Released: 26/01/2010
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RNS Number : 0988G
Baltic Oil Terminals Plc
26 January 2010
Baltic Oil Terminals PLC
("Baltic" or "the Group")
Update re Oil Products Trading Joint Venture
Baltic owns and operates oil product terminals in the strategically vital Russian port of Baltysk,Kaliningrad on the Baltic
Sea and through its subsidiaries is engaged in matched refined oil product trading.
On 8 December 2009, Baltic announced that it had entered into a binding Heads of Agreement with Exoy Holding AG ("Exoy"),
whereby Exoy agreed to acquire a 51 per cent. interest in Baltic's wholly owned trading subsidiary Baltic Hydrocarbons
Limited ("BHL"). Baltic confirms that the formal share purchase and joint venture agreements are expected to be entered
into shortly.
As the first stage in the Joint Venture's trading activities, Exoy undertook that in December 2009 it would procure a
minimum of 150,000 tonnes of distillates and lubricants for BHL to sell. Baltic is now pleased to confirm that 170,000
tonnes of these products were sold through BHL in the month, 20,000 tonnes more than originally anticipated. An additional
80,000 tonnes have been contracted to be sold in January 2010 and further volumes of product are expected to be sold by BHL
in February.
Simon Escott, Chief Executive of Baltic, commented:
"The Joint Venture with Exoy was established in order to create a long term trading business. We are therefore very pleased
that it has made such rapid progress. Working with such an astute and energetic commercial partner is delivering immediate
returns and the prospects of further trades are very encouraging."
Baltic also reports that both the Rosbunker terminal and Baltic Top are currently operating at full capacity and expects to
provide a trading update on the Group prior to entering the close period
Enquiries:
Baltic Oil Terminals plc Tel: +44 (0)20 3145 1908
Simon Escott, Chief Executive
Arbuthnot Securities Limited Tel: +44 (0)20 7012 2000
Alastair Moreton, Corporate Finance
Pelham Bell Pottinger
Archie Berens Tel: +44 (0)20 7337 1509 / +44 (0)7802 442486
About Baltic Oil Terminals
Over the last four years, Baltic has built up a terminals business in the Russian ports of Baltysk and Kaliningrad. A
separate enclave located between Poland and Lithuania, Kaliningrad is Russia's only year round access to the Baltic Sea.
Other ports in the region, such as St Petersburg, are frozen for much of the winter, as are many rivers, including the
Volga River, one of the most significant commercial waterways in the world. As Russia relies on year round export of its
vast supplies of petroleum products, Kaliningrad is thus a trading centre of major strategic importance.
Baltic's key asset is a 50% interest in the Rosbunker terminal, which is located at Baltysk, right on the Baltic Sea at the
mouth of the Pregol River leading into Kaliningrad. It is the only port in the region at which all types of ship can take
on cargo, as the channel into Kaliningrad is too shallow for many vessels. Trains are able to deliver products from all
over Russia, the Former Soviet Union and Asia directly to the terminal.
Since 2007, the Rosbunker terminal has been handling consignments of oil refined products, specialising in fuel oil
(mazut), a product that requires heating and special equipment and as such is not handled by other terminals in the area.
Baltic earns tolling fees for processing the unloading of cargo from trains into storage tanks and then onto vessels.
Baltic is also able to trade in these products in its own right, taking advantage of local price differences. Since the
financial crisis in Russia, this market has become increasingly interesting to Baltic. Baltic's transportation and trading
activities utilises its extensive network of industrial partners and refineries.
In addition to Rosbunker, Baltic also has interests in several other oil product assets in Kaliningrad, which derive
revenues through processing and distribution of oil products to domestic markets.
Baltic's executive management have a wealth of experience of the oil services industry. The team has worked in the industry
for more than 40 years, constructing and operating oil rigs, terminals and other infrastructure in world wide locations,
including the Former Soviet Union.
Baltic has been listed on AIM since May 2006. It is headquartered in Kaliningrad, with a small representative office in
London.
This information is provided by RNS
The company news service from the London Stock Exchange