(Adds Tesoro Corp reaction, paragraph 5)
By Elida Moreno and Marianna Parraga
PANAMA CITY/SAN ANTONIO, March 22 Royal Dutch
Shell agreed to lease capacity at a large oil terminal
in Panama that has been used by U.S. refiner Tesoro Corp
, sources involved in the deal told Reuters, gaining
much-needed storage for its crude operations.
The facility, designed for storage and transshipment of oil,
is owned by Petroterminal de Panama and provides up to 14
million barrels of storage capacity, a pipeline network that
connects the Atlantic and Pacific oceans, and docks for very
"We have signed a contract with Shell for a three-year
period involving all the available space we have," said an
official from the Panamanian government.
It remained unclear when the contract would start and the
capacity involved, but the source said the deal will soon be
submitted to the Finance Ministry's board of directors for
Shell did not respond to requests for comment. Tesoro said
it does not comment on contract agreements.
Access to oil facilities in Central America or the Caribbean
is important for producers along the Atlantic basin because a
saturated storage network has forced some to sell crude at very
low prices in recent years during the oil-price crash.
Petroterminal de Panama in 2008 announced it would reverse
the flow of its 81-mile (130-km) trans-Panamanian pipeline.
After the completion of the project in 2010, Tesoro started
shipping more than 100,000 barrels per day (bpd) of crude
through the line under a seven-year agreement.
The contract, which also included leasing existing
facilities and building dedicated storage tanks for Tesoro,
allowed the San Antonio, Texas-based firm to manage crude grades
from Africa, South America and the North Sea for its Pacific
For Shell, having access to Panama would expand its current
network in the Atlantic. After buying BG Group, it became the
largest gas player in the Caribbean island of Trinidad and
Tobago, where it also has blending and lubricant facilities.
Shell also participates in exploration and production
projects in Brazil, Venezuela, Colombia, Guyana, Peru and
Argentina, and has a trading unit in Barbados.
(Reporting by Elida Moreno in Panama City and Marianna Parraga
in San Antonio; Editing by Gary McWilliams, Jonathan Oatis and