British oil major BP and China’s Sinopec Fuel Oil are starting a Singapore-based joint venture in ship fuel storage and sales, BP said in a statement on Tuesday.
The 50/50 joint venture, which builds on a similar agreement signed in 2011, will leverage both companies’ existing bunkering locations and activities to deliver marine fuel to their customers, with a strong focus on Chinese shipping companies, a BP spokeswoman said in an email.
“The ports served by BP Sinopec Marine Fuels Pte Ltd will be: Singapore; Fujairah, United Arab Emirates; Antwerp, Belgium; Rotterdam and Amsterdam in the Netherlands; Tianjin, Qingdao, Shanghai, Ningbo and Shenzhen, China,” the statement said.
Unlike the Singapore market which is open to around 60 suppliers, the Chinese marine fuel market is limited to only a few players, including Sinopec, Chimbusco and Brightoil, trade sources said.
“BP gives access to their physical locations against getting access to China, which is a very restricted market,” said a Singapore-based fuel trader.
Sinopec is one of the top refiners in China and has a third of China’s bonded bunker market, which sells up to 9 million tonnes of fuel a year.
BP has been the largest marine fuel seller in Singapore since 2004, with estimated monthly sales of around 400,000 tonnes. Singapore sold 42.4 million tonnes of marine fuel last year.
(Reporting by Jane Xie and Henning Gloystein; Editing by Alan Raybould)