Gulf Petrochem will invest about $80mn in Fujairah and East Africa over the next one year, a senior executive with the company told Gulf News.
“We are planning to spend about $25 to 30mn in acquiring new terminals in East Africa and about $50mn in adding new tankage in Fujairah,” said Thangapandian Srinivasalu, executive director of Gulf Petrochem.
The construction work in Fujairah will start next year and the project is expected to be completed by March 2017.
“We are going to add around 260,000 cubes in Fujairah. These tanks will not only cater to trading activity but will also support the refining activity which we are planning,” Srinivasalu added.
Earlier this month the company said it plans to ramp up storage capacity in the Tanzanian capital Dar es Salaam and in Kenya's second largest city Mombasa.
“The next decade belongs to Africa and there are tremendous business opportunities in East Africa, which is politically stable and secure. There is steady growth of 5 to 7% in Tanzania, Kenya and Uganda.”
The UAE-based trader is also planning to tap the bunker fuel and liquefied petroleum gas (LPG) sectors, with a deal to lease about 100,000 cu/m to store mainly gasoil and gasoline due to be finalised by December.
The company has applied for licences in Kenya and Tanzania to market LPG (mainly to be used for cooking) and plans to increase the number of its fuel stations from three to eight.
“The next decade belongs to Africa because that’s the market which is short. Tremendous opportunities are available there and assets are available at cheap rates. Things are slowly stabilising there,” said Thangapandian.
In Kenya, it recently acquired local firm Essar Petroleum East Africa Ltd., which was licensed to market petroleum products through outlets it previously serviced.
The company also recently invested $60mn in storage facilities in Fujairah, as part of its plans to increase its presence in the Middle East.
Part of the storage capacity would be ready by December 2016, with the remainder completed by March 2017, Thangapandian added.
The launch of supply operations in Fujairah will compliment Gulf Petrochem Group’s growing global footprint in bunker supply, which to date includes Khor Fakkan and all other ports of the UAE, Gulf of Kutch, Indian ports of Kandla, Sikka and Vadinar.