Buckeye Partners LP has signed a definitive agreement with BP Products North America Inc and its affiliates to acquire 33 refined petroleum products terminals with total storage capacity exceeding 10 million barrels and about 1,000 miles of refined petroleum products pipelines, including BP’s approximately 50% interest in Inland Corporation, for a total transaction purchase price of $225 million.
The terminal and pipeline assets are in the Midwestern, Southeastern, and Western United States, further extending Buckeye’s operations into new geographic markets. Buckeye’s proposed acquisition of BP’s interest in Inland, which represents $60 million of the total transaction purchase price, is subject to Inland’s other shareholders’ existing rights of first refusal. Buckeye expects the acquisition to close in the second quarter of 2011, subject to regulatory approvals, other customary closing conditions, and with respect to BP’s interest in Inland, the co-owners’ right of first refusal.
“This transaction is a key step in our continued expansion and geographic diversification efforts and further facilitates our participation in several key growth markets outside our current system footprint,” said Forrest E Wylie, Buckeye’s chairman and chief executive officer. “This acquisition provides stable tariff and fee-based revenue streams that are supported by multi-year throughput commitments by BP. We expect the acquisition to be immediately accretive to our distributable cash flow. In addition, we have identified several opportunities for further commercial development of these assets and anticipate a smooth integration and rapid realization of operating synergies with our existing assets.”