Keppel Infrastructure Trust and Metro Pacific Investment Corporation to acquire Philippine Coastal Storage & Pipeline Corporation
Acquisition of the largest petroleum products import storage facility in the Philippines
A quality infrastructure business that will strengthen KIT’s portfolio
Keppel Infrastructure Fund Management Pte Ltd (KIFM), as the Trustee-Manager of Keppel Infrastructure Trust (KIT), is pleased to announce that KIT and Metro Pacific Investments Corporation (MPIC) have today entered into a conditional sale and purchase agreement with Philippine Investment Alliance for Infrastructure (PINAl)1, a fund, to acquire 100% interest of Philippine Tank Storage International (Holdings) Inc. (PTSI) which owns Philippine Coastal Storage & Pipeline Corporation (PCSPC), the largest petroleum products import storage facility in the Philippines.
Upon completion of the proposed acquisition, it is intended that KIT will indirectly hold 80% of the shares in PTSI and MPIC will indirectly hold 20% of the shares in PTSI.
Mr Matthew Pollard, CEO of KIFM, said, “The strategic acquisition of PCSPC will allow KIT to diversify, grow and strengthen the resilience of KIT’s distributable cash flow. As the largest petroleum products import storage facility in the Philippines, where demand for petroleum products is expected to grow, PCSPC presents an attractive opportunity for KIT to capture opportunities arising from the strong macroeconomic outlook as well as robust growth fundamentals for imported petroleum products in the Philippines.”
1 The PINAI comprises Government Service lnsurance System, Langoer Investments Holding B.V. and Macquarie Infrastructure Holdings (Philippines) Pte. Limited.
PCSPC inaugurates another expansion project in its Maritan Tank Farm. The construction includes three (3) 180,00 barrels capacity fuel storage tanks, two (2) 50,000 barrels capacity fuel storage tanks, four (4) additive tanks, a loading rack, control office, and auxiliary facilities.
Despite being hampered by the COVID Pandemic, the project was completed in 18 months, on budget, and was commissioned in the last quarter of 2020. Constructed by the Aboitiz Construction Group, Inc., the facility conforms with international standards, and its first use was Oct 1, 2020.
With its completion, the Company’s total capacity increased to 6 million barrels for various fuel products. It also strengthens the ability of the terminal to cater to clients and customers supplying fuel to Northern and Central Luzon and parts of the National Capital Region.
To date, PCSPC remains the largest independent fuel storage facility in the Philippines.
Two additional fuel storage tanks were commissioned in Boton Tank Farm, Subic Bay Freeport Zone. Completed in 2019, the project includes one tank of 15,000 barrels and one of 20,000 barrels capacity, a new loading gantry, an inspection gantry, a control office, and other auxiliary facilities. The project conforms to international standards. On completion, the terminal had increased its capability to serve the increasing need for fuel storage. Further, it increased the Company’s capacity to 5.8 million barrels-solidifying PCSPC as the largest independent fuel storage in the Philippines.
A new administration building was formally turned over to PCSPC by the contractor JEQ Constructions in 2019. The 2-storey building was completed in 24 months and will initially house Support Services Group such as Admin staff, Accounting, Engineering, HR and Quality Assurance. The new building creates a better working environment to meet our clients’ needs and represents the rapid growth of the business.
Philippine Coastal Storage and Pipeline Corporation (PCPSC) has successfully completed the construction of 540,000 barrels of additional storage capacity and loading facilities at its operations within Subic Bay Freeport Zone (SBFZ). Three (3) new 180,000 barrel fuel storage tanks and two (2) tank truck loading racks, were built over 12 months, on time and on budget, by Aboitiz Construction Group Inc. The new tanks, built to today’s international standards, will increase PCSPC’s total fuel storage to 5.2 million barrels (or 827 million litres) of various fuel products such as diesel, gasoline, jet and fuel oil. This also completes PCPSC’s commitment to SBMA to invest and build 1.8 million barrels of fuel tank storage in Maritan tank farm.
Mr Michael Rodriguez, Chairman of PCSPC, said, “This considerable increase in storage is in response to our customers’ demand for quality and available fuel storage in Subic Bay, and we are pleased to be able to provide this new expansion to accommodate their needs.”
PCSPC’s strategic location in the SBFZ provides for efficient importation of fuel products for storage and onward distribution along the network of well-maintained toll roads to Clark, Manila, Central and Northern Luzon. SBFZ also provides an efficient coastal location for hub operations with imports from regional refineries for onward export distribution to the region
Mr Rodriguez added, “With our existing long term lease agreement with Subic Bay Metropolitan Authority, PCSPC looks forward to being able to undertake further investment, as demand requires, in order to serve the increasing fuel needs of the Philippines now and in the future.”
PCSPC operates the petroleum storage and pipeline facilities of the former Subic Bay Naval Base. The facility was originally constructed in 1953 with 2.4 million barrels of capacity. Capacity has doubled over the past 6 years. PCSPC was acquired by The Philippine Investment Alliance for Infrastructure (PINAI) fund in 2014. PINAI is a 10-year, closed-end fund, dedicated to equity investment in Philippine infrastructure, and managed by Macquarie Infrastructure Management (Asia) Pty Limited.
Subic Bay Freeport Zone – PCPSC is to increase its storage capacity by 540,000 barrels in 2017 by adding three (3) new tanks at its Subic Bay Freeport Zone facility. Aboitiz Construction Group Inc have been awarded the contract to build the three new 180,000 barrel capacity tanks, tank truck loading racks and associated facilities which are due for completion in May 2017. The new tank facility will be interconnected to the existing piers to allow dedicated vessel discharge and barge loading. The total capacity of PCPSC will therefore increase to 5.24 million barrels in 2017.
The decision to increase capacity follows a steady increase in demand from our customers for their various fuel product storage requirements. PCSPC’s strategic location in the Subic Bay Freeport Zone allows the means of reliable/sustainable fuel supply for timely deliveries, safe importation and storage, good proximity to fuel hubs within the Asian region, good road networks for distribution from Subic Bay to Clark and onwards to Northern Luzon and Manila, and easy coastal access for barge trans-shipments throughout the Philippines. Coupled with an existing long term lease agreement with Subic Bay Metropolitan Authority, PCSPC is very pleased to be able to commit to this long term investment to further serve the fuel needs of the Philippines both now and in the future.
Subic Bay Freeport Zone – On Dec. 15, 2013, PCSPC received formal turn-over from its contractor of a newly constructed barge loading facility with an overall length of 200 meters designed to cater for smaller vessels ranging from 500 to 6,400 DWT. The new jetty is supported by seven mooring dolphins and is equipped with state of the art marine loading arm produced and manufactured in Germany by EMCO WHEATON® and Rubber Fender System from TRELLEBORG®.
The new jetty is currently being outfitted with pipes for receiving and discharging of petroleum products to and from storage tanks situated inside Boton Tank Farm, SBFZ which is scheduled to be completed by end of February 2014.
Subic Bay Freeport Zone – On Dec. 09, 2013, PCSPC has completed construction of seven storage tanks and related facilities. These facilities were designed and constructed in accordance with the standards embodied in the National Building Code of the Philippines (NBCP) (PD 1096) and American Petroleum Institute (API 653 4th Edition 2009,10.5). PCSPC’s new facilities also received a Certificate of Conformance to API Standard 653 from SGS. SGS is the world’s leading inspection, verification, testing and certification company.
The tanks are now fully operational bringing the total storage capacity of PCSPC to 4.6 million barrels of petroleum and petroleum related products.