Singapore: Oil product trader Gulf Petrochem plans to focus on East Africa for growth and is increasing its storage capacity in the region to take advantage of double-digit growth for some products, executive director S Thangapandian said.
The UAE-based company also plans to strengthen its presence in the Middle East, and is spending $60 million to boost its storage at Fujairah.
Gulf Petrochem, whose main trading activities are in fuel oil and bunkering, started talks about three months ago to take up storage capacity in Dar Es Salaam in Tanzania and Mombasa in Kenya, Thangapandian said in an interview.
A deal to lease storage of about 100,000 cubic metres to store mainly gasoil and petrol in East Africa is expected to be finalised by December, while the company also plans to tap the bunker fuel and liquefied petroleum gas (LPG) sectors.
“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,” Thangapandian said in an interview during the Asia Pacific Petroleum Conference in Singapore.
African demand for gasoil and petrol is increasing at seven to eight per cent, while LPG demand is rising in double digits, he said.
Gulf Petrochem has already applied for licenses in Kenya and Tanzania to market LPG, used mainly for cooking, while taking baby steps to increase the number of its fuel stations to eight from the current three.
Outside East Africa, Gulf Petrochem will spend $60m to add up to 270,000 cubic metres of capacity in Fujairah to its existing 412,000 cubic metres. Part of the capacity would be ready by December 2016, with the remainder completed by March 2017.
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