Oil tank farm on track
A multimillion-dollar oil tank farm terminal, which is nearing completion in Timaru, will bring a significant trade boost for the town’s port.
PrimePort chief executive Phil Melhopt said the addition of the new tank farm would ‘‘be great for our business’’.
Pacific Petroleum-owned Timaru Oil Services Limited is building the farm, which will include six bulk fuel storage tanks, an office building and truck loading facilities, once completed.
TOSL expects to have the four-tank, 32 million litre facility operational in July. Two six-million litre tanks will be added later.
‘‘To the port it is clearly beneficial. It means more market share of the South Island fuel industry so it means improved revenue and improved trade through the port.
‘‘It will bring increased trade, more volumes, more ships,’’ Melhopt said.
He said, combined with Timaru District Holdings Limited (TDHL), the port was able to make good strategic use of its land to the benefit the region.
‘‘We welcome Tasman Fuels. We appreciate the support they have given in
choosing Timaru, and I think it’s a really great sign of confidence that the industry has in Timaru as a central key port location in the South Island.’’
From a regional point of view, the tank farm will bring increased competition to the South Island which was good for fuel consumers and industries reliant on fuel, he said.
‘‘That’s a good news story all around – good for the port, the region and good for the consumer.’’
Melhopt said this was the second big investment at the port in five years, after Holcim Cement also selected it as its South Island base and invested $50 million.
Timaru Oil Services Limited managing director Philippe Dubau said the project on Fraser St is ‘‘getting very close to completion’’ ahead of its July schedule, but costs were ‘‘more in the $40 million range than the $30m’’ as had been previously reported. Dubau said a name change was also on the cards.
‘‘We believe our project will increase storage capacity in the South Island thus stop shortages that occur from time to time and increase competition.
He said the new supply would increase pressure to push prices down.
The two-stage project started with the installation of four 8000 cubic metre fuel storage tanks in 2018.
The second stage involved building an underground pipeline from the wharf to the tank farm, on reclaimed land used primarily for ‘‘industrial purposes associated with port activities’’, and the installation of two more 6000 cubic metre fuel storage tanks.
Dubau said it was difficult to assess the number of direct and indirect jobs the tank farm would bring but about 10 people had been directly employed by TasmanFuels.
‘‘Our first vessel is planned for midJune. It is a medium range tanker very much similar to the ones you see in Timaru from time to time.’’
Dubau said the project, which had been up to two months ahead of schedule, had lost ‘‘some days’’ during Covid19 alert level four, but was back on track.
South Canterbury Chamber of Commerce chief executive Wendy Smith said the selection of Timaru as a base for Timaru Oil Services ‘‘is good news all round’’.
‘‘With increased capacity in the centre of the South Island this reduces the cost and pressure on supply, so is beneficial for our industries and operators. Increased competition should also impact positively by applying downward pressure on fuel prices.
‘‘Plus this development further cements our position as a strategic freight and logistics hub for the South Island. This work could not have come at a better time as we look to recover and reposition our economy Post Covid19.’’
Timaru Oil Services Limited is owned by Pacific Petroleum, which was established in 2006 by a group of Tahitian and Caledonian investors, following the acquisition of the activities of Shell Group in French Polynesia, New Caledonia and Vanuatu.