Quarterly October 2004 - Odfjell

Odfjell enters into New TerminalVenture in ChinaBy Siri-Anne MjåtvedtFor several years Odfjell has been involvedin the Chinese tank storage market, throughthe terminals in Dalian and Ningbo. OnJune 24th 2004 Odfjell signed a joint ventureagreement with Jiangsu Garson InvestmentCo. Ltd to establish a new Chinese terminal,Odfjell Terminals (Jiangyin). Garson is a wellknownproducer of PET, but is also a traderand distributor of petrochemicals. The newcompany is a 45/55% split between Garsonand Odfjell, and has an initial investment ofabout US$ 30 million. This will be one of twointernational tank storage companies operatingon the Yangtze River.As the name indicates, the new terminalwill be situated in the city of Jiangyin in theJiangsu Province, on the south riverbank of theYangtze River between Shanghai and Nanjing.Jiangsu Province is one of the richest regions inChina, and is today the most important areaof consumption of chemicals and downstreamproducts in China. Main products imported areSM, MEG, Methanol and BTX (mainly toluene),but there are also large volumes of sulphuricacid being imported from Japan and Korea.In addition comes import of smaller quantitiesof products like DEG, phenol, acetone etc. Thelocal authorities in Jiangyin are providing thenecessary infrastructure to the terminal gate;roads, electricity, but also steam and waste waterarrangements. Garson’s main contribution tothe joint venture includes the rights to an areasuitable for a tank terminal with associatedberths. The land size is about 40,000 m 2 , withthe possibility for further expansion at a laterstage. One of the advantages of the locationis the wide shoreline, which can accommodateships up to 50,000 Dwt.From the signing ceremony in Bergen (from left: Wang, Weicheng (Party Secretay JiangjinProvince), Sun, Biao (Chairman of the Board, Garson Group), Terje Storeng (President/CEO,Odfjell), Svein-Gustav Steimler (Senior Vice President Odfjell Terminals) and Dan Odfjell(Chairman of the Board, Odfjell))Construction of the first phase of the terminalwill commence already in December 2004/January 2005, and will include erecting a tankfarm with approximately 80,000 cbm (around20 bonded storage tanks) and a berth that canaccommodate 2 x 50,000 Dwt ships and threesmaller tankers. Of the estimated throughput of800,000 mts of chemicals, Garson will generateabout 200,000 mts. The first phase is estimatedto take some 15 months to complete, andthe plan is to further develop the terminal inaccordance with the market requirements andneeds.Exchanging gifts with our newChinese partners.Preliminary plans for the new tank storage terminalodfjell quarterly 12