Brooge Energy LTD Announces Completion of Basic Design for Phase III Facility

Rhea-AI Summary

Brooge Energy (NASDAQ: BROG) announced the completion of the final basic design for its Phase III oil storage terminals and refinery by MUC Oil & Gas Engineering Consultancy. This phase aims to boost storage capacity to 3.5 million m³ (22 million barrels), with plans for operational readiness by late 2022. Brooge seeks to contract the facility before construction to ensure revenue stability. Located near the strategically vital Strait of Hormuz, Brooge aims to lead the oil storage sector in Fujairah, UAE, enhancing its service capabilities.

Positive

• Completion of final design for Phase III oil storage terminals and refinery.
• Targeting operational readiness by late 2022, increasing total storage to 4.5 million m³ (28.3 million barrels).
• Plans to secure multi-year take-or-pay contracts before construction for financial stability.
• Strategic location near the Strait of Hormuz enhancing market potential.

Negative

• Dependence on securing financing for Phase III on commercially reasonable terms.
• Risks associated with construction management and cost overruns.

NEW YORK, July 15, 2020 (GLOBE NEWSWIRE) --  Brooge Energy Limited (“Brooge Energy” or the “Company”) (NASDAQ: BROG), a midstream oil storage and service provider strategically located outside the Strait of Hormuz, adjacent to the Port of Fujairah in the United Arab Emirates (“UAE”) through its wholly-owned subsidiary Brooge Petroleum and Gas Investment Company FZE (“BPGIC”), announced today MUC Oil & Gas Engineering Consultancy (“MUC”) has issued the final basic design for the Company’s planned Phase III oil storage terminals and refinery.

In April 2020, the Company appointed MUC Oil & Gas Engineering Consultancy to complete the basic design and Front End Engineering Design (FEED) study for its planned 180,000 bpd refinery and the Phase III oil storage facility in Fujairah, UAE. Completing the basic design progresses the Company’s plan to develop up to 3.5 million m³ of storage capacity, the equivalent of 22 million barrels. The Company is targeting the Phase III facility to be operational in late 2022.

Nicolaas L. Paardenkooper, CEO of Brooge Energy and BPGIC, said, “Our vision is to build the largest oil storage and be the best service provider in the Port of Fujairah in the UAE, which is one of the world’s most strategically important choke points with approximately 25% of total global oil passing through this strait. Once Phase III is completed, this would bring our total storage capacity up to 4.5 million m³, which is the equivalent of 28.3 million barrels of oil. We are pleased that MUC has completed the basic design, which is an important stage in the planning and development of the facility, and that they are progressing with the FEED study which is anticipated to be completed in the coming weeks. Concurrently, we are in discussions with global oil majors that have expressed interest in contracting portions of the Phase III facility. We plan to ensure that Phase III capacity is fully contracted through a multi-year take-or-pay contract prior to commencing construction to ensure revenue stability and visibility.”

BPGIC is a key independent storage provider in Fujairah, UAE, conveniently situated in the East-coast port of Fujairah on the Gulf of Oman, which owns capacity to store Clean Petroleum Products and Fuel Oil using some of the latest technology to maximize company performance and efficiency, while reducing operating costs. Through the development of its Phase II and Phase III facilities, it is also building capacity to store crude oil using similar technology.

About Brooge Energy Limited

Brooge Energy, formerly known as Brooge Holdings, conducts all of its business and operations through its wholly-owned subsidiary Brooge Petroleum and Gas Investment Company FZE (“BPGIC”), a Fujairah Free Zone Entity. BPGIC is a midstream oil storage and service provider strategically located outside the Strait of Hormuz adjacent to the Port of Fujairah in the United Arab Emirates. BPGIC’s oil storage business differentiates itself from competitors by providing its customers with fast order processing times, excellent customer service and high accuracy blending services with low oil losses. For more information please visit www.broogeholdings.com.

Forward-Looking Statements
This press release contains “forward-looking statements” within the meaning of the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995, that involve risks and uncertainties concerning BPGIC’s and Brooge Energy’s expected financial performance, as well as their strategic and operational plans. The actual results may differ materially from expectations, estimates and projections due to a number of risks and uncertainties and, consequently, you should not rely on these forward looking statements as predictions of future events. Words such as “expect,” “estimate,” “project,” “budget,” “forecast,” “anticipate,” “intend,” “plan,” “may,” “will,” “would,” “could,” “should,” “believes,” “predicts,” “potential,” “continue,” and similar expressions are intended to identify such forward-looking statements. These risks and uncertainties include, but are not limited to: (1) the ultimate geographic spread, duration and severity of the coronavirus outbreak and the effectiveness of actions taken, or actions that may be taken, by governmental authorities to contain the outbreak or ameliorate its effects; (2) BPGIC’s ability to obtain financing for Phase III on commercially reasonable terms; (3) BPGIC’s ability to negotiate and enter into development and offtake agreements on commercially reasonable terms; (4) the results of technical and design feasibility studies, including the Phase III FEED study; (5) the loss of any end-users; (6) changes in customer demand with respect to ancillary services provided by BPGIC including throughput, blending, heating, and inter tank transfers; (7) BPGIC’s ability to effectively manage the risks and expenses associated with the construction of Phase II, Phase III and other growth and expansion projects; and (8) other risks and uncertainties indicated from time to time in filings with or submissions to the SEC by Brooge Energy. Readers are referred to the most recent reports filed with or furnished to the SEC by Brooge Energy. Readers are cautioned not to place undue reliance upon any forward-looking statements, which speak only as of the date made, and we undertake no obligation to update or revise the forward-looking statements, whether as a result of new information, future events or otherwise.

Investor Contact
KCSA Strategic Communications
Valter Pinto / Elizabeth Barker
+1 212-896-1254 or +1 212-896-1203
BROG@kcsa.com

FAQ

What is the goal of Brooge Energy's Phase III project?

The goal of Brooge Energy's Phase III project is to develop oil storage capacity up to 3.5 million m³ (22 million barrels) and enhance refinery capabilities.

When is Brooge Energy expecting the Phase III facility to be operational?

Brooge Energy plans for the Phase III facility to be operational by late 2022.

What is Brooge Energy's strategy for ensuring revenue stability for Phase III?

Brooge Energy aims to contract the Phase III capacity through multi-year take-or-pay contracts before commencing construction.

Where is Brooge Energy's facility located?

Brooge Energy's facility is strategically located near the Port of Fujairah, UAE, outside the Strait of Hormuz.

What capacities will Brooge Energy achieve with the completion of Phase III?

Upon completion of Phase III, Brooge Energy will achieve a total storage capacity of 4.5 million m³, equivalent to 28.3 million barrels.