Fundraising

Prostar invests over $100m in Chinese oil storage terminal

The manager acquired a 40% stake in the country's third-largest independent oil storage terminal, its second oil storage acquisition.

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Prostar Capital, a private equity firm focused on energy infrastructure, has agreed to acquire a 40 percent stake in China’s third-largest independent oil storage terminal for more than $100 million. 

Located near Shanghai, the strategic crude oil and refined product storage terminal is owned by Tyloo Oil and Gas International Holdings Corporation, a privately held Chinese energy infrastructure investment firm. 

With nearly three million cubic metres of storage, the asset has direct access via pipeline to approximately one-fifth of China’s refining capacity, thanks to its proximity to the largest oil refining and petrochemical regions in China. Serving the likes of China’s state-owned enterprises and major global oil traders, the asset has been operating close to full capacity utilisation. 

The investment is being made via a subsidiary of Global Terminal Investments, which is Prostar’s storage terminal investment company. The portfolio company, under the $750 million Prostar Asia Pacific Energy Infrastructure Fund, also owns a 40 percent interest in Fujairah Oil Terminal in the United Arab Emirates. 

The deal makes Prostar one of the largest private owners of storage capacity in the Asia Pacific region with total capacity of more than four million cubic metres, according to Prostar managing partner Steve Bickerton. 

“The strategic location of this terminal in an industrial heartland along with China’s growing domestic energy needs means there will be continuing and rising demand for storage from a range of major domestic and international customers,” said Bickerton. “In addition, there is expansion potential on spare land next to the terminal.” 

Prostar chairman Greg Martin added: “Our partnership with Tyloo is a great platform from which we can continue to build a major presence in the region.”

Founded in 2012, the Greenwich, Connecticut-based Prostar invests across the mid-market energy value chain from offices in Connecticut, Sydney and Hong Kong.