Nu Star Energy Enters $54 million JV in Turkey

Texas-based oil pipeline and terminal operator NuStar Energy has started a joint venture with Turkish companies S-Oil and Aves for around US$54 million. The deal gives NuStar a 75% stake and operational control over two petroleum terminals in Turkey.

One of the Turkish terminals has a storage capacity of 606,000 barrels for gas, oil and distillates such as diesel, while the other terminal has a 740,000 barrel capacity which is designed mostly for oil products. The terminals are both connected to a new offshore platform off the Mediterranean Coast via pipelines. Reports suggest that NuStar are in talks with their new partners about the possibility of building a number of new terminals in different parts of Turkey.

NuStar’s management have been keen to show their enthusiasm for the joint venture, with CEO Curt Anastasio stating “Turkey is an exciting market for us because the country has a booming economy and growing petroleum demand.” Of the terminals, he remarked, “They are new, well-built and well run facilities with outstanding employees, and we will invest to expand and optimize the operations to enhance profitability.”

According to analysts, the joint venture will be planning to expand the capacity of the terminals by another 930,000 barrels by the end of 2011. S-Oil operates more than 190 retail gas stations in Turkey and is the eighth-largest importer of fuel into the Turkish market. Aves is an international commodity trading company that serves a number of Mediterranean markets.

A recently published report, ‘Oil, Gas, and Renewable Energy : Europe Industry Guide’, suggests that the European fuel retailing industry generated total revenues of US$571.8 billion in 2009, which represents a CAGR (compound annual growth rate) of 7.9% for the period spanning 2005-2009. This data suggests that although the European fuel retailing market is an extremely large industry, the CAGR shows that it is still growing, meaning that opportunities are still present for companies such as NuStar Energy.

By Alex De Angelis (companiesandmarkets)

[mappress]

Source:Ptil, February  11, 2011;