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Wednesday, 19 March 2014

R19bn SA oil hub in the pipeline

NM SBM mooring
Two new single-buoy moorings (SBMs), similar in style to 
Sapref s SBM off the south Durban coast (pictured), are being 
planned as part of a R19 billion oil and petro-chemical hub 
project near Richards Bay by Phangela Storage Farm (Pty) Ltd. 
The SBMs and hub would service the international and regional market.

Durban - A R19 billion project involving the development of two
offshore single buoy moorings (SBM), to be used by giant oil supertankers,
 is on the cards for the Zululand coast, south of Richards Bay.
The twin reversible offshore mooring project is being developed
 and driven by Phangela Storage Farm and will be linked to a tank farm near
 Port Durnford station, about 26km from the port of Richards Bay.
There is also set to be an offshore pipeline connecting with Durban and Richards Bay.
The major project involves a 2 million cubic-metre liquid bulk storage
 and through-put hub. It will include a comprehensive storage tank farm
 and strategic reserve storage on behalf of long-term international and local clients.
The two new SBMs, similar in style to the single-buoy mooring off Isipingo south of
 Durban and providing deep water offshore berthing facilities,
will be served by large crude carriers and ultra-large crude carriers,
known in the industry as VLCC and ULCCs.
The activities include the import and export of crude oil
 and handling of petroleum-related products, bulk liquid petrochemicals,
 bulk liquid fertilisers, LPG and bitumen.
Willie Vogel, executive development director of Phangela,
said a multi-product reversible offshore pipeline would connect the
 Phangela storage tank farm with the three major oil refineries in
 Durban and various industrialists operating in Durban and Richards Bay.
He said that after three years of feasibility studies the ideal location
had been found at Port Durnford, south-east of Richards Bay.
Vogel said the site for the tank farm was 3.6km away from the coast
near the Port Durnford railway station. This gives access to road, rail
 and power supplies and is well outside the area affecting the
 control of the port of Richards Bay.
“Phangela will meet a significant part of the shortage of (oil) storage
 and will fulfil a hub function in the region for the storage and throughput
of liquid commodities, refined products, biofuels and ethanol, LPG and chemicals.”
Vogel said the project would see crude oil being pumped ashore
from the giant tankers moored to either of the SBMs
and stored at the tank farm until required, either locally or internationally.
When required, the crude would be pumped back into another tanker
 and shipped to wherever it is required internationally.
Crude oil required by refineries will be pumped ashore.
Exports of refined fuels could be exported from Durban in reverse manner, he said.
A reversible pipeline between the tank farm and Durban refineries makes
up part of the planned development and will be mainly offshore,
thus avoiding any routing through built-up areas, said Vogel.
“We will be storing crude for international customers so you’ll have
crude coming in through the pipeline to be stored,
then going out again to be shipped overseas.
We’ll also be available as a storage facility for Durban and other refineries.
“In addition, we will be handling the 45 or so various chemical products associated
with a refinery business, so having two reversible SBMs becomes an advantage all round.”
Vogel said the facility would have state-of-the-art through-put facilities via ship,
 rail and road, as well as via the pipeline infrastructure.
American Tank & Vessel, with 30 years’ experience in tank farm development,
 has been awarded the contract for the construction of the tank farm
 and the on-site facilities. Fendercare Marine has been appointed
 as the executing operator for the marine facilities, pilotage,
mooring and diving. The selection of the terminal operator is in progress.
Petrol Storage Broker, an independent brokerage that specialises in finding worldwide terminal storage for suppliers and producers of liquid bulk petrochemicals and biofuels with customers worldwide, has been appointed executive project manager and has begun the sales and marketing for both storage and throughput customers.
Vogel said that subject to regulatory consent, construction of the tank farm was planned
for the end of 2014. This included doing environmental impact studies to secure environmental approvals. He said the total estimated investment was $1.8 billion (R19.3bn).
Durban Chamber chief executive Andrew Layman said the chamber’s forums
 had not discussed the project, but on the face of it, he welcomed the venture.
“Certainly its construction will represent many jobs and a major investment in infrastructure.
I will be interested to know what impact it might have on what is planned
 for Durban in relation to the dig-out port,” he added.
“Perhaps it will relieve Transnet of some of its implementation of new SBM facilities,
 and relocate the hub of oil traffic away to a less populated and less congested part of the coast.
 These might be positive circumstances.
“Environmental issues are inevitable, and one hopes that good sense prevails – on all sides.
 There is no doubt that the South African economy, and that of the region,
needs oil and this has to reach us across the sea.” - The Mercury

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