The first fuel tanker is expected to dock at VTT Vasiliko Terminal in mid November, marking the operation of a project that aspires to place Cyprus at the centre of the fuel transport routes.
With a total cost of €405 million the project is considered as one of the biggest foreign direct investments in Cyprus in the last couple of years.
The state-of-the-art terminal features 28 tanks with a total storage capacity of 543,000 cubic metres of core fuel (diesel, gasoline and jet fuel) a deep water marine jetty as well as road tanker loading facilities in phase one, already completed at a cost of €305 million. Phase two scheduled to begin in mid 2015 will create an additional 13 tanks and an extra capacity of 305,000 cubic metres at a cost of €105 million.
VTT Vasiliko Ltd (VTTV) was founded in 2010 and is a subsidiary of VTTI B.V., the international company that owns and operates oil storage terminals, 50% of which is owned by Dutch-owned Vitol.
VTTV, the company operating the terminal, believes that the facility, located in Vasilikos, in the island`s southern coast, is very attractive to operators as in the wider area there are oil products flows from the Black Sea to the East, from the East to the West and from Europe to the East Med and the Red Sea, as 250 trans-shipments per year take place in the open sea around Cyprus.
“The Terminal, in conjunction with the island`s strategic location near the Suez Canal, places Cyprus on the map of these fuel transports,” VTTV General Manager George Papanstasiou told CNA.
Furthermore, upon completion of phase two, the terminal can exploit the fuel oil and crude oil transport market. The company believes that it can store crude oil being transported from the Red Sea to Asia`s emerging markets.
He added that the terminal could also act as the storage of Cyprus` strategic fuel reserves, as well the fuel storage of Cypriot fuel companies, recalling that under a Court ruling, fuel depots currently located in the coastal city of Larnaca should be relocated by 2016.
Panastasiou also notes that the VTTV terminal also could diversify the local fuel market, as more players can enter the fuel market which could lead to a drop in fuel prices in Cyprus. So far fuel importing companies were owners of storage facilities, which following the operation of the terminal is no longer necessary.
With regard to the terminal`s sustainability, Papanastasiou believes that despite the economic downturn, the company will sign “in the coming days” contracts that will secure 80% of the terminal`s capacity.
“Our aim is to serve 500 ships annually, a figure that corresponds to the Limassol Port`s annual commercial activity, in the peak of phase one” he notes.
Moreover, Papanastasiou believes markets do not create projects, rather than projects of such magnitude often create markets.
