LMTSB has agreed to appoint subsidiary TMD with the exclusive right to operate, manage and provide bunkering services at Lumut
By SULHI KHALID / Pic By https://www.straits-interlogistics.com
STRAITS Inter Logistics Bhd has secured a one-year contract with a potential return of RM16 million a year to provide fuel bunkering services at Lumut Port in Perak.
Its 55%-owned subsidiary, Tumpuan Megah Development Sdn Bhd (TMD) has entered into an agreement with Lumut Maritime Terminal Sdn Bhd (LMTSB), the operator of Lumut Port which handles over 500 ships per year, the oil trading and bunkering service provider told Bursa Malaysia yesterday.
The contract period commenced yesterday with the option to renew for not more than one year, upon mutual agreement.
A bunkering anchorage area dubbed “Pitstop Bunker Hub @ Lumut” will be set up for the business venture.
“TMD is currently operating its business in eight ports in Malaysia. By entering into this agreement with LMTSB, TMD hopes to establish a base in the bunkering business in Lumut and subsequently enlarge its bunkering business in the western region of Peninsular Malaysia,” Straits MD Datuk Seri Ho Kam Choy told reporters during the signing ceremony in Petaling Jaya yesterday.
LMTSB has agreed to appoint TMD with the exclusive right to operate, manage and provide bunkering services at Lumut including, but not limited to jetties/wharfs, the anchorage area and the designated pit-stop bunker area.
“The tie-up with LMTSB marks an important milestone for Straits for its expansion in the bunkering business,” Ho added.
With the launch of the bunkering anchorage area at Lumut Port, ships plying through the Straits of Malacca can now save time, deviation cost and port charges incurred previously just for calling into a port for bunkering services.
Straits completed its acquisition of a 55% stake in TMD and 38% equity interest in Banle Energy International Ltd last year.
The acquisition of interest in TMD has expanded Straits’ fleet size from two vessels to nine vessels with a total capacity of 12 million litres, while the Banle acquisition has allowed the group to venture into the marine fuel oil trading market in Hong Kong, China and Taiwan.
TMD currently operates at eight ports in Malaysia, namely Pasir Gudang Port, Tanjung Pelepas Port, Johor Baru Port, Kuantan Port, Kemaman Port, Kuala Terengganu Port, Labuan Port and Miri Port.
In June this year, TMD inked a provision of bunkering services agreement with Bintulu Port Sdn Bhd for a three-year contract period with the option to renew for no more than two years upon mutual agreement.
The same month, SMF Begonia Ltd — a 67%-owned unit of Straits — inked an agreement with Constellation Tra- ding Sdn Bhd (CTSB) to acquire an oil tanker known as Antlia for US$4.7 million (RM19.5 million).
SMF Ixora Ltd, also a 67%-owned subsidiary of the group, signed an agreement with Hibiscus Fuels Ltd last month to purchase a vessel known as Poseidon for US$4.8 million.
This will bring the group’s enlarged fleet size to a total of 11 vessels with a total carrying capacity of 22 million litres.
Shares of Straits closed 2.38% higher at 22 sen yesterday, giving it a market capitalisation of RM139.89 million.