies and more are addressed in existing American Petroleum Institute (API) standards. These standards are recognised throughout the world for their high quality and success in designing, building, constructing, repairing, operating, and inspecting petroleum storage facilities in operations ranging from upstream to downstream facilities. Additionally, the process itself, by which these standards are created, have an added layer of rigor and credibility as it is accredited by the American National Standards Institute (ANSI). This ensures that the RPS are developed with openness, balance, due process, and consensus. UNIVERSAL TANK STANDARDS Most oil companies throughout the world rely on API standards for tank storage facilities. For

building new tanks, API RP 650 is by far the most commonly used tank standard for storing crude oil, fuels, petrochemicals and other products everywhere in the world. Applying API RP 650 to oil tanks ensures the owners that unexpected quality, materials, construction and design problems do not creep into their operations. There are many design, manufacturing, and quality assurance considerations that are packed into the more than 500 pages of the API RP 650 standard; tank owners know that the best insurance policy is to use this standard to evaluate their tanks. Another widely used API storage tank standard is API RP 653 which gives owners and operators the ability to maintain the integrity of their storage tanks according to current industry best practices. API RP 2610 provides a laundry list of standards related to tank facility design, construction, inspection and operations that guide tank owners on best practices for storage facilities. Note that API RP 2610 is currently being revised and will be issued as the 3rd edition most likely within a year. One important standard that is critical in assisting operators in preventing overfills is API RP 2350. The industry is actively getting up to speed with the latest (4th) edition of this standard which incorporates risk, safety systems, and a host of other ideas to help tank owners reduce problems. The document, in its entirety, is designed to be a comprehensive roadmap of actions, that when properly followed, can significantly reduce the chances of an overfill. FUTURE PROOFING THE INDUSTRY As industry looks to the future, there is great concern that the inevitable loss of talent could threaten efficient and safe operations. The use of contractors can additionally present challenges as companies often depend on these hired services to supply skilled and knowledgeable help. Market demand can further exacerbate both of these issues by creating more growth and capacity that subsequently draws down on the supply of a knowledgeable workforce for

both companies and their contractors. Industry standards, such as these, provide a viable solution to these issues by capturing the knowledge in the documentation and enabling a consistent training of the workforce through ebbs and flows of its business-related cycles. One of the most important things that an oil company can do is to ensure that their management systems remain in top shape. Management systems include top management messages and directives to the workforce about the importance of safety, incident prevention, and following the right practices. They include basic elements, such as written procedures, a system of lessons learned, maintenance and inspection, and other systematic components that keep a company running smoothly. The use of current best practices, as framed by industry standards such as the API RPs, provides a documented procedure that, when followed, ensure the implementation of a robust management system. Company procedures should incorporate good standards such as API RPs 650, 653, 2350, and 2610 to ensure that current minimum best practices are part of the daily company practices and become part of its culture. Although API standards are voluntary, they contain vital information for safe, reliable, and efficient operations and have weight and influence as they have evolved for just about a century and have been vetted by time. Existing standards stay evergreen – as they are reviewed regularly – and new standards are constantly being identified and developed. Regardless, the best information is being provided as this work is being done by the experts and best minds from the industry, public sector, academia, and others. Keeping these standards as living practices within a company will help to keep the workforce ‘tuned up’ to the many details needed to operate these facilities safely and reliably. FOR MORE INFORMATION This article was written by Philip Myers, director at PEMY Consulting LLC, phil@pemyconsulting.com.

AUGUST/SEPTEMBER 2016 VOLUME 12 ISSUE NO.4

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PROFILE l OILTANKING KARIMUN

OILTANKING RETURNS TO INDONESIA Designed to serve the growing demand for petroleum products in Asia, Oiltanking Karimun promises to be a key player in the competition for efficient storage

trategically positioned in the Singapore Straits and perfectly placed to participate in Plattâ&#x20AC;&#x2122;s trading environment, Oiltanking Karimun is the manifestation of the companyâ&#x20AC;&#x2122;s continued investment in the region to maintain its competitive advantage. Sitting just outside Singapore, where land scarcity is significantly

01 The facility benefits from a strategic location outside the Singapore Straits 02 A glut of ready-to-build land allows for further expansion 03 Vice president of Oiltanking Asia Pacific Sjoerd Boer

constraining new terminal developments, the new terminal serves the growing demand for petroleum products in Asia with 730,000 m3 of capacity. The facility, a joint venture between Oiltanking and Gunvor Group, recently recieved 60,000 metric tonnes of petroleum and petroleum components. An attractive proposition is the fact that the facility in Indonesia has a glut of ready-to-build land to allow for further expansion. The region is still grappling with market imbalances including refinery closures in Japan and Australia coupled with increasing demand.

AUGUST/SEPTEMBER 2016 VOLUME 12 ISSUE NO.4

PROFILE l OILTANKING KARIMUN

‘Since 2008 demand dynamics have changed considerably, for example following much more transparency in the trading environment,’ says Boer. ‘Competition is now severe between trading companies, where it has increasingly become about size, access to systems or higher risk appetite to retain the same, or even lower, margins.’

CHANGING MARKET DYNAMICS The company returns to Indonesia after selling a facility in Merak back in 2014. As the supply and demand interplay starts to balance out in the region following a period of healthy demand, the storage environment has become far more competitive, underlying the importance of continual investment to maintain a slice of this lucrative trading environment. In an interview with Tank Storage Magazine, Sjoerd Boer, vice president of Oiltanking Asia Pacific, says that the company’s continous substantial investments in the region is now starting to bear fruit in this competitive environment. He says: ‘Demand has been healthy over the last couple of years and as a result a substantial amount of capacity has been added. With supply now coming more in line with demand, dynamics are changing as well. We see contract tenures shortening and customers are being more critical before entering into new agreements and are more demanding when it comes to the performance capability of the terminals. ‘There are a few players and companies that operate in this increasingly competitive environment who are now, more than ever, critical in their choice of logistics providers. We have seen that other terminals are finding it increasingly difficult to compete for high profile customers whose business determines the market these days.’ In addition to more exacting requirements from some high-profile customers, smaller customers are slowly being pushed out of the market by larger organisations, who have more capital and thus can take on bigger risks.

Since 2008 demand dynamics have changed considerably following much more transparency in the trading environment

EFFICIENCY DEMAND The flexibility and efficiency of Oiltanking Karimun reflects the growing transparency in the market which has driven shorter turnaround times and the ability to handle many sensitive products simultaneously. The terminal can serve various markets and product segments ranging from clean petroleum products and fuel oil. This diversity also allows it to adapt to the ever changing demand flows. Boer explains: ‘Demand has been healthy although we seem to be slowly moving towards a market where supply seems to be in line with demand. Of course it also differs by product. ‘The fuel oil market for example, is a market which will decline over the next 10 years following the implementation of the new sulphur cap regulations in 2020 or 2025. This could potentially impact the demand for fuel oil storage in Singapore, currently the largest bunkering market in the world. ‘However, despite this healthy demand for storage, limited land availability and a scarcity of waterfront access in Jurong Island has made it difficult to grow further there. We have a lot of experience dealing in Indonesia and Karimun is only 25 nautical miles from Singapore, so when the opportunity crossed our path, we seized it.’ Along with the rest of the world, the region has also benefited from the low oil price and contango market however the effect on individual terminals varies greatly and the impact is not lasting. Boer explains that Oiltanking has a diversified portfolio of customers in the Singapore Straits and all of them are in the industry for long-term plays and thus are not always influenced so much by the fluctuating market structures. ‘Our portfolio includes not only traders but IOC’s, NOC’s, chemical players and customers with long-term vested interests. Singapore is also a premium location for many good reasons and for pure short-term contango play, customers will start searching for less favourable (and cheaper) locations first. ‘Also, apart from contango economics, for petroleum, blending economics are just as important for our customers when it comes to profitability.’

OILTANKING KARIMUN AT A GLANCE: The terminal is positioned within a free trade zone and has four deep-water berths, including VLCC capability It can store and handle the full range of clean petroleum products as well as fuel oil It successfully received 60,000 metric tonnes of petroleum and petroleum components in June, marketing the commissioning of the facility It has a total storage capacity of 730,000 m3

AUGUST/SEPTEMBER 2016 VOLUME 12 ISSUE NO.4

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29th March 2017

The all new global Tank Storage Awards are designed to highlight those that excel in a range of different categories relating to terminal achievements, equipment innovations, ports and individual achievements. Winners will be announced at the Gala Dinner & Awards Ceremony following Day 2 of StocExpo Europe 2017. The highly anticipated evening will be hosted by a well known comedian and will include drinks upon arrival, three course dinner, casino, live band, all inclusive drinks & a midnight snack to help keep the celebrations going!

For the full list of judges and to submit your AUGUST/SEPTEMBER 2016 VOLUME 12 ISSUE NO.4

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JUDGES INCLUDE: Roderick de Rooij, Commercial Manager, Oiltanking Odfjell Terminals Oman Walter E Wattenbergh, CEO, LBC Tank Terminals Group Martyn Lyons, CEO, InterTerminals Ulf Vleeshouwers, Senior Adviser, InterTank Marc De Witte, Executive Director, FETSA John Cornell, Training Provider, API

SUBMIT YOUR NOMINATIONS NOW!

Categories include:

AWARD FOR SAFETY EXCELLENCE IN BULK LIQUID STORAGE BIGGEST COMMITMENT TO ENVIRONMENTAL PROTECTION MOST EFFICIENT STORAGE TERMINAL MOST INNOVATIVE TECHNOLOGY AWARD MOST INVALUABLE PRODUCT AWARD BEST TECHNOLOGY PROVIDER BEST PORT AWARD BEST NEWCOMER INDIVIDUAL ACHIEVEMENT AWARD PERSONALITY OF THE YEAR (Voted for by the industry)

nomination visit www.tankstoragemag.com/awards AUGUST/SEPTEMBER 2016 VOLUME 12 ISSUE NO.4

PROFILE l STOLTHAVEN SINGAPORE

STORAGE EQUILIBRIUM IN SINGAPORE As land scarcity on Jurong Island constrains oil storage expansion, Stolthaven Singapore’s chemical facility is enjoying a happy equilibrium in the logistics supply chain

tolthaven Singapore is nestled within a supply chain equilibrium on Jurong Island where both storage and logistical assets work at optimal utilisation rates. Following the completion of the storage operator’s phase 2D project in July 2015, the company provides a crucial storage element that forms an integral part of the chemical and petrochemical supply chain in Singapore. Despite land scarcity creating a ‘double edge sword’ situation, which has prompted neighbouring countries to develop their own independent storage facilities, these developments are focused on the oil markets rather than chemical storage. On Jurong Island, Stolthaven Singapore has positioned itself to capitalise on the fact that major chemical producers are now seeking to optimise their supply chain networks and move their storage logistics to independent operators in order to maximise their manufacturing capabilities. In an interview with Tank Storage Magazine, Stolthaven Singapore’s commercial manager Vincent Low says that despite slowing demand from industrial customers with manufacturing plants, this trend should only be temporary. ‘China and North East Asia are key markets that drive demand in the region,’ he explains. ‘To some extent the South East Asian markets make up the balance when looking at demand of products versus storage on the basis of the hub and distribution concept. ‘Enquiries from potential industrial customers looking to set up plants in Jurong Island have slowed lately but we expect this to

be a short-term trend and that this will reverse itself as soon as regional and global economic conditions improve.’ As storage capacity for oil products grows ever tighter on Jurong Island, Stolthaven Singapore is tapping into volumes of chemical and petrochemical cargo flooding into the region. The operator recently completed its phase 2D project, which involved the construction of 50,000 m3 of capacity comprising a mix of carbon and stainless steel tanks. Engineering, procurement and construction was staggered to accommodate the tight project schedule of

just over a year. In addition, two truck loading bays were added. This expansion came on the back of new investments in manufacturing on Jurong Island and in Singapore overall, which has driven increased demand for storage a secure and sustainable medium for feedstock logistics. COMPETITIVE EDGE Storage in Singapore offers manufacturers in regions like the Middle East an important edge on their competitors by significantly reducing their cargo delivery lead times with strategically leased storage.

AUGUST/SEPTEMBER 2016 VOLUME 12 ISSUE NO.4

PROFILE l STOLTHAVEN SINGAPORE

STOLTHAVEN SINGAPORE AT A GLANCE: The facility boasts 81 tanks, of which 75 are chemical tanks with a total capacity of 230,000 m3 It has six truck loading bays with two provisional bays for future operational use, and three jetties with dedicated jetty pipelines from jetty to each storage tank Its Phase 2D expansion saw the addition of 50,000 m3 of capacity at the 15 hectare site with a mix of carbon and stainless steel tanks Low says: ‘Middle East manufacturers producing intermediate or finished products are looking to shorten their supply chains to their end receivers by taking up storage and re-delivering their cargo on short notice to their buyers. ‘This is a competitive edge against sellers who need long lead times to deliver their cargoes. For petrochemical and chemical cargoes, the storage element is an important one and integral to the supply chain. ‘Storage also provides an opportunity to consolidate larger parcels of cargo so that they can be re-distributed in smaller packages, such as ISO containers or on smaller regional tankers.’ In addition, Stolthaven Singapore has three jetties, enabling the terminal to efficiently serve both Stolt Tankers’ global fleet of deep sea tankers – the world’s largest – as well as Stolt’s Asia Pacific fleet, which provides customers with regional service. The terminal is also served by Stolt Tank Containers, providing intermodal options to customers. These synergies not only ensure continuity of quality, safety and reliability across the supply chain, but enable significant potential cost savings for Stolt customers. The operator also benefits from the close proximity to one of the world’s busiest shipping lanes as well as its location close to recievers and manufacturers and the network of roads and pipeline on the island.

01 The facility enjoys storage equilibrium within the grid-like logistics supply chain 02 Stolthaven Singapore has the potential to expand further in this growing market 03 The terminal benefits from the synergy between Stolthaven terminal and Stolt Tank Containers

LAND SCARCITY As the oil storage situation in Singapore gets tighter, neighbouring countries are embarking on their own storage projects. Southern Johor and Batam and Tanjung Uban in Indonesia will see their projects come on stream in the next three to five years. On Jurong Island, the land scarcity issue has manifested itself in greater demand for independent chemical storage as manufacturers prefer to allocate the land they have to manufacturing. Low says: ‘Manufacturers prefer to leave the logistics of storage to storage companies. In addition, outsourcing the storage helps relieve congestion at their premises and gives them flexibility of another location from which to distribute their cargoes.’ Uniquely, competition for storage in chemicals and petrochemicals is at a close equilibrium. Storage and logistics on Jurong Island operates in a grid system to store and deliver via pipeline, or through ISO containers and marine facilities. ‘We work closely with customers to help them optimise their supply chains, by leveraging the synergies inherent in Stolt-Nielsen’s integrated solutions for the transportation, storage and distribution for chemicals and other bulk-liquid products,’ says Low. Looking to the future, Stolthaven Singapore still has the capability to expand to meet the needs of their existing client base as well as new ones through its intermodal supply solution. ‘As a unit of Stolt-Nielsen, we are part of a global and integrated transportation, storage and distribution solution for chemicals and other bulk liquid products,’ Low says. ‘The efficiencies and flexibility resulting from that integrated network enable us to deliver significant synergies and cost savings for our customers.’

AUGUST/SEPTEMBER 2016 VOLUME 12 ISSUE NO.4

PROFILE l VTTI ATB

LOGISTICAL EXPERTISE TO SATISFY ASIA’S DEMAND

VTTI’s ATT Tanjung Bin has positioned itself to absorb the growing demand for fuel oil in Asia following an expansion of its facility in 2015

TT Tanjung Bin capitalises on offering logistical assets for Asia’s biggest energy product, fuel oil, as well as being part of the world’s biggest market for excess fuel. Situated in the heart of the FOB Straits, Asia’s most dynamic trading hub, the facility has expanded its operations further with an extra 260,000 m3 of capacity for fuel oil as well as constructing an additional berth. In addition to handling greater volumes of vessels as a direct consequence of its expansion, the facility is also reaping the benefits of being part of Platts’ changed FOB Straits oil price assessment last year. PLATTS PRICING BENEFITS The new assessment came on the back of further storage expansion in nearby Johor and the Riau Islands

Although there is an oversupply of products, the underlying demand is still growing, which means a continued requirement for logistical assets

meant that the trading of products extended beyond Singapore’s traditional boundaries. FOB Straits encompasses terminals beyond Singapore’s borders and means that bids can be met from any approved terminal, whether in Singapore or Malaysia, while similarly sellers could nominate any such terminal for an FOB Straits offer. As a result, the previous two-tier market that operated in the region has been dissolved and has left a more level playing field according to ATB’s general manager Aernout Boot. He says: ‘We used to be a Platts approved location but since July 2015 when the FOB Straits benchmark was launched anyone in the Singapore region is treated equally. It is now a much more level playing field and as a result we see much more Platts deliveries from our location. ‘We are part of the Singapore market. As we are only ten nautical miles from Singapore we should be seen in the context of the Singapore trading hub. We see a lot of traffic to and from our facility to the pelepas anchorage as well as to refineries and terminals located on Jurong Island.’ The first phase of the terminal was commissioned in April 2012 with 893,000 m3 of capacity spread over 41 tanks and five berths with a draft of 17.5 meters. It can handle petrol, jet fuel, gasoil, fuel oil and biofuels. The operator has focused on expanding their fuel oil storage capabilities as it remains the biggest market in Singapore thanks to the region being

AUGUST/SEPTEMBER 2016 VOLUME 12 ISSUE NO.4

PROFILE l VTTI ATB 01

Executives are now examining where they can further optimise their market offering and add further value to their business. However, Boot says that they will approach any future plans with caution. ‘We have a strong track record so it would be easy for us to expand further, but there will need to be a market justification for it and it needs to go hand in hand with additional jetty capacity.’ CONSISTENT DEMAND Despite the global petroleum products market being oversupplied, Boot counters that whilst demand growth has slowed in some places, it has not declined and that underlying physical demand will still grow. ‘The tankage market is quite balanced at the moment despite the fact that there has been a lot of additional capacity over the last few years,’ Boot says. ‘The market can absorb this and as such there are no empty tanks. People are not being driven to build and lease tanks elsewhere outside of the Straits hub. ‘Demand for petroleum products is the main driving force of our business. The higher the underlying demand, the more need for logistical facilities to handle all the arbitrage flows. ‘Demand for oil in Asia is expected to grow over the next 10 years, which means there should be healthy demand for tanks. Although there is an oversupply of products, the underlying demand is still growing, which means a continued requirement for logistical assets. ‘The demand for products in India, Indonesia and China is still growing, despite the slowdown in growth in China, and the Singapore hub will continue to cater to these demand centres.’

the world’s largest bunkering hub. Asia is also known to be the biggest outlet for excess fuel in the market. Since the expansion the facility now handles approximately 130 vessels per month, which is partly attributable to new customers as a result of the project. The facility also benefits from favourable port tariffs as well as available land for potential growth.

01 The expansion involved the addition of 260,000 m3 of fuel oil capacity

ATT TANJUNG BIN AT A GLANCE: The facility’s deep waters cater for regional distribution and offer shorter turnaround times as well as product blending at lower operating costs compared with equivalent terminals in Singapore

02 It now handles around 130 vessels per month since the expansion

The phase two expansion has brought total capacity at the site to 1.15 million m3 and includes six berths that can handle ships up to VLCC size

03 The terminal is part of Platts’ changed FOB Straits pricing assessment

The terminal receives oil from Europe, Middle East, Russia, northern Asia and India and redistributes across Asia and Australia

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MARKET ANALYSIS l MERGERS AND ACQUISITIONS

TANK STORAGE – WORTH THE INVESTMENT RISK

he global bulk liquids storage and infrastructure industry sits in the middle of a very active merger and acquisition market and there is no sign of this slowing, given underlying business drivers and the intentions of key transaction players. Energy is vital to the economy but an investor is largely driven by upstream ‘mining’ activities in oil and coal. However, these come with significant exploration and commodity price risks – risks that financial investors are not willing to take. Energy transportation infrastructure is one of the most attractive areas for investors, who are looking to capitalise on the resilience of this sector without taking any risk on the underlying energy commodities, namely coal, oil and gas. Liquid storage terminals play on the movement of the largest energy commodity – oil – as well as other bulk liquid cargoes including chemicals and bio fuels. The scale of opportunity, oil price movements and the converging interests of the players involved have resulted in multiple M&A transactions and many more will follow. To understand where the transactions are coming from and what will continue to drive them, it is important to understand each interested party’s dynamics. OIL STRATEGICS Historically oil storage and transmission assets have been owned by integrated oil and gas majors and downstream oil refiners. In the more recent past, driven by the need to clean up balance sheets, release capital in a declining oil price environment and downward pressure on refining margins, the oil strategics have been coming to market with assets to sell. BP coming to markets to sell its interest in the Amsterdam oil terminal is a case in point. INDEPENDENT OIL TERMINAL PLAYERS Vopak, the leader among independent oil terminals players, control 10% of global market share. Three others – Oiltanking, NuStar and Magellan Midstream are the only ones with any near level of global scale. The need to consolidate as an industry and the need to respond to change in global trade patterns will continue to throw transaction opportunities. LBC Terminals is currently in the market to sell part of their European assets and Vopak, who have been an active seller of terminals in the market, are a key drivers of this trend. TRADING HOUSES INFRASTRUCTURE INVESTMENTS Almost all the major oil traders (Glencore, Gunvor, Trafigura, Vitol, Mercuria and Noble) and some regional/smaller oil traders (BrightOil, BB Energy, Concord, Galana and Hin Leong) have invested in and run oil logistics assets including storage terminals. Ownership of logistics assets did provide superior control through the supply chain and leverage to extract margins which would otherwise get lost in the trade. In the more recent past, traders’ balance sheets have gone through

severe strains resulting from commodity price declines, which limits their ability to raise capital beyond a level without capital releases from existing assets. These factors may lead traders to come to market to monetise some of their logistics assets, especially if it can be done through sale and leaseback arrangements where operational control can be retained post sale. Glencore coming to market is a case in point and more will follow. ATTRACTIVENESS TO INFRASTRUCTURE INVESTORS For infrastructure funds, oil storage and port terminal assets offer an attractive business model incorporating infrastructure characteristics that investors prefer. Storage businesses generate the bulk of their revenues from storage fees derived from leasing space in tanks. These contracts vary in length and complexity, often depending on the client. Contracts are often takeor-pay, which means the client pays even if they don’t use a tank. This provides a level of guaranteed income. Terminal businesses charge fees for moving product from tanks to transport points – be it barges, transmission pipelines and rail or road networks. These ‘through-put’ fees alongside other services such as heating, mixing and blending of products provide investors with additional sources of revenues. In addition, on the back of oil storage, these enterprises have become larger liquid businesses encompassing chemicals, vegetable oils and even food additives. This ‘de-risks’ the business by reducing its reliance on oil-based products such as crude, aviation fuel, diesel or kerosene. SHORT-TERM, TACTICAL CONTANGO ECONOMICS In the very recent past the oversupply of crude and the contango in the forward curve have offered handsome rewards to anyone with capacity to stash oil. These market fundamentals have spurred the immediate rush to invest in new oil storage assets or acquire existing ones. STRATEGIC INVESTMENT Success in the sector in part comes from buying storage terminals in the right strategic locations. Across the globe there are four key liquid storage hubs – Houston, the ARA region, the straits of Homuraz/ Fujairah and the straits of Singapore. The closer the storage facilities are to suppliers’ markets or required transport networks the better. Investors’ affinity for OECD markets has meant there has been greater deal activity in Europe. Going forward one can expect Australia, Singapore and Houston to catch up before we see a lot of financial investor activity in the Middle East region. The recent bid process and aggressive pricing for the sale of a minority stake in Universal Terminals in Singapore could be an early indicator of this trend. Universal Terminals is Singapore’s largest independent oil storage provider, with a capacity of 2.33 million m3 across 78 tanks. The ARA region is a strong gateway for Europe – a region which has seen a lot of trans-

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MARKET ANALYSIS l MERGERS AND ACQUISITIONS

action activity. iCON Infrastructure’s most recent investment, Service Terminal Rotterdam, was made in this region. Antin’s Infrastructure’s PISTO-owned Le Havre oil terminal on France’s northwest coast, is another example of a strategic location as it is the key entry point for oil products (crude and refined) in northern France. The asset has immediate access to the TRAPIL pipeline (also partially owned by Pisto), which links the business to a number of France’s major airports and cities, including Paris. THE CUSTOMER IS KING Customer base is another key concern for infrastructure investors seeking stable returns from these assets. Contract renewals are one of the major risks of the business. The more revenue locked over the long-term the better. Antin’s PISTO also stores for the SAGESS – the French State’s strategic oil reserve –which contributes to stable long-term revenues of the company. Macquarie’s TanQuid counts the German equivalent, the EBV, as one of its customers, according to sources. Whilst it’s not known what type of contracts will be available at Vopak’s UK storage terminals, which it recently divested, fellow seller BP has said it would look to enter a long-term capacity agreement with a potential buyer, which should offer infrastructure investors some comfort regarding revenue security. OPERATIONAL RISKS AND SAFETY LINKED COSTS Storage assets are not without their operational risks. Health and safety requirements have tightened since incidents such as the Buncefield fire. Costs attached to health and safety requirements – such as the Netherland’s PGS 29 legislation, which outlines how liquids can and can’t be stored, have also been increasing. Owners of storage assets have little scope for passing these costs on because the assets are not generally

regulated, with new requirements – now occurring on more periodic cycles – likely to eat into potential returns. INVESTOR ECONOMICS WILL DRIVE TRANSACTIONS Investors have had success investing in liquid storage and transmission assets – 3i’s 15.4% internal rate of return (IRR) from its investment in Oiltanking subsidiaries in Malta, Singapore and Amsterdam since 2007 – is a case in point. The oil storage business will continue to attract infrastructure investors’ attention over the next few years. By investing in these assets, infrastructure investors – whilst not taking direct commodity exposure – are indirectly taking a view on the market for the products they store. But with established customers, strategic locations and long-term contracts in place, these assets have shown that they can deliver mid-teen IRRs for investors willing to take the risk. Beyond standalone economics – investors also have an eye on building a network of these assets. This will deliver benefits of being able to deploy larger quantum’s of capital in high-return generating assets. Macquarie seems particularly keen on this play and is not afraid of paying rich premiums – 18x enterprise value EBITDA on the Universal Terminals transaction. On another live transaction – the sale of the Portuguese, Spanish and French assets – Macquarie again seems to be the front runner. The successful outcome on the LBC transaction could trigger many other marginal independent storage providers to follow suit. FOR MORE INFORMATION This article was written by Rahul Saikia, investment banker at Pricewaterhousecooper’s corporate finance team. Rahul.saikia@in.pwc.com

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AUGUST/SEPTEMBER 2016 VOLUME 12 ISSUE NO.4

MARKET ANALYSIS l STORAGE IN ASIA

ASIA: THE GLOBAL ENERGY DRIVER The emergence of China’s teapot refineries as well as growth of the one belt, one road mega project and India’s insatiable energy demand are helping to future proof Asia in the global storage market. Amy McLellan reports.

opes that 2016 was the start of the turnaround for oil prices, now in the second year of slump, were dashed this summer as yet another rally ran out of steam, this time stalling short of $50 a barrel. Oil prices slid to a three-month low in July as concerns mounted about the global supply overhang, with WTI sliding to $43.11 a barrel. Production data suggests US output is on the rebound while the return of disrupted supplies from Canada, Iraq and Libya is again adding to the global glut of oil. The result is that the one-year price contango, which has seen global tanks sloshing full to the brim, has almost doubled, suggesting the recent weakening of the oil price could be more than a summer dip. There is precedent: last summer the contango widened by 40%, stalling the recovery over the first half of 2015 and sending futures into a tailspin, with the price slumping to a 12-year low by the start of this year. The contango is good news for those in the business of storing oil. Terminals in key trading hubs – such as Oklahoma’s Cushing, Rotterdam and Singapore – are enjoying high utilisation. Asia’s main physical oil trading hub, Singapore, is awash with crude. Earlier this year freight data from Thomson Reuters Eikon pointed to a fleet of 40 supertankers anchored off its coasts or in nearby Malaysian waters

holding 47.7 million barrels of oil – enough oil to satisfy five working days of Chinese demand. This is, say analysts, the highest volume of oil stored at sea in South East Asia for at least the last five years, and given the spread is not wide enough to justify the costs of this floating storage, it’s a signal that onshore facilities are almost full.

[China’s] share of the global economy, and of many specific sectors, will be larger than ever Gordon Orr, analyst, McKinsey & Co As an IEA analyst puts it: ‘Traders have been sending cargo to Singapore but they can’t find the land-based terminals to offload it. At key terminals we have seen capacity being built out over the last five years, but stocks have ballooned.’ Even so, some now expect this unprecedented ‘huge demand for storage’ to ease. ‘Moving forward and with the market growing somewhat accustomed to the price levels, we see a narrowing of this

demand and a return to normal growth,’ says Muthukrishnan Prabakaran, global head of terminals at UAE-based Gulf Petrochem, who says terminals will need to become more agile in a changing world. TEAPOTS AND BOTTLENECKS Tanks are not just brimming with crude; refined products are also in over-supply. In China, for example, the refining capacity has doubled over the past decade to about 14.5 million barrels per day (bpd). This had been intended to meet domestic needs but given that economic growth has fallen by half since 2007, to less than 7%, there will be a daily fuel surplus of 700,000 bpd by 2020 according to data from China National Petroleum Corp. Already Chinese-refined petrol and diesel are hitting international markets. Exports surged at least 30% this year, adding to stockpiles in Singapore and heading further afield, to the US, South America and Europe. Indeed, the refining boom has created problems of its own. This summer congestion at one of China’s biggest ports curbed purchases from small independent refiners, known as ‘teapots’. Looser importation rules led to ‘unprecedented tanker traffic’ in Qingdau Port, where most of the teapots are based, according to a spokesman for Qingdao Shihua Crude Oil Terminal Co, a subsidiary of Hong Kong-listed storage giant Sinopec Kantons.

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MARKET ANALYSIS l STORAGE IN ASIA

The gradual relaxation of importing rules for the teapots means aggregate throughput volume of Sinopec Kantons’ six domestic terminals (Zhan Jiang Port Petrochemical Terminal, Qingdao Shihua Crude Oil Terminal, Ningbo Shihua Crude Oil Terminal, Rizhao Shihua Crude Oil Terminal, Tianjin Port Shihua Crude Oil Terminal and Tangshan Caofeidian Shihua Crude Oil Terminal) surged more than 16% to 175 million tonnes in 2015. This summer, however, these storage and logistical bottlenecks meant that there was an easing back of imports in China. Customs data shows inbound shipments into China were equivalent to 7.62 million bpd in May, down 4.3% from the previous month. The regional oil glut is not just a supply-side issue; it is aided by anaemic demand as economies around the world struggle with sluggish growth. Even the ‘tiger’ economies of Asia have experienced a pull-back in growth rates in recent years. But while the rate of growth may have slowed, the countries of Southeast Asia, China and India are still on an upward trajectory: according to the OECD, real GDP growth in emerging Asia is projected to remain solid at 6.4% in 2016 and 6.3% in 2017. Real economic activity in Southeast Asia (ASEAN 10) is projected to grow at an average rate of 4.9% in 2016, with India at 7.4% and China at 6.5%, much of it driven by domestic demand. It is the powerhouse of China that is the real bellwether of global growth. China’s economy grew 6.7% in the second quarter of 2016, unchanged from the previous three-month period and slightly ahead of economists’ expectations. The country is targeting a full-year growth target of 6.5% to 7% for 2016 but there remain significant downward pressures as the economy rebalances, with rising corporate debt a real concern. But analyst Gordon Orr of McKinsey & Co puts it best, pointing out that whether growth is a percentage point up or down, there’s no denying the absolute scale of China’s $11 trillion economy. ‘No matter what rate the country grows at in 2016, its share of the global economy, and of many specific sectors, will be larger than ever,’ says Orr. ONE BELT, ONE ROAD This is a country that looks to the future in decades. In September 2013, during a visit to Kazakhstan, Chinese president Xi Jinping announced plans to re-develop the Silk Road with high-speed rail, roads and pipelines connecting lands once crossed by caravans in the first millennium. By November 2014, this ambitious pan-Eurasian ambition was backed by the creation of the $40 billion Silk Road fund. One Belt, One Road (OBOR) seeks to connect the landmass of Eurasia and the waters of the Indian Ocean. The OBOR has both land and sea dimensions: the New Silk Road Economic Belt (known as Belt) is made of railways, highways, oil and gas pipelines and major energy projects. This includes nearly

Storage terminals need to become more agile in a changing world according to Muthukrishnan Prabakaran

$16 billion of Chinese funding for the construction of 4,000 km of railways and 10,000 km of highways across Central Asia – and stretch its tentacles through Kazakhstan, Mongolia, Russia, Iran, Turkey and European cities Budapest, Hamburg and Rotterdam. The sea route, known as the ‘Maritime Silk Road’, or simply the ‘Road’, spans out from China’s eastern ports to Southeast Asia, South Asia, East Africa, West Asia and the Mediterranean, ending at Rotterdam. Important junctions along the way will include Pakistan’s newly developed port of Gwadar on the Arabian Sea, Istanbul, Greece, Venice, and Hamburg. Analysts suggest that when completed the OBOR will include 60 countries, home to two-thirds of the world’s population, 55% of the global GDP and 75% of global energy reserves. This scheme will consist of 900 infrastructure projects, valued at about $1.3 trillion, much from Chinese banks, financial institutions and special funds and will help soak up China’s overcapacity in steel, cement and construction materials. It will open up new strategic hubs along the road; Gwadar, just northeast of the strategically important Straits of Hormuz, is not only being built with Chinese money but will also be owned and operated the China Overseas Ports Co. This new deepwater ‘gateway port’ gives China access to the Indian Ocean. 60% of China’s oil comes from Persian Gulf ships travelling over 16,000 km to Shanghai and Gwadar will slash that to just 5,000 km. This is not just about commerce and trade; it’s also about access, security and influence. THINKING STRATEGIC, BUILDING RESERVES Part of this long-range planning has been China’s spending spree on strategic petroleum reserves (SPR). This has been a significant fea-

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ture of global oil markets, with China’s apparently insatiable demand to stockpile reserves mopping up cheap oil from the markets. The country increased imports by 8.8% to around 6.7 million bpd in 2015 as the country continued to spend billions of dollars to build up a strategic petroleum reserve equivalent to 90 days of net imports using government-owned storage sites, of which there are seven aboveground facilities at Zhoushan, Zhenhai, Dalian, Huangdao, Dushanzi, Lanzhou and Tianjin, and one operational underground facility at Huangdao. In addition there is plus compulsory stockpiling by state-owned companies and tanks built and operated by private firms. Beijing has set a 550 million barrel SPR target for 2020; as of mid-2015 it had 190 million barrels in storage, having doubled its reserve base in just eight months. This rate has slowed, with existing facilities full and new underground caverns encountering technical and construction delays. This summer however, it was reported that the government would build 441 million barrels of storage for its SPR in three construction phases. It is not just China that is piling on the barrels. Low oil prices have also prompted India to accelerate the growth of its SPR, with the first phase of three facilities in southern India providing room for 39.1 million barrels of crude oil. The Visakhapatnam facility began filling last summer while the Mangalore and Padur facilities will complete later this year. The country’s second phase will add another 91 million barrels of SPR capacity by 2020. South Korea is also investing in oil storage capacity, not just for internal security but also to capitalise on its proximity to China’s booming independent refineries. This year the country plans to add 1.82 million barrels of crude and oil products to its SPR to take the tally to 94.42 million barrels. State oil

MARKET ANALYSIS l STORAGE IN ASIA

company KNOC operates nine storage sites that can hold 146 million barrels of crude and oil products, including strategic reserves that currently account for 92.6 million barrels and 26.6 million barrels for foreign oil stored under joint storage agreements. There is massive investment in storage capacity in South Korea. Ulsan Port Authority, for example, the country’s largest liquid cargo handling port, is busy expanding through its Northeast Asia oil hub project, which will lift capacity to 28.4 million barrels with ten docking facilities across 906 sq km. Phase one – the north terminal – got underway in November 2013 and land reclamation will be completed in January 2017, ahead of Korea Oil Terminal Company starting construction on the facility. The north terminal will comprise six docking facilities with storage capacity for 9.9 million barrels of petroleum products and the ability to handle vessels up to 120,000 DWT. This work will be completed in 2018, with commercial operations expected to start in 2019, says Jinwon Choi, assistant manager of Ulsan Port Authority.

Phase two – the south terminal – will see the reclamation of another 604 sq km of land for facilities that can handle 18.4 million barrels of products, with three berths and a buoy that can accommodate ships up to 300,000 DWT. ‘A feasibility study for the second phase project is underway by Korea Maritime Institute, a company specialising in feasibility studies for the public sector,’ says Choi. He also points out that there is a ‘wide array of infrastructure’ at Port of Ulsan, including major refiners SK and S-oil, a large petrochemical complex, docks specialised for liquid cargo handling and a strategic geographic location, with a population of 700 million with 1,200 km of Ulsan. Pending the results of the feasibility study, work could get underway in 2017 with a view to starting commercial operations in 2025. THINKING LONG TERM Elsewhere, Gulf Petrochem thinks long term about the location of its terminals. Global head of terminals Muthukrishnan Prabakaran points out that its Hamriyah terminal, with capacity of 204,000 m3, is growing in strategic importance,

serving Saudi Arabia, South East Asia and East Africa while the 250,000 m3 Pipavav terminal in India allows the company to tap into one of the fastest growing economies in the world. While there may be plenty of oil seeking a home – there can be many challenges to adding new capacity. In Malaysia, for example, construction work on the Asia Petroleum Hub (APH) in Johor has been stalled due to lack of funding and unresolved issues over ownership, leaving it far adrift of its original on-stream date of 2009. It is hoped the entry of a consortium led by cash-rich Emirates National Oil Company will revive work on the project. In Indonesia, four years after it acquired 95% stake in PT West Point Terminal, Sinopec Kantons has reported slow progress. Last year the company’s plans to build a 2.6 million m3 facility – known as the Batam Project – ran into difficulties because of a difference between shareholders on ‘the management philosophy’. Sinopec Kantons said it will ‘actively take responsive measures to carry out the project and to protect our shareholders’ interests’.

A RIVAL SEA ROUTE: THE NSR ON ICE?

rade routes are not immutable. As the history of the old silk routes show, they are living things that depend on many factors for their survival. One of these factors is environmental and, in an era of rapidly retreating Arctic sea ice, new routes are being opened that could, in a warmer future, rival the shipping lanes that today connect Asia with western markets. By sailing through Russia’s Arctic waters – the Northern Sea Route – companies can cut the normal sailing distance between Rotterdam and Shanghai via the Suez Canal by up to 24%, reducing journey times by up to 15 days. In 2014, for example, the Stena Polaris carried almost 400,000 barrels of naphtha from Ust Luga near Saint Petersburg to Yeosu in South Korea in 35 days compared with a typical seven-week journey via the Suez Canal. There are significant cost and environmental savings to shorter journeys. Christian Bonfils, managing director of Nordic Bulk Carriers, which in 2010 was the first company to use the NSR to transport cargo through the Arctic to China, said the fuel savings alone added up to 750 tonnes. ‘It is safer, shorter and thereby more eco-friendly,’ he says.

The recent plunge in oil prices, however, has eroded that cost advantage. In 2015, there were just 18 transits and 40,000 tonnes of cargo. ‘There has been successful navigation of the northern sea route in recent years but there remain significant challenges before we see international shippers regularly using this northern shortcut,’ says Martin Clark, editor of Frontier Energy magazine, which covers Arctic shipping. ‘These include safety and environmental concerns, the costs of operating in an area that requires icebreaker support at a time when lower oil prices have offset the cost advantages of the shorter route and the unpredictability of the sea ice.’ Yet further ahead, when oil prices recover and increased Arctic infrastructure reduces the risks and costs of the northern journey, the shorter transit times may prove hard to resist. ‘With Russia, China and South Korea investing in new icebreaker fleets, and the ongoing retreat of Arctic sea ice, it is likely that longer term these challenges will be overcome, opening up new shipping routes for strategically located terminals in Asia,’ Clark adds.

The oil price plunge has slashed the cost advantages of the Northern Sea Route

AUGUST/SEPTEMBER 2016 VOLUME 12 ISSUE NO.4

CHEMICAL STORAGE SUPPLEMENT The voice of the storage terminal industry

AUGUST/SEPTEMBER 2016 Volume 12 Issue No.4

Chemical storage opportunities in Europe

Leveraging supply chain opportunities

LBC Tank Terminals is capitalising on tank storage opportunities

Serving a growing need for specialty chemicals storage in the Middle East

AUGUST/SEPTEMBER 2016 VOLUME 12 ISSUE NO.4

CONTENTS

Chemical storage contents News

Features

Chemical tank terminal update

Spearheading storage efficiency

Port potential drives storage opportunities

Leveraging supply chain opportunities

Changing chemical storage dynamics

Chemical storage opportunities in Europe

Effective protection for secondary containment areas in chemical storage

Chemical storage news

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AUGUST/SEPTEMBER 2016 VOLUME 12 ISSUE NO.4

TERMINAL NEWS l CHEMICAL

Lanxess enlarges specialty chemicals storage capacity Lanxess has significantly expanded storage capacity for its phosphoric acid ester plants at its Leverkusen site. The specialty chemicals company has invested around €8 million into the facility, which is now six times larger than before. It now contains six 150 m3 tanks, giving a total volume of 900 m3. It replaces the previous, smaller tank farm, which had a capacity of 145 m3. In addition to the tank facility the company has built a new unloading station to transfer raw materials from tankers. The new station has five bottom discharge arms and vapour recovery arms. The new tank farm has been completed and is awaiting its official permit before starting operations, which is expected by the end of July.

Largest liquid storage terminal in Turkey acquired Yilport Holdings has acquired 100% shares in Solventas Technical Storage Company, Turkey’s largest liquid terminal. Yilport Gebze Port and Solventas terminal will now be consolidated into the largest and most advanced liquid terminal, operational in Dilovasi District in the Gulf of Izmit. The Solventas terminal is Yilport’s 23rd terminal. The handover is expected to start following the Turkish Competition Authority’s approval. The merger will contribute to growth of the chemical industry in Turkey. The terminal is also significant as the first specialised port of Yilport Holding, exclusively dedicated to handling and storing chemicals and liquid cargo. The facility has 217 chemical tanks with a storage capacity of 333,000 m3. It serves tankers and vessels on two quays and stores and handles more than 70 types of products including chemicals and petrochemicals. The consolidation of both facilities will form Yilport Dilovasi Liquid Terminal, with more than 300 tanks and more than 450,000 m3 of liquid storage.

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AUGUST/SEPTEMBER 2016 VOLUME 12 ISSUE NO.4

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TANK TERMINAL UPDATE l CHEMICAL

Chemical tank terminal update Sabic, Exxon Mobil Location:

Products:

LBC Tank Terminals Gulf Coast, US Petrochemicals

Construction/ expansion/ acquisition:

Both companies are carrying out studies to assess the potential of a new complex before a final investment decision is made

Comment:

If developed it will be located near natural gas feedstock and include a world-scale stream cracker and derivative units

Location:

Products: Capacity:

Port of Rotterdam, the Netherlands Liquid chemicals 250,000 m3

Construction/ expansion/ acquisition:

To meet growing demand for chemical storage, the operator is expanding its jetty capabilities as well as its storage capacity

Comment

The first 36,000 m3 expansion will be operational in the first half of 2017

Saudi Aramco, Sabic Location:

Products:

Saudi Arabia

Standic

Crude oil, chemicals

Location:

Construction/ expansion/ acquisition:

A joint study is being conducted on a crude oil-to-chemicals complex after an agreement document was drawn up

Comment:

The ambition is to create a fully integrated complex to maximise chemical yield, recycles by-products and diversifies the petrochemical feedstock mix

Products: Capacity:

Construction/ expansion/ acquisition:

Comment

Products: Capacity:

Investment:

Chemicals, petrochemicals 333,000 m3 Yilport’s acquisition of Solventas Technical Storage will help it continue its plans to be ranked in the top 10 international port operators by 2025 The facility will be integrated into Tilport Gebze’s terminal, which has 85 chemical tanks. The integrated facility, Yilport Dilovasi Liquid Terminal, will have more than 450,000 m3 of storage

36,000 m3 The expansion into tank pit 7 comprises 43 tanks in different sizes The existing facility has also been modernised as part of the expansion, and the storage and distribution centre has increased its jetty capacity by 33%

Epic Midstream Location:

Products: Capacity:

Construction/ expansion/ acquisition: Comment

Leverkusen, Germany

Savannah, Georgia Asphalt, asphalt additives, condensate, crude, ethanol and other chemicals 1.12 million barrels Epic acquired the terminal, with 19 tanks, from Axeon Specialty Products The facility has 18 acres available for future development and the company says it will develop crude, condensate and chemical export opportunities

Phosphoric acid ester 900 m3 Investment: €8 million

Construction/ expansion/ acquisition:

The specialty chemicals company’s investment replaces previous, smaller tank farm, which had a capacity of 145 m3

Completion date:

July 2016

Comment:

The company has built a new unloading station to transfer raw materials from tankers

Construction/ expansion/ acquisition:

Oleochemicals, specialty chemicals

Dilovasi Distrcit, Gulf of Izmit, Turkey

Lanxess Location:

Capacity:

Comment

Yilport Holdings Location:

Products:

Dordrecht, the Netherlands

This list is based on information made available to Tank Storage Magazine at the time of printing. If you would like to update the list with any additional terminal information for future issues, please email: jasmin@tankstoragemag.com

AUGUST/SEPTEMBER 2016 VOLUME 12 ISSUE NO.4

CHEMICAL STORAGE IN THE MIDDLE EAST. COVERED.

CHEMICAL PROFILE l PORT OF TARRAGONA

With over 85,000m3 of liquid bulk storage in Saudi Arabia and terminals in Jubail and Yanbu, ACT is the perfect partner to import and export your chemicals or minerals safely and effectively. Contact us to find out how we can help to leverage your chemical businesses in the Middle East. AUGUST/SEPTEMBER 2016 VOLUME 12 ISSUE NO.4

Find out more at www.ArabianChemicalTerminals.com E: info@arabianchemicalterminals.com T: +966 12 652 0000

CHEMICAL PROFILE l TEPSA

SPEARHEADING STORAGE EFFICIENCY TEPSA AT A GLANCE:

series of investments to further improve productivity and efficiency across all of Tepsa’s facilities will position the company as one of the main storage players in Spain. The company has already ploughed €4 million into modernising its facilities by improving efficiency, productivity and service quality – this includes an automation project for the chemical tanker loading bays in Barcelona. A further €20 million has been earmarked for Tepsa’s four terminals in the ports of Barcelona, Bilbao, Valencia and Tarragona to further roll out automation at these facilities as well as implement new technologies to improve efficiency and productivity. In an interview with Tank Storage Magazine, managing director Luis Sala says that as a result of these ‘small’ investments so far, the company has ‘the fastest and most efficient operations of all the Spanish terminals’. ‘It is really a set of small investments spread among the Tepsa terminals that form part of the continuous improvement system that positions

The company operates in four of Spain’s principle ports, Barcelona, Bilbao, Tarragona and Valencia Tepsa has almost 900,000 m3 for the storage of petroleum, biofuels and chemicals with more than 300,000 m3 for chemical storage In 2015, total product throughput (incoming and outgoing) was more than 6.5 million tonnes Tepsa as the main point of reference in Spain in the storage and handling of all types of liquid bulk. ‘The results is a service that is increasingly in line with customer needs and increased customer loyalty. The reduction in tanker loading time for petroleum products is one example of this.’ As previously reported, petroleum tanker turnaround times at Tepsa terminals have been substantially reduced and has resulted in an 18% reduction in operation times. The entire loading procedure is completed in around 30 minutes from the tanker’s arrival to its exit from the terminal. Looking to the wider chemical storage market, Sala observes that the sector has recovered from the fallout of the 2008 global economic crisis, which saw a slump in chemicals demand as well as a lack as access to credit. At the time, then president of the European Chemical Industry Council Francois Cornelis said that chemical activity is very closely connected to trends in economic growth and that the industry was very worried. Sala says: ‘The continued growth of the Spanish economy over the past 18 months is maintaining this improvement independently of oil price trends. ‘Consumption of chemical products per inhabitant in Spain increased 5.7% in 2015, surpassing pre-economic crisis consumption and the chemical industry turnover was 3% higher than the year before according to the Spanish Chemical Industry Business Federation. ‘Nevertheless, there are still domestic and international uncertainties, which means we must be prudent with regard to future development.’

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CHEMICAL PROFILE l PORT OF TARRAGONA

PORT POTENTIAL DRIVES STORAGE OPPORTUNITIES The Port of Tarragona is developing itself as central chemicals hub in the Mediterranean with further expansion projects on the horizon

he Port of Tarragona benefits from several strategically unique factors which it is seeking to capitalise on further to elevate itself as a chemical logistics hub. Nestled along the east coast of Spain and perfectly placed to capture trade flows from the Mediterranean, the port has embarked on a series of projects to consolidate its hub position. In 2013 it invested more than €76 million to expand its chemicals wharf from 18 hectares to 36 hectares in response to growing demand from local industries and in 2015 Vopak Terquimsa invested in six new tanks as a result of market needs. Offering significant growth and development potential, port executives are considering a number of different projects on the back of high demand for its available land. Genoveva Climent, commercial director at the port, says that a key factor to its success is the fact that it supports its terminals to increase traffic volume to the port. ‘The potential of the chemical industry is huge; the local industry has an annual production of around 20 million tons and represents 25% of Spanish production. Also, the growth rate for the chemical industry is expected to be 4.5% globally by 2030. ‘The port is also focused on the Middle Eastern bulk liquid market due to our strategic location on the Mediterranean and the lifting of Iran’s export restrictions has been really positive for the port and the chemical cluster. ‘One of our objectives is to also develop new relationships between chemical and complementary industries.’ ‘We have developed the port as a hub platform to capture trade flows coming from the eastern Mediterranean. We are studying various invest-

Picture caption

ment projects from different terminals, which will significantly increase the storage capacity of the port and traffic. Moreover we will be able to handle new types of products and additional services will be on offer which will improve the potential of Tarragona as a liquid hub in the Mediterranean.’ Utilisation rates at the three independent terminals remain high and operators are looking at further investments. ‘With their enlargement onto the chemicals harbour, Vopak Terquimsa now uses one third of the total chemical quay and due to high demand for the land we have available we are studying different projects,’ says Climent. ‘The main objective of the chemical quay extension was to receive the largest cargo in the market. It allows us to respond to the increasing demand and remains effective and accessible without congestion and additional demurrage costs. ‘After the chemical industry restructured to become more competitive, it seems like the industry will be growing again.’

AUGUST/SEPTEMBER 2016 VOLUME 12 ISSUE NO.4

CHEMICAL PROFILE l ARABIAN CHEMICAL TERMINALS

LEVERAGING SUPPLY CHAIN OPPORTUNITIES T

he expansion of Arabian Chemical Terminals (ACT) to satisfy the growing demand for specialty chemical storage will help to create a seamless supply chain operation in Saudi Arabia. The expansion at its facility in Jubail Commerical Port involves the construction of two additional tankpits to house 13 stainless carbon and stainless steel tanks. Work is currently underway to connect the tanks to piping as well as further electric and instrument installation ahead of its expected commissioning in the first quarter of 2017. A major part of the facility is leased out to current and new customers and, in addition, some potential customers are looking into opportunities. However, there are still tanks available in all sizes as some restructuring of the existing tank farm has created some further opportunities. Once complete the facility will comprise 39 tanks supported by two marine berths to accommodate chemical tankers up to 220 meters. Additionally, plans are in place for ACT’s Yanbu facility in the Red Sea to modernise and expand, with loading systems with high accuracy metering and low utilisation rates. Plans are expected to come to fruition in the coming period. At the heart of these modernisation and expansion plans, is ACT’s ethos that safety is more important than production. In an interview with Tank Storage Magazine, Kasper Castricum, business development manager at ACT, explains: ‘Our main asset is manpower. So in other words, ACT cares for each employee working in any ACT facility. To ensure the safety of each person, reliability of

ACT and Sutton Arabia work together on a daily basis

equipment and the quality of production, ACT has put in place the ‘tenets of operation’.’ These 10 tenets set out practices for employees to abide by, including following stipulated procedures, reporting environmental, health and safety compliance information accurately and on time as well as addressing abnormal conditions and understanding procedures before proceeding. ACT seeks to capitalise on emerging opportunities not only in Jubail and Yanbu but in the wider GCC region. Castricum says that the facilities are attracting demand from a growing pool of international clients. ‘Demand for our storage comes from both regional and international sources. We have a high number of local key clients but recently have started to see a growing number of international clients looking at our facilities for the Middle East.

‘We have seen demand steadily increase as has the need for specialised firms such as ACT. ‘The approval from the Saudi government to release trading license to foreign companies leverages supply chain solution opportunities. Producers seek to integrate and allow verticals with their plant yield and feedstock more and more to focus on their core business and let us do ours.’ The additional capacity at Jubail will help serve a range of petrochemical projects in the region including SABIC, SATORP and SADARA in Jubail Industry City – an industrial complex developed by the Royal Commission of Jubail. ACT is also working with Suttons to realise a large logistics park in Jubail Industry Support Zone. The Suttons Arabia Park will accommodate tank and ISO cleaning stations, drumming installations and several support logistical services to the surrounding industries focusing on liquid and packaged chemicals.

AUGUST/SEPTEMBER 2016 VOLUME 12 ISSUE NO.4

CHEMICAL MARKET ANALYSIS

l CHEMICAL STORAGE

CHANGING CHEMICAL STORAGE DYNAMICS T

here are a number of trends impacting the outlook of the global chemical storage market. These include a shift towards the Asia-Pacific market and rapid growth in the Middle East and Africa; rise in export activity in North America; stress on the market due to the surge in low-cost fuel influencing limited storage availability; conversion of old refineries into more profitable, automated, and digital facilities including those enabling a mix of material; technology advancements in new applications, coatings, and performance materials; increased security measures, and movement towards more value-added services/solutions. Yet, to be able to fully understand the affect these dynamics will have on the chemical storage market, it is vital to also understand the forces driving change and growth in the global chemicals and specialty materials industry. For the past several years, Deloitte Touche Tohmatsu (Deloitte Global) has tracked a number of trends in the global chemical and specialty materials industry. In the initial stages, these efforts focused on the key question of how the chemical and specialty materials industry would rebound or reset itself since the last peak in 2007 and in the wake of the great recession of 2009. Now, in 2016 it is clear that some companies were able to recover and return to their 2007 position, yet others were not. Evidence has increasingly pointed to the reality that companies have an unrelenting focus on optimising their core business,

It is clear that some companies were able to recover and return to their 2007 position, yet others were not

AUGUST/SEPTEMBER 2016 VOLUME 12 ISSUE NO.4

which leaves little capacity or time to tackle the task of growing the company. Given these conditions, it is no wonder that the majority of companies and the industry have settled into an anemic pattern of growth that largely tracks gross domestic product. As companies decide whether to expand their scope into new areas of growth or stay true to their core, they will also have to contend with a number of rising threats to their operations. These challenges include cyber threats, regulations/policy, and the regional landscape â&#x20AC;&#x201C; all which have an effect on the global chemical storage market. CYBER THREATS As companies pursue technological advances, such as cloud computing, robotics, and artificial intelligence, the digital threat becomes increasingly complex â&#x20AC;&#x201C; but not impossible to overcome. The broadening scope of cyber-attacks is a function of many factors, including exploitation of system vulnerabilities, cyber espionage of research and development, and human resources strategies that favor shorter-term contract employment, over traditional job-for-life models. REGULATIONS/POLICY Environment, health, and safety protection regulations can lead to the relocation of the manufacturing of specific chemicals. Strict climate change regulation around high carbon dioxide emissions pricing could accelerate the developments of bio-based materials. Regulations that monitor greater fuel efficiency will likely have an impact on advancements in materials technology. On the policy side, protectionism will remain a factor whenever a country sets a goal for self-sufficiency. Policies to promote domestic employment will contribute to overcapacity, along with free-trade zones changing the way regional markets are served. Additionally, policies that influence the use of natural gas or alternative fuel sources for domestic use will likely impact the outlook of the chemicals and specialty materials industry. REGIONAL LANDSCAPE Markets are moving and will continue to move across geographies as they follow growth. Among developed economies, the US is currently the strongest, while chemical and materials players in western Europe

CHEMICAL MARKET ANALYSIS

l CHEMICAL STORAGE

face the prospect of searching for growth in a no-growth economic zone. Among BRIC (Brazil, Russia, India, and China) countries, China’s economy has slowed but opportunities still exist for chemical players, albeit ones that are more difficult to seize and with a shorter time window to realise. In India, economic growth is quite robust, and purchasing power is rising and creating millions of new consumers. GROWTH OPPORTUNITIES The global chemical storage market, like the chemical parcel tanker market, operates on imbalances, fluctuating growth rates, overcapacity, and supply disruptions. This sector will likely be impacted by major building programs in the Middle East and North America, which will create significant growth opportunities in export flows and the need to build additional storage facilities. Regional shifts will likely occur in strategic reserves, trading activity, and warehouse storage. As companies in the global chemicals and specialty materials sector prepare for the future, they are likely challenged to find new areas for growth outside of their core business. It is as hard (or harder) as competing on an un-level playing field with subscale core assets, assets approaching technological obsolescence, or with products that regulators or consumers are sun-setting. Fortunately, there are options for companies that need more than their core can deliver. These companies may shift a few links down the value chain to become more

solutions oriented, with stronger, more direct, relationships with customers and a more value-based business model. The shift downstream to specialties, a trend in the Middle East, will likely have an impact on storage requirements including a multitude of smaller tanks, stainless steel, flexible operations, improved efficiency, to name a few. The traditional response to the need for growth has always been innovation. For over 50 years, researchers and engineers worked day and night in labs, plants, and in the field to seek out and discover new molecules, materials, and applications that substituted for or improved upon existing products. Their inventiveness, commitment, and dedication to continuous improvement helped their companies maintain admirable rates of growth. It is challenging for today’s companies in the chemicals and specialty materials industry, along with those in the global chemicals storage market, to focus on the problems and solutions of the future, while still operating and managing their core business. No longer should companies look at the current state of the industry with a “straight line.” They need to take into account the disruptors and what drivers will influence the most returns. ABOUT THIS ARTICLE This communication contains general information only, and none of Deloitte Touche Tohmatsu Limited, its member firms, or their related entities (collectively, the “Deloitte Network”) is, by means of this communication, rendering professional advice or services. Before making any decision or taking any action that may affect your finances or your business, you should consult a qualified professional adviser. No entity in the Deloitte Network shall be responsible for any loss whatsoever sustained by any person who relies on this communication.

FOR MORE INFORMATION This article was written by Duane Dickson, vice chairman, global and US chemicals & specialty materials sector leader at Deloitte Consulting

AUGUST/SEPTEMBER 2016 VOLUME 12 ISSUE NO.4

CHEMICAL PROFILE l LBC TANK TERMINALS

CHEMICAL STORAGE OPPORTUNITIES IN EUROPE With the petrochemical industry predicted to consistently grow over the next five years, LBC Tank Terminals are capitalising on these emerging tank storage opportunities

he chemical and petrochemical industry in Europe is undergoing a welcomed resurgence, with growth of 3% per year predicted for the next five years. Coupled with increasing import flows to the region as a result of imbalances between chemical production and demand – opportunities are ripe for tank storage in Europe. On the back of these favourable market conditions, LBC Tank Terminals’ facility in the Port of Rotterdam is undergoing an expansion with the construction and lease of a new jetty as well as two new tankpits with 36,000 m3 stainless steel heatable capacity. Overall, the operator plans to have an additional 179,000 m3 of capacity, a new jetty with two seagoing berths and two barge positions, up to 14.5 meters safety draft, central truck loading facilities and increased capacity for rail cars. In an interview with Tank Storage Magazine, Dominique Waeytens, general manager for northern Europe, says that the ARA region is concentrated with chemical storage opportunities due to its high concentration of chemical plants. ‘Synergies on shared utilities, the concentration of producers and their industrial clients, and other cluster advantages make Rotterdam well positioned for growth.

AUGUST/SEPTEMBER 2016 VOLUME 12 ISSUE NO.4

‘The growth in the petrochemical industry will drive demand for basic chemicals, intermediates and other liquid chemicals to produce polymers. ‘Growing demand and growing imports create opportunities for tank storage in Europe. We also see customers consolidating tank storage needs in hub locations such as Rotterdam and Antwerp, close to their customers.’ In the US, the low oil prices have contributed to a slow down in the expansion plans of olefin plants, and has also triggered strategic reviews of European refinery capacities. As a result, some customers have been reluctant to engage in longer-term commitments, however Waeytens has seen this trend reverse recently. As a result of these market dynamics and ever increasingly demanding customers, competition in Rotterdam and Antwerp is significant for operators, thus making storage efficiency, flexibility as well as fast turnaround times paramount. Company executives are also confidents that they can triple the size of the Rotterdam terminal over the next three to five years. ‘Rotterdam is a key hub for the petrochemical industry, with excellent connections by waterway, pipeline, rail and road. ‘In southern Europe, many of the LBC terminals have unique assets and handle products with strong local demand and long-lasting customer relationships. We have seen some movements of capacity between Le Havre and ARA, but in the rest of France and in Iberia the LBC terminals have shown steady growth in recent years. ‘Also, our US terminals in Houston and Baton Rouge are seeing significant growth, due to continued high oil production in the US and continued high storage demand of chemicals and petrochemicals storage along the Gulf Coast.’ Besides its project in Rotterdam, the company is also embarking on a significant investment programme in Houston, with the creation of an additional 632,000 m3 of additional tank capacity as well as a new ship dock and two additional barge docks and a strategic alliance with Magellan in Seabrook Logistics. The Houston project is in the first phase of construction, which comprises 93,000 m3 shell capacity barrels with an expected commissioning date of April 1 2017. Subsequent phases are planned to commence in the 2017 financial year for the second phase and the 2018 financial year for phase three.

CHEMICAL TECHNICAL FEATURES l CONTAINMENT

EFFECTIVE PROTECTION FOR SECONDARY CONTAINMENT AREAS IN CHEMICAL STORAGE

rotecting the inside of chemical storage tanks from corrosion and leakage is of paramount concern to bulk liquid storage facilities, tank farms and chemical processing operators. Just as vital is the protection of the areas in and around and underneath tanks, including concrete tank pads, flooring, secondary containment and waste water areas. These areas must be able to withstand spills and splashes, and tank leaks from aggressive chemical exposures, including strong acids, alkalis, gases, solvents and oxidisers, to prevent migration into the concrete surfaces. Advanced Polymer Coatings (APC), has developed various ChemLine coating formulations that are ideal on concrete applications. These coatings are based on a unique, patented cross-linking polymer system that creates a very dense, tightly knit chemical structure, with a virtually impenetrable surface. TURKEY’S UDME SEEKS TO SAFEGUARD CONCRETE SURFACES WITH CHEMLINE At the GÜBRETAS fertilizer factory in Turkey, the manufacturing operations produce a range of fertilizers and related products that are used in the Turkish agricultural sector. UDME consulted with APC to review what high performance coatings would provide acid resistance on new concrete pads that will hold chemical tanks used in fertiliser production and the surrounding areas at the facility. UDME’s focus was to protect these concrete areas from any potential leakage of chemicals from valves-lines to and from the tank, and also any release directly from the tanks. APC also studied the cargo (chemicals) and temperature service conditions to monitor what types of potential splash, spill and leakage situations that could occur, and checked these against ChemLine’s coating resistance list.

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CHEMICAL TECHNICAL FEATURES l CONTAINMENT 01 At this new concrete secondary containment pit, the surface is first cleaned and prepared for the coating application 02 After the primer coat of ChemLine is checked, stripe coating of ChemLine (red colour) is applied 03 The containment areas are lined with a ChemLine base coast (red), followed with a ChemLine top coat (grey) to finish out the protective lining application 04 ChemLine can be used for a range of different service applications 05 The versitaility of ChemLine can protect concrete surfaces in, around and under tanks.

These conditions included: • 18% Phosphoric acid • 10% Hydrogen sulphate-sulphuric acid • 98% Chlorine – fluoride • Operating temperatures between 95˚C to 105˚C (203˚F to 221˚F) All the concrete surfaces coated were new, covering more than 1,000 square meters of surface area. For heat curing ChemLine coatings in these large outdoor areas, APC built a protective enclosed area using plastic sheeting wrapped around the staging as a support. This provided adequate protection during the heat curing stage.

CHEMLINE SECONDARY CONTAINMENT PROTECTION In the country of Turkmenistan, one of the largest thermal power plant builders in the region specified ChemLine coating for concrete secondary containment protection. ChemLine was applied at three different power facilities in the cities of Ahal, Lebap and Mary. Various chemicals are used at these facilities, including the following, and these are all safely contained with ChemLine: • 98% H2SO4 (Sulfuric acid) • 0-100% NaOH (Sodium hydroxide) • 0-19% NaOCl (Sodium hypochlorite) • 0-50% FeCl3 (Ferric chloride) at ambient temperature. For these projects, APC first applied a ChemLine primer coat (blue colour), with ChemLine (red colour) next as the base coat, finished with ChemLine (grey colour) as the top coat.

ADDITIONAL CONCRETE PROTECTION PROJECTS The following photos illustrate how ChemLine is also effectively used to protect a wide range of concrete and secondary containment areas. This protection is an imperative for any bulk liquid storage facility, tank farm or chemical processor that wants to meet regulatory compliance and that wants to protect the environment from the hazards of chemical products.

FOR MORE INFORMATION This article was written by Norbert Hobrath, (+1) 440 937 6218. www.adv-polymer.com

AUGUST/SEPTEMBER 2016 VOLUME 12 ISSUE NO.4

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AUGUST/SEPTEMBER 2016 VOLUME 12 ISSUE NO.4

Technical news

TECHNICAL NEWS

All the latest terminal technical news from around the globe

Coupler innovation promises to revolutionise terminal loading OPW Engineered Systems has brought to market the LYNX coupler to its line of terminal solutions. The coupler incorporates a U-pin design that enables an operator to disassemble the couple in a matter of seconds. This design enables the operator to gain access to the internal components, perform maintenance and quickly put the coupler back in service. Dave Morrow, director of products for engineered systems says: ‘A single coupler might be responsible for the transfer of millions of gallons of fluid, so you want to shorten the service cycle as much as possible.’ Each LYNX coupler comes with a five-year warranty and it can extend the life of the wave spring as well as handle surge pressures up to 500 psi.

Revolutionary singlepoint top-loading system launched The SmartTech Logic terminal ground system, the first all-in-one system for loading terminals, has been launched by SixAxis. Ther terminal grounding system controller by SixAxis’ new subsidiary SmartTech provides multiple truck and railcar grounding operations all in one enclosure. It contains features including monitoring potential overfill; monitoring loading arm position, enabling dead-man control and the ability to log external environmental conditions such as temperature and humidity. The interface allows the operator to immediately see operational issues and activities via a pre-set menu. Real-time wireless communication to the terminal automation system is also possible with this grounding system. Graeme Murphy, VP of business strategy and development for Saferack says: ‘I am not exaggerating when I say that there’s no system in the world – and no combination of controllers in the world – that provides this range of functionality for truck and railcar terminal operations as well as tank farms.’

MTS Sensors product line NEC and CEC certified

MTS Sensors’ Temposonics T series product line is now certified to NEC and CEC Standards 500, 505 and 506. These certification standards are used in US and Canada to ensure that equipment meets certain standards for operating in potentially hazardous conditions. The positions sensors are now ATEX, IECEx, NEC and CEC hazardous area certified for use in Class I, II, III, Divisions 1, 2 – Groups A,B, C, D, E, F, G as well as Zone 0/1m 21 and 22.

AUGUST/SEPTEMBER 2016 VOLUME 12 ISSUE NO.4

TECHNICAL NEWS

New wirelesslymonitored storage tank emergency vents Emerson has introduced wirelessly-monitored Enardo 2000 emergency pressure relief vents for abnormally high storage tank pressures in the oil and gas, chemical and petrochemical industries. The new product design consists of a proximity indicator and wireless transmitter integrated with an EPRV. The indicator senses movement of the emergency vent. ‘Open’ or ‘closed’ signals are received by the wireless transmitter and can be sent to a control room via a WirelessHart gateway. Emerson Process Management’s product manager Steve Attri says: ‘Though EPRVs represent the last line of defence against tank overpressure, they have largely remained unmonitored. Along with the recent introduction of wirelessly-monitored pressure vacuum relief vents more information is now available to quickly identify and resolve pressure issues that can impact safety and emissions.’

Pentair brings new series of pressure and vacuum relief valves to market The new Anderson Greenwood 4000 Series of pressure and vacuum relief valves, compliant with the latest API 2000 standard, has been launched by Pentair Valves and Controls. These valves are the first high capacity full lift valves verified to meet the requirements of the 7th edition of API 2000, which covers normal and emergency vapour venting requirements for bulk liquid storage tanks. They provide increased flow capacities and will fully open at 10% overpressure, helping protect tanks from physical damage caused by internal pressure fluctuations. This means the valves can be set more closely to a storage tank’s maximum allowable working pressure or maximum allowable working vacuum. The valves remain closed longer and enhance flow capacity, resulting in increased productivity and reduced evaporation. The range is available in weight or spring-loaded designs and comes in two to 12 inch sizes.

AUGUST/SEPTEMBER 2016 VOLUME 12 ISSUE NO.4

TECHNICAL NEWS

European-wide insulation projects underway for Belfa Belgian-based Belfaconstruct is working on several tank insulation projects across Europe as insulation and cladding deliver proven cost savings for operators. The company, which launched in 2011, is about to embark on insulation works at McCain’s production plants in Lelystad, in the Netherlands, and Harnes, France, and has just completed the insulation of six steel tanks in Locminé, France. Additionally, Belfaconstruct is also underway with its first UK project in Nottinghamshire for the cladding of two concrete tanks and will begin a project in January 2017 for the insulation and cladding of 15 steel tanks in Norway. Belfaconstruct specliaises in the construction and insulation of steel tanks, and the cladding of concrete tanks, all over Europe. In response to companies facing greater constraints on their budgets as larger projects struggle to get the necessary financing after the economic crisis in 2009, Belfaconstruct offers greater project flexibility and detailed preparation before arriving on site to ensure works are completed swiftly and efficiently. Owner Bert Boonen says: ‘The speed difference

in works distinguishes us from other companies and allows us to move on the market with a sharper price. ‘What has also changed is the demand for greater flexibility, which we have built into our operations. ‘Tank insulation is one of the last steps in the process of building tanks. We come on site last and our works are the finishing touch to the project so the cladding is the aesthetic part. The cutouts and metal roofs are carefully made and produced on site.’ The company is highly-focused on safety and in addition to running safety courses for its workers, every worker has a VCA certificate and are certified to work on heights and to build scaffoldings. Boonen adds: ‘Through our close connection with an established company, we can quickly put all the necessary papers in place to start works in a ‘new’ country. ‘We try to be flexible, modern and efficient in every way.’

• Additive Injection • Loading Systems • Blending • Vapour Recovery • Access Solutions

+44 (0) 1329 284145 sales@FlotechPS.com www.FlotechPS.com

AUGUST/SEPTEMBER 2016 VOLUME 12 ISSUE NO.4

Find us on Stand 58 at the Tank Storage Conference & Exhibition

TECHNICAL NEWS

Ergil to supply heat exchangers for Kazakhstan refinery

Ergil has been assigned to supply 11 heat exchangers to the Atyrau Refinery Deep Oil Refining Complex project. The third biggest refinery in Kazakhstan has a capacity of 16,600 m3/day. The company worked with Jsc Ogcc Kazstroyservice to secure the project. Ergil will supply shell and tube heat exchanger to KSS. The shell and tube types have been designed and manufactured at Ergil’s facility in Turkey. Diethanolamine (DEA) regenerator reboiler, methyldiethanolamine (MDEA) regenerator reboiler, reboiler sour water stripping (SWS), hydrogenation cooler, stripped water trim cooler are the heat exchanger types that would be supplied. The minimum design pressure was 4.6/ FV Kg/cm2 and maximum was 15.4/ FV Kg/cm2 for shell type heat exchanger and for tube type heat exchanger minimum was 4.2 kg/cm2 and maximum was 20/ FV kg/cm2. These are some of the designing standards adopted to design the heat exchangers for KSS.

Fort Vale launches new version of Safeload API bottom loading coupler Fort Vale is launching a new version of its loading coupler with an aluminium handle. The new handle reduces the mechanical effort required to open and close the poppet during service. It has a grab handle to make it even quicker to manoeuvre the coupler onto the tank adaptor and a non-slip ball for extra safety during actuation. Whilst the handle is rugged, it is lightweight and is an available option across the entire Safeload API range. The company says that its coupler improves safety and keep maintenance requirements minimal. Extended triggers cover more than 60% of the adaptor circumference, improving connection and reducing wear on the adaptor. A splined spindle offers greater engagement and strength to the handle and internal components than traditional pins. Safeload has internal compression springs which are more durable. The actuating springs are also internal and are therefore not vulnerable to damage or corrosion. The coupler underwent rigorous testing in various settings and environments. At the beginning of 2016 the company launched its new Safeload loading arm system, of which the key component is the balance mechanism, which is manufactured in stainless steel instead of traditional cast steel with a coated finish Euan Fisher, business development manager for petroleum products says: ‘One client has over 150 couplers in daily service and has had zero maintenance issues after seven years constant heavy use.’

AUGUST/SEPTEMBER 2016 VOLUME 12 ISSUE NO.4

TECHNICAL NEWS

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It will feature extensive analysis on the dynamics in this market as well as the latest storage terminal and technical developments as well as in-depth operator interviews.

The magazine is the official publication for Tank Storage Germany and will be handed to EVERY visitor and delegate at the show. It will also be distributed at: • Intermodal Europe, Rotterdam, the Netherlands • Argus Africa Storage & Logistics, Cape Town, South Africa • Oil Terminal, Saint Petersburg, Russia

Editorial topics to include: • Spill control, emergency response and remediation • Leak detection in tanks and pipelines • Fire prevention • Ground preparation • Planning and financing terminals and expansions • Hoses and couplings • Intermodal

CONTACT US TODAY TO SECURE YOUR ADVERTISING POSITION: David Kelly International Sales Manager E: david@tankstoragemag.com T: +44 (0)20 8843 8161 FOR EDITORIAL ENQUIRIES CONTACT: Jasmin McDermott Online & Content Editor E: jasmin@tankstoragemag.com T: +44 (0)20 8843 8159

Advertising deadline: 5th October

Serving the tank storage community globally AUGUST/SEPTEMBER 2016 VOLUME 12 ISSUE NO.4

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Ultra-lo k vap arm ✔ AL or retu ng rea L CR rn line ch, Sho s rt tail FLUID YOGENIC , PRES S AN LNG – D GA SURIZ CNG SSES ED AN – Oils Rotary is ISO 9001, ISO 14001, OHSAS certified and is listed ✔ISO – Che and is listed Rotary is ISO 9001, OHSAS certified D HE FL14001, EX Exchange on the mainboard of Singapore since 1993. mic ATED on the mainboard of SingaporeIBL Exchange E LNsince 1993.als ✔ 100 G BU % EN NKER Rotary’s capabilities include: 1474ING SO Rotary’s capabilitiesLN include: G MA • EPC for bulk liquid storage terminals LUTIO RINE 1:2009 CE • EPC for bulk liquid storage terminals Revolu NS LOAD RT • EPC for offsite & utilities tion ary effi ING AR IFIED • EPC for offsite & utilities cient • Front-end engineering design (FEED) & detailed engineering MS self • Front-end engineering design (FEED) & detailed engineering

Rotary Engineering Limited (HQ) Rotary Engineering Limited (HQ) 17 Tuas Avenue 20 Singapore 638828 • Tel: (65) 6866 0800 • Fax: (65) 6866 0999 17 Tuas Avenue 20 Singapore 638828 • Tel: (65) 6866 0800 • Fax: (65) 6866 0999 Website: www.rotaryeng.com.sg • Email: bdd@rotaryeng.com.sg Website: www.rotaryeng.com.sg • Email: bdd@rotaryeng.com.sg

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TECHNICAL FEATURES l COATINGS REMOVAL

ROBOTICS AND INDUCTION HERALD GREENER TANK REFURBISHMENT RPR Technologies combines a patented induction technology and robotics to reduce cost, down time and the environmental impact of tank refurbishment

PR Technologies combines a patented induction technology and robotics to reduce cost, down time and the environmental impact of tank refurbishment Every year there are millions of square meters of coated steel surface in storage tanks across the globe that require refurbishing. Estimates suggest that Europe along accounts for 12-15 million m2. Stripping of protective coating is traditionally carried out using manual or robotic abrasive blasting or UHP water. These technologies require large quantities of energy and processing grit or water. Refurbishment expenses, extended down time and waste handling represent a considerable cost to storage tank owners and management. In addition to the economic impacts, the traditional stripping methods leave a heavy CO2 footprint, risk of local contamination and health hazards to operators and workers. COATINGS REMOVAL BY INDUCTION Induction heating for coatings removal on steel substrates is an appealing alternative that is rapidly gaining recognition. RPR Technologies AS, with their unique patented solutions, provides a range of induction paint removal systems. The technology operates by transferring high frequency electric currents to magnetic steel by moving an inductor head over the surface, facilitating a localised controlled and fast heating of the steel. This results in a fast disbonding of most types of coatings with thickness up to 20-25 mm. The RPR system requires a minimum steel thickness of 5 mm to avoid damage on the backside coatings or insulation material used. 01

01 With induction heating the coating can easily be scrapped off 02 RPR induction system 03 Robotics for vertical applications 04 Minimised waste disposal

COATING TYPES AND DISPOSAL While the technology can be used on most paints and coatings it is particularly efficient on thick and resilient systems where one would have to use large quantities of grit or water, or even chisel to remove otherwise. The RPR induction system can remove most type of coatings like GRP, reinforced epoxy, 3LPE, PFP, antiskid (Epoxies) and thick rubber coatings. Easy containment and no contaminated deposits of sand or water make induction not only practical on tough surfaces but also on coatings containing hazardous substances like asbestos, lead or PCB. Unlike blasting methods, induction does not break the coating into small particles, but it rather comes off in strips and flakes for easy bagging and containment.

AUGUST/SEPTEMBER 2016 VOLUME 12 ISSUE NO.4

TECHNICAL FEATURES l COATINGS REMOVAL 03

ECO INNOVATION – THE GREENTANK PROJECT Based on the environmentally-friendly properties of the RPR Induction technology, the European Commission has, through its eco innovation program, granted funding to co-finance a project called GreenTank. The project intends to develop the RPR induction system for removal of coatings in storage tanks with focus on environment, health, safety, time and costs. The GreenTank project consortium consists of RPR Technologies, OFTEC GmbH and Jak. J. Alveberg AS. Less disposal and reduced handling/transport benefits the environment. Health hazards such as noise and harmful particles/dust in the air are greatly reduced, requiring less need for protective gear and rendering induction equipment safer in use. Other benefits are increased stripping rates per hour, more efficient working conditions and shorter down time. The cost reduction comes from reduced logistics and waste handling, shorter down time, higher removal rates, reduced energy costs and fewer man hours. By replicating the use of RPR induction heating combined with elements of robotic platforms used in competitive methods, the project aims to double the stripping rate and reduce energy consumption with more than 50%. The eco-innovation initiative bridges the gap between research and the market. It encourages innovative ideas for new products, services and processes that protect the environment and helps them become fully-fledged commercial prospects, ready for use by business and industry. In doing so the initiative not only helps the EU meet its environmental objectives but also boosts economic growth. Eco-innovation is about reducing the industry’s environmental impact and making better use of resources. In terms of tank refurbishment, the GreenTank project meets all these 04 objectives. RPR Technologies now offers optimised solutions for storage tanks where the induction heads are mounted to robotics and electric trollies with vertical support. These automated aids are in particular ideal for removal of difficult coatings on tank floor and lower wall section, securing a consistent predictable result and alleviating work load for the operators.

electric trolley for tank floor and lower wall section was tested in three different tanks ranging from 28 to 70 meters in diameter and proved to be at least twice as fast as sand blasting. Surface coatings; coal tar epoxy (600 microns), solvent free epoxy (1000 microns) and amine cured epoxy (500 microns) were cleaned down to the zink silicate or iron oxide primer. The stripping rates of thick GRP, epoxy and polyurethane coatings, often found inside storage tanks, are according to RPR’s findings two to five times higher than conventional methods. The tougher and thicker the coatings is, the more efficient RPR’s induction system reportedly becomes compared to other systems. New coatings can often be applied directly over RPRtreated surfaces, but in certain cases a quick sweep blast may be necessary to achieve required cleanliness and/or specified surface profile. Nonetheless even when sweep blasting is warranted, using RPR induction will still be a significantly more cost-effective solution. Paint stripping inside storage tanks generally require up to 100 kilograms sand per m2 that needs to be managed through the manhole. Removal via RPR induction does not add any waste or contaminated water and thus greatly reduces handling, transport and disposal costs. Energy wasted on transport and processing is one thing, another is the actual energy consumption in use. According to the Norwegian National Institute of Technology, the typical consumption of the induction system is 25-30% to that of abrasive blasting or UHP water. Adding to the merits of induction are quiet operation and safer working environment for the operator and co-workers. Airborne particles and gas emissions are very low and the work can be done in tanks simultaneously with inspection and other maintenance work taking place.

FOR MORE INFORMATION This article was written by Tommy Gabe, RPR Technologies sales manager, tg@rprtech.com and Hans Petter Engejordet, RPR Technologies marketing and sales director, hpe@rprtech.com at RPR. www.rprtech.com.

RPR INDUCTION IN ACTION The latest GreenTank demonstration was done at Repsol Petronor Refinery in Bilbao in April 2016. With a capacity of 220,000 barrels/day, Petronor is one of Spain’s largest refineries. The RPR induction system with

AUGUST/SEPTEMBER 2016 VOLUME 12 ISSUE NO.4

TECHNICAL FEATURES l XXXXXX XXXXXX

AUGUST/SEPTEMBER 2016 VOLUME 12 ISSUE NO.4

TECHNICAL FEATURES l FLOATING ROOFS

NAVIGATING THE SPECTRUM OF INTERNAL FLOATING ROOFS

nternal floating roofs (IFRs) have been used and proven for many decades in storage tanks all over the world. Over the years various types of IFRs have emerged in the market and whilst focusing on different aspects, all comply to API 650, Appendix H. There are various options for end users who opt for a low maintenance IFR made of aluminum alloy or stainless steel. There are various factors to consider when deciding which IFR to use. CHOICE OF MATERIALS There are several material choices available between carbon steel, stainless steel, aluminum alloy and lately GRE. Carbon steel This is the oldest and still very common material found in IFRs. It can be supplied by the same tank builders who have built the storage tank and it is welded and has to comply to the same welding standards as storage tanks. It is robust yet flexible and suitable for virtually all storage products. Building an IFR in carbon steel takes quite some time and a lot of expertise on site as all the manufacturing and fitting is done there. Also, carbon steel needs regular maintenance to control corrosion. This can lead to unpleasant down times.

a lot, especially if multiple tanks are being built simultaneously, as the tank builder can concentrate on tank shells. It is nevertheless very important to use an experienced and trustworthy supplier who guarantees a proper functioning of the IFR during its life cycle. The costs of down time are much higher than the cost of the IFR, if it needs to be dismantled or modified later on.

01 01 Detail of VaconoDeck AL-P QE2 (aluminium pontoon type deck) 02 VaconoDeck SS-FC QE2 (full contact stainless steel deck) 03 Detail of VaconoDeck AL-FC QE (full contact aluminium deck) 2

04 VaconoDeck SS-FC QE2 from the top view

Stainless steel The most adaptive material to potentially changing storage products is stainless steel. Due to its relatively high price it is mainly used for corrosive products, or in the case of biofuels, for just those parts of the IFR that are in direct contact with the liquid. GRE This can be provided in various qualities to comply with the stored product. Its low degree of prefabrication requires a skilled workforce

Aluminum The lightest and ultimately cheapest option, aluminum is suitable for almost all storage products used in the industry. There are limitations in terms of corrosion resistance against sulfur, demineralised water and certain aggressive chemicals. The biggest advantage of aluminum emerges during installation. These decks are usually prefabricated in the manufacturerâ&#x20AC;&#x2122;s workshop and can be bolted together on site from crews under the manufacturerâ&#x20AC;&#x2122;s supervision. This speeds up the installation

AUGUST/SEPTEMBER 2016 VOLUME 12 ISSUE NO.4

TECHNICAL FEATURES l FLOATING ROOFS

on site, which may not (yet) be available everywhere. Also, this metal oriented industry has very little experience with plastic materials. It thus may be quite difficult for a purchaser to present the correct specification. FULL CONTACT A basic choice in design has to be made between the so called full contact decks and pontoon type decks. Full contact decks are fully immersed into the product and have no vapour phase between the product and the IFR. Pontoon-type decks however only have their floating pontoons wetted in the product, with the skin that acts as vapour barrier a few inches over the product level, thus leaving a certain amount of vapour space between the deck and the product. The main advantage of skin and pontoon decks is probably the low material and installation cost, and it can usually be brought into the tank through the tank manhole, whereas full contact IFRs usually have much larger parts that need additional entry doors or roof openings. EASY INSPECTION Another important design aspect is the ability to verify if there floaters are gas free when a tank inspection is due with hot work in the tank. Different manufacturers have introduced different designs, especially for the full contact decks. Foam filled panels make it nearly impossible to properly identify gas in them. The so called honey comb aluminum panels need special vapour permeable honey comb cells to make an inspection possible. In reality though this will be quite difficult. The best option would be empty floaters where no gas can be trapped. This would apply for pontoons as well as for certain makes of aluminum or stainless steel full contact decks. Single deck open top IFRs can also be found made from aluminum. They provide ultimate visibility for trapped product but are subject to flooding from the top. Usually, you will find (old) pan type steel IFRs, which are rarely used these days as they do not have multiple flotation compartments and do not qualify as IFR in NFPA. A different type of IFR is the open-top bulkheaded design, which is an evolution of the

pan type deck. It has multiple flotation compartments and qualifies for rim foam systems in NFPA but it does not provide protection against product or water from the top, as eventually the open top floaters will keep the liquid on the top side without the possibility to drain it. The design is rather simple though and therefore not very expensive. This type of IFR is usually made of carbon steel, but there are designs in stainless steel as well as in aluminum. The most common design for IFRs made from carbon steel has peripheral closed-top bulk-headed compartments and other closed compartments distributed over the surface if required. This option ensures proper operation under virtually all conditions, allows drainage of product on the top side and offers good inspection possibilities of the flotation compartment through inspection hatches on the top side. The downside of this design is the weight, the subsequent loss of storage volume and ultimately the cost. Another option is the double-deck with continuous closed top and bottom decks, which contain various compartments. All of those four designs are designed as full contact decks which are in full contact with the liquid surface. The IFR on floats is the most widely spread design for aluminum decks. It is easy to

DIFFERENT DESIGNS OF INTERNAL FLOATING ROOFS

Carbon Steel Aluminum

GRE

Full contact Not full contact

Pan type

Open-top bulk-head

Closed-top bulk-head

Double-deck

IFR on floats

Sandwich-panel IFR

X X

install, also as retrofit, as it fits through the tank manhole. It is the most cost efficient option compared to all other designs, it is very light weight and yet flexible to accommodate movement of the stored product. As it is not in full contact with the product, the proper design of the structure, including the clamping systems, is very important. With around 5,000 installations worldwide, the pontoon type Vaconodeck is one of the most well-known products in the market. A subject of great debate concerns the sandwich-panel/composite IFR. It is an array of different full contact designs made from aluminum. It may include honeycomb or foam cores for stability. This design combines the typical advantages of aluminum, such as very low maintenance cost, high level of prefabrication and easy installability with a full contact and robust design usually know from carbon steel decks. Vaconoâ&#x20AC;&#x2122;s product comes with a solid aluminum framework fitted with pressure tested rectangular floaters. The floaters are empty with neither foam nor honeycomb structures, which allows easy detection of combustible gases in the floaters. Also, the amount of weld seam in the product is reduced by 99% compared to welded honeycomb designs. One aspect that has emerged recently, and mainly in the US, is the focus on welded vs clamped deck seams. The potential leak from clamped seams is regarded as quite important by the Environmental Protection Agency who define the emissions for IFRs. As there are quite different approaches in the market from different manufacturers it is probably quite simplistic to come this digital approach. The difficulty starts when it comes to welding nonferrous metals in a tank environment. Various installations by otherwise established manufacturers have shown unexpected difficulties. Also, aluminum weld seams have

AUGUST/SEPTEMBER 2016 VOLUME 12 ISSUE NO.4

TECHNICAL FEATURES l FLOATING ROOFS

quite different mechanical properties than carbon steel welds. The future will show if this approach can be maintained successfully, especially with a shortage of aluminum welders available in the market. From a manufacturer’s point of view this development goes in the wrong direction as it forces both users and suppliers to adopt solutions that lack a proper quality control just to improve the permitting situation. As a user there are choices to be made beyond price or install time and cost. The expected operating life of an internal floating roof should equal the tank’s life cycle. So it is quite worthwhile to invest some time to find out what the requirements really are today and tomorrow. Serious and reasonable IFR manufacturers should be able and competent partners to discuss suitable options before the budgets are made. In the end every solutions bears its ups and downs and there is no such thing as black and white for this choice.

FOR MORE INFORMATION This article was written by Marco Micelli, CEO at Vacono Aluminium Covers. vacono@vacono.com

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PONTOON SYSTEM Low maintenance internal floating covers to limit the emissions which occur where volatile hydrocarbons are stored. • • • • • •

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CONTACT US: Vacono America LLC Vacono Aluminium Covers GmbH www.vacono.com www.vacono.com info@vaconoamerica.com vacono@vacono.com AUGUST/SEPTEMBER 2016 VOLUME 12 ISSUE NO.4

TECHNICAL FEATURES l SAFETY

INVESTING IN SAFE ACCESS AND LOADING ARMS BEST PRACTICE

oadtec Engineered Systems’ first distributor training event in Italy provided a comprehensive overview of the nuances of the safe access and loading arms industry. Tank Storage Magazine was invited along to gain a greater understanding of the company’s operations Continued and long-term investment in education and industry best practice in safe access and fall prevention systems sits at the heart of Loadtec Engineered Systems’ business model. The growth of the company in the provision of fall prevention systems and fluid transfer solutions has prompted a growth in its distributor network to span the Americas, Europe, the Middle East and Asia. To ensure consistent product knowledge delivery as well as to keep up to date with the latest market trends affecting the bulk liquid storage industry company executives organised a distributor training event at their collaborative partner Zipfluid’s factory in Bologna to give an overview of their product line as well as key industry themes. Loadtec managing director Alec Keeler explains: ‘It is critical when working in exacting environments that our staff and representatives understand the client’s problems and have the confidence to question the validity of the brief they are given. Giving them that confidence comes from close support, training and development of their skills. ‘We are committed to a long-term plan of education and close support of our field agents. Familiarisation within the factory and our in-house team is important, but this has to be complimented with regional training events to understand the nuances of culture and level of technical development in their home countries.’ The two day training and networking event in Bologna underlined these principles with presentations on the specifics of marine loading arms by head of marine Martin Dicke-Künitz

including various technical parameters that need to be considered, tanker sizes, tide levels as well as manual or hydraulically powered operations. Keeler then went on to explain the fundamentals of loading arms, including the company’s range of Zip-Load loading arms for the chemical and industrial markets as well as the company’s core principles behind these products. 01 Delegates are given demonstrations of various loading arms

This was followed by a talk about safety and fall prevention systems. Keeler highlighted real-life, operational examples of an inherent lack of understanding surrounding safety and fall prevention systems as well as how the company is working to address these deficits with their range of solutions including the multi modal elevating safety access system. In addition, Loadtec’s latest venture, Loadtec Service, a new division of the company pro-

02Alec Keeler demonstrates the tilting multimodal access system 03 Handling a loading arm 04 A vintage Ferrari at the Righini Collection

AUGUST/SEPTEMBER 2016 VOLUME 12 ISSUE NO.4

TECHNICAL FEATURES l SAFETY

viding servicing and support for road, rail and marine loading and access equipment was also discussed in greater detail. Led by Dicke-Künitz and Rob Williams, Loadtec Service will ‘plug a gap in the service industry’ according to Keeler. He adds: ‘We have seen a huge shift in the capital purchasing of goods where there is still a lot going on but customers are more wary of investing in something that is a short-lived item.

There have been a lot of companies coming to the market that are driving prices down for equipment but not offering the total care package. Customers have been disappointed, initially they get low capital cost but paying a high lifetime cost. We don’t think that is morally right and we would like to be in it for the long haul. We want to be involved at concept and consulting stage, to provide the best quality technical solution and to go on and support our products through their lifetime.’ In addition to the company’s new division it has also very recently acquired a majority share in Incontrol Projects, a loading and access equipment service, maintenance and repair company in the UK. Keeler adds: ‘We have already worked together as far afield as Russia, Bangladesh and Saudi Arabia, with great success. Incontrol have also built some amazing systems for us in the last few years so the natural development of that is to join forces.’ Distributors were given a tour of the Zipfluid factory. There were working demonstrations of various loading arms for different applications as well as a wide range of safe access equipment. In the evening distributors were treated to a gala dinner at the Circolo della Caccia club as

well as a tour of historical Bologna. On the second day, as part of the networking event, distributors were given a tour of the private Righini Collection, which comprises a rare and unique collection of classical, vintage cars.

FOR MORE INFORMATION www.loadtec.co.uk

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AUGUST/SEPTEMBER 2016 VOLUME 12 ISSUE NO.4

TECHNICAL FEATURES l EMISSIONS

LOWERING STORAGE TANK EMISSIONS S

torage tank vapour emissions have experienced significant reductions over the past 30 years. Regulatory requirements have driven a host of tank upgrades now available to the industry. Upgrades include internal floating roofs, external floating roofs, guide pole sleeves, double seals, liquid mounted mechanical shoe seals, closed loop sample systems, inert gas blanket pads and vapour recovery systems. In addition, updated tank monitoring systems, use of overfill alarms and operating procedures have further reduced vapour emissions by better product level monitoring, required scheduled seal inspections as well as minimising poor past practices like: emptying tanks for extended periods, routine product stripping and refilling operations, overfilling of tanks and so on. Lowering of tank emissions from this point forward is a challenge as most of the larger emission sources have been addressed. To achieve further reductions will require examining

01 Examples of tank storage installation and repairs 02 Exmples of current in-service repair options 03 Tank vapour emission reductions have been driven by regulatory changes

AUGUST/SEPTEMBER 2016 VOLUME 12 ISSUE NO.4

the remaining emission sources. Tank operations such as tank cleaning, initial filling and unscheduled maintenance activities can produce a substantial amount of hydrocarbon vapours. In order to mitigate emissions from these activities conventional practices should be challenged and replaced with use of better technologies, operational and maintenance practices. Due to the migration by the industry to APIâ&#x20AC;&#x2122;s-653 internal inspection program, one could make an argument that increasing the frequency of internal tank inspections has actually increased emissions from tank desludging, cleaning and gas freeing operations. That being said no one would or should challenge the benefits to the environment by industries adherence to API-653 inspection and repair program. In an effort to combat the increased frequency of tank cleanings, several US states have placed specific requirements on tank cleaning operations in an effort to minimise vapour emissions. Use of vapour burning engines, thermal oxidisers, portable condensers, charcoal adsorptions packs and scrubbers have worked to some extent on specific clean product tanks where the tank atmosphere can be displaced rapidly, although less harmful emissions from the destruction of hydrocarbon (HC) vapors can still occur. However minimising HC vapour emissions from black/crude oil storage tank cleanings can be much more difficult as bottom sludge continually emits (HC) vapours when disturbed during cleaning/mining operations that can takes weeks to complete. Due to the challenges, duration and cost of cleaning black/crude oil tanks, little headway has been made toward reduction of emissions from this activity. MINIMISING EMISSIONS The good news is, there are cleaning technologies, methods, practices, available to industry that can, and do, minimise black/crude oil tank emissions. Submerged jet mixing (SJM), solvent selection extraction (SSE) and chemical cleaning (CC) are a few proven technologies that are cost effective and work. These cleaning methods typically do not require extended opening of the tank as the solids/sludge are diluted, dissolved and liquefied for pump out of the tank as a liquid product. Once the sludge has been liquefied and pumped from the tank a more typical cleaning can take place similar to clean product tanks. An added advantage of the SJM system is the jet mixers can be permanently installed for future use of routine desludging and scheduled cleaning without the need for opening up of the tank. Lastly, unscheduled repairs and associated tank cleanings in many cases can be avoided all together by making in-service repairs. There are new proven cost effective repair technologies available to industry that allow for safely making engineered long term repairs to in-service tanks that have the integrity to keep the tank in service until itâ&#x20AC;&#x2122;s next scheduled API-653 internal inspection. Friction forge bonding (FFB) is

TECHNICAL FEATURES l EMISSIONS 02

Reduction in tank emissions has come a long way due to regulatory driven innovative technologies 03

one such technology that successfully bonds metal studs to tank roof or shell plate. Once the studs are installed an engineered gasketed lap patch plate is bolted in place. This in-service repair method restores integrity to the leaking or weakened area of the tank in a similar manner that a welded lap patch repair does only without need of conventional welding. In summary it should be noted that reduction in tank emissions has come a long way due to regulatory driven innovative technologies over the years. The combination of drivers and innovation should continue as newer and more innovative technologies continue to evolve.

FOR MORE INFORMATION This article was written by Robert Buckley, tank T/A strategist and consultant at Buckley Ventures.

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TECHNICAL FEATURES l CONTAINMENT

ALL IN ONE ARMOUR FOR SECONDARY CONTAINMENT A revolutionary new secondary containment bund lining solution is a world first in tank storage

here have broadly been two approaches to creating secondary containment bunds within tank storage facilities, ‘hard’ and ‘soft’. The ‘hard’ solution is the construction of a hard faced structure (typically concrete) which offers long term durability but is logistically complex and expensive to install. The ‘soft’ solution is the use of a geomembrane liner, which is relatively easy to install, but needs to be buried and therefore often requires importing expensive fill materials. CC Hydro is a new material from Concrete Canvas, which offers a different approach. It can be unrolled and jointed as easily as a conventional geomembrane liner, but it has an integrated protective concrete layer on one side, thus eliminating the need for burial. CC Hydro is the second generation of a new class of materials known as GCCM’s (geosynthetic cementitious composite mats). Broadly speaking GCCM’s are concrete impregnated fabrics which can be unrolled over any surface, sprayed with water and then 24 hours later set hard to form a hard wearing, durable, fibre reinforced concrete layer. Essentially it is concrete on a roll. The first generation of GCCM’s, known simply as Concrete Canvas, are a finely tuned composite consisting of a 3-dimensional polymeric matrix, filled with a high early strength, dry concrete mix. The result is a range of flexible fabric from 5 to 13mm thick, in roll lengths up to 200m. MARKET Standard Concrete Canvas (CC) is used in the construction sector for erosion control applications such as lining water channels, protecting slopes and providing weed suppression. More recently it has been adopted

within the petrochemical sector to provide erosion control to secondary containment bunds and remediation of cracked concrete for applications such as relining extinguishing ponds. The ability to be unrolled in the same manner as a geosynthetic product and then set hard to form a concrete surface with a design life of more than 50 years is a unique quality in the material. The standard product does however have its limitations, the CC joint provides limited impermeability and cannot be easily leak tested. That means its use, until now, has been limited primarily to erosion control rather than for containment applications. THE FIRST ALL-IN-ONE ARMOURED CONTAINMENT LINER CC Hydro is designed to address that limitation, combining standard CC with a high impermeability (1x10-12m/s), chemically resistant geomembrane liner laminated onto the rear surface. CC Hydro can provide the same level of impermeability in containment applications as a conventional geomembrane but has an integrated protective concrete surface as part of the package. By contrast, conventional geomembranes typically require 0.3-0.5m of top cover (often expensive imported fill) to protect them from UV degradation, puncture and the effects of weathering. The logistical and time savings benefits of eliminating top cover are enormous, not to mention the safety benefits of reducing plant and personnel movements in a high risk environment such as a petrochemical plant. A key feature of CC Hydro is that it incorporates a high visibility welding strip along one edge. This allows the product to be thermally

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TECHNICAL FEATURES l CONTAINMENT 02

01 Secondary containment bund lining with CC Hydro 02 CC Hydro welding strip with high visibility blue geomembrane 03 A pallet of CC Hydro containing 150 sqm of material 04 Unrolling CC Hydro prior to welding and hydration

has excellent resistance across a broad range of hydrocarbons – often a key challenge when polymers meet hydrocarbons. It also incorporates a high tensile reinforcement scrim embedded in the membrane, this gives the material a high level of puncture and tear resistance as well as adding stiffness. The system has already completed a raft of national and international tests standards including long term durability and fire certification tests. Concrete is inherently far more fire resistant than conventional geosynthetics, allowing CC to be assessed against building materials such as concrete and plaster board. Under the European Norm for building material CC achieved a Euroclass B classification, the second highest level achievable. In addition, CC Hydro has been tested to and passed the Canadian national standard for flammability of secondary containment liners with a zero burn time.

welded using the same techniques as conventional geomembranes. This also has the advantage of allowing installation with an existing thermal welding contractor with only minimal additional training. The twin track weld for jointing CC Hydro layers together works by welding two parallel seams along each joint to create an air channel; and this is then pressurised to ensure joint integrity and continuous impermeable across the containment surface. In many ways the geomembrane backing is an innovation in itself, developed in close partnership with one of the world’s leading geomembrane manufacturers. Its distinct colour – bright blue – allows any uncovered areas, around joints or interfaces with upstands to be easily identified on site and addressed during installation, to ensure the membrane has complete protection. Significant development time has been invested in the polymer chemistry, in order to create a material which

BENEFITS In the past there have broadly been two approaches, a hard structure, such as poured or precast slabs of concrete, often onto a trapezoidal earth berm. Or a flexible geomembrane liner buried deep within the bund to protect it from the effects of weather, UV and puncture. Both of these approaches require large amounts of plant, personnel and time. Pre-cast or poured concrete offers long term durability but is logistically complex, subject to weather conditions and costly. Geomembrane liners are generally seen as fast and easy to install but require large amounts of earth works and often expensive imported fill to provide top cover. CC Hydro offers a new approach. It can be unrolled and jointed as easily as a conventional liner system but provides the long term protection and durability of a concrete structure. This has the added benefit when remediating existing infrastructure in that it can be laid directly onto an existing bund profile without any additional excavation works. Also, because CC Hydro is the only surface lying containment product, it is easy to inspect post-installation – even several years after the contractors have finished. All joints are fully visible and any damage can by identified and repaired and re-tested, with nothing hidden from view, providing the terminal operator with peace of mind that they comply with current regulations. There is also a final benefit that comes when considering the total life cycle costs. A standard earth covered bund for example, will normally require a high degree of ongoing maintenance. In arid climates this may be in the form of annual re-profile to combat the effects of weathering and erosion. In northern European climates, root growing vegetation will necessitate an annual ‘de-veg’ (as a minimum) to limit potential fire hazards. Longer term, at end-of-life, any top cover may also contain hidden costs at the point of disposal. If the material is classified as ‘contaminated fill’ it will require processing, even if the facility can show that it hasn’t had any documented leak events. This is a significant cost when consider the volume of fill material laid over membranes in a typical tank storage facility. CONCLUSION The geomembrane market has remained relatively static over the last decade, with modest product innovations over the years. By combining a containment liner and hard armour protection into a single product, Concrete Canvas has made a product which is as easy to install as a liner and as durable as concrete. FOR MORE INFORMATION This article was written by Will Crawford, director at Concrete Canvas. Will.crawford@concretecanvas.com

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TECHNICAL FEATURES l LNG LOADING ARMS

LNG: THE ENERGY OF TOMORROW

ne of the most pressing challenges today are issues relating to energy. A growing world population with rising living standards requires more and more advances in energy supply and efficiency. According to the International Energy Agency, the demand for energy across the world is projected to grow by 1.4% a year to 2035. A cornerstone of the energy supply, natural gas is the fastest growing fossil fuel at 1.8% per annum and is recognised as being part of a sustainable energy future. With a significant portion of the world’s natural gas resources located far from any market and considered ‘stranded’, couple with the fact that transporting gas by pipeline can be costly and impractical, it is more economical to transform the natural gas into LNG for transport by ship, road and rail. Created by cooling natural gas to -163˚C, LNG is a clear, colourless and non-toxic liquid, 600 times smaller than natural gas. It can be transported safely and delivered efficiently in its liquefied form, by specially designed LNG tankers, or from country to country or across continents, through a network of pipelines. THE RISE OF LNG Vice president/general manager of Emco Wheaton Michael O’Neil says: ‘The development of LNG in the global marketplace has expanded massively, with eastern Asia the largest part of the market, accounting for 50% of the total global demand for LNG. In addition countries such as China and India are facing more pressure to bring carbon emissions down by a shift away from coal.’ As the world’s second largest importer of LNG behind Japan, South Korea is planning LNG bunkering terminals at all the country’s major ports. It is also aiming to dominate the market for building ships fueled by both oil and gas. The Singapore government is also expanding gas infrastructure and investing heavily in LNG. With plans to become Asia’s LNG hub, Singapore is developing a second LNG and port terminal to ensure there is spare capacity to be able to cater to new imports over time. According to the EY Global Oil and Gas Centre, the LNG market is expected to reach 650 million tonnes per year within the next ten years. Compared to natural gas, which has grown at 2.7% since 2000, LNG has eclipsed that with growth of 7.6% over the same period. LNG is clearly set to be the fuel which will help fill this gap and bring about greater demand. MEETING THE NEEDS OF THE LNG INDUSTRY The emergence of new areas with tremendous supply potential has been one of the most striking changes in the LNG industry over the past three years. Gardner Denver has undertaken extensive research on LNG as a fuel and has implemented a range of projects with industry partners. LNG is set to thrive in both the shipping and transport sectors.

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01 LNG will feature more prominently in the future as a fuel for both shipping and transport sectors 02 Emco Wheaton’s marine loading arm has been used at Petrobras’s Bahia Regasification Terminal in Salvador

To meet growing supply and demand across the LNG industry, Gardner Denver Energy brand Emco Wheaton has continuously developed safe and reliable LNG transfer solutions which have reduced costs in all components of the LNG value chain. The range includes the LNG loading arm, which has been designed for the bottom loading and unloading of road or rail tankers and the marine loading arm, for the loading and unloading of LNG product from river barges, ships and ocean going super tankers. Engineering and design are constantly improved to ensure the safety and security of LNG terminals and ships. LNG is stored at an ambient temperature so that a tank rupture will not cause an explosion. When

TECHNICAL FEATURES l LNG LOADING ARMS

LNG spills on the ground or in water it vaporises quickly and leaves behind no residues. It can ignite as it vaporises but only if there is a source of ignition. While the LNG industry has created an enviable track record of safety in operations and transport, complacency should not be seen as a barrier to innovation and development across the supply chain and it is imperative that all parties conform to the same high level of attention to safety. THE TRANSFER ENERGY SOLUTION In playing a key part in the development of the LNG industry and with Emco Wheaton marine loading arms installed around the globe, Emco Wheaton has supplied proven and reliable high pressure marine loading arms for a number of LNG liquefaction plants and regasification terminals including a new gas import terminal in the Bahir Province of Brazil. Located in the Bay of All Saints, Salvador, Petrobras’s Bahia Regasification Terminal (TRBA) has a capacity to regasify 41 million standard m3 of natural gas per day. The facility is able to transfer LNG between ships and compressed natural gas (CNG) to the shore using the permanently moored floating storage and regasification unit, the Golar Winter, which has had modifications including the addition of LNG loading arms. In order to meet the extreme pressure, flows and conditions required, as well as stringent international safety standards, the transfer process between the Golar Winter and the liquefied natural gas shuttle is accomplished through Emco Wheaton LNG marine loading arms. The LNG will be vapourised onboard the FSRU to the gaseous state and then injected into the gas pipeline network by means of the CNG marine loading arm and into the shore based pipeline. Emco Wheaton supplied 2 x 12 inch CNG marine loading arms which

can be operated at pressures up to 130 bar with a hydraulic QC/DC (quick connect/disconnect) coupler. To ensure safe operation, an integrated safety feature will allow the rapid and automatic release of the loading arm from the ship in the event of an emergency. As well as being able to handle the high pressure, the loading arm had to be designed such that a maximum arm availability throughout the lifetime of the unit can be guaranteed. This was one of the key requirements of the customer as the CNG arm is the only available interface to the shore based gas pipeline. A failure or even short unavailability of the unit would result in a shutdown of the regasification vessel and consequently in a shortage of gas supply. Due to the potential motion of the vessel when connected, the balancing of the arm is achieved by a rigid link pantograph system with independent counterweights directly linked to the inboard and outboard arm. With these field proven marine loading arms fully operational, Emco Wheaton has met the stringent safety and availability requirements of the gas industry and in the case of Petrobras’s Bahia Regasification Terminal, ensured the supply of natural gas to the north east of the country. FUEL FOR THOUGHT With its low carbon emissions compared to other fossil fuels, natural gas is a solution to some of the world’s economic and environmental challenges. Cleaner than coal and oil, and more efficient and reliable than renewable energy, energy experts have rightly pointed out that natural gas should not be viewed as a bridge fuel, but is actually an answer to the world’s energy and environmental challenges. FOR MORE INFORMATION www.emcowheaton.com/marine-loading-arms

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TECHNICAL FEATURES l INSPECTION 01

INSTILLING INDUSTRYWIDE NDT BEST PRACTICE I nspection of facilities and assets is a key part of operating an efficient and safe working environment in the storage industry. We are all aware of the impact of failures resulting in possible personnel injury, environmental contamination, and loss of revenues. A range of standards has been developed which the industry has to meet covering inspection regimes and fitness for service assessment. Operators rely on inspectors and asset engineers to make these assessments, report on condition and specify preventative actions, so it is imperative that these people are suitably trained and qualified to carry out their duties. The non-destructive testing (NDT) community has always taken its responsibility very seriously and has developed a wide range of training approaches to ensure high standards. Organisations such as API, BINDT (through PCN), ASNT and EEMUA have developed methods of training and assessment to develop a body of knowledge and qualify inspectors that asset owners and operators can rely on. The range of training approaches includes the following: ON-THE-JOB TRAINING BY EMPLOYER Widely used by employers to deliver training to staff and share knowledge to ensure cross training and practical experience. The advantages of this are gaining real world experience whilst learning and gaining very specific knowledge about the company’s processes and needs. However, the limitations include consistency of knowledge transfer and independent review to assess capability. Often the training is targeted at a particular skill development, but lacks the background theory to enable the trainee to fully understand the impli-

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cations of their action or to cope with unforeseen circumstances. Additionally, it requires existing knowledge within the organisation to train others which can have an impact on productivity.

MANUFACTURER SUPPLIED Where test equipment is used to perform inspections, manufacturers often provide some initial training in how to use the tools. Whilst this can be fairly comprehensive they can also be no more than basic operation. This is certainly useful, but rarely equips the inspector with the broad background knowledge to apply the technique, and does not prove the same competency and an independently certified course.

FORMALISED EMPLOYER-BASED TRAINING A step on from the on-the-job option is to have formal in-house training programmes with defined syllabus and examination. This can be very effective at building a level of skill and knowledge which is examined and assessed. Again it requires knowledge already in-house, or bringing in an external trainer. The standard of training can be very good, however without external review can also fail to achieve best practice. EMPLOYER-BASED UNDER THIRD PARTY GUIDELINES Building on from a formalised employer scheme, organisations such as ASNT have developed a standardised framework to help employers develop a good training programme. It also gives guidance on levels of knowledge to be attained and requires assessment by a higher qualified person, for example a ‘level III’ in the discipline. In larger organisations with teams of similarly skilled inspectors this can be effective, but smaller organisations find it difficult to resource within and may not have Level III people to approve schemes. THIRD PARTY GENERIC SCHEMES Third party is where the training and assessment is carried out by an independent company, often working to a recognised independent syllabus. PCN is one such scheme that has become very successful globally and is a recognised standard for competence of inspectors. However, there are limits in that the generic nature of the syllabus, incorporating broad theory and most common practice, often means that actual knowledge of a

TECHNICAL FEATURES l INSPECTION

specific inspection requirement is not covered. For instance, a PCN ultrasonic level II qualified person may not fully appreciate the techniques required for pitting measurement under coating on a tank floor. The main advantage is that it can be used to ensure a base level of competence that will cover theoretical and practical knowledge, and experience in application of the general technique.

01 Onsite supervision using Silverwing’s MFL floor scanner 02 Practical training on actual tank floor plates 03 Class room based specific thoery training

THIRD PARTY SPECIFIC SCHEMES This is also delivered by an independent training organisation, but with the added benefit of being very application specific – imparting key knowledge and capabilities for the actual task to be conducted. Example schemes here are API653 and EEMUA 159 whereby an inspector undergoes an education and assessment programme specifically designed for storage tank inspection. These schemes deliver qualified people, independently assessed and capable of meeting the needs of industry. The bodies behind these schemes also develop best practices and review and update the knowledge bank to ensure the qualifications remain relevant. DEVELOPING A TRAINING SYLLABUS Over many years training programmes have been developed into standardised frameworks that can be applied to different techniques and processes. One such framework is Recommended Practice No SNT-TC-1A, personnel qualification and certification in non-destructive testing developed by the American Society for Nondestructive Testing (ASNT). This recommended practice can be used by employers to develop in-house schemes, but can also be used by third party providers to develop specific application based programmes to meet needs of particular industries and/or employers. It is also possible for any training programme to be externally assessed to ensure it meets the criteria set out. In using such an approach it is possible to quickly develop a high quality, independently assessed programme, for specific applications and needs where the generic programmes fall

short or are not available. This is of particular benefit when bringing new approaches and technology to the market since it can use a small group of experts in the field to peer review, rather than design by committee that a generic scheme often requires. This means a new technology can be developed and the training put in place quickly to enable asset owners to use it in a controlled way. The elements of SNT-TC-1A include sections on general theory, specific theory, practical training, regular assessment and examination. For example, a tank floor inspection programme ‘general theory’ section could include sections on, say, magnetic testing theory and causes of corrosion, the specific theory section would then consider magnetic flux leakage applied to tank floors and the types of corrosion seen inside a tank. Practical training would be based on actual machines used for inspection with real tank floor plates incorporating the full range of defects likely to be found. Within SNT-TC-1A the duration of the course is specified as 80 hours to achieve level II, however to qualify and be awarded a certificate the trainee must also complete four months supervised onsite experience and be signed off by an appropriate person. The course should detail the capabilities of the product/technology, but just as important the limitations. Sufficient training and examination samples of real world conditions must be available to ensure the training reflects situations the engineers will find on site, and trainers should have real world experience of the application to discuss the sort of challenges faced. As an industry we have been well served by API and EEMUA in developing training programmes for engineers and inspectors regarding the specifics of tank integrity assessment, but the NDT part of the inspection has depended on either employer-based, or generic third party training. This is now changing and companies such as Silverwing and UK-based South West School of NDT have shared resources to create an SNT-TC-1A third party delivered and assessed programme for MFL tank floor inspection. Based around the latest technology Floormap systems the programme ensures operators understand the technology, capabilities and limitations, and can analyse data accurately to provide the best assessment of tank condition. Moving forward the industry should continually push to improve training and dissemination of NDT best practice, using the existing training bodies and partnerships such as the Silverwing/SWNDT initiative. The best way to do this is to ensure any inspection contracts awarded specify the qualification requirements of the team, and records examination certificates. This is certainly best practice in many industries, such as aerospace and downstream inspection, and should now be considered the norm when inspecting a tank in addition to the API and/or EEMUA certification. FOR MORE INFORMATION This article was written by Wayne Woodhead, VP Silverwing products, Silverwing. www.silverwingndt.com

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TECHNICAL FEATURES l TANK JACKING

WHY JACK A TANK?

ank jacking is perceived by some as an additional cost to tank repair works, however it is a crucial part of ensuring long-term usage of storage tanks. The earliest tanks Verwater jacked were located in the Rotterdam harbour area. The soft soil conditions in the river delta resulted in settlements due to the load of filled storage tanks. Jacking projects in the years that followed are spread to areas with similar soil conditions throughout Europe and later to locations worldwide. Nowadays, tank settlements are not the prime reason for tank jacking and in fact, a combination of repair works and tank improvements now form the basis for many requests for tank jacking. Aging is an important concern as many tanks were constructed in the growth decennia around the 1960s and 70s. In the 50 years since, tank bottoms have lost their thickness in such a way that replacement is now necessary. Environmental requirements have also changed significantly, adding special applications to ensure tank bottom tightness and to also extend their lifetime. Secondary containment is new in tank construction and is a requirement by authorities in many places. As a result, under any older repair, tank liners are installed to prevent for ground pollution in case of leakages. Both internal and external coatings result in an extension of the lifetime of a tank. WHEN IS TANK JACKING MOST PROFITABLE? In parts of the world, the jacking of tanks is seen as an additional cost on top of repair works. Unfortunately this view is very limited, only seeing direct costs filtered from quotations. The combination of several types of repairs and installation of

01 Regular repair projects can help extend the life span of a tank

02 The reasons for tank jacking have evolved as storage requirements change 03 Tank jacking can be a crucial aspect of a repair programme 04 Jacking also allows for easier tank relocation

applications together with increased quality of the repairs and reduced repair time, makes the jacking technique the most valuable aspect when considering the total project and long-term tank usage. The following repair works can or should be combined to achieve optimum result: â&#x20AC;˘ Foundation repairs consisting of replacement of old foundation materials for new, more suitable materials such as crushed stone ring walks or other aggregate materials. This should be combined with re-levelling of the tank foundation

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TECHNICAL FEATURES l TANK JACKING 03

• Replacement or removal of damaged concrete ring walls or installation of new ones • Removal of pollution in case of leakages • Installation of secondary containment liners • Application of coatings at the underside of the tank bottom • Replacement of entire tank bottoms or replacement of annular plates where the new plates can be installed in the ‘as built’ shape (letterbox methods often do not allow for relevelling of the foundation and limiting the quality of welding (butt-welds)). A combination of the above works results in a ‘win-win’ situation regarding time, quality and safety. TANK RELOCATION Besides tank repairs, the jacking technique also allows for easier methods of tank relocation. Tanks with diameters up to 230 feet have been shifted for various reasons including a new designed plotplan, a new owner on a

different site or storage of a different product. Examples are available of a temporary shifting of a tank for installation of a piled foundation or for the removal of polluted soil underneath the tank. For each type of relocation, different techniques are developed, ranging from skid tracks, modular trailers, floating barges to (floating) cranes. SOLUTIONS FOR THE LONG-TERM Participation in a repair program can be the first and most important step towards the reliable repair methods. Verwater has the experience of more than 10,000 tanks being jacked and as such have solutions for any problem with a storage tank. FOR MORE INFORMATION This article was written by Herman Buisman, manager international projects at Verwater. h.buisman@verwater.com.

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TECHNICAL FEATURES l INSPECTION

THE IMPORTANCE OF CHECKING FOR CORROSION UNDER INSULATION

or storage terminals, the quality and safety of the tankage is essential in the daily operations of the site. To ensure all tanks are maintained to the highest standard, most companies undertake regular NDT testing and Viking Inspection provides this service in the UK. Viking recently performed a full NDT tank inspection to EEMUA 159 tank integrity standards at a facility. On an inspection of an adjacent tank, some CUI (corrosion under insulation) was identified and attributed to penetration in the lagging. The decision was therefore made to scaffold the tank and remove the lagging for full inspection. In recent years it has become popular with some terminal operators to leave the bottom section of the shell un-insulated. This results in some loss of heat but has the advantage of leaving the lower shell readily available for inspection and eradicates the risk of CUI degradation for this area. However, this area should be reviewed periodically regardless as it may be affected by thermal stresses due to low ambient temperatures. In insulated tanks, CUI is very common in the lower section of the tank shell, as well as the stiffening rings, roof, and any gaps or defects in the lagging, and can be identified via visual inspection. Once the lagging was removed, a visual inspection needed to be carried out, which identified multiple areas of CUI and pitting to the tank shell. Then a UT thickness survey was carried out and was completed using a Krautkramer USM36 flaw detector, which uses dual element probes to provide both the thickness measurement and the A-scan for maximum reliability. Finally, a shell stability calculation was made to determine the tank’s structural stability. This procedure assists in minimising the risk of shell buckling; a major safety issue for thin walled steel tanks operating at low levels of contained liquid. On this occasion, the data showed no issues with the structural stability of the tank and that it was comfortably within the parameters of safe operation. Another key area where corrosion can occur is the stairways and platforms. Water can pool on the stairs causing heavy pitting and corrosion. Some minor defects were found due to surface corrosion and recommendations made.

MINIMISING CORROSION Prioritising design, attention to detail and material selection are fundamental in minimising CUI issues. EEMUA recommends the use of cellular glass closed cells for suscep01 tible areas that include the bottom section of the shell, and secondary wind girders on insulation support rings or locations where water can pool. In addition to internal pressure, storage tank shells are subjected to loads that must be transmitted through the structure without gross

01 Corrosion points on a tank 02 Loads exerted on a tank 03 CUI on the tank shell around a weld

deformation of the shell plates or their appurtenances. Examples of these loads include tank roof weight, wind induced forces, vacuum load, connected pipework loads and dead weight of mixers. The diagram details load combinations working on a tank shell. The three load conditions are: 1. Hydrostatic pressure including maximum operating static pressure 2. Weight of roof, including a live load (1.2KN/m²) 3. Wind load including maximum operating vacuum. To conclude the initial shell inspection, Viking determined the locations for patch plates and insert plates, and provided this information in a detailed report to the client. As well as the raw data provided in the readings, the report included photographic evidence of the tank flaws and recommendations to remedy any issues. Heating coil penetrations in the bottom shell should always be equipped with annular pipes to separate insulation from contact 03 with the nozzles. This prevents accelerated corrosion at these points; no issues were found with the tank in question. Once the wall inspection was completed, a floor survey was also required. This was completed using a Silvering floormap 3Di. Viking Inspection was able to identify defective areas more efficiently and accurately than before, finding surface defects on the tank floor that were predominantly due to heavy corrosion. A decision was taken to replace the entire tank floor as opposed to patch repair the affected areas to maintain the high facility standards. The full analysis and reporting took two people seven days to complete. Viking Inspection managing director Steve Delves says: ‘We see a lot of CUI in the industry. It’s important for companies to see the importance of removing the insulation on a regular basis to perform a visual inspection of the Tank. This facility recognises the importance of this.’

FOR MORE INFORMATION www.vikinginspection.co.uk

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AUGUST/SEPTEMBER 2016 VOLUME 12 ISSUE NO.4

TANK STORAGE ASIA

l SPEAKER INTERVIEWS

SPEAKER INTERVIEWS INSIGHTS FROM A SELECTION OF TANK STORAGE ASIA’S INDUSTRY EXPERTS Interviews with some of the speakers at this year’s conference at the Marina Bay Sands on September 27 and 28

Asia Pacific energy outlook and deepdown analysis of storage Antonio Della Pelle, of Enerdata Singapore provides an overview of three possible scenarios for Asia’s future energy mix and how this could impact future storage requirements

he Conference of Parties (COP) 21 conference in Paris has posed a number of questions for market players in the energy industry. While there is no legal agreement, various countries have shown that energy policy discussions cannot neglect climate change. This will have huge implications on the energy mix of different countries. There is a significant uncertainty for project developers and investors due to a lack of any commitment in the COP 21 discussions. Hence it is important to understand the forecasts for a variety of scenarios to assess the effect of uncertainty in policy implementations. Enerdata has complied an energy mix forecast for Asia until 2040. Three scenarios are presented – one scenario (Ener-Blue) provides an outlook of the energy system up to 2040 based on the central assumption that the different countries implement their stated commitments made during the COP21. The other scenario (Ener-Green) explores the implications of more stringent energy and climate policies to limit the global temperature increase at around 2˚C by the end of the century. The third scenario (Ener-Brown) describes a world without a global agreement which results in soaring CO2 emissions across the world, towards a +6˚C temperature increase by the end of the century. The scenario analysis is based on the company’s in-house POLES energy forecast model, which has been used for long-term energy forecasts purposes by several governments both in Europe and Asia, in addition to various industry players. ASIA PACIFIC ENERGY DEMAND The final energy demand of the Asia Pacific region has increased by 4.2% a year over 2000-2014 period as compared to the global average of 2% a year for the same period. Rapid economic growth, urbanisation and

better lifestyle are some of the factors behind the high growth in energy demand in the Asia Pacific region. Energy demand in the EnerBlue scenario is expected to increase by 47% from 2015 to 2040. Demand will increase at the fastest rate from 2015 – 2020 and will progressively slow down as the Asian economies mature from the high growth stage. India and Vietnam will see the fastest growth in energy demand followed by China. The structure of energy supply to meet the growing energy demand is also expected to change. Increases in electrification and fuel switch to electricity will increase the share of electricity in the energy supply. In 2015, electricity accounts for only 19% of the total supply and by 2040, share of electricity will increase to 27%. Tighter climate policies will also affect the share of gas in power mix and the share of renewables will increase from 4% to 18% over 20152040 (EnerBlue scenario). Currently, we have an LNG oversupply situation that has brought LNG at low price levels and supported an increase on spot trade thereby increasing the importance of storage. Asia alone, accounted for 57% of the spot and short term volumes in 2015. When looking at the current global regasification capacity we can see that it is more than twice the liquefaction capacity implying the possibility of low utilisation terminal factors and high competitiveness. In the near future regasification terminal operators, including LNG storage tank operators, need to be ahead of the competition with their business strategies. Renewable implementation will require additional efforts to bring significant affordable energy storage technologies. Today, the most used solution for energy storage is pumped hydro power, however it has its own limitations. Japan, the US and China account for more than 50% of the global energy storage with the US and Europe leading on emerging energy storage technologies. This is a ‘new’ storage area that will grow in the near future to accommodate the evolution of the energy mix. No matter which scenarios we prefer, we see two common themes emerging: the increase of gas and LNG as clean fuel and substantial development of renewable energy. Both of these energies will require additional storage solutions and further development of storage to capture the electricity generated by renewables.

Della Pelle will be looking at global energy demand for the next 25 years on the second day of the Tank Storage Asia conference in Singapore on September 28.

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Petrol and diesel trade flows to drive Singapore’s oil storage Despite altering demand patterns, Asia remains an integral player in the global oil markets with a growing reliance on petrol imports to satisfy demand, according to Wood Mackenzie’s Benjamin Tang.

apidly changing demand patterns and refining dynamics have a profound impact on global oil product trade flows and the need for storage. In this context, Asia is where the action is. Wood Mackenzie forecasts global oil demand to grow by four million barrels per day between 2015 and 2020, with Asia accounting for almost 70% of the increase. A majority of Asia’s rising oil consumption will be driven by petrol and diesel, as demand for these products is strongly correlated with rising incomes and economic development respectively. Asia’s refining system will not be able to meet the pace of petrol demand growth, resulting in higher petrol imports from outside the region. In contrast, intra-region trade in diesel will gain prominence, with China increasing exports to other countries in Asia. ASIA TO LOOK OUTWARDS TO SECURE PETROL Asia will shift from being a net exporter of petrol in 2015 to a net importer by 2020. This change is underpinned by strong transport demand growth in China, India and Southeastern Asia. Net imports of petroleum into Asia will reach 500,000 b/d in 2020, mainly long-haul volumes from Northwest Europe, the US and Middle East. Interestingly, Asia has traditionally exported petroleum to the Middle East and US. However, with those regions becoming surplus in petrol, the relationship will reverse as Asia gets increasingly short of the product. Intra-region petrol trade flows will also evolve. India largely trades its excess supply to the Middle East and US, with relatively few cargoes moving to Singapore. Looking ahead, strong demand growth in India will reduce the country’s surplus. India will cut exports to the Middle East and US, and target deficit markets within Asia: moving cargoes to the re-export hub of Singapore, or direct to countries like Indonesia and Australia. North Asia petrol flows to the rest of Asia will reduce in the longer run. Historically, China has exported petrol to Singapore and Southeastern Asia. Due to a rapid growth in car ownership and a slower pace of refinery capacity additions, China will near a balanced position after 2020. This will reduce China’s exports to the rest of Asia. Refinery closures in Japan and Taiwan will also contribute to lower petrol exports from North Asia to Singapore and the rest of Southeastern Asia. DIESEL TRADE WITHIN ASIA TO INCREASE Asia will continue to be a net exporter of diesel to other regions. However, net export volumes will fall from around 400,000 b/d in 2015 to under 100,000 b/d in 2020. This is based on a modest demand growth, amid sluggish refinery capacity build over the forecast period. Due to the start-up of large greenfield refineries, the Middle East will reverse its diesel trade position with Asia, from a large net importer in 2015 to a net exporter by 2020. We believe Northwest Europe, with its widening diesel deficit, is the only region with room to absorb additional volumes from Asia. As there is rising competition from the Middle East, FSU and the US to place diesel cargoes into Europe, Asian exporters will also seek opportunities within the region. Historically, India has been a major exporter to the Middle East, Africa, Europe and Latin America. Due to strong transport diesel demand growth, India’s surplus will narrow through to 2020, reducing its export volumes to other regions. China’s diesel surplus will expand to 350,000 b/d by 2020 from 45,000 b/d in 2015. In recent years, diesel demand has slowed significantly as the country shifts from an investment-led to a consumption-led economy. China’s export refineries are modern and complex, and are competitive

against many of Asia’s older refineries. So Chinese diesel exports to Singapore will increase, for re-export to regional deficit markets like Australia and Indonesia. SINGAPORE HANGS ON TO ITS REGIONAL HUB POSITION Singapore is the regional oil trading and storage hub, accounting for around one-third of Asia’s oil products gross trade. Wood Mackenzie expects Singapore to play a prominent role, as growing inter-regional trade for petrol, and intra-regional trade for diesel contribute to 85% of Singapore’s growth in trade over the next five years. Singapore’s enviable position as the regional hub is not without risk and challenges. Land availability is a major concern for storage capacity growth in Singapore to keep pace with the growth in the future trade flows. If Singapore fails to act, this provides opportunity for new storage facilities in neighbouring Malaysia and Indonesia. Higher land storage rates in Singapore and improving port infrastructure in the end-user market will encourage direct trade, potentially bypassing Singapore. For petrol, the need for blending and breaking bulk for longhaul cargoes will play to Singapore’s strength as a hub. Conversely, the increasingly intra-regional nature of diesel trade flows will favour direct trade routes. Storage players, shipping companies and traders will need to understand Asia’s evolving trade flows, and develop winning strategies to stay on top of the competition.

Tang will be speaking more on Asia’s future product trade flows and their implications for storage on the second morning of the Tank Storage Asia conference on September 28 at the Marina Bay Sands, Singapore.

China’s liberalised industry and emerging dirty tank market China is becoming an increasingly attractive region for tank storage following the liberalisation of the country’s teapot refineries, according to head of ICIS China’s research team Li Li

he oil price crash in 2014 and unleashing of the hidden force from the teapot refineries in 2015, made China’s crude oil market suddenly become one of the hottest topics in the global energy community. In the past, China’s oil storage market was mute from the global players’ ears, as most of the tanks are operated by state-owned enterprise (SOE) as inventory for their refineries or as commercial operation usage, or as mysterious strategic petroleum reserves by the country. It seemed there were few chances for private investors before the crude oil market became liberalised. Private companies used to build lots of fuel oil tanks when the industrial fuel market was flourishing, or build distillate tanks if they got close relation with local SOE majors’ branches. Vopak has pioneered phase I of its crude oil tanks in Hainan Yangpu in south China and some majors such as Exxon Mobil and Saudi Aramco have integrated oil storage in their joint venture Fujian refining entities. However, global trading houses such as Vitol are showing increasing interests in renting crude storage (bonded storage) in China, and may also be regretting why they were so cautious to build tanks by themselves in Shandong or other coastal ports in China. The third-party, independent crude oil storage business could get more promising in China as more players and competitors seek to get involved in China’s 14-million barrel per day refining industry, which requires increasing operation and cost flexibility.

Li Li will be speaking on the first day of Tank Storage Asia’s conference on September 27 about China’s crude importing and storage prospects as well as its strategic petroleum reserve plan.

AUGUST/SEPTEMBER 2016 VOLUME 12 ISSUE NO.4

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AUGUST/SEPTEMBER 2016 VOLUME 12 ISSUE NO.4

The anatomy of Asian oil storage

TANK STORAGE ASIA

l SPEAKER INTERVIEWS

The steady growth of Asia to become the world’s largest oil trader is documented by Tri-Zen’s senior with CNPC/PetroChina now owning an equity stake. The anatomy of Asian By 2003 China had surpassed Japan to become the world’s second advisor Moe Merican

oil storage

largest oil consumer after the US. China’s first phase of construction of strategic oil reserves storage The steady growth of Asia to become the began in 2004. By 2009, 103 million barrels of storage had been filled. world’s largest oil trader is documented China has been the main driver of global oil demand, accounting for by Tri-Zen’s senior advisor Moe Merican The story of Asia’s oil storage is dominated by the continuing oil demand growth shift from west to almost half of global growth over the last ten years and by 2020, China he story of Asia’s oil storage is domplans to have 500 million barrels of strategic oil reserves. east and the rise of large oil traders to become today’s global players. inated by the continuing oil demand growth shift from west to east and the rise of large oil traders to ASIA AND SHAPING THE WORLD’S LARGEST OIL TRADER Global oil demand shift become today’s global players. Often overlooked is the oil trade that closely reflects the shifting dynamics of demand growth to Asia and its implications for refining, shipping and In the ten years from 2005 to 2015 , global oil demand grew by 10 million barrels per day and the GLOBAL OIL DEMAND SHIFT storage. In the ten years from 2005 to 2015 , global oil demand grew by 10 million Asia Pacific market accounted for almost 80% of that growth. Competing head on with international oil companies ( IOCs ) are the big barrels per day and the Asia Pacific market accounted for almost 80% of four traders Vitol, Glencore, Trafigura and Gunvor, who were recognised in that growth. 2011 as becoming a true force in the global oil market. China and India, the two Asian giants, shared 64% of that growth, while the world’s two top China and India, the two Asian giants, shared 64% of that growth, consumers, the US and Japan, saw a decline in their oil consumption. while the world’s two top consumers, the US and Japan, saw a decline in SHIPPING their oil consumption. Shell and Vitol were the world’s top charterers of oil product tankers in 2014 spot markets, according OPIS. In 2015, Vitol was the top charterer of Aframax tankers, the segGlobal Oil Consump<on ment where traders are best represented, Vitol’s shipping subsidiary is Mansel. 25 While revenue rose 45% over the period 2006-2015, its oil trade also 20 rose by 46%.

Source: BP Statistical Review

Million barrels per day

REFINING AND MARKETING TO REFINING AND OIL TRADING The ‘golden age’ of oil refining came to a halt in 2008, with Europe the 5 first to be affected. Over the next five years, nearly 1.7 million barrels per day of refining capacity closed in Europe. 0 In Asia, India’s Reliance had built a mega-scale refining complex with US Japan China India 668,000 barrels per day of capacity at Jamnagar, that began operations in 2000. This was expanded in 2008 to 1.24 million barrels per day, to 2005 2015 become the world’s largest oil refinery. Plans are underway to add a further 400,000 barrels per day of capacity by 2020. 2015 also saw India’s oil demand surpass Japan, taking them to third place behind the US and China. The shift in oil consumption to Asia and the success of this new Source: BP Statistical Review 93, China became a net importer of oil products The shift towards Asia has been many years in the making. In his business model of refining for export and trading have been important January 1991 speech, then US President George Bush made reference to another group of global oil players, the national oil companies (NOCs). 96, China became a net importer of crude oil 2015 also saw India’s oil demand surpass Japan, taking them to third place behind the US and China. to the ‘new world order;, which acknowledged the relentless growth of Saudi Aramco’s joint ventures with Total and Sinopec provide good Asia. 3 examples. at the time, has tial investment of $25 million, which equated to about $210 per m soon after thisAsia that the oil been traders,many in assessing their The It was shift towards has years in future the and making. In his January 1991 speech, then US 3 growth prospects, required a new business model – developing an assets SINGAPORE LAYING THE FOUNDATIONS FOR OIL REFINING AND TRADING HUBS he facility now boasts 450,000 m with CNPC/PetroChina now owning an equity stake. President George Bush made reference to the ‘new world order;, which acknowledged the relentless based strategy. While the rapid growth of China’s oil trade has been the darling of media growth of Asia. reports, it was the ‘little red dot’ of Singapore that laid the foundation for had surpassed Japan to become the world’s second largest oil consumer after the US. CHINA AND THE CHANGING GLOBAL OIL MARKETS oil storage growth in Asia and the rise of oil traders into global players. In the mid 1990’s Dutch oil trader Vitol took the initiative and launched its This timeline reflects the 30 years (1983 to 2013) of growth in startup It was soon after this that the oil traders, in assessing their future and growth prospects, required a phase of oilconstruction strategic oil reserves storage began By from 2009, 103 m3 in 1983 to 1,300,000 m3 in 2013. products storageof terminal of 120,000 m3 in the port of Zhuhai, China. in 2004. capacity, 500,000 new business model – developing an assets based strategy. Two key events supported its move into China: The single most important driver of Singapore’s oil storage success, s of storage had been filled. • In 1993, China became a net importer of oil products the is the fuel oil trade – bunkers. The bunker trade was the monopoly of China and the changing global oil markets • In 1996, China became a net importer of crude oil the oil refiners, belonging to the majors, prior to the deregulation of the Today that initial investment of $25 million, which equated to about $210 bunker trade in 1985. perthe m3 at the time, has swelled facilityVitol now boasts m3 South Korea’s national oil company (KNOC) has been closely following In mid 1990’s Dutch and oil the trader took 450,000 the initiative and launched its oil products storage the developments of oil trade and storage at both Singapore and Fujairah. 3 in the port of Zhuhai, China. terminal of 120,000 m China Strategic Petroleum Reserves In 2008 it initiated plans for a ‘north Asia oil hub’ and, five years later in Storage (mmbbl) 2013, the Yeosu crude oil and oil products storage hub began commercial Two key events supported its move into China: operations with a capacity of 1.3 million m3. The next phase of the hub, the port of Ulsan – with a storage capacity PetroChina, Sinopec, of 4.5 million m3, has investors that now include the world’s largest Dalian, 18.9 Zhenhai, storage operator, Vopak. Slated for completion before 2020, KNOC fore 1 32.7 casts the hub handling trade of 250 million barrels a year of crude oil and oil products (685,000 bpd), with economic benefits to the country of $3.5 Sinopec, to 4.5 billion by 2020 . Huangdao, This translates to storage rates of $7 to 8.50 per m3 per month, an 20.1 increase over current rates of $ 5.00 to 5.50 per m3 per month . South Korea currently exports 1.25 million barrels per day of oil prodSinochem, ucts and has a refining capacity of 3.11 million barrels per day, or 40% of Zhoushan, its refining capacity is exported. 31.4

en the main driver of global oil demand, accounting for almost half of global growth AUGUST/SEPTEMBER 2016 VOLUME 12 ISSUE NO.4 en years and by 2020, China plans to have 500 million barrels of strategic oil reserves.

TANK STORAGE ASIA

l SPEAKER INTERVIEWS

THE OIL STORAGE TRANSFORMATION Ten years ago, Vopak owned 76% of the equity in its storage business. Today Vopak’s invested equity has reduced to 61%. Its main competitors are now its former customers, the oil traders, and also the infrastructure fund managers. However, Vopak still maintains its position as the world’s number one oil storage operator.

Merican will be speaking on the first day of the Tank Storage Asia conference on September 27 in Singapore about Asia’s oil and gas storage and providing an overview of investment prospects.

China and India dominating demand for new storage Containing one of the world’s largest storage hubs as well as two countries that dominate global energy demand, Asia provides storage operators and investors with a solid platform for growth.

he region has a population and market growth which demands more energy, and these demands will grow exponentially over time, with the IEA predicting that India will surpass China in the dominant energy consumption top spot with forecasts that it will add six million barrels per day to its current demand. China is expected to add a further five million barrels per day. Ellen Ruhotas, Ratio Group’s managing director, says that China, India and Indonesia are showing the largest demand for new storage for

greenfield development in relation to their population growth and their economies. However, she says that these countries need to improve infrastructure to meet demand as they move into a more ‘middle class’ growth phase. She says: ‘There will be growth on existing terminals, where those facilities which service key import and export ports will need to keep up with the general growth of the Asia region.’ In addition to the favourable contango market for petroleum products, which is contributing to healthy storage inventories, the closure of refineries in Australia is also resulting in an increase in refined products through terminals in Korea, Greater Singapore and Japan. The regional terminals in the Greater Singapore region are being kept full by the likes of Indonesia, Philippines, Vietnam and Cambodia, which have insufficient refinery capacity and require blending and consolidation of petrol, diesel and fuel oil. Focusing on Singapore itself, Ruhotas believes that the country may have difficulty in sustain its high storage rates in the future. ‘Once the contango comes off, Singapore may have difficulty sustaining its high storage rates, as compared to other hub ports. Singapore is more expensive due to land constraints, but the current premium for storing in Singapore may not be sustainable. ‘By virtue of history, Singapore will continue to be the petroleum hub of Asia. Traders depend on Platts pricing, which is centered on terminals in the Greater Singapore region. The ease of doing business in Singapore – its legal system, corruption free environment and certain free trade agreements, which it has entered and Malaysia and Indonesia have not, make it the country of first choice for traders when they are selecting storage in the region.’

Ruhotas will be providing a forecast on terminal developments by country in Asia on the first day of the conference on September 27.

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EVENTS l TANK STORAGE ASIA PREVIEW

EXPLORING THE ENERGY SILK ROAD

Occupying a larger hall in the luxurious Marina Bay Sands in Singapore, Tank Storage Asia will provide a platform for visitors to explore the energy silk road with networking, learning and business opportunities. Boasting more than 75 companies on the show floor as well as an insightful conference programme, the two day event continues to attract professionals from across the industry’s supply chain. We take a look at some of the companies and innovations at this year’s event on September 27 and 28… ABB Access Professional Singapore Arflu Atreus Auma

Emco Wheaton Endress+Hauser

Bioex

L&T Valves Labuan IBFC Loadtec Engineered Systems

CNC Petroleum Concrete Canvas CTS (Far East) Dixon DeHumidification Technologies

Fabricom Fort Vale

Netherlocks Safety Systems Newson Gale OPW

RPR Technologies Saferack Scanjet Techflow Marine Timm Elektronik Tristar Terminals Guam TTK Verwater Viscoy Zhejiang Jialong Mechnical Equipment Co Zwick

AUGUST/SEPTEMBER 2016 VOLUME 12 ISSUE NO.4

EVENTS l TANK STORAGE ASIA PREVIEW

ABB provides terminal management systems with software and hardware solution T-MAC Plus. It has been created as a result of more than 20 years of experience in the field and the company’s knowledge in automation systems for the oil and gas industry. T-MAC Plus brings together the control system, different subsystems and devices into one platform to automate key monitoring and control modules, reducing operating cost and increasing productivity.

Visit ABB at:

STAND C42

Access Professional Singapore is an ISO certified & SAC-SINGLAS accredited company offering a complete solution on sales and aftermarket servicing for instrumentation and valves in Singapore, Vietnam and Myanmar. Capabilities include: Custom-made Jerguson level gage, control valve/manual valves/safety valve testing, overhaul and in-situ jobs, Singlas approved workshop and In-situ PSV certification, flow verification – both onsite and workshop as well as pressure and temperature switches setting.

Visit Access Professional Singapore at:

Auma is a leading manufacturer of electric actuators, actuator controls and manual gear operators for industrial valve applications. Auma is a specialist for electric part- and multi-turn actuators with more than 50 years’ experience in valve automation. The company manufactures its products at two plants and supports the products from three service centres. Further an international sales and service guarantees the support to the final customer for spare part and maintenance requirements. With the new FQM fail safe unit, Auma offers innovative and safe actuator solutions for automatic operation of valves in case of emergencies making use of stored mechanical energy. The FQM fail safe unit meets the requirements of safety related applications up to SIL 2/SIL 3 and is basically maintenance-free. An explosion-proof version is also available.

STAND A1 Visit Auma at:

Arflu will be using the exhibition to showcase its dual expanding plug valve, which eliminates common problems that occur during tank terminal operations. The company uses full-size stem packing and can also install special stem packing and an inverted stainless steel trunnion which completely eliminates body cavities. The valves have a backseat and the stem packing is accessible from the outside and can easily be changed even under pressure. Arflu’s dual expanding plug valves are top and bottom entry type. If changing the slips is required, these can easily be accessed by removing the lower cover without any special tools. The lower trunnion is not part of the plug but incorporated in the lower cover, thus eliminating a body cavity where accumulation of particles may interfere with the valve function.

Visit Arflu at:

STAND D3

Atreus is a brand of the Kremsmueller Group which designs, manufactures and supplies advanced ADRs and IFRs to the storage industry. Atreus provides the first silicone-free aluminium dome roof on the market thanks to the Hub-Tit technology and one of the most sophisticated IFR´s based on a totally new design. Kremsmueller has been active in tank, apparatus and tank construction for many several years. The Kremsmueller Group provides all services from one source. The group’s core competencies act together to form a large expertise network – specialists from relevant fields work together to produce the perfect service package without unnecessary stop gaps. Kremsmueller designs and supplies equipment for the construction of new tank farms, takes part in the reconstruction of existing tank farms and of course maintains them.

Visit Atreus at:

STAND D21

AUGUST/SEPTEMBER 2016 VOLUME 12 ISSUE NO.4

STAND A17

Bioex designs and manufactures the latest generation of ecological foam concentrates that are 100% fluorine free and proposes conventional foams for use in firefighting. The company will be on hand at the show to discuss their new formula – Ecopol F3 HC. It is the first fluorine-free 3% foam concentrate for hydrocarbon fires that performs better than the best AFFFs and it is also readily biodegradable. Exceptional extinguishing performance • Used at 3% in direct application on hydrocarbon fires • Obtained the best 1A performance classification under EN 1568-3 standard (certified 1A/ fresh water – 1A/sea water) • Obtained the best performance classification under LASTFIRE – Good-Good-Good Effective on hydrocarbon fires • Exceptionally fast extinguishing action on hydrocarbon fires • Very long burn back time equal to the best protein foams Powerful foaming capability • Offers durable adherence on vertical surfaces • Insulates of storage containers in case of fire nearby.

Visit Bioex at:

STAND B30

EVENTS l TANK STORAGE ASIA PREVIEW

versatile. Always a leading innovator, ROSEN not only supplies pipeline customers with the latest diagnostic and system integrity technologies but also offers flexible solutions and all-round support for plants & terminals. www.rosen-group.com

AUGUST/SEPTEMBER 2016 VOLUME 12 ISSUE NO.4

EVENTS l TANK STORAGE ASIA PREVIEW

CNC Petroleum provides complete downstream petroleum solutions. As a reputable petroleum distribution firm with a fleet of 10 road tankers of various capacities, the company is also establishing itself as a renowned fuel management company that provides technologically innovative solutions. Having forged close working relationships with key partners, the company actively engage in providing fuel storage and dispensing systems for its clients. These systems comprise of the Harlequin double-walled bunded tank, Dunraven Systemâ&#x20AC;&#x2122;s independent Apollo monitoring sensor, and Piusi fuel management system. This bundled solution makes it possible for clients to have their own mini fuel station at a location of choice with full access control over their refuelling and diesel inventory; a novelty for the fuel management industry in Singapore.

Visit CNC Petroleum at:

AUGUST/SEPTEMBER 2016 VOLUME 12 ISSUE NO.4

STAND C16

Concrete Canvas manufactures a revolutionary product called Concrete Canvas (CC) which has gained market acceptance as a cost-effective alternative to conventional concrete. CC is used in over 70 countries worldwide with customers including Exxon Mobil, Shell, BP, Total and ENI. CC consists of a flexible concrete impregnated fabric which hardens on hydration to form a thin, durable, water-proof layer. The company describes it as concrete on a roll and can be used for a wide range of applications such as bund lining, remediation, ditch lining and weed suppression. The company will also be discussing its new CC Hydro at the show, a new product designed specifically for containment applications in the petrochemical sector. CC Hydro combines the companyâ&#x20AC;&#x2122;s impregnated fabric technology with a high visibility, chemically resistant geomembrane liner. The result is a hard-armoured containment liner that combines high impermeability with the durability of concrete.

Visit Concrete Canvas at:

STAND A3

EVENTS l TANK STORAGE ASIA REVIEW

EVENTS l TANK STORAGE ASIA PREVIEW

CTS (Far East) is specialised in the design, manufacturing, supply and installation of products and systems used in the safe and effective transfer and storage of chemicals and hydrocarbons. Products and services include: • Aluminium geodesic dome roofs • Internal floating roofs, various materials • Tank seals, primary and secondary tank seals • Drain systems for externals floating roof tanks • Composite hoses • Dry break couplers • Emergency release couplers • Floating suction lines • Foam dam, integral • Skimmer units • Swivel joints • Installation and inspection The company’s clients include oil majors such as Petronas, Shell, Total as well as Vopak and VTTI, where the following recent contracts have been awarded: • Petronas, RAPID Project, dome roofs • Shell, Pulau Bukom, dome roof • Total Cambodge, aluminium full contact internal floating roofs.

Visit CTS (Far East) at:

STAND A18

With more than 100 years’ experience working within the fluid transfer industry, Emco Wheaton produces marine loading arms used to safely and efficiently transfer hazardous liquids and gases from ship to shore, distribution loading arms, dry-break couplers, adaptors, petroleum road tanker equipment, a range of refuelling systems used to refuel fleets of buses and its TODO range of couplers, adaptors and break-away couplings. The company’s products are designed and manufactured at four plants strategically placed around the globe. The manufacturing plants in Houston Texas, US; Oakville Ontario, Canada; Kirchhain, Germany and Margate, UK are supported by sales offices in Paris, France; Kuala Lumpur, Malaysia; Manama, Bahrain; Vienna, Austria; Shanghai, China; Moscow, Russia and Campinas, Brazil, as well as a network of trusted distributors covering more than 100 countries globally.

Visit Emco Wheaton at:

STAND A6

DeHumidification Technologies is a portable climate control company that focuses on humidity and temperature control. It provides services/equipment for blasting and coating of tanks and other confined spaces in the petrochemical, marine, power and municipal, as well as several other markets. It has the largest variety of fleet including refrigerant and desiccant - style dehumidifiers (200 to 20,000 CFM). The company has four international offices to serve those abroad in: Edmonton, Canada; Sydney and Melbourne, Australia; Singapore and Bangkok, Thailand. Its corporate office is located in Houston, Texas, along with eight other locations: Corpus Christi, Texas; Dallas/Fort Worth, Texas; Baton Rouge/New Orleans, Los Angeles; Eustis/ Orlando, Florida; Norfolk, Virginia; Wilmington, DE; Joliet/Chicago, Illinois; Long Beach, California.

Visit DeHumidification Technologies at: STAND E16

Dixon (Asia Pacific) is a manufacturer and supplier of hose couplings, valves, dry-disconnects, swivels, and other fluid transfer and control products. The company’s global reach includes a wide range of products for numerous industries including petroleum exploration, refining, transportation, chemical processing, food and beverage, steel, fire protection, construction, mining and manufacturing. The company, founded in 1916, says it will maintain the best inventory levels and lead times in the industry while providing training and support before, during, and after the sale.

Visit Dixon (Asia Pacific) at: STAND E11

The highlight on Endress+Hauser’s stand at this year’s show is a new platform of high-performance tank gauging instruments supporting both servo and radar technologies. The servo, with its rotary transformer, and the world’s first 79GHz tank gauging radar for liquids incorporate innovative and unique sensing elements that ensure highly accurate and reliable measurement in almost any process and environmental condition. It is the world’s first platform upon which both servo and radar measuring principles are designed according to IEC61508 and certified SIL 2/SIL3 capable. The new tank gauging instruments are verified and certified to meet the international custody transfer recommendations of OIML R85. A variety of open and vendor-specific communication protocols enable integration into any commonly used tank gauging system, and open the way for future expansion and migration possibilities.

Visit Endress+Hauser at:

STAND B10

AUGUST/SEPTEMBER 2016 VOLUME 12 ISSUE NO.4

EVENTS l TANK STORAGE ASIA PREVIEW

15-17 NOVEMBER 2016

AHOY ROTTERDAM

Organised by:

YOUR PLATFORM IN EUROPE TO MEET THE GLOBAL CONTAINER SHIPPING INDUSTRY Meet an international market

5,000+ senior buyers

Discuss and debate

Finalise deals

90%

30+ hours of free conference sessions

of visitors have decision-making power

Be amongst leading industry players

140+

Network with peers from

80+ countries

global suppliers

For more information please call +44 (0)20 701 75112 www.intermodal-events.com

AUGUST/SEPTEMBER 2016 VOLUME 12 ISSUE NO.4

EVENTS l TANK STORAGE ASIA PREVIEW

Fabricom is a reliable, experienced, full service contractor, specialised in engineering, the building, repair and maintenance of storage tanks from size S to XXL, operating worldwide. The company is skilled, up to speed with the latest techniques, guidelines & regulations and compliant with the highest safety standards in the industry. Since 1977, Fabricom has been dedicated to providing service of the highest quality within budget and on schedule. The company’s multidisciplinary project management team offers solutions in the following fields: • Tank inspection and assessment EEMUA 159 • Tank design and engineering • Tank installation and construction • Tank jacking and relocating • Tank maintenance and repair Fabricom is part of ENGIE (formerly GDF SUEZ).

Visit Fabricom at:

STAND E13

Fort Vale is launching its new safeload loading arm, the latest addition to its well-respected range of products for the petroleum transfer industry. Unique safety and design features include an integral earth system that ensures electrical continuity without separate wiring, a device to prevent over-rotation and a 3-seal dual needle/dual ball race bearing combination for maximum axial and radial strength and performance. The stainless steel and aluminium construction fitted with specialist high-pressure low-friction seals ensures excellent corrosion resistance, rugged durability and enhanced performance. It will be demonstrating the safeload loading arm with its range of API semi-automatic couplers.

Visit Fort Vale at:

STAND E12

L&T Valves is a leader in engineered flow-control solutions for oil and gas, power and allied process industries. Leveraging this expertise of over five decades, the company has developed a variety of products that enhance safety, performance and efficiency in oil and gas storage, transportation and distribution systems. • Double block and bleed plug valves • Remote-operated triple-offset butterfly valves • Pipeline ball valves • Control valves • High integrity pressure protection systems

These valves are designed to meet stringent industry standards. Every phase of the manufacturing process is governed by an institutionalised environment, health and safety policy. L&T Valves is a wholly owned subsidiary of Larsen & Toubro.

Visit L&T Valves at:

STAND E1

Labuan International Business and Financial Centre (Labuan IBFC) offers global investors and businesses the benefits of being in a well-regulated midshore international business and financial center, which provides fiscal neutrality and certainty, in addition to being an ideal location for substance creation. Located off the northwest coast of Borneo, Labuan IBFC provides access to Malaysia’s network of more than 80 double taxation agreements and boasts Asia’s widest range of business and investment structures for cross-border transactions, international business dealings and wealth management needs. Well-supported by a robust, internationally recognised yet business-friendly legal framework, Labuan IBFC operates within clear and comprehensive legal provisions and industry guidelines, enforced by its single regulator, Labuan Financial Services Authority. With a focus on enabling cross-border transactions, providing risk management structures, Islamic financial services, commodities trading incentives and wealth management vehicles, the center offers solutions to regional businesses going global or global businesses looking at penetrating Asia’s burgeoning markets.

Visit Labuan IBFC at:

STAND C43

Loadtec Engineered Systems is a global provider of unique solutions for bulk fluid transfer and tanker fall prevention. The company designs, engineers and supplies bulk fluid transfer packages including; meter and pump skids; tanker loading and unloading arms; marine arms; permanent or temporary tanker access platforms; operator safety cages; breakaway couplings and dry-disconnect systems. Loadtec is represented globally by a number of agents and distributors. The company will be on hand at the show to discuss its newly created company – Loadtec Service – which will complement its existing range of products and services. Loadtec Service is a newly formed installation, maintenance and servicing company with an international team of engineers and after market professionals with the aim of providing the best and most comprehensive service team around. The company has experience of working on all types of road, rail and marine loading and access systems.

Visit Loadtec Engineered Systems at:

STAND E19

AUGUST/SEPTEMBER 2016 VOLUME 12 ISSUE NO.4

EVENTS l TANK STORAGE ASIA PREVIEW

10th Conference on Flat Bottom Storage Tanks October 18 –19, 2016 in Munich (Germany) Topics International Regulatory Requirements Design for Special Loads Emission Reduction and Control Storage Tanks for New Technologies

TÜV SÜD Akademie GmbH Ms. Viktoria Wolter Westendstraße 160 80339 Munich Germany Registration congress@tuev-sued.de www.tuev-sued.de/storagetanks AUGUST/SEPTEMBER 2016 VOLUME 12 ISSUE NO.4

201701-Flach-anz-210x297-p-16-07-28

www.tuev-sued.de/storagetanks

EVENTS l TANK STORAGE ASIA PREVIEW

Netherlocks Safety Systems offers premium industrial valve safety solutions that enhance safety and efficiency in tank storage facilities. At this year’s Tank Storage Asia the company will reveal its new valve position indicator. It offers real time position feedback of manual valves to a DCS. The VPI ensures a correct line-up of your manual valves and avoids: • Incorrect (off)loading operations • Product spills • Product contamination The Netherlocks valve interlocks increase operator safety during critical change overs. Valve interlocks ensure a predefined valve operating sequence to avoid human errors during critical change overs like: • Relief valve switch overs; • Pipeline pigging; • Pump start-ups. The Power Wrench is a pneumatic valve wrench that severely reduces valve operating time and reduces physical strain to the operator. Power Wrench can also save actuator capex by using one tool to operate many valves.

Visit Netherlocks Safety systems at: STAND B33 Newson Gale manufactures hazardous area static grounding equipment and services designed to protect against static sparks, fires and explosions in flammable and combustible atmospheres. Static ground indicating systems are available for drums, IBC’s, road tankers, railcars, and process plant and equipment. Also available are static grounding and bonding clamps, cables, and reels; as well as test instruments, publications, and training materials. Customers are supported from sales and service centres in the UK, US and Germany and via an international network of specialist distributors and partners. Newson Gale will be exhibiting the Earth-Rite Multipoint II, a unique value proposition that makes the active static grounding of multiple items of equipment with interlock control more cost effective than other options available to the EX/HAZLOC industries.

Visit Newson Gale at:

STAND C33

Recognised as an industry standard in fluid handling equipment, OPW is revolutionising fluid handling operations globally by optimising safety, efficiency, reliability and environmental sustainability through innovative fluid handling and information management solutions. OPW will be displaying its Lynx bottom loading coupler at this year’s show.

Visit OPW at:

STAND B35

RPR Technologies with their unique patented solutions is a leading provider of induction paint removal systems for steel surfaces. Recently, RPR Technologies, along with two consortium partners was granted EU funding (ECO Innovation) on a project called GreenTank, aiming to develop robotic solutions for fast and environmentally friendly stripping of coatings on storage tanks. It is suited for the removal of thick coatings on tanks storage floors and lower wall section. Using the robotic or semi-automatic solutions, removal rates of 30 m2/hr or more can be achieved depending on type of coatings, conditions and film thickness. The RPR Induction system is economic and delivers a significant reduction in energy consumption with no handling of grit or water. It is almost quiet and facilitates a safer working environment for the operators and co-workers. Consequently, a continuous and uninterrupted fast removal process results in shorter down time for the tank owners.

Visit RPR Technologies at:

STAND B31

SafeRack manufactures gangways and loading platforms and provides turnkey services to carriers of crude oil, natural gas and liquid products. Its products help improve safety and productivity at truck, railcar and industrial loading terminals. Manufactured using precision laser technology, the systems support safety compliance and offer fall protection that’s durable, easy to operate and requires little maintenance. ErectaStep, RollaStep and YellowGate brand turnkey stairs, gates, crossovers, and work platforms support safety compliance and deliver fall protection ships same day and are easy to assemble, install and operate. Manufactured using precision laser technology and a patented modular design, the systems have quality, durability and can be easily reconfigured and repurposed as a plant’s footprint changes.

Visit SafeRack at:

STAND C27

AUGUST/SEPTEMBER 2016 VOLUME 12 ISSUE NO.4

EVENTS l TANK STORAGE ASIA PREVIEW

Scanjet offers containerised systems designed to fluidise and remove hydrocarbons sludge from crude-oil, HFO, and complex slop-oils stored in aboveground storage tanks. The system is produced by Entecx in Denmark and integrates the most reliable jetting nozzles in the market produced by Scanjet from Sweden. The process is based on mechanical and thermal treatment at the lowest possible temperature. This allows maximum preservation of valuable light-fractions of hydrocarbons. The sludge removal and surfaces cleaning uses the non-invasive concept through programmable and remote-controlled jetting-nozzles. The control philosophy of the entire process is based on a proprietary user-friendly system encompassed with an optimal man-machine interface. Thus, personnel are not exposed to hazardous or potentially explosive environments. The process fully complies with the European ATEX directive.

Visit Scanjet at:

Timm Elektronik is a specialised developer and producer of electronic measurement and control devices for use in hazardous environments. The company is a European market leader for grounding control devices. The intelligent explosion protection allows easy commissioning and maintenance while adhering to the highest safety standards and it is used in the petrochemical and chemical industry. These products provide safe loading and unloading of inflammable liquids as well as qualified access control to hazardous areas. Together with their Singaporean business partner OSK Industrial and their longtime software partner Implico the company will be displaying a range of its products including the EUS-2 overfill prevention controller, the EKX-4 grounding control device and the next generation of marine grounding, the SEK-3.

STAND C31

Visit Timm Elektronik at:

Techflow Marine are a global supplier of fluid transfer systems to the oil, gas and petrochemical industries, delivering innovative solutions to major blue chip companies worldwide. Working together with an international petrochemical company Techflow Marine has developed a global Edison gold award winning quay reel loading and unloading system, resulting in reduced vessel loading times, reduced demurrage times and providing opportunity for further volume increases. The multi-product loading and unloading system allows simultaneous and safe transfer of fluids to and from product tankers, reducing operational time by more than 60%. The quay reel system is based on Techflow Marine’s proven offshore oil and gas industry technology, supplied on more than 1,000 reels, in over 120 projects worldwide. The company is working with clients around the world developing quay reel system from 2” to 16” NB crude offloading systems.

Visit TechFlow Marine at:

STAND C34

AUGUST/SEPTEMBER 2016 VOLUME 12 ISSUE NO.4

STAND C12

Tristar Terminals Guam is the largest single storage fuel farm in the region with four million barrels of storage capacity spread across 237 acres. The terminal has 26 tanks interconnected to the Port Authority of Guam’s oil berths, other major customers and storage terminals by means of an eight kilometer-long three underground pipelines. Tristar manages its operations and processes through the utilisation of a world-class management system that holds SQAX, ISO 9001, ISO 14001 and OHSAS 18001 certifications as well as ISO 39001 certification for its road safety management system.

Visit Tristar Terminals Guam at:

STAND E10

EVENTS l TANK STORAGE ASIA PREVIEW

Organised by:

24–25 November, Saint-Petersburg 11th Annual Congress and Exhibition

Crude oil, LPG and petroleum products trading and transportation

Among industry speakers:

Sergey Andronov, Vice-President, Transneft

Konstantin Khamlay, General Director, Ust-Luga Oil

Alevtina Kirillova, Head of transportation tariff policy department, Russian Railways

Ellen Ruhotas, Managing Director, Ratio group (Singapore)

• Gain insight on the current and prospective projects in the industry

of oil, petroleum products and LPG transportation and ensure you are making the best strategic commercial decisions out of them

• Network with 300+ industry leaders, including more than 70 heads

of international and Russian oil and gas majors, transport companies, investors, world’s leading technology and equipment providers

• Draw the attention of 50+ potential investors by taking part in an

Siamak Goudarzi, CEO, Open Iran Group

Aleksandr Tiumin, Head of the tank farm, GazpromneftTerminal

exhibition – (a dedicated manager will be scheduling tet-a-tet meetings)

Gold Sponsors:

Special partner:

Sponsors: 94

AUGUST/SEPTEMBER 2016 VOLUME 12 ISSUE NO.4

EVENTS l TANK STORAGE ASIA PREVIEW

TTK is one of the world’s leading manufacturers of liquid leak detection systems and offers a range of oil leak detection systems specifically designed to identify and locate all liquid hydrocarbon leaks in tank farms, pipelines, airports and refineries. The system, based on sensing cables, probes and digital monitoring panels, is capable of detecting petroleum, fuel, crude oil, and jet fuel. The sensing cable and probe are fast-responding, re-usable and ATEX approved, allowing early accurately located detection of oil leaks. With its headquarters based in Paris and all products manufactured in France, TTK’s products hold a number of recognised international safety and specific approvals such as UL, TUV/GS, IEC, and ATEX. TTK systems provide continuous monitoring to secure assets and protect the environment in which they are installed, and can offer tailored solutions for various projects.

Visit TTK at:

Zhejiang Jialong Mechnical Equipment Co is the biggest Chinese manufacture of tank truck manhole covers, bottom loading equipment, vapour recovery equipment, anti-overfill system equipment and fuel dispenser parts. It is the main supplier for CIMC and Sinopec. All the products have presence in domestic and international markets with API, CE, ADR, PEI and ISO certification.

STAND B34

Visit Zhejiang Jialong Mechnical Equipment Co at: STAND D19 Verwater has been permanently based in Singapore since 1992 but has been carrying out tank jacking projects in Singapore, Malaysia and Brunei since the 1970s. It is focused on tank jacking works and tank foundation repairs and since 1992, more than 220 tanks were jacked. The company relocated a 70 meter floating roof tank in Port Dickson, Malaysia. In June 2016, the company shifted a tank on one of the refinery sites in Singapore using the skid-method. The combination of the unique Verwater jacking system together with its skid-system enabled the company to shift the tank temporarily for foundation repair (piling) after which the tank was placed back on its renewed foundation.

Visit Verwater at:

STAND A20

Zwick is a leading manufacturer of valves with a product range that contains metal-seated triple offset butterfly valves known as series Tri-con, the check valves, called Tri-check and the Tri-block series, Zwick’s double block and bleed design. The double block and bleed design features every technical advantage which the series Tri-con has plus there is a true double block and bleed feature which delivers zero leakage. By using this design, the former two valve system with a spool piece becomes obsolete. With Zwick’s unique design of the linkage between the two shafts, the user is able to actuate both shafts with only one actuator and reach zero leakage with the two available sealing surfaces.

Viscoy is a specialist supplier of remote visual inspection (RVI) equipment. It offers the full range of RVI products to address any visual inspection requirements. Products include small diameter endoscopes capable of accessing the smallest cavities, remotely controlled crawler systems and push cameras for inspection of long pipeline networks as well as powerful pan, tilt and zoom cameras for inspection of large storage tanks or confined spaces. Viscoy also offers customised inspection systems.

Visit Viscoy at:

STAND D18

AUGUST/SEPTEMBER 2016 VOLUME 12 ISSUE NO.4

Visit Zwick at:

STAND E15

Argus Africa Storage and Logistics 2016 EVENTS l XXXXXX XXXXXX

argusmedia.com

DoubleTree Hilton Hotel, Cape Town, South Africa

16 November – Investing in Infrastructure Summit 17-18 November – AfricaConsulting Storage and Logistics Conference Events

Tank Storage Magazine Discount Quote TSMASL20 to receive 20% off

Your headline speakers include:

Dipo Salimonu Chief Executive, Moteriba Terminals & Logistics

Shem Simuyemba, Fund Manager, Nepad Infrastructure Project Preparation Facility (NEPAD-IPPF)

Topics on the agenda include:

Ezekiel Adesina Senior Business & Strategy Analyst, Nigeria LNG

Barbara Mommen, CEO, Maputo Corridor Logistics Initiative

Join us and benefit from:

•

Tank owners and operators: Explore the developments of ports and storage availability

•

New! Investing in Infrastructure Summit: The realities of financing the continent’s infrastructure projects

•

New! Operational steam: Building storage tanks, key HSEQ guidelines, prevention not reaction

•

Champagne round tables: Examine operational, trading and strategic issues with peers

•

New! Trading and Strategy streams: Floating storage, refining capacities and landscape, SPMs vs berthing

•

New! Live debates: How to overcome logistical challenges and get oil products to inland countries

Exhibitors

Supporting Partners

Official Publication

Official Media Partner

Official Social Media

Media Partner

View the agenda and register at www.argusmedia.com/africa-storage 96

AUGUST/SEPTEMBER 2016 VOLUME 12 ISSUE NO.4

EVENTS l ILTA REVIEW

Winners of the ILTA safety excellence award

MIXING BUSINESS WITH NETWORKING

Arc Terminals Holdings

NuStar Energy

Benchmark River and Rail Terminals

Odfjell Terminals

Demaco Terminal Operations Intercontinental Terminals Company Kinder Morgan Energy Partners

Petro-Diamond Terminal Company Phillips 66 Company Sunoco Logistics Partners Tesoro Logistics

Marathon Petroleum Company

U.S. Venture

Motiva Enterprises

Vecenergy

his year’s ILTA kicked off with a real life story from Brad Livingston, who shared his experiences of being in a workplace accident. Livingston was the victim of two back to back explosions while performing hot work to repair a pinhole leak on a drip tank at a natural gas well. He suffered broken bones and third degree burns on more than 60% of his body. His resounding message to delegates was to think of the ripple effects that your actions have. ‘The only reason you don’t follow procedure is to save time,’ he said. In the case of his own accident, by not gauging the tank, he would have saved himself three minutes. ‘Is saving that time really worth all the hurt and pain an accident would cause your friends and family? SOMETHING A LITTLE DIFFERENT One of the highlights of the second day of the event was the entertainment from The Passing Zone, an act that featured on America’s Got Talent. Not only did they show off their juggling and balancing skills they also brought Earl Crochet from Kinder Morgan and Melinda Whitney onto the stage – much to the amusement of the audience!

A few photos from this year’s Monday night party, hosted by Tank Storage Magazine, Easyfairs and VapourFlow

AUGUST/SEPTEMBER 2016 VOLUME 12 ISSUE NO.4

EVENTS l ILTA REVIEW Hosted by:

4-7 APRIL 2017 Makuhari Messe Chiba Tokyo Japan Official Knowledge Partner:

Organised by:

The 2017 Conference Final Call for Papers The Gastech 2017 conference includes a broader choice of topics than ever, with four times as many technical sessions running compared to 2015. Japan will host our largest-ever conference, welcoming more than 200 speakers and 2,500 delegates – all representing the natural gas & LNG value chain at core commercial and technical levels. There is still time to apply to speak. Just review the commercial and technical themes opposite, then upload your summary abstract to the website. Details are on this form, so don’t miss out – our final deadline to accept any applications is 9 September.

TECHNICAL SESSIONS INCLUDE: Coal Bed Methane/Coal Seam Gas Resources Digital & Data Management Engineering, Procurement & Construction Floating LNG Fuel Cell & Battery Technology

LNG & Gas for Transport: Sea LNG & Gas fro Transport: Land LNG Shipping: Ship Design & Build LNG Shipping: Cargo Handling LPG Shipping Gas & LNG Process Engineering

Gas & LNG Storage & Containment

Gas & LNG Process Control Instrumentation

Gas from Unconventional Resources: Technology & Solutions

Heat Transfer/Exchange Technology

Gas from Unconventional Resources: Risk Assessment

LNG /Cryogenic Technology Operations, Maintenance & Reliability

Gas to Liquids/Natural Gas Liquids

Small-Scale LNG & Infrastructure

Gas Fired Power Generation: Engineering & Technology

Smart Grids

Health, Safety, Security & Environment: People

Transmissions Systems & Pipelines

Health Safety Security Environment: Asset Infrastructure

COMMERCIAL SESSIONS INCLUDE: The Future for Gas in the New Dawn of Tighter Economics and Lower Carbon Emissions Contracting, Pricing & Trading of Gas & LNG

To find out more about the submission process, please email the conference content team on content@dmgevents.com. 98 Or, visit our website: www.gastechevent.com/tsm2

Gas & LNG Project Progress & Updates New Frontiers, Opportunities & Investments in Projects

AUGUST/SEPTEMBER 2016 VOLUME 12 ISSUE NO.4

EVENTS l TANKBANK REVIEW

A MEETING OF MINDS ON THE MEDITERRANEAN

As Israel looks to move away from coal to natural gas, the country is looking for further investment in its energy infrastructure

srael is undergoing an energy revolution and is poised to transform the sector with more investment into storage and pipeline infrastructure. The country’s energy shift and its implications on the storage sector as well as emerging global trends was a key talking point at this year’s Tankbank in Tel Aviv as industry professionals gathered to debate the current market dynamics. Yossi Rosen, from Israel’s Institute of Energy and Environment, said that there is ample investment opportunity for private companies seeking to enhance and improve current infrastructure. ‘We are having a revolution but our infrastructure is not ready for this. We currently rely on one significant pipeline for natural gas and we need additional pipelines – only way to develop it is through the private sector. ‘Additional pipelines could transform the industry and there is an investment opportunity for the country.’ Platts’ Andrew Bonnington provided an overview of the current global crude markets, and told delegates that there has been a 90% rise in oil prices since January 2016. He highlighted that the US has changed the crude production landscape, and since 2012 there have been large increases in its production to such an extent that it is now considered to be a swing producer. However, he said that global demand is now slowing after hitting a fiveyear high in 2015. This was echoed by Ratio Group’s MD Ellen Ruhotas, who observed that supply and demand will come back into balance in 2017. Despite demand waning, Asia remains the largest growth area for crude oil demand. Ruhotas said that in April, China took delivery of a record amount of crude oil, with eight million barrels per day.

AUGUST/SEPTEMBER 2016 VOLUME 12 ISSUE NO.4

‘It is the sink for crude oil,’ she said. The Middle East is also a booming region for storage – particularly Fujairah. ‘The storage industry has really taken off here over the last 12 months,’ Ruhotas said. ‘Fujairah is an example of this real take off. By 2018 it will have increased by 55% on the back of blending for petroleum and fuel oil.’ Delek and PiGlilot Terminals’ Moshe Busany gave an overview of the facilities operations in Israel followed by Eastport Global’s Mike Beviss, who provided an overview of storage in Europe. On the second day, delegates were treated to a guided tour of Old Jaffa, sponsored by the Eilat Ashkelon Pipeline Company, with a fascinating insight into the colourful history of ancient port city. They were then given a tour of Eilat Ashkelon Pipeline Company’s Ashkelon terminal. EAPC serves as a land bridge to transport crude oil from producing areas to consumers in Israel, Europe, southeast Asia and the far east through it pipeline system, which comprises three separate pipelines. The company has two oil terminals – one in Eilat on the Red Sea and one in Ashkelon on the Mediterranean – with a combined capacity of 3.7 million m3 for crude oil and oil products. The two terminals are connected with a 42” pipeline. This is one of the largest independent oil terminals in the Mediterranean Basin Deputy general manager Effie Milutin said that Ashkelon terminal underwent a five million barrels expansion five years ago, and that plans are in place for an additional five million barrels to be added.

EVENTS l CALENDER

EVENTS 2016/17 SEPTEMBER 2016

26th – 27th October 2016

6th – 8th September 2016

MEDIA PARTNER

Asian Downstream Week Marina Bay Sands, Singapore

Asia Pacific Petroleum Conference www.gevme.com/the-32nd-asia-pacific-petroleum-conference-appec-2016

The Asian Downstream Week conference will be split into three streams to allow greater focus in each area. www.downstream-asia.com

7th-8th September

27th October 2016

Raffles City Convention Centre, Singapore

MEDIA PARTNER

European Bulk Liquid Storage

NISTM 6th Missouri Storage Tank Conference

Tarragona, Spain

Blue Springs, Missouri

This two day event will bring together key industry stakeholders from the sector to address a need to invest in storage facilities and expansion of terminals with a focus on safety and environmental standards. www.wplgroup.com/aci/event/european-bulk-liquid-storage

www.nistm.org

27th-28th September

OFFICIAL PUBLICATION

Tank Storage Asia Tank Storage Asia is the fastest growing show in the StocExpo and Tank Storage portfolio of events. The two day conference and exhibition brings the Southeast Asian bulk liquid storage industry together to network, learn and do business. www.tankstorageasia.com OFFICIAL MEDIA PARTNER

NISTM 9th Annual Aboveground Storage Tank Conference and Trade Show Galveston, Texas

www.intermodal-events.com 16-17th November

Tank Storage Germany Hamburg Messe, Hamburg, Germany www.tankstoragegermany.com 17th – 18th November 2016

Argus Africa Storage and Logistics

24th – 25th November 2016

www.oilterminal.org/en

FEBRUARY 2017

OCTOBER 2016 MEDIA PARTNER

21st-23rd February

50th EPCA Annual Meeting

IP Week 2017

Budapest, Hungary

London, United Kingdom

www.epca.eu

www.energyinst.org MEDIA PARTNER

Global LNG Tech Summit www.lngsummit.com

MARCH 2017 OFFICIAL PUBLICATION

StocExpo Europe MEDIA PARTNER

API Tank, Valves, and Piping Conference and Expo

Ahoy Rotterdam, Rotterdam, The Netherlands www.stocexpo.com

Las Vegas, Nevada, US

APRIL 2017

www.api.org MEDIA PARTNER

International Conference on Flat Bottom Tanks Munich, Germany www.tuev-sued.de/academy/conference-management/tank-storage-systems/international-conference-on-flat-bottom-tanks

100

MEDIA PARTNER

28th-30th March

Barcelona, Spain

18th – 19th October 2016

OFFICIAL MEDIA PARTNER

Saint Petersburg, Russia

www.tankstorage-event.org.uk

10th-13th October

MEDIA PARTNER

Oil Terminal 2016

E.ON Lounge, Ricoh Arena, Coventry

3rd-5th October

OFFICIAL PUBLICATION

www.argusmedia.com MEDIA PARTNER

Tank Storage Association

1st-4th October

MEDIA PARTNER

InterModal Europe

Cape Town, South Africa

www.nistm.org 29th September

15th – 17th November 2016 Rotterdam, the Netherlands

Marina Bay Sands, Singapore

28th-29th September

NOVEMBER 2016

26th-27th April

OFFICIAL PUBLICATION

StocExpo Middle East Africa Dubai World Trade Centre, Dubai, United Arab Emirates Tank World Expo will return to the Dubai World Trade Centre under the new name of StocExpo Middle East Africa www.stocexpomiddleeastafrica.com

AUGUST/SEPTEMBER 2016 VOLUME 12 ISSUE NO.4

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ADVERTISERSâ&#x20AC;&#x2122; INDEX Alma/Carbovac 19 Anton Parr

Argus Africa

Asian Downstream Week

ATEC Steel

AUMA 10 Belfa Construt

Blackmer 58 Borsig 56 Brodie 65 Cashco 64 CB&I 57

STORAGE IS GETTING SOCIAL What the storage terminal sector has been saying on Twitter. Follow @tankstorageinfo for the latest news & developments and @TStorageAwards for more about our first awards event in 2017! @training8m A global products glut that has led storage tanks from Houston to Singapore to reach near capacity is also weighing

Chemie-Tech 61 Emco Wheaton

13,15

Emerson Process Management

Fenelon Storage Tanks

Flotech 43 Fort Vale

@sarahkgregory Oil tankers sent the long way around Africa due to lack of sales, storage #oilandgas #brokers #shipping

Gastec 98 Hayward Baker

Inter Tank

Intermodal Europe

Kanon 14 Loadtec

@HCarbonsMex Investors interested to invest in storage, transport, distribution & logistics centres for oil reception from abroad

Front Cover

Matcor 35 Midwest Steel

Milton Roy

Newson Gale

Nordic Storage

Oil Terminal 2016

Oiltanking 73 Omni Valve

OPW 80 Oreco 19

@Stockriddler When we had 420 million barrels of oil in storage, oil was 29 dollars a barrel. Now we got 521 million and oil is 43, makes sense

@Kalei53scop3 Wait ...what happens when crude oil storage gets filled up?? Where does the extra oil go?

Protego 87 Rosen 86 Rotary

Outside Back Cover

RPR Technologies

SafeRack 4

@TSWDT Oil demand can shrink when storage reach maximum capacity in the end of this year.

Silverwing 7 Solventas 75 Tank Connection

Tank Design House

Tank Storage Asia

Tank Storage Germany

TSA

TUV Sud

Vacono 52 Verwater 17 Viking Inspection

Inside Front Cover

Zwick 79 Chemical Storage Supplement Advanced Poymer Coatings

Arabian Chemical Terminals

IFC Inflow Port of Tarragona

Inside Front Cover

@WSJ The historic fall in oil prices has created a pileup of inventories, but how much is unclear

@OilandEnergy US #Crude Imports continue to keep storage levels elevated as domestic #oil production falls second week in a row

@chris1reuters Floating #oil storage is rising not falling and a response to severe global glut, says @MorganStanley #OPEC #Brent

Front Cover

TEPSA 8 Tank Storage Magazine (ISSN 1750-841X) is published six times a year (in February, March, May, August, October and November) by Easyfairs UK Ltd, 2nd Floor, Regal House, 70 London Road, Twickenham, TW1 3QS, UK. The 2016 US Institutional subscription price is $240. Airfreight and mailing in the USA by Agent named Air Business, C/O Worldnet Shipping USA Inc., 155-11 146th Street, Jamaica, New York NY11434. Periodical postage pending at Jamaica NY 11431. Subscription records are maintained at Easyfairs UK Ltd, 2nd Floor, Regal House, 70 London Road, Twickenham, TW1 3QS, UK. Air Business Ltd is acting as our mailing agent.

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ROTARY AT A GLANCE ROTARY is one of the region's leading oil and gas infrastructure services companies with extensive international experience offering fully integrated engineering design, procurement, construction (EPC) and maintenance services to the oil and gas, petroleum and petrochemical industries. Headquartered in Singapore, Rotary has established a strong presence in the Asia-Pacific region and continues to make its mark as a global player. Established in 1972, Rotary has forged a reputation built on its hallmark traits of providing quality services, within budget, safely and on-time delivery. Today, Rotary boasts a total strength of about 6,000 employees, including a highly and multi-skilled workforce that forms the mainstay of its core EPC services. Singapore remains a key market for Rotary while it actively seeks business opportunities overseas. Rotary has subsidiaries and associate companies in Malaysia, Thailand, Indonesia, India, China, Vietnam, Saudi Arabia, the United Arab Emirates, Australia and Myanmar.

Rotary is ISO 9001, ISO 14001, OHSAS certified and is listed on the mainboard of Singapore Exchange since 1993. Rotary's capabilities include: • EPC for bulk liquid storage terminals • EPC for offsite & utilities • Front-end engineering design (FEED) & detailed engineering • Mechanical works including piping & equipment installation • Electrical & instrumentation works • Civil, structural & building works • Maintenance of process plants & facilities • Fabrication of modules • Specialised services

Rotary Engineering Limited 17 Tuas Avenue 20 Singapore 638828 Tel: (65)6866 0800 • Fax: (65)6866 0999 • Email: bdd@rotaryeng.com.sg

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