Boomtown Fujairah
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TRADE Boomtown Fujairah Once known for its pristine beaches and resorts, Fujairah is fast becoming the region’s most lucrative new trade hub, attracting millions in investment. BY HEBA HASHEM IRAN FUJAIRAH UNITED ARAB give Abu Dhabi access to the Indian A maritime fortune EMIRATES Ocean at a tense time when the EU As the largest multipurpose port on has embargoed Iranian oil, forcing the country’s eastern seaboard, the Asian countries to turn to GCC oil as Port of Fujairah occupies an enviable an immediate alternative. geographic location and can accom- Construction on the $3.3 billion modate up to 100 vessels at any time. ith the slowdown pipeline began in 2008 and is ex- Taking advantage of this exceptional in Dubai’s con- pected to finish by mid-2012. When maritime station, Gulf Petrochem struction and complete, the pipeline will be able to recently invested $136.4 million to project cancel- export 1.5m barrels per day and will develop a 412,000-cubic metre stor- lations in Abu enable Abu Dhabi Company for On- age terminal by September, in which Dhabi, the tiny emirates of Fujairah shore Oil Operations (ADCO) to ex- Fujairah Petroleum Company will ac- has seized the opportunity to trans- port half of its total production within quire a 12% stake. form itself into one of the world’s top the first year. Although the Sharjah-based com- tanker refueling and oil storage hubs. Indeed, this will be a new era in crude pany operates globally with offices Strategic location, lower risk, and transportation, not only for Abu Dha- in Dubai, India, Singapore and Eu- relatively less congestion are some of bi but also for Fujairah, where a strate- rope, its latest investment proves the the factors that the emirate has man- gic oil reservoir and refinery are being significance of Fujairah’s port to the aged to leverage in order become the world’s second largest bunker- ing port after Singapore. While the Fujairah has seized the opportunity to trans UAE’s other six emirates lie along the - western Persian Gulf, Fujairah’s posi- form itself into one of the world’s top tanker tion on the east coast provides direct sea access leading to the vast Indian refueling and oil storage hubs. Ocean. In terms of import and ex- port, this is Fujairah’s unique selling set up. The reservoir, housing eight oil services industry. “Our latest de- proposition. giant tanks, each capable of holding velopments in tank storage reflect our one million barrels of crude, is larger vision to make the oil storage business A new era in crude transport than initially planned. These develop- one of the key drivers for our rapid The world has been watching as a ments are bound to attract oil players, growth”, says Harsh Sinha, Executive massive 370km oil pipeline is being especially those in the field of oil trad- Director of Gulf Petrochem. built across the UAE. Stretching from ing, bunkering, refining, and storage Azerbaijan is also establishing a Habshan in Abu Dhabi all the way as well as bitumen manufacturing and foothold in Fujairah’s bunker market to Fujairah and bypassing the critical shipping. Some of these players have through a project known as SAFT; a Strait of Hormuz, this pipeline will already arrived. joint venture between Socar, the in- Image courtesy/ ArabianEye.com Corbis of 26 GC March / April 2012 TRADE The Port of Fujairah occupies an enviable geographic location and can accommodate up to 100 vessels at any time. ternational marketing and trading Port of Fujairah arm of the State Oil Company of the Azerbaijan Republic (SOCAR); Au- rora Progress, the Swiss-based com- modity trading house; and the Gov- ernment of Fujairah. SAFT involves the construction of a 641,000-cubic metre oil terminal in Fujairah, and will receive financing of $110m from the Arab Petroleum Investments Corporation (Apricorp); a multi- lateral development bank owned by the Organization of Arab Petroleum Exporting Countries (OAPEC), and which the UAE holds a 17% stake in. Beyond the sea Fujairah’s 1,450 sq km of land is drawing other clusters of business as the opportunity early on was J.K. Ce- pacity of 300,000 tonnes, besides the well that can use the seaside emirate as ment Ltd., having invested $150m in 300,000-tonne refinery that is under- a base for regional activity. Qatar will the construction of a cement factory way. be awarding more than $106 billion in Fujairah, to be commissioned in “We are open to investment pro- worth of projects between now and 2013. The plant will have a capacity of posals. You have advanced technol- 2022, investing in oil and gas, heavy 600,000 tonnes per annum for white ogy and we can take advantage of industry, electricity generation, water cement. that. Anything to do with processing desalination, social infrastructure and or pharmaceuticals is welcome,” he transportation. Saudi Arabia has $108 Attracting Chinese business told the meeting attended by Chinese billion worth of construction across Chinese companies are next on the oil and other companies. The 85km the kingdom in the pipeline. Global agenda for Fujairah Free Zone Au- Sheikh Khalifa Highway linking Fu- manufacturers catering to any of these thority (FFZA), where more than jairah and Dubai opened last Decem- industries would turn a profit by being 2,000 companies are already regis- ber, reducing travel time between the close at hand, and given that Fujairah tered. At a meeting during the sec- two emirates by 60 minutes. Con- has its own free zone with competi- ond China-Arab States Trade Forum, nected via road, sea, and air, Fujairah tive packages on offer, prospects for FFZA’s director general Sharif Al has all it takes to become a business new establishments look promising. Awadi said the authority was prepar- hub, with a dedicated department for Image courtesy/ ArabianEye.com Corbis of An Indian conglomerate that sensed ing to build a new refinery with a ca- industrial and economic activities. March / April 2012 GC 27.