(EnergyAsia, December 22 2011, Thursday) — US-based Louis Dreyfus Highbridge Energy (LDH) LLC said it has established a joint venture with China’s Zhejiang Zhong Ao Energy Co Ltd, to construct an oil and petrochemical import-export terminal near Shanghai city in China.
Louis Dreyfus Zhong Ao Energy Co Ltd will develop the facility in Zhoushan City on Liuheng Island in two phases starting with a 1.4-million-barrel petrochemical storage facility and deep water port with a 75 foot draft. The second phase will add 7.5 million barrels of storage capacity for crude oil and petroleum products and associated expansion of and connectivity to the port. The cost of the investment was not revealed.
Stamford, Connecticut-based LDH Energy said it will be a minority partner in the joint venture providing commercial development expertise while Zhong Ao will manage day-to-day operations.
The joint venture has received regulatory approval with US law firm White & Case acting as legal counsel to LDH Energy in connection with the transaction.
William C. Reed II, LDH Energy’s co-chairman, CEO and President, said:
“This transaction is core to our global growth strategy and is the first of several initiatives to expand our presence in the Asia Pacific region. In this case, we elected to partner with Mr Wang Yuanwan, chairman of Zhejiang Zhong Ao Energy Co Ltd.
“With the rapid growth of the energy market in China, we are excited that we could find a joint venture partner whose strengths complement ours. We are delighted to be working with Mr Wang and look forward to a long and successful partnership with him and his organisation.”
Mr Wang said:
“We take great pride in forming a strategic alliance with LDH Energy. This partnership combines our strengths with LDH Energy’s expertise operating and commercialising midstream energy assets. This facility is being developed in one of the most economically advanced regions in China and a rapidly growing center of the country’s energy market. We look forward to working together with LDH Energy to build a world class terminal and storage facility to serve the leading energy and petrochemical companies in China.”
LDH Energy is a diversified merchant energy company with integrated operations involving the marketing and merchandising of energy commodities and the ownership and operation of midstream physical assets. It is the merchant energy platform of the Louis Dreyfus Group and the multi-strategy hedge fund of Highbridge Capital Management LLC with offices in Houston, Texas; Calgary, Canada; Lausanne, Switzerland; Shanghai, China; and Singapore.
Zhong Ao, a subsidiary of Shanghai Zall Enterprise Development (Group) Co Ltd (Zall), is a rapidly growing and diversified private enterprise group established in 1992 whose main businesses include petrochemical and metal merchant trading, storage terminals and logistics, ship building and repairing, real estate development, elevator, project investment and asset management. Headquartered in Shanghai, Zall has more than 20 subsidiaries in China.