Larger, more complex refineries driving storage demand, Vopak CEO says

HOUSTON — The recent drive to build massive, sophisticated refineries have changed the way that oil and gas moves around the globe, the international storage giant CEO of Royal Vopak N.V. said in a recent interview.

As refineries have grown larger, they’ve increasingly been consolidated in a handful of places, said Eelco Hoekstra, such as along the U.S. Gulf Coast. The concentration has made the infrastructure near those areas more important, as it is tasked with handling a larger share of the world’s petroleum, he said.

“The refineries constructed now are substantially larger in volume, in complexity and in price. This has helped to concentrate refining in fewer areas of the world, and that in turn has concentrated storage and shipping traffic in those areas,” he said. “We looked at the data from the three big ports – Singapore, Fujairah and Rotterdam – and we’ve seen that the volume through those ports in petroleum products has quadrupled in 15 years. The whole supply chain has changed.”

Vopak, the largest independent operator of petroleum tanks, has 74 terminals worldwide, with total storage capacity equal to just under half of the tank and underground oil storage in the U.S. at 216 million barrels. Vopak handles crude oil, petroleum products, gases and edible oils.

The full interview with Hoekstra is available online for Houston Chronicle subscribers.