BSM to build 2 additional storage tanks

BRUNEI Shell Marketing (BSM) yesterday launched its biggest ever project, the construction of two storage tanks that will ensure Brunei has sufficient stock of diesel and gasoline to cover for interruptions in supply.

The project, worth $30 million, entails the construction of two 12,000 cubic metre storage tanks at Muara Terminal. It will be BSM's largest.

Hj Mohd Sufri Hj Sulaiman, the managing director of BSM, said the project is meant to meet a Country Wide Stock (CWS) that requires Brunei to have at least 31 days worth of refined products.

"The new tanks will help us improve the CWS from 25 days to 31 days," said Hj Mohd Sufri.

"The main objective of this is to fulfil Brunei's Energy Contingency Plan (that) sets out a Country Wide Stock to ensure that the country will have sufficient stock to cover the interruptions in supply, especially with demands increasing over the past five years."

Prior to this, BSM's largest storage tank has a capacity of 5,300 cubic metres. The new tanks will each have a 33 metre diameter and measures 15 metres in height, designed to store white oil products, gasoline and diesel.

The managing director listed additional storage for the importation of bigger parcel size of fuels (which can result in some freight savings) and the chartering of bigger vessels (which will reduce congestion at Muara Terminal Jetty, potentially avoiding demurrage) as some of the benefits BSM hopes to gain from the project.

In constructing the tanks, BSM has also taken into account a design that "meets the latest standards for safety and environmental protection", said Hj Mohd Sufri.

"For the Brunei Shell Joint Venture companies, preserving the environment is like safety. It is a core value, and a true business priority. This is a commitment which BSM is also strongly supporting," he said.

When asked whether or not refineries will have to ramp up production for BSM's storage needs, Hj Mohd Sufri said that the current production will remain the same.

"Currently, 75 per cent of the demand is produced by our existing refinery, while the remaining 25 per cent is coming from Singapore and Malaysia," he said.

With the additional storage space, the MD said that it's not about producing more but rather storing more.

"Even if there is any interruption to supply, or if something happens to the refinery. We have our own capacity to meet the country's requirement for the next 31 days. (They) don't need to produce more," he added.

The contract to build the two new tanks was awarded to Ishii Iron Works Co-SKS joint venture company on August 8, 2011, and is scheduled to be commissioned by the first quarter of 2013.

Ishii Iron Works Co from Japan, is an international tank builder, founded in 1900. The company has built over 2,000 tanks in the world, including a number of export tanks in Seria Crude Oil Terminal.The Brunei Times