Wednesday October 31, 2012
Platts adds Tanjung Bin terminal to pricing process
SINGAPORE: Energy pricing agency Platts has approved a new storage terminal in southern Malaysia set up by a joint venture of oil trader Vitol to participate in its assessment process for oil products, a step that could strengthen the region’s role as a trading hub.
The move will also allow the Geneva-based trading house, which is a major player in the Asian market, to take bigger trading positions and gain greater flexibility.
Platts, which provides Asian benchmark assessments for most oil products traded in the region, would include Tanjung Bin storage terminal in its pricing process for fuel oil, diesel, jet fuel and gasoline from Dec 1, the unit of McGraw Hill told subscribers.
“Platts will continue to review the relative value of deliveries from southern Malaysian terminals compared with deliveries from landed storage within Singapore itself, and adjust normalisation values,” it said in a note this week.
Vitol, the world’s largest independent oil trader, has a combined storage capacity of more than a million cu m of both dirty and clean products in commercial terminals in Singapore, which is Asia’s largest oil trading hub.
In recent years, Singapore, which is just about 3½ times the size of the US capital, Washington DC, has been struggling to meet Asia’s expanding demand for oil storage.
The city-state’s reluctance to allot more land to oil storage facilities has triggered a series of oil infrastructure projects in southern Malaysia, as well as a move to get them recognised in the pricing process.
Tanjung Bin, a joint venture between Vitol and MISC Bhd, started operations in April. It comprises 41 storage tanks with total capacity of 841,000 cu m of fuel oil, gasoline and middle distillates. Another 1.6 million cu m of storage are planned to be added by the third quarter of 2013.
On the Platts’ list, Tanjung Bin joins more than 10 terminals in Singapore, Port of Tanjung Langsat and the adjacent Pasir Gudang, as well as some floating storage units. — Reuters