Enbridge to acquire oil assets from Shell
Feb 1, 2004 12:00 PM
Enbridge Energy Partners LP has agreed to acquire crude oil pipelines and storage systems from Shell Pipeline Co LP and Shell Oil Products US for $131 million, excluding customary closing adjustments for working capital and other items. Closing of the purchase is anticipated to occur in first-quarter 2004, subject to regulatory approvals and a right of first refusal on one pipeline.
Assets being acquired serve refineries in the midcontinent from the Cushing OK hub and consist of some 615 miles of active crude oil pipelines and 9.5 million barrels of storage capacity. Included are:
The 433-mile Ozark pipeline that transports 170,000 barrels of crude oil per day from Cushing to Wood River IL
A 58.8% interest in the 135-mile Osage pipeline and associated 1.2 million barrel storage terminal that delivers 110,000 barrels per day and is connected to two refineries in Kansas (subject to satisfaction of a right of first refusal in favor of the other owner)
The 47-mile West Tulsa pipeline that currently transports 55,000 barrels per day to two refineries in Oklahoma
The Shell storage terminal at Cushing, which has 8.3 million barrels of storage capacity
Concurrently, Enbridge Inc in Toronto plans to acquire Shell's Patoka West Tank Farm and its 60% interest in the Woodpat Pipeline for $9.5 million. These assets complement Enbridge's initiative to access new markets for Canadian crude oil. The market access initiative will benefit the partnership by facilitating throughput on its Lakehead system.
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