(EnergyAsia, March 31 2011, Thursday) — Barely two months after signing off on two long-term deals to store crude oil in Japan, Saudi Aramco is watching with concern at the worsening nuclear power plant disaster in Fukushima.
In February, Saudi Aramco announced that it had agreed to lease tanks from Japan Oil, Gas and Metals National Corp (JOGMEC) to store an initial 3.8-million barrels of Arabian crude oil in southern Okinawa Island, located about 1,850 km from Fukushima. The first shipment was to have been delivered in the first quarter, with the option for a second quarter later in the year.
“This agreement further underlines our long-standing relationship and commitment to being a reliable long-term supplier to our customers in the wider Asia region,” said Dawood M. Al-Dawood, Saudi Aramco’s vice president of marketing, supply and joint-venture coordination.
Separately, Saudi Aramco and Japan’s Agency for Natural Resources and Energy had agreed to jointly invest in crude oil storage facilities also in Okinawa.
Ironically for both countries, the projects were aimed at providing safe and secure oil supplies to Asia.
Renowned for its political stability and reliable business environment, Japan is an established favourite major customer of Saudi Arabia’s. By storing oil in Japan, Saudi Arabia had added a new outlet for safekeeping of its oil outside the politically volatile Middle East.
On March 11, northeastern Japan was struck by a massive 9-richter earthquake and a tsunami that also destroyed and damaged nuclear power plants, refineries, power stations and many other vital infrastructure pieces. More than 26,000 people have died or are missing.
The world’s attention is now focused on the Japanese government’s attempt to contain the disaster unfolding at the Fukushima nuclear power plant, which was badly damaged and now leaking radiation that has spread to countries as far away as the US and Southeast Asia.