UPDATE 1-Most ex-BP fuel oil traders to join China Brightoil

*Brightoil may be the only firm able to hire ex-BP as a

*Brightoil seen as ambitious, aims expansion into cargo mkt

*Sees expanded role in Asian fuel oil market this year
(Adds details and background)

By Yaw Yan Chong

SINGAPORE, June 2 (BestGrowthStock) – Most of the former BP (BP.L: )
fuel oil traders, who recently resigned from the major’s Asian
and U.S. units, are expected to join Chinese trading firm
Brightoil Petroleum, four industry sources said on Wednesday.

They include BP’s former global head of fuel oil, Quek Chin
Thean, ex-Asia team leader Edmund Lau and ex-chief U.S. fuel
oil trader Tim Gawne, the sources said. Some other members of
the trading team and support staff who left the oil major are
also set to join the Hong Kong-listed Brightoil (2910.HK: ).

Brightoil chairman Raymond Sit could not be reached for
comment on the matter.

Reuters had reported that 14 traders and support staff of
BP’s fuel oil trading operations worldwide quit in the past
month. [ID:nSGE64P0MF] [ID:nSGE64U0E3]

Not all the traders who left are joining Brightoil. Chris
Paine, its London fuel oil team leader, is joining Vitol while
its two U.S. traders are going over to Mercuria and Noble Group
(NOBG.SI: ), industry sources said.

BP has yet to officially inform its counterparties of the
departures of its Asian fuel oil traders, as is the standard
industry practice, though the sources said the staff have
physically left the company.


Brightoil’s hiring of the bulk of the ex-BP traders is seen
as a coup that would enhance its trading capabilities,
particularly in physical fuel oil cargo trading, where it does
not yet have a presence, traders said.

“Brightoil has got a substantial presence in the South
China bunker market and are growing in other parts of the
country. Right now, they are buying cargoes from Singapore to
supply their China outlets,” an industry source said.

“With the entry of the BP guys, they would be able to
source for their own cargoes, do the blending themselves to
optimise value and trade larger positions, especially in the
swaps market.”

However, traders said Brightoil would have to expand its
trading infrastructure in Singapore, particularly its oil
storage capacity, if it aims to be a major participant in the
fuel oil market, which already has entrenched players plus
several new entrants. [ID:nSGE62P059]

The company presently sub-leases 80,000-100,000 tonnes of
shore-based storage in Singapore and supplies some marine fuels
into the world’s largest bunker port by volume, since it
obtained a licence to do so less than a year ago.

Brightoil also has a fuel oil term supply deal with oil
major Shell (RDSa.L: ), in which the cargoes are mainly sent to
its outlets in China. Its total supply volumes in China are
around 150,000-200,000 tonnes a month, mostly in the south.

It expanded its overall supplies within Asia to
250,000-300,000 tonnes a month this year, appeared in the
Platts pricing window for the first time six months ago and
bought two 80,000-tonne aframaxes that were commissioned
earlier this year.

Traders said Brightoil is poised for a major push, after
growing its market to other parts of China, mainly Shanghai and
Zhoushan, where it started business some six months ago.

The firm, with assets worth about $1.5 billion, has about
400,000 cubic metres (cu m) of oil storage capacity in China,
mostly in the south, and plans to grow the capacity to about 1
million cu m, its official website shows.

The website also shows that its chairman, Sit, is a member
of the government’s powerful National Committee of the Chinese
People’s Political Consultative Conference (CPPCC) and Vice
President of the China Chamber of Commerce for the Petroleum
Industry. (http://www.bwoil.com/en/AboutFounder.asp)

“The timing seems perfect — they are ready to expand just
when the BP guys have become available,” another industry
source said. “And it’s a big coup for Brightoil to be able to
recruit a team of A-list traders, after failing to do so for
the past two to three years since they set up in Singapore.”

The ex-BP traders are expected to start work in late August
at the earliest, as they are required to serve three months
“gardening leave”.

“Brightoil is probably the only shop that would hire the BP
guys as a collective group in terms of need and affordability.
With these guys on board, it would be regarded as a serious
player by the market,” the second source added.

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(Editing by Ramthan Hussain)

UPDATE 1-Most ex-BP fuel oil traders to join China Brightoil