Sinopec to Lease 75% of Hovensa Oil Storage Capacity

Sinopec to Lease 75% of Hovensa Oil Storage Capacity

Sinopec, Asia’s biggest oil refiner, and Freepoint, US commodity trader, will take part in reviving the Caribbean oil refinery, Hovensa, in collaboration with  Limetree Bay Holdings LLC, the buyer of the complex in St. Croix, US Virgin Islands, Reuters reported.

The deal with Sinopec includes a 10-year lease of 75 % of Hovensa’s crude and oil storage tanks with a total capacity of 13m barrels.

The move marks China’s further expansion to the region controlling growing volumes of Latin American crude oil, the partners said, according to Reuters. China had made billions in loans to state-run oil producers in Venezuela, Ecuador and other Latin American countries in exchange for crude.

According to Bloomberg, Limetree plans to expand storage capacity up to 30 million barrels.

Storage spaces for oil and refined products have been gradually diminishing due to the US shale boom, and as OPEC production has increased global supplies to about 3 billion barrels — a record, according to the International Energy Agency, Bloomberg reported.


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