Mashreq Petroleum, a core platform company of Citadel Capital, has signed a 30-year concession agreement to build fuel bunkering terminal and logistics hub on the Suez Canal.

The unique tank farm in East Port Said Port on the north side of Suez Canal will serve global shipping market and be a backup to Egypt’s national energy security policy.

The EGP3 billion ($429.7 million) facility will have capacity for up to 800,000 metric tons of product, including liquid bulk (fuel oil, gasoil, naphtha and jet fuel) and bunker fuels.

Announcing this on Monday, Mashreq Petroleum chairman and managing director Dr Tamer Abubakr said, “Coming on the heels of cabinet-level approval for the project yesterday, the concession agreement between Mashreq and the Port Said Port Authority clears the way for the fast-tracking of this critical project, which stands as a backup to Egypt’s national energy security.”

Mashreq was set up in 2004 by Citadel to build and operat the first tank terminal and logistics hub of its kind in the region. The original contract for Mashreq was signed on December 10, 2005.

Mashreq will have an annual storage capacity of 10 million metric tons per year and an annual bunkering capacity of 2-3 million tons with three berths that will accommodate tankers up to 120,000 DWT and four berths for bunkering barges. The project will be completed in several phases.

The facility will primarily serve liquid bulk market in the Far East, the Middle East and the broader Mediterranean region.

Mashreq will also provide fuel bunkering services for ships transiting the Suez Canal, to capitalize on the unique location of the world’s busiest maritime route, with more than 20,000 vessels transiting annually.

Total traffic through the Canal represents 10 per cent of global maritime transport and approximately 22 per cent of container trade worldwide.

An estimated 110 million tons of petroleum products passed through the Canal in 2012 (growing at a rate of 19 per cent annually over the previous eight years).-TradeArabia News Service