Abu Dhabi:  Gulf Petrochem Group will invest $136.4 million (Dh500.89 million) to develop a 412,000 cubic metre storage terminal project in Fujairah in which Fujairah Petroleum Company (FPC) has signed an agreement with Gulf Petrochem to buy a 12 per cent stake, a senior executive of Gulf Petrochem said yesterday.

Sanjeev Sisaudia, Group Chief Executive for Gulf Petrochem, told Gulf News, "FPC will also invest as per the agreement". He didn't elaborate.

Gulf Petrochem recently signed an investment agreement with the Government of Fujairah subsidiary Fujairah Petroleum Company (FPC).

Gulf Petrochem's storage terminal is due for completion next September.

Ashok Goel, Chairman of Gulf Petrochem Group, said in a statement: "Participation of Fujairah Petroleum Company in our project underlines the importance of the storage terminal business as a tool for socio-economic progress in the emirate and across the region. Such strategic partnerships complement our aggressive growth plans and help us create new economic possibilities for the communities we serve. This agreement reaffirms the commitment and trust various stakeholders have in this project."

Headquartered in Hamriyah, Sharjah, Gulf Petrochem operates globally with offices in India, Singapore and Europe. The group recently opened a Dubai office in line with regional growth plans. Gulf Petrochem specialises in oil trading and bunkering, oil refining, grease manufacturing, oil storage terminals, bitumen manufacturing and shipping and logistics.

It operates a 60,000 cubic metre facility in Hamriyah Free Zone, Sharjah. Strategic location, lower risk and relatively less congestion are factors that have led to the emergence of Fujairah as the second-largest bunkering port in the world after Singapore and positioned it as a major maritime hub for the region's oil exports.

With the passage of tankers through the Strait of Hormuz being prone to risks due to geopolitical tensions, Fujairah sensed the opportunity well in time to transform itself into one of the world's top tanker refuelling and oil storage hubs.

The emirate's unique selling proposition is that location-wise it provides a direct access to the open sea — the Indian Ocean — for crude oil and oil product exports.

A 370-kilometre pipeline is expected to be commissioned soon which can carry around 1.5 million barrels per day of crude oil from Abu Dhabi's onshore Habshan field to Fujairah for export.

In addition, a proposed 200,000 barrel per day refinery scheduled to be commissioned by mid-2016 will allow Fujairah to become a major hub for oil and petroleum product exports, catering to the booming demand from Asia and other Middle East countries.