SJB Petroleum Products B.V / SJB (Marine) Energy B.V.

Company’s objective is to trade, supply and ship mineral oil products. Trading is done in a partly defensive, partly opportunistic manner.
SJB’s flexibility in easily changing the ratio of types of commodity traded is a key issue in the companies’ success. Total turnover in wet oil amounted some 2 Million metric tons in 2005.

Products
SJB has 4 main key product areas in which trading takes place;
a/ Fuelfluxants; material used to cut heavy fuel into a lighter grade
b/ Marine products; used for fueling seagoing vessels (marine diesel oils + LSFO)
c/ Refinery intermediate feedstocks, anything which is re-processed in a refinery which is not crude. Amongst these Low/ High Sulphur Atmospheric Residue, Vacuum Gas oil
d/ Low Sulphur Cracked Fuel Oil for utility usage (mainland + overseas)

SJB Petroleum Product’s activities are, apart from trading, to blend its products to meet its customers needs for a good price / quality ratio.

Storage
This is currently done at 4 storage locations situated in the Antwerp area, Flushing US and in Rotterdam Europoort Area. Other storage locations are at Tallinn Estonia, Gibraltar and Houston.

SJB “adds value” by blending components to a customer desired specification. 90% of all wet oil flowing thru our tanks has value added by admixtures.
VGO is blended towards the cracking capability of its destination catalytic or hydrocracker.

LSFO is either blended to bunkergrade 1,5% LSFO or to a grade typical for a certain utility. Same applies for fuelfluxants where quality depends on refinery crudeslates.

Shipping
SJB charters many spotbarges for the ARA trading. In addition to that we have a time charter barge of the Vereenigde Tankrederij for ARA displacements of 4000 m3 which is 24 hours at our service.

Seavessels are hired on a charterbasis where an average displacement is either handymax size or small Panamaxsize.

Imagine more than 50% of the total turnover of mineral oil products has been shipped in any form under the custody of SJB.

Product Sourcing
Our excellent credibility and relationship with the majority of Russian, European and US refiners provides us with plentiful sources. Our customer base consists mainly (> 95%) of European and American refiners and large international trading houses. Majority of them have a reoccurring buying pattern. Other part of customers is the independent bunker suppliers in the ARA area.

Logistics
Both the storage locations in Antwerp are strategically located in the center of both ARA trade/Rhine trade and “deep”-sea trade. We therefore have the opportunity to easily switch one geographical market (TA, MED, NWE) for another when this is in favor.

Exclusivity
As the success of the SJB Group depends on the right mix of price, service and exclusivity, storage plays the greater and more vital role for exclusivity and service.
We are of the opinion that both these aspects can be provided by the correct layout of the terminal. (Line dedication, tank size, pumps, jetties, water draft)

Risk management
Products can be purchased or sold on basis of a “floating” price or on basis of a fixed price. In any case SJB will apply a form of risk management by either hedging at ICE, Nymex or in the OTC market. As activities have been rapidly growing in 2005, we now tend to run a full physical book against a derivatives book. The derivatives book sometimes outweighing the physical on basis of a market vision (leverage). Up to now it was mainly the front side of the derivatives curve which had our interest. This on the basis of SJB being mainly a physical player.

As the energy trading subsidiary will provide term purchases contracts further out this will be diversifying into derivatives with longer time span.

Expansion
Based on SJB’s extensive knowledge in the activity areas, expansion will be mainly geographical. We are concentrating on further exploring into the Mediterranean for feedstock and fuel oil trade as well as the North- American oil market.

In the North of Europe the Low Sulphur Cracked market will be shortly boosted by the shipping industry compulsory switching to 1, 5%S for local burning in 2005. As also will the need for feedstock’s like VGO grow in the US range as refiners debottleneck their upgrading capacity. The fuel fluxant business is a stable business giving returns from reliable counterparties.