Vitol to build oil products terminal in Cyprus

* Initial investment exceeds 100 million euros

* Set for completion H2 2012

* To hold 340,000 cubic metres of oil products

NICOSIA, July 22 (Reuters) - Vitol [VITOLV.UL], the world's largest energy trader, plans to build an oil import and distribution terminal in Cyprus, it said on Thursday.

Vitol Tank Terminals International (VTTI), a wholly owned subsidiary of Vitol Group, said it expects the project to be completed by 2012 at an initial cost of more than 100 million euros ($127.6 million).

The terminal in the southern coastal region of Vassiliko would provide 340,000 cubic metres of storage for gasoline, diesel, jet fuel and fuel oil.

"This terminal will turn Cyprus into a regional oil product hub allowing us to export products from this terminal into other parts of the east Med," VTTI CEO Rob Nijst told a news conference in the Cypriot capital Nicosia. <^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^ For a FACTBOX on Vitol: [ID:nLDE66K1ON] ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^>

The terminal facility would hold 20 tanks and construction was expected to be complete in the second half of 2012, VTTI said. In addition to storage tanks, a jetty would also be constructed to handle seagoing vessels.

Vassiliko is already an industrialised area and will be the hub of a liquefied natural gas regasification facility and storage terminal managed by the island's electricity authority, EAC. The EAC is seeking a strategic partner for that project.

Worldwide, VTTI owns more than 5 million cubic metres of storage, which it hopes to grow to exceed 8 million cubic metres by 2013, Nijst said.

Last month Vitol agreed to sell 50 percent of VTTI to Malaysia's MISC Bhd (MISC.KL), an international shipping line, for $735 million. The deal had yet to close as of July 21. (Reporting by Joe Brock in London and and Michele Kambas in Nicosia; editing by James Jukwey)