KUALA LUMPUR (Oct 1): Straits Inter Logistics Bhd has secured a contract to provide fuel bunkering services at Lumut Port.
In a joint statement today, the group announced that its 55%-owned subsidiary Tumpuan Megah Development Sdn Bhd (TMD) has entered into a Fuel Bunkering Services Agreement with Lumut Maritime Terminal Sdn Bhd (LMTSB), the operator of Lumut Port which handles over 500 ships every year.
Straits Inter Logistics said the agreement, which will see the addition of Lumut Port into its bunkering services portfolio, has a contract period of one year commencing today, with the option to renew for not more than one year, upon mutual agreement.
A bunkering anchorage area "Pit-Stop Bunker Hub @ Lumut" will be set up for the business venture.
LMTSB has agreed to grant TMD the exclusive right to operate, manage and provide the said services at or within Lumut Port limit including but not limited to jetties/wharfs, anchorage area and designated Pit-Stop Bunker area.
Straits Inter Logistics said TMD is desirous of accepting such appointment and warrants to perform the said services with good principles and accepted professional standards.
Straits Inter Logistics is principally engaged in oil trading and fuel bunkering services and investment holding activities.
The group's oil bunkering services involve refuelling marine gas oil and marine fuel oil through vessels to other ships and ocean faring vessels such as oil tankers, container vessels, cargo vessels and cruise ships.
At present, Straits Inter Logistics said TMD operates in eight ports in Malaysia — Pasir Gudang Port, Tanjung Pelepas Port, Johor Bahru Port, Kuantan Port, Kemaman Port, Kuala Terengganu Port, Labuan Port and Miri Port — all of which are licensed under the Petroleum Development Act 1974 (PDA Licences) for its bunkering services.
LMTSB, or widely known as Lumut Port, owns and operates the Lumut Maritime Terminal at Kg Acheh, Lumut, and has been in operation for more than 20 years.
In 2002, Lumut Port began to operate and manage Lekir Bulk Terminal at Teluk Rubiah, where 14 million mt of coal is handled annually.
Following the launch of Straits Inter Logistics' bunkering anchorage area at Lumut Port, the group said ships plying through Straits of Malacca can now save time, deviation cost as well as port charges that were incurred previously just for calling at a port for bunkering services.
Straits Inter Logistics group managing director Datuk Seri Ho Kam Choy said by entering into this agreement with LMTSB, TMD hoped to establish a base in bunkering business in Lumut and subsequently to further enlarge its bunkering business in the western region of Peninsular Malaysia.
He said the tie-up with LMTSB is part of the company's overall strategy to establish collaboration with strategic ports in Malaysia to provide bunkering services to vessels within their port limits, adding that the company expects the new venture to contribute positively to the revenue and future earnings of Straits Inter Logistics from the financial year ending Dec 31, 2019 onwards.
"We believe that the opportunity to collaborate with LMTSB will bring forth new dimensions to both parties' infrastructures which will allow both parties to tap the vast potential in the bunkering industry. The tie-up with LMTSB definitely marks an important milestone for Straits Inter Logistics for its expansion in the bunkering business," he said.
Straits Inter Logistics had on June 26 this year announced that TMD entered into a Provision of Bunkering Services Agreement with Bintulu Port Sdn Bhd (BPSB) for a contract period of three years, with the option to renew for not more than two years to be mutually agreed upon.
BPSB is in the business to operate, maintain, manage and provide operational facilities and services of port undertakings within the Bintulu Port area. BPSB is also a subsidiary of Bintulu Port Holdings Bhd, which is primarily involved in the provision of port services, storage and bulking services.
At the midday break today, shares of Straits Inter Logistics were unchanged at 21 sen, for a market capitalisation of RM136.64 million.