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Burgan breaks ground on Cape Town fuel storage facility

Burgan breaks ground on Cape Town fuel storage facility

Photo by Bloomberg

19th November 2015

By: Kim Cloete

Creamer Media Correspondent

  

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Burgan Cape Terminals, a new independent fuel storage, distribution and loading facility, has officially broken ground in the Port of Cape Town.

The multipurpose facility will be used for the storage and distribution of both locally produced and imported fuels.

It is the first project under government’s Operation Phakisa programme to be implemented, with R650-million to be invested in the project’s development over the first two years.

Burgan Cape Terminals is a joint venture between Thebe Investment Corporation, local firm Jicaro and Rotterdam-based international terminal operator VTTI.

Speaking at the launch of the facility at the port, on Wednesday evening, Netherlands State Secretary for Economic Affairs and Agriculture Minister Martijn van Dam said the development was an important initiative that would further entrench cooperation and partnership between the Netherlands and South Africa.

“We strongly believe that, together, we can create opportunities that will benefit both countries and their people.”

The terminal is due to be completed within 18 months. Transnet has awarded Burgan Cape Terminals a 20-year lease to develop the facility.

Burgan Cape Terminals CEO Muziwandile Mseleku said he expected the facility to ensure security of fuel supply by adding greater flexibility and choice to a “strained provincial storage market”.

“It will also play an important role in opening up a previously closed market for emerging black-owned independent fuel suppliers. All of this is good news for the country and for the economy and, most especially, for all fuel consumers,” said Mseleku.

Department of Trade and Industry director-general Lionel October noted that government was very excited about the new terminal and prospects for the development of the oil and gas sector.

“This is very big for us. It’ll allow us to bring in the oil, refine it and distribute it in Cape Town. It puts the city on the map. Cape Town could soon be seen as the Rotterdam of Africa,” he told Engineering News Online. Rotterdam is Europe’s largest port and a gateway into the continent.

Thebe Investment Corporation executive chairperson Vusi Khanyile said the development would help boost the security of fuel supply.

“South Africa is likely to be energy constrained for many years to come, so the more contingencies we put in place to address this energy challenge, the better. Secure and plentiful energy means a growing economy and much-needed jobs.”

The terminal is expected to create 130 contract jobs during the construction phase over a period of about 22 months. About 20 operational jobs will be created once the facility is up and running.

“The ready uptake of the facility by customers makes it clear that there is growing local demand for refined petroleum products in the region. We are very pleased to be able to share our extensive global experience with our local partners and look forward to working together,” said VTTI global head of strategy and business development Rubel Yilmaz.

Companies will “rent” space from Burgan to store their fuel products. Burgan has already signed long-term, ten-year contracts with oil companies, who jointly aim for throughput of up to 805 000 m3/year.

Gulfstream Energy has signed a three-year throughput agreement to store 120-million litres a year with Burgan Cape Terminals, while Shell will also be an anchor tenant.

Edited by Chanel de Bruyn
Creamer Media Senior Deputy Editor Online

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