x Abu Dhabi, UAEFriday 28 July 2017

ENOC pulls out of Fujairah port

Emirates National Oil Company has stopped storing and marketing bunker fuel at the emirate's port, citing rising competition.

Emirates National Oil Company (ENOC), owned by the Government of Dubai, has stopped storing and marketing bunker fuel at the port of Fujairah. It has ceased its operations at the world's second-biggest bunkering port less than two years after restarting the business, as traders pointed to rising competition from other ports in the region and business rivals. "We have stopped operations since July 1," Khalid Hadi, the group brand and marketing manager of ENOC, told Reuters without giving reasons.

"Bunker fuel" describes the blend of mostly heavy oil products that constitute the fuel used to power most long-haul commercial shipping. Traders estimated ENOC had lost about US$20 million (Dh73.4m) from its bunkering operations in Fujairah and had been selling about 200,000 tonnes of the fuel a month before quitting the business. The state oil company pulled out of Fujairah and Singapore, the world's busiest bunkering port, as it was not able to compete with rivals selling fuel to ships using the ports, traders said.

"ENOC doesn't own its own barges so it couldn't compete with players that do," a Dubai-based bunker trader told Reuters. Some players have been exiting or downsizing their operations in Fujairah because of competition from other ports in the region, he added. ENOC had stopped supplying bunker fuel in Fujairah in May 2008 after splitting with its joint-venture partner, Kuwait's Independent Petroleum. The Kuwaiti company had maintained the logistics operations of the business.

Despite the split, ENOC relaunched its bunkering business as a solo venture eight months later, in January last year. @Email:tcarlisle@thenational.ae