Global Partners LP (NYSE: GLP) today announced that it has signed an agreement to acquire 100 percent of the membership interests in a West Coast crude oil and ethanol facility near Portland, Oregon from Cascade Kelly Holdings LLC. The total purchase price is expected to be approximately $95 million. The transaction includes a rail transloading facility serviced by the BNSF Railway, 200,000 barrels of storage capacity, a deepwater marine terminal, a 1,200-foot dock and the largest ethanol plant on the West Coast. Situated along the Columbia River in Clatskanie, Oregon, the site is located on land leased under a long-term agreement from the Port of St. Helens. In November 2012, the facility began transloading unit trains of crude oil.
“This transaction capitalizes on our advantaged logistics and enables Global to supply cost-competitive crude and ethanol to refiners and customers on the West Coast,” said Eric Slifka, Global’s president and chief executive officer. “From our origination hub in the Bakken region of North Dakota, we will now have destination assets on both coasts. The Oregon site is linked via BNSF to the Basin Transload facility in Beulah, North Dakota while our Albany, NY terminal is connected via single line haul on Canadian Pacific to the Basin Transload location in Columbus, North Dakota. This facility also creates a link between the Western Canadian Sedimentary Basin and Pacific refiners. With the pending closing of our Basin Transload acquisition this quarter, these new assets increase our capability to transport crude from the U.S. and Canadian mid-continent and extend our virtual pipeline to the West.”
“Because certain regions of the West Coast energy market have limited pipeline access, the dynamics of sourcing and logistics for PADD V refiners and customers are comparable to those we see in the Northeast,” Slifka said. “As we have demonstrated to those customers, we believe that we can apply our rail and marine expertise to meet the demand for crude and ethanol on the West Coast. Given the 3.3 million barrels a day of crude refining capacity in PADD V, this facility represents an opportunity for Global to drive additional product volumes and enhance margins.”
Global’s purchase of Cascade Kelly Holdings, which has been approved by the Board of Directors of the Partnership’s general partner, Global GP LLC, is subject to customary regulatory approvals and various other customary commercial closing conditions. The purchase is expected to be completed by the end of the current quarter and is expected to be accretive to unit holders in its first full year of operation.
In addition to this transaction, this quarter Global expects to close its pending acquisition of a 60% interest in Basin Transload, LLC for approximately $80 million. To finance these transactions, Global has arranged a $115 million increase in its bank credit facility and has secured a senior unsecured five-year note of up to $70 million from funds managed by GSO Capital Partners LP, the credit arm of The Blackstone Group.
About Global Partners LP
Global Partners LP, a publicly traded master limited partnership based in Waltham, Massachusetts, owns, controls or has access to one of the largest terminal networks of refined petroleum products and renewable fuels in the Northeast. Global Partners is a leader in the logistics of transporting crude and other products from the mid-continent region of the U.S. and Canada to the East Coast. The Partnership is one of the largest wholesale distributors of gasoline (including blendstocks such as ethanol and naphtha), distillates (such as home heating oil, diesel and kerosene), residual oil and renewable fuels to wholesalers, retailers and commercial customers in the New England states and New York. In addition, the Partnership has a portfolio of approximately 1,000 gas stations in nine Northeastern states. The Partnership also is a distributor of natural gas. A FORTUNE 500® company, Global Partners trades on the New York Stock Exchange under the ticker symbol "GLP." For additional information, please visit www.globalp.com.
Some of the information contained in this news release may contain forward-looking statements. Forward-looking statements include, without limitation, any statement that may project, indicate or imply future results, events, performance or achievements, and may contain the words “may,” “believe,” “should,” “could,” “expect,” “anticipate,” “plan,” “intend,” “estimate,” “continue,” “will likely result,” or other similar expressions. In addition, any statement made by Global Partners LP’s management concerning future financial performance (including future revenues, earnings or growth rates), ongoing business strategies or prospects and possible actions by Global Partners LP or its subsidiaries are also forward-looking statements.
Although Global Partners LP believes these forward-looking statements are reasonable as and when made, there may be events in the future that Global Partners LP is not able to predict accurately or control, and there can be no assurance that future developments affecting Global Partners LP’s business will be those that it anticipates.
For additional information about risks and uncertainties that could cause actual results to differ materially from the expectations Global Partners LP describes in its forward-looking statements, please refer to Global Partners LP’s Annual Report on Form 10-K for the year ended December 31, 2011 and subsequent filings the Partnership makes with the Securities and Exchange Commission.
Readers are cautioned not to place undue reliance on the forward-looking statements, which speak only as of the date on which they are made. Global Partners LP expressly disclaims any obligation or undertaking to update forward-looking statements to reflect any change in its expectations or beliefs or any change in events, conditions or circumstances on which any forward-looking statement is based.
Thomas J. Hollister, 781-894-8800
Chief Operating Officer and
Chief Financial Officer
Edward J. Faneuil, 781-894-8800
Executive Vice President,
General Counsel and Secretary
Nasdaq quotes delayed at least 15 minutes, all others at least 20 minutes.
Markets are closed on certain holidays. Stock Market Holiday List
By accessing this page, you agree to the following
Press Release Service provided by PRConnect.
Stock quotes supplied by Six Financial
Postage Rates Bots go here