West Indies Petroleum ups capacity to take on new markets
Jamaican bunkering company West Indies Petroleum (WIP) says it is ready to be a bigger player in the regional fuel market, in addition to becoming the major supplier of low-cost bunker fuel to shipping companies in Jamaica and the Caribbean.
CEO Charles Chambers said the commissioning of more than 830,000 barrels of storage will make WIP second only to Petrojam as the largest owner of fuel storage in Jamaica.
The total storage is broken down as 65,000 barrels at the Ocho Rios Pier and 600, 000 at the former Jamaica Broilers ethanol plant, which it acquired last year and has now completely retrofitted to store gasolene, diesel and heavy fuel oil.
The plant was divested to WIP for around US$5 million according to regulatory filings.
Chambers says his company spent about another US$3 million to repurpose the plant, which had been idled before its takeover.
That facility has been renamed the West Indies Petroleum South Terminal.
Chambers told the Financial Gleaner that WIP is now seriously focused on growing as a regional player. It has sights on the Caribbean and Central America.
"Our business is primarily focused on the regional export market and we feel like we've identified an opportunity to participate in that space," Chambers said.
The company has more than doubled its delivery capacity with the addition of a third fuel barge. The previous vessels had 45,000 barrels and 27,000 barrels of capacity. The new acquisition has a capacity of 96,000 barrels for a total delivery capacity of 168,000 barrels which, added to the 665,000 barrels of static storage rounds out the total storage to just over 830, 000 barrels.
"It's a big deal to have that much volume of fuel," Chambers said. "The bunker market is where it all started for us, we're pushing deeper into that space and literally turning it into something that it is not at the moment."
WIP says it has signed a supply agreement with a global fuel supplier - whose identity Chambers declined to disclose - allowing it to transship fuel regionally.
"We've partnered with a massive global company and they have a lot of product in storage at different locations all over the world. They are not very big players in the region, we're working with them and, based on our ability to sell, getting the product delivered here is not a problem. We will trans-ship regionally as well, using other vessels," he told the Financial Gleaner.
WIP expects its first shipment of approximately 400,000 barrels of fuel to arrive in Jamaica before the end of March. Chambers says that by April, the new storage facility will be full to capacity, but declined to say what that capacity was.
"There is a competitive advantage in not disclosing our storage parameters, and so we'd rather not say just how we'll break down our storage," he said.