Oman Tank Terminal Company (OTTCO), a subsidiary of Oman Oil Company today announced the launch of a new floating storage facility at Mina Al Fahal.
The facility, which has a storage capacity of 2.1mn barrels, will be used by buyers of Oman export blend crude.
China Oil, Glencore and Oman Trading International (OTI) have won bids for access to the facility on board a Very Large Crude Carrier (VLCC), which will be provided and operated by Oman Shipping Company (OSC).
The new floating storage facility, which was initiated and supported by Oman’s Ministry of Oil & Gas (MOG), has been developed in partnership with OSC, Petroleum Development Oman (PDO) and the Dubai Mercantile Exchange (DME).
While the vessel itself will be operated by OSC, scheduling and nomination for the loading of crude oil will be managed by PDO. Ship-to-ship (STS) transfers will be executed by Fendercare Marine, an international specialised STS firm.
The initiative makes OTTCO the first storage company in the world to provide floating storage linked to an energy futures contract.
It also makes DME the first exchange in the world to incorporate floating storage at delivery point for customers, thereby supporting the trading of DME Oman crude oil futures on the exchange while strengthening its strong trading ecosystem to create more efficiencies.
The new facility will also enable buyers on the DME to store their oil and optimise market circumstances to their benefit giving them additional flexibility.
It will also enable buyers to face any unforeseen circumstances by providing a viable storage option for the oil they have purchased.
HE Nasser Al Jashmi, Deputy Chairman of Dubai Mercantile Exchange, said: “The floating storage facility will deliver improved convenience to customers of Oman Export Blend oil, and stands as a brilliant testimony to the Sultanate’s commitment to create a better, more efficient oil trading environment.
“With the launch of this facility, buyers on DME will now have access to a world-class oil storage hub that gives them unprecedented flexibility and control to capitalize on favourable market conditions. We congratulate OTTCO on this landmark initiative which will dramatically augment the capacity for storage and exports of the Oman blend.”
