China Brightoil's Zhoushan Petroleum Products Storage Facility

ANALYSIS

SEP 01, 2014

China Brightoil’s Zhoushan Petroleum Products Storage Facility

China: Brightoil’s Zhoushan Petroleum Products Storage Facility

Assessment: Overview: The Zhoushan storage facility is being Construction at the Zhoushan storage During 2010, as part of the continued developed on the island of Waidiao Shan facility, which began during 2011, is expansion of the petroleum infrastructure in (Wai Island), 153 km southeast of Shanghai continuing. Phase I construction is nearing China, Brightoil Petroleum (Holdings) Limit- and 500 meters off the western shore of completion. Phase II construction appears ed announced that it intended to construct Zhoushan Qundao, on China’s east coast. to have begun, seven storage tanks are a new petroleum products storage facility Construction of the Zhoushan project is complete and 22 are under construction. in the Zhoushan area. The Zhoushan area divided into two phases that are anticipated One transfer jetty (with six berths) and is emerging as a major petrochemical and to commence operations in 2014 and 2015 one general cargo jetty are complete and trading hub for eastern China supporting respectively. When finished the facility will two transfer jetties are under construction. the import and regional trade not only for have a capacity of 3.16 million cubic meters. At the present rate of construction the the greater Yangtze River delta region (e.g., Phase I began during 2011 and when facility could begin initial operations during Shanghai, etc.), but also for China’s East complete will have a total capacity of 1.94 late-2014 or early 2015. China Sea coast. million m3 and include storage facilities for crude oil, fuel oil, gasoline, diesel, jet fuel, While Brightoil has a 100 percent interest and chemical tanks. Phase II will expand in the new storage facility, it formed a upon storage capacity, berthing and joint venture, in which it has a 55 percent infrastructure on the island. interest, with the Zhoushan Port Group Ltd. Company to construct the jetties and service the oil storage facility. The jetties Location: will include berths that could accommodate Waidiao Shan (a.k.a., Wai Island), vessels ranging from 1,000-300,000 dead Zhoushan, Qundao, Zhejiang, weight tons (DWT). China Coordinates: 30° 03’ 30.42” N, 121° 57’ 55.29” E Date of Report: February 3, 2014 Date of Imagery: April 10, 2010–March 15, 2014

China: Brightoil’s Zhoushan Petroleum Products Storage Facility

Development: The following year, on November 6, 2012, Table 1. Storage Tank Status, 2010-2014 April 23, 2010 satellite imagery (Figure 3) satellite imagery (Figure 5) the extensive shows Waidiao prior to the commence- nature of excavation, earthmoving and ment of construction for the Zhoushan landfilling operations are visible. The Under Construction Under Construction Under Construction Storage Facility. The island covers latter have resulted in the landmass 29-meter 44-meter 81-meter approximately .94 km2, of which approxi- being increased to approximately 1.2 mately 50 percent was under cultivation. km2. The temporary worker housing and Completed 29-meter Completed 44-meter Completed 81-meter equipment camp has been moved 200 m Satellite imagery from June 3, 2011 image to the northwest, additional construction (Figure 4) shows the dramatic changes buildings are present on the southwest that have taken place in the 14 months 35 shore, and the temporary batch-plant is since the previous image. Extensive in the process of being moved 175 meter excavation of Waidao’s central ridge, 30 to the southwest. Approximately 1,500 and the concurrent earthmoving and meters of sea wall have been construc- landfilling operations, has resulted in the tion along the southern half of the island. 25 island’s landmass being increased to A 185 meter-long general cargo dock approximately 1.1 km2. All cultivated land has been constructed, an 871 meter-long has been filled and dredging operations 20 transfer jetty is under construction on the are being conducted off the northeast eastern shore of the island, and pilings and southwest shores. Twenty-three for a second transfer jetty are being 15 temporary building have been erected in placed. Foundations for seven 81-meter the north central section of the island for (unpaved), five 44-meter (paved) and construction crews and their equipment. 10 two 29-meter storage tanks are under Several temporary construction buildings construction. have been erected on the southwest 5 shore. A temporary batch-plant has been erected on the northern tip of the island. 0 4/3/10 6/3/11 11/6/12 7/23/13 1/23/14 3/15/14

China: Brightoil’s Zhoushan Petroleum Products Storage Facility

Figure 1 Satellite imagery from July 23, 2013 (Figure Approximately 575 meters of sea wall of 29 storage tanks have been completed 6) show that excavation, earthmoving and have been added on the north shore. The or are under construction: twelve 81-meter landfilling operations have continued— general cargo and first transfer jetty are tanks—five foundations, three with most notably in the northeast corner of the complete and remain unchanged, construc- foundations and walls and 4 essentially island. The temporary worker housing and tion continues on the second transfer jetty complete with walls and floating tops; nine equipment camp has been reduced to 17 (now approximately 930-meters-long) and 44- meter tanks—four foundations, two buildings, there are no significant changes construction of a third transfer jetty has be- with foundations and walls, three essen- to the construction buildings along the gun on the west side of the island. A total tially complete with foundations, walls and southwest shore, and the temporary of 25 storage tanks are under construction: floating tops; and eight 29-meter—eight batch-plant remains in its previous location. twelve 81-meter tanks—five foundations, foundations. Pipes connecting the transfer No significant progress on the construction four with foundations and walls and three jetties, pumping stations and storage tanks of the sea wall is apparent. The 185-me- with foundations, walls and floating tops; are still being laid. View of the first ter-long general cargo dock is unchanged, seven 44-meter tanks—three foundations, Recommendations: transfer jetty looking major construction on the 871-meter-long four with foundations and walls; and six Continued monitoring and analysis of southeast. (Brightoil) transfer jetty is complete, construction of 29-meter—six foundations. Pipes connect- Brightoil Petroleum’s Zhoushan Storage the second transfer jetty (approximately ing the transfer jetties, pumping stations Facility on a quarterly basis is recommend- 930-meters-long at this point in construc- and storage tanks are being laid. ed to determine: operational status, storage tion). Foundations for seven 81-meter, five Most recently a satellite image from March levels and shipping activity. Such monitor- 44-meter and two 29-meter storage tanks 9, 2014, shows (Figure 8) no significant ing and analysis may provide advanced Figure 2 are essentially complete. additional excavation, earthmoving and insight into historical and future import/ Six months later, on January 23, 2014, landfilling operations. The temporary work- export trends and status of petroleum satellite imagery shows (Figure 7) that er housing and equipment camp remains reserves for China’s eastern provinces. excavation, earthmoving and landfilling at 7 buildings, no significant increase in the operations have continued at a slower number construction buildings along the pace than previously and suggests that southwest shore, and one of the two batch Phase II construction has begun. The plants on the northern tip of the island has temporary worker housing and equipment been removed. The sea wall on the north camp has been reduced to 7 buildings, shore remains essentially unchanged. The there has been a dramatic expansion general cargo and first transfer jetty are to the number construction buildings complete and remain unchanged, construc- along the southwest shore, and a second tion continues on the second transfer jetty Foundations for 81-me- batch plant has been constructed on the (still approximately 870-meters-long) and ter storage tanks. northern tip of the island. construction of a third transfer jetty on the (Brightoil) west side of the island continues. A total

Figure 3

Laotangshan

HENGSHUI YANG (CHANNEL)

4.23.13 Waidiao several months prior to the beginning of construction.

Figure 4

Temporary batch plant

Laotangshan

Newly constructed sea wall

Temporary housing and construction camp

Excavation and landfill operations

HENGSHUI YANG (CHANNEL)

6.03.11 Zhoushan Petroleum Storage Facility

Figure 5

Temporary batch plant

Temporary housing and construction camp

Laotangshan

Cargo jetty (~185 m)

7 storage tanks (~82 m)

2 storage tanks (~28 m) Transfer jetty (~871 m)

HENGSHUI YANG (CHANNEL) 5 storage tanks (~43 m)

Transfer jetty under construction

11.06.12 Zhoushan Petroleum Products Storage Facility.

Figure 6

Temporary housing and construction camp Temporary batch plant

Laotangshan

New excavation and earth-moving operations

7 storage tanks (~82 m)

2 storage tanks (~28 m)

HENGSHUI YANG (CHANNEL) 5 storage tanks (~43 m)

Transfer jetty under construction

7.23.13 Zhoushan Petroleum Products Storage Facility.

Figure 7

Temporary housing and construction camp Temporary batch plant

Laotangshan

12 storage tanks (~82 m)

Continued excavation and earth-moving operations

Transfer jetty under construction

5 storage tanks (~43 m)

2 storage tanks (~28 m)

Transfer jetty under construction HENGSHUI YANG (CHANNEL)

1.23.14 Zhoushan Petroleum Products Storage Facility.

Figure 8

Newly constructed seawall

Temporary batch plant Temporary housing and construction camp Laotangshan

12 storage tanks (~82 m)

Transfer jetty under construction

9 storage tanks (~43 m)

8 storage tanks (~28 m)

HENGSHUI YANG Transfer jetty under construction (CHANNEL)

3.09.14 Zhoushan Petroleum Products Storage Facility.

AllSource Analysis, Inc. helps customers by focusing on what’s most important— Questions or comments concerning AllSource changes that directly impact their organizations. Our team of professional imagery, Analysis can be sent to info@allsourceanal- geospatial and open source research analysts are backed by direct access to the ysis.com. Images in this report may be col- satellite imagery collections from numerous providers of sub-meter resolution or-corrected for the purpose of publication. imagery. AllSource Analysis keeps a constant eye on the world to provide early Indemnity: You will indemnify, defend, and insights into the business, market, military and political changes that impact hold harmless AllSource Analysis, Inc. and its people around the world. subsidiaries, affiliates and subcontractors, and their respective owners, officers, directors, -em ployees and agents, from and against any and all direct or indirect claims, damages, losses, liabilities, expenses, and costs (including rea- sonable attorneys fees) arising from or out of: (1) Your use of the Product for any purpose; (2) Your actual or alleged breach of any provision of this Agreement; or (3) damage to property or injury to or death of any person directly or indirectly caused by You. AllSource Analysis, Inc. will provide You with notice of any such claim or allegation, and AllSource Analysis, Inc. has the right to participate in the defense of any such claim at its expense.

All satellite imagery in this document: Airbus and DigitalGlobe