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Vopak Terminal (Bahamas) is said to be in the process of completing contract negotiations for the further expansion of its facilities in Grand Bahama, according to Managing Director Bahamas, Raymond Jones.

Speaking at the 12th annual Grand Bahama Business Outlook conference, Jones said "We already went out to bid on the project, and we are actually doing bid evaluation now, looking at the operability of the design to see how we can best operate it safely, and also for the benefit of customers in terms of the service we can offer."

The Vopak terminal, located in Freeport, Bahamas, just 80 miles of the coast of Florida, is the largest storage terminal in the Caribbean offering blending, transhipment and bunkering services from a strategically positioned location.

First Reserve and Vopak completed their acquisition of the Bahamas Oil Refining Company (BORCO) terminal - renamed Vopak Terminal Bahamas - in April 2008.

Vopak is the world's largest independent tank terminal operator specializing in the storage and handling of liquid and gaseous chemical and oil products, whilst First Reserve Corporation is the leading private equity firm that specializes in the energy industry.

Following the acquisition of the Freeport terminal in 2008, the new owners pledged to expand the existing operational capacity in the near term.

Jones said the BORCO terminal had already grown from a 14 million to 21 million-barrel storage facility with an investment of around $250 million.

He added that the cost of the next expansion phase will be another $350 million, which will raise the terminal facility's storage capacity by an additional six million barrels.

"We hope within the next couple of weeks we will be able to complete negotiations with the contractor and go back to our board with the entire economic package, and say: 'Here is the proposal, here is what we can achieve, how we can do it, here is the return', and hopefully successfully get approval from our board to go ahead and do it, and get the contract signed" he said.

Jones said that he was confident that contract negotiations would be completed before the end of May and that the facility would be completed within 24 months, with the first tanks becoming available by the end of December 2011.