A 50/50 joint venture consisting of Royal Vopak and BlackRock’s Global Energy & Power Infrastructure Fund recently agreed to acquire from Dow three major industrial terminals on the U.S. Gulf Coast for $620 million.
The newly named Vopak Industrial Infrastructure Americas joint venture will have a diversified set of infrastructure assets, in three locations, with each situated alongside an active Dow production complex, Vopak said.
The new JV will enter into long-term service agreements with Dow, for storage and infrastructure services. Dow expects Vopak’s terminal expertise and capabilities to deliver operational efficiencies and opportunities for growth.
“We are excited for the opportunity to serve Dow via these industrial terminals in a safe, sustainable and efficient way,” said Eelco Hoekstra, chairman of the executive board and CEO of Royal Vopak. “We are dedicated to contributing to the long term success of Dow’s U.S. Gulf Coast business. This unique expansion opportunity, in which we partner with the leading global investment experts of BlackRock, fits perfectly into Vopak’s growth strategy for industrial terminals.
“We are very proud of our expertise and long track record of storing vital products with care for our customers and our drive to continue to invest.”
The total capacity of the three terminals is 852,000 cubic meters (cbm).
The Freeport TX terminal has 53 tanks (140,000 cbm) for storage of chemicals, the St. Charles LA terminal has 73 total tanks (409,000 cbm) for storage of chemicals, and the Plaquemine LA terminal has 30 tanks (303,000 cbm) for storage of chemicals and refined products.
The involved assets include 16.4 hectares of expansion land, 36 vessel berths, multiple pipeline connections, and rail and truck racks.
Vopak Industrial Infrastructure Americas and Dow are working closely to ensure a seamless transition, the companies said. The transaction is expected to be closed before the end of the year, subject to customary closing conditions.
“We are extremely proud to partner with Vopak, a best-in-class terminal operator, to serve as a steward for this critical infrastructure,” said Mark Florian, managing director and head of BlackRock’s global energy and power infrastructure team.
“This investment is aligned with our strategy to deliver value for our investors by investing in high-quality and critical operating infrastructure assets that are supported by long-term contracts to provide cash flow visibility ,and partnering with industry leaders who are like-minded to help grow these businesses while maintaining a strong culture of safety.”