Prostar increases control of major oil port

The US fund manager has increased its ownership interest in FOT, the second-largest bunkering port in the world, less than two years since first investing in the UAE-based asset.

Prostar Capital, the Greenwich, Connecticut-based energy and energy infrastructure investment firm, has acquired an additional 21.4 percent share in the Fujairah Oil Terminal (FOT), bringing its total ownership interest in the United Arab Emirates (UAE) facility to 40 percent, Prostar said in a statement on Thursday.

Prostar first invested in FOT in September 2013, when the facility was under construction, acquiring an initial 18.6 percent stake from Singapore-based Concord Energy Group.

“The increased ownership stake means Prostar can be more involved in the terminal’s value creation undertakings, including optimization of operations, sourcing of new customers, implementation of global best practices, as well as executing capacity expansions and upgrades,” Prostar managing partner Steve Bickerton said.

A 1.2 million cubic meter onshore bulk liquid storage facility based in the UAE’s Port of Fujairah, FOT is the second-largest in the world and a strategic trading hub for crude oil and refined products in the region. It began operating earlier this year.

According to Bickerton, “Its strategic link to Asia’s rapidly expanding energy markets will ensure continued strong demand for storage and drive potential growth and other value enhancing opportunities.”

FOT’s other owner is Sinomart, a wholly-owned subsidiary of Chinese state-owned oil and gas company Sinopec Group.

Founded in 2012, Prostar invests across the mid-market energy value chain from its offices in Connecticut, Sydney and Hong Kong. According to its website, the fund manager targets strategic investments alongside like-minded co-investors in companies that are typically capital constrained and under-performing. It manages $600 million of capital.

It is in the process of raising the Prostar Asia-Pacific Energy Infrastructure Fund, for which it has raised $300 million to date, a source told Infrastructure Investor.