BP Eastern Mediterranean has signed a fuels storage agreement with the Cyprus Oil Terminal Ltd., formerly the Cyprus Petroleum Refinery Ltd,. in Larnaca for 25,000 cubic metres in extra storage capacity, to be used initially for jet fuel.
COTL has transformed its business to a storage terminal and services company ever since the refinery was shut down last April. It has a total capacity of 150,000 tonnes, most of which is or will be allocated to local fuel companies and the Cyprus Organisation for compulsory stocks.
Jeremy Huck, General Manager Air BP South and East Europe, who is in charge of 20 countries from Portugal in the west to Israel in the east and up to Russia and the former Soviet republics, was in Cyprus for a site visit of BP facilities.
He told the Financial Mirror that the agreement will expand BP’s storage capacity in Cyprus, in addition to the 16,000 tonnes storage BP owns at the Larnaca terminal and the two airports.
“BP expects an increase in tourism traffic to Cyprus this year based on CTO projections,” explained George Papanastasiou, Country President for BP Eastern Mediterranean Ltd., who signed the agreement with COTL.
Huck added that the expected increase is also due to factors such as the Olympics in Athens last year, the bad winter this year in the rest of Europe and political stability compared to the rest of the eastern Mediterranean.
“Growth in Greece seems flat for this year, Italy may see a marginal increase, while the two ends of the Mediterranean – Portugal, Spain in the west and Cyprus in the east – will enjoy the biggest increase,” he said.
“Cyprus shares the same tourist customers to these countries from Germany, the Scandinavian countries and Russia. Scheduled and charter airlines will increase their capacity and we will be there to help serve them.”
Cyprus lies in the middle of Jeremy Huck’s market, both as regards volume sales and profitability.
BP has a strong presence in the US market, Europe and the Asia-Pacific basin, but its presence in Africa (other than South Africa) is weak.
The Cyprus Republic is currently buying most of its supplies from BP for its police helicopters and other aircraft, but this business is a very small part of the BP Cyprus operations.
BP has three divisions in Cyprus: Aviation, Marine (that has developed since last January after the introduction of a 3,200 tonne double-hull feeder barge), and Lubricants (BP, Castrol, Duckhams and Aral, the latter sold primarily in Israel).
Further expansion plans, either on the retail side, or at the two new airports to be built by 2010, will depend on developments with the Cyprus political problem, Papanastasiou explained.
