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The Broward County Commission's selection committee has unanimously selected Magellan Midstream Partners L.P. to construct a new oil terminal at Port Everglades, according to media sources.

Oklahoma-based Magellan, which is primarily involved in the transportation, storage and distribution of refined petroleum products, was selected after two other bidders - Oiltanking Houston and Nustar Energy - withdrew their bids prior to Tuesday's selection process.

Magellan was selected following the Broward County Commission's decision to issue a retender in January after failing to agree on a winner for the previous tender, which lasted more than a year and ended with a deadlocked vote last December.

The new 1.68 million barrel oil terminal is expected to be used for the storage of bunker fuel, diesel, gasoline and ethanol.

The project is expected to cost around $80 million and construction of the new oil terminal is likely to take 36-42 months. The completion date could be earlier than projected, depending on approvals for local, county, state and federal permits.

Magellan is understood to have already begun preliminary discussions with potential customers for use of the new terminal facility.

The project requirements include a land lease of 20 years, with an extension option for a further 10 years. Companies are required to agree to pay a minimum rent of $1.0-1.2 million a year, depending of size of the land leased.

According to the tender requirements, Magellan must maintain an inventory of 420,000 gallons each of gasoline and diesel at the new terminal, which must be available for sale in the event of a hurricane or supply disruption. Magellan must also commit a minimum of $40 million in capital investment for the project versus $25 million in the previous tender.

Port Everglades/Florida Projects and Growth

In January 2009, Tran Construction Inc. of Miami won a bid to construct a new 41-acre containerized cargo terminal at Port Everglades, which is set to have a positive impact on sales of marine fuel at the port. The terminal is being built in the Southport area at Port Everglades at a cost of $12.3 million.

In addition to cargo shipping, Port Everglades is also a leading cruise ship destination, which has seen a rise in cruise ship and passenger visits in recent years. Last year the number of people traveling aboard traditional multiday cruise ships increased by 7.6 percent to 2,836,954 passengers, up from 2,636,711 passengers in 2008.

The port's variety of business lines - cargo shipping, cruise, petroleum and real estate - have helped keep Port Everglades profitable despite the global economic downturn.

However, the increase in oil storage capacity has led to concerns that Port Everglades could be oversupplied. Chevron is constructing six new tanks at Port Everglades, with completion scheduled for mid-2010, whilst TransMontaigne has also built new tanks at the port, totalling 438,000 barrels, for storage of fuel oil and cutterstock.

Meanwhile, also in Florida, Vitol Group last month announced the opening of the Seaport Canaveral Terminal

The state-of-the-art terminal, built at a cost of around $130 million, has a storage capacity of just under 3 million barrels of refined products in 24 tanks for fuel oil, gasoline, diesel, biodiesel, jet fuel. It will also have transportation infrastructure for the loading of barges, seagoing vessels and trucks.

The terminal has two jetties and a maximum draft of 12 meters. It will also be linked to a pipeline to serve cruise ships at Port Canaveral.