TransMontaigne Partners LP (TLP) and Blueknight Energy Partners LP (BKEP) announced agreements for the construction and operation of one million barrels of crude oil storage adjacent to BKEP’s Cushing OK facility.
TLP will lease a portion of the land at BKEP’s Cushing, Oklahoma facility and construct storage tanks and associated infrastructure on that property for the receipt of crude oil by truck and pipeline, the blending of crude oil and the storage of 1,000,000 barrels of crude oil. BKEP and TLP will cooperate on the design and construction of the facility and BKEP will provide operational services for TLP under a long-term operating agreement and provide connectivity between the TLP facility and the Cushing market through BKEP’s existing facility and infrastructure.
TLP has entered into a long-term services agreement with Morgan Stanley Capital Group Inc for the use of the TLP facility. Construction of the TLP facility is expected to begin in August with completion planned for the second quarter of 2012. Anticipated cost of the project is less than $25 million.
TLP is a terminaling and transportation company based in Denver CO with operations primarily in the United States along the Gulf Coast, in the Midwest, in Brownsville TX, along the Mississippi and Ohio Rivers, and in the Southeast. TLP provides integrated terminaling, storage, transportation and related services for customers engaged in the distribution and marketing of light refined petroleum products, heavy refined petroleum products, crude oil, chemicals, fertilizers and other liquid products. Light refined products include gasoline, diesel fuels, heating oil and jet fuels; heavy refined products include residual fuel oils and asphalt. TLP does not purchase or market products that it handles or transports.
BKEP owns and operates a diversified portfolio of complementary midstream energy assets consisting of approximately 8.1 million barrels of crude oil storage located in Oklahoma and Texas, approximately 6.7 million barrels of which are located at the Cushing Oklahoma Interchange; approximately 1,285 miles of crude oil pipeline primarily in Oklahoma and Texas; approximately 300 crude oil transportation and oilfield services vehicles deployed in Kansas, New Mexico, Oklahoma and Texas; and approximately 7.4 million barrels of combined asphalt product and residual fuel oil storage at 45 terminals in 22 states.