Texas-based energy company Navasota has signed a joint venture agreement with the developer of the Ironwood golf resort proposal in a deal that the two companies hope will bring a fuel transshipment terminal to Cayman’s eastern districts.
The proposal, similar to a deal put to the Cayman Islands government by the energy company in 2015, would involve construction of a massive fuel storage depot that could service long-distance cargo ships. It does not involve the construction of a port, however, but would service ships from offshore mooring buoys.
Neither Navasota nor Ironwood is proposing to operate the facility. They will seek to acquire the land and permits for the project before going out to bid for companies to build and operate the facility.
Government would not be involved other than to deal with the applications through the usual planning and permitting processes.
The project has an estimated cost of $400 million. The two companies believe they could attract major oil business to build and run the facility. They say the profit margin would come from selling fuel to large ships crossing the Atlantic Ocean.
The spin-off benefits for Cayman would be cheaper fuel prices and the chance to shutter the Jackson Point fuel terminal on South Church Street, according to Frank Giacalone, director of Navasota. The proximity of that facility to a residential area is a long-held concern that resurfaced following a fire in a diesel tank there in July.
Ironwood CEO David Moffitt said its subsidiary, Ironeagle, has entered into a deal with Navasota on the terminal project.
He said the proposal could help facilitate construction of a 10-mile extension to the East-West Arterial Highway, considered crucial to Ironwood’s proposed golf course development.
Ironwood will seek to secure rights of way for the fuel pipelines along the highway.
The developer is still in talks with government over a joint proposal to build the road, and the parties plan to meet this week to discuss the new element of the deal.
“The east-west corridor is an important infrastructure project for Cayman,” said Mr. Moffitt. “It provides safe and convenient travel to the eastern districts, as well as making the area more accessible for tourism. Ironwood will benefit from the reduced travel time and Navasota will have the right of way required for fuel lines that ultimately benefits everyone.”
He declined to specify the proposed site for the development at this stage, but said it is a remote location near Breakers and surrounded by quarries, with no water lens.
Mr. Giacalone said little progress has been made on the 2015 agreement with government, and the partnership with Ironwood represents an opportunity to complete the “vision.”
“By working together with Ironwood developers,” he said, “we believe our collaboration will provide the needed structure to get both the east-west corridor and fuel transshipment terminal projects approved.”