​​Valero has had its eye on the aviation supply business at Birmingham Airport since 2012. Not only is it the largest airport in the Midlands, it is less than 12 miles from the company's Kingsbury Terminal, which receives aviation fuel directly by pipeline from Valero's Pembroke refinery.

Birmingham already had two incumbent fuel suppliers – Shell and World Fuel Services – that own tanks and into-plane facilities. However, there are very high entry barriers that prevents new market entrants - any newcomer would have to invest in infrastructure to store and deliver product, as well as build and staff new offices.

But the airport authorities have stepped in. "For the sake of the airlines, competition, growth of the airport and to create a level playing field, airports are building tank farms that anyone can access at a published rate. This is what has happened at Birmingham," said Jason Oliver, Valero's marketing manager for their aviation and bunkers business.

"The new facility means that the airport is more competitively supplied and has extra supply resilience, should the existing facilities be unable to cope. The challenge for Valero is that we have to drive the volume growth within the capacity constraints of the new facility," Oliver added.

Valero now has a through-put contract with Birmingham Airport Limited (BAL), the airport operator, and another with Menzies, an independent fuel-farm and into-plane operator, which has the concession for fuel delivery within the airport. "With the airport close to our Kingsbury Terminal, we can supply equity product using Valero-branded trucks operated by Wincanton."

The new facility has been operational for a year and has two other users.

"We are really pleased to have gained our first airline contract in Birmingham from 1 October 2019. This is the second new airport we have managed to get into as Valero, after Belfast International Airport in March 2017.

"Our restriction is only the size of the BAL facility. We can meet new growth in airline business having our terminal so close to the airport. Valero is working closely with Menzies and the airport to grow towards a brighter future."

Picture caption: Valero fuels several SAS scheduled flights each day from Birmingham