Ramping up global bunkering business

GP Global is committed to providing bunker customers globally with compliant fuel for regulatory changes by IMO in 2020, says Prerit Goel, joint managing director at GP Global

Prerit Goel, joint managing director at GP Global.
Prerit Goel, joint managing director at GP Global.

GP Global is a well-known player in the oil industry, specialising in oil trading and bunkering, refining, grease manufacturing, storage terminals, bitumen manufacturing, shipping, and logistics. Headquartered in Sharjah’s Hamriyah Free Zone, and having a presence in South Asia, the Far East Asia, Africa and Europe, the company has emerged as one of the well-established manufacturers and traders of petroleum products in major parts of the world.

GP Global has a refining capacity of 10,000bpd in Hamriyah Free Zone and has about a million cubic metre storage capacity spread across three ports – two in the UAE (Hamriyah and Fujairah) and one in India (Pipavav).

The business started in the early 1990s, when brothers Ashok Goel and Sudhir Goyel began with trading of petrochemical products in Delhi and Gujarat in India. In 1998, after having established the business activities in India, they expanded the business activities in to Sharjah, UAE, and named the company Gulf Petrochem. Twenty years later, the company marked a new chapter in its growth with a new corporate identity – GP Global – reflecting the organisation's fast-growing international presence, and strengthening its reputation and recognition among the global business community and stakeholders.

Prerit Goel, joint managing director at GP Global, was instrumental in setting up the global trading offices, most notably in Singapore and London, for the company and was actively involved in the storage terminal project in Fujairah, UAE. A young achiever and a man of many talents, Goel holds an MBA on ‘Family Managed Business Programme’ from SP Jain Institute of Management & Research, Mumbai, India, and an engineering degree from Birla Institute of Technology & Science, Dubai, UAE.

Recently, GP Global announced an ambitious plan to strengthen the company’s international bunkering business with the addition of new supporting infrastructure, and hiring experienced industry professionals at key offices, including Dubai and Singapore.

Gearing up to be IMO 2020 ready
With the goal of expanding the firm’s marine fuel business while getting ready to supply IMO 2020 compliant fuel to the customers, GP Global is leveraging the company’s international network to ramp up its bunkering business and gear up to meet the 1 January 2020 regulation  by International Maritime Organization (IMO) to curb sulphur content in marine fuels to 0.5%.

GP Global has restarted its trucking business to cover fuel oil and marine gas oil in major ports in the UAE, increasing the company’s market share by drawing on its assets of owning trucks and utilising tanks at the Hamriyah Terminal.

We are prepared to offer 0.5% low-sulphur fuel oil (LSFO) right now to our customers in major ports and at physical delivery points of Rotterdam/ARA (Amsterdam-Rotterdam-Antwerp), Fujairah and Singapore. These can help our customers plan their voyage economics and fuel compatibility for 2020 and beyond. We shall extend the availability of LSFO to other smaller ports where we are physical suppliers by Q4-2019 in preparation for the regulatory changes in January 2020,” says Goel.

“I feel there will be, for anybody and everybody, some time when things will be very uncertain. Uncertainty provides opportunity to traders, and because we are right there in the middle, having asset base, customer base and supply base, we would be positively impacted by the IMO sulphur regulation on marine fuels – we will be able to trade more.”

“In addition, our fuel delivery systems at all ports shall include high-sulphur fuel oil (HSFO) and marine gas oil (MGO), meeting the changing needs of our customers as we go in to 2020. We are also gearing up to provide specific lubricant solutions in the major ports conforming to the changes in fuel specifications over the course of a vessel’s voyage,” Goel adds.

Rebranding to GP Global
About the progress made in rebranding from Gulf Petrochem to GP Global, Goel observes: “With any rebranding, it is not a short process, it takes a lot of time. I would still say that people, or the larger community still know us by the name Gulf Petrochem. Yes, we are getting there. In the new markets that we are entering, we will be known as GP Global because there is no legacy in those markets. But home markets like the Middle East and India still identify us as Gulf Petrochem.”

“It is a journey and it will happen, eventually. We put a neck out by calling ourselves GP Global, and we are getting there. We have obviously opened a lot of new offices in the last one-and-a-half years of this rebranding – so that does justify the name.”

“Also, one of the main reasons for changing from Gulf Petrochem to GP Global was to ensure that we are seen as a cross-commodity player and a multi-asset player rather than just focusing on oil and gas. So, we got into grains, recently. We are looking at many other asset classes as we speak. So, it is not just energy anymore. There are bits and pieces of other commodities that we trade as well,” explains Goel.

Becoming a global player
When asked about the evolution and transformation of GP Global from a UAE-based entity to a global player, Goel remarks: “The business was started in 1998 by my father and his brother, who sold everything back home in India and came to the UAE, seeking opportunities in the country, which provided a lot of potential. We started as a small waste collection company, doing a lot of collection of waste and a lot of trade with India on recycled products. In 1998, we set up our own small refining unit.”

“From there, up till 2010, we were primarily a UAE company, doing more opportunistic businesses. That is when Manan Goel and I joined the business, and we definitely so beyond the UAE. We went to Singapore, opened a trading office there, and since then, there has been no looking back. Now, we are present in almost all the continents. We have offices in Houston, Geneva Rotterdam, London, Dubai, Mumbai, Singapore and Seoul. So, we are really global and we are present in various businesses around the energy sector.”

GP Global has about a million cubic metre storage capacity spread across three ports – two in the UAE and one in India.

Storage terminal and bunkering businesses
Responding to question on the company’s plans for Fujairah in terms of the storage terminal business, Goel comments: “The storage terminal business has really done well over the last seven to eight years of its existence. In between, we had plans to expand the business. But, I think it was good that we had held the plans back a little bit because there was a feeling of overcapacity in Fujairah about one-and-a-half years ago. Things have started looking up again with the advent of the first quarter of 2019.”

“With the IMO 2020 rules, one business that will do really well is the storage because the same set of physical suppliers would have to keep various grades rather than just keeping HSFO – a ship owner might want LSFO, another will require HSFO, and somebody else could ask for gas oil. There will be a lot more demand. We will evaluate what happens in terms of the growth needed in really expanding the storage side in Fujairah.”

As of now, things look stable, and we are not 100% certain whether we would want to build more capacity in Fujairah. We are looking at a few opportunities in terms of acquisitions in the region in the storage space. So, probably this will be more in the inorganic route than the organic way,” Goel reveals.

As of now, GP Global has a talented team of 50 bunker traders. Explaining the company’s focus on bunkering business, Goel states: “I would take pride in saying that we are one of the largest bunker traders in the world, having presence in Rotterdam, Fujairah and India – three very important port destinations put together.”

“There is no other physical supplier who has presence in all these three destinations like us. There are traders, or physical suppliers in Rotterdam, or in Fujairah, or India on standalone basis. For us, it has really become a global business. We are doing a volume of about half a million tonnes every month now and this all started from nothing just four years ago. Bunkering is a very important business for us.”

Environmental footprint
GP Global claims to reduce environmental footprint and emissions in its operation. Advocating the company’s positive direction on sustainability, Goel points out: “Everybody wants to go green. I think almost all energy companies are taking this very seriously. So, we have proper CSR programmes and we take very deep understanding of the whole supply chain. We ensure that our suppliers and customers do not pollute too much. So, we have a preferred set of suppliers who are greener than some other suppliers.”

“Within our own little world, we take steps to ensure that all the emissions are under check, and we are seriously contemplating of getting in to biofuels as well. Ten years ago, we did announce a biodiesel project. We set up the plant, but we were not very successful because we were very ahead of times at that time. The economics of the project did not work at all. Now, it looks very different, looks much better. We are reviving our biodiesel project. It will be announced sometime later this year. From trading perspective, we are definitely getting into biofuels as well.

A growing business
Elaborating on the growth of the business, Goel declares: “In 2017, we did close to 10 million tonnes of trading globally, and we had a top line of about $3.6bn. In 2018, we touched 12.5 million tonnes in terms of product delivered to customers, and $5.1bn in top line.”

GP Global is a bunker supplier in many ports and a mid-market trader. Last year, the company supplied about 12 million tonnes of energy products starting from LPG, gas oil, gasoline, naphtha, jet oil, base oil, bitumen, fuel oil and coal.

“GP Global is a global bunker supplier with operations in Europe, the Middle East, Indian Subcontinent and the Far East, with bunker trading offices in Rotterdam, London, Geneva, Dubai, India, Singapore and Seoul. We are currently exploring to enter the bunker market in America and expect to supply five million metric tonnes of bunkers to customers globally in 2020,” concludes Goel.

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