The emergence and growth of Puma Energy

THIS YEAR PUMA ENERGY MADE ITS ENTRANCE INTO THE UK’S BITUMEN AND WHOLESALE MARKETS.

WITH A PORTFOLIO THAT SPANS THE FULL SPECTRUM OF THE OIL PRODUCTS MARKET – RETAIL, WHOLESALE, B2B, AVIATION, MARINE BUNKERING, BITUMEN, LPG AND LUBRICANTS – PUMA ENERGY HAS DEVELOPED MARKETS IN 45 COUNTRIES WITH GROWING MARKETS IN AFRICA, THE AMERICAS AND ASIA PACIFIC; IN 2014 the markets of NO FEWER THAN SIX NEW COUNTRIES WERE ENTERED

Origins and developments

The Puma brand was originally established in Argentina in 1929 by Campania General de Combustibles which specialised in the marketing and distribution of crude oil and its products across the country.

Over the ensuing 20 years CGC built up its network of Puma filling stations across Argentina and, subsequently Ecuador.

A milestone in the company’s evolution occurred in 1997 when the Puma brand was acquired by international trading giant Trafigura; by 2000 the latter had purchased Puma Energy.

This was the start of Puma’s ambitious growth era – not only through expansion into other parts of South and Central America – but also sub Saharan Africa, firstly in the Congo then significantly so in Angola.

In 2007 substantial storage facilities were established in Norway and Estonia taking advantage of their strategic locations as confluence points for trading between Russia and Europe.  A year later the company was consolidated under one management team.  In 2010 Puma acquired the BP fuel marketing businesses in Namibia, Botswana, Zambia, Malawi and Tanzania. In 2011 Exxon Mobil’s fuel marketing businesses in five Central American countries were acquired along with those of Chevron in Puerto Rico, the US Virgin Islands and Namibia.

Mindful of expansion opportunities in Asia Pacific, the company’s Singapore head office was established in 2012 with interests established in Vietnam (bitumen) and Indonesia. A notable landmark was achieved in 2013 with the acquisition of three independent distributors in Australia bringing 270 filling stations, two bulk terminals and 16 depots. The following year saw further acquisitions and completion of a new $70 million bulk storage facility in Australia along with the purchase of Trafigura’s bitumen interests there.

This year has seen the addition of BP Australia’s bitumen business and the establishment of a bitumen storage/distribution operation out of the Stolthaven Dagenham facility to service requirements in London and the south east.

In March, Puma acquired the former Murco Milford Haven refinery plus three inland rail-fed bulk terminals at Westerleigh, Theale and Bedworth.  This added 1.426 million M3 (equivalent to 25%) of capacity to the company’s worldwide portfolio of storage facilities.

In 2013 Trafigura reduced its stake from 62% to 48.79%, while the Angola state-owned oil company, Sonangol increased its holding from 20% to 30% – the $500 million price paid at the time effectively valuing the company at $5 billion.  Cochan Holdings, an Angolan investment group, has a 15% interest with the balance of ownership being private shareholders.

Before the end of 2015,  it is expected that a further capital injection of $500 million will be completed by the three principal shareholders to help funding of further expansion opportunities thus demonstrating confidence in the company’s track record of success.

Trafigura remains Puma’s preferred supply source of oil products for its downstream activities, providing preferential access to international oil markets.

Future intent

Increasing the company’s capitalisation is a clear signal of intent around continued pursuit of growth opportunities, coupled with consolidation of its presence in existing markets.  This year’s entry to markets in Australia and the UK marks a departure from the focus on smaller, emerging countries and suggests closer consideration of opportunities in larger territories with more substantial volume requirements.

Having come a long way in a short time, Puma Energy is clearly a force for the future and a name to watch.


The Puma Energy business*

  • Total Storage – 7.2m M3 at 88 facilities
  • Throughput- 20m M3
  • Sales – 14.76bn litres (2013 – 13.05bn)
  • Retail sites – 2,212
  • Aviation outlets at 47 airports in 17 countries with 17 added in 2014
  • Employees – 7,350 directly employed with 20,000 indirectly
  • Customers – 23,500+
  • EBITDA in 2014 – $650 million, an increase of $99 million on 2013

*Based on the latest information available, generally 2014

In recognition of its extraordinary record of consistent, successful expansion in recent years, in 2014 the company was awarded the prestigious Platts Global Energy Award in the Rising Star individual category.

The Puma Energy model

The business model comprises a relatively simple, integrated midstream-downstream business with the former obtaining access to and providing a secure supply of products to the latter.

With no upstream activity, the absolute level of oil prices does not influence company profitability; this is determined first and foremost by the margin generated between the cost of sourcing and supply and the prices achieved in the different marketing & distribution businesses which service the requirements of the various customer segments.

Over the past 5 years, storage capacity has been expanded by 70%, with five new facilities being commissioned in 2014 alone.  Much of this capacity has been constructed in house along with management of all individual facilities, thereby establishing an internal source of expertise in the two key areas. It also enables direct control over a critical point in the supply chain and makes the company one of the largest independent oil storage owners/operators in the world.  This activity forms a critical component of the integrated midstream/downstream operation enabling material economies of scale, a competitive cost base, ready management of risk and secure, seamless supply.

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