Enbridge to Acquire U.S. Crude Oil Pipeline and Storage Systems

abarrelfullabarrelfull wrote on 11 May 2012 07:22

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December 22, 2003

Enbridge Inc. (TSE, NYSE: ENB) today announced that companies within the Enbridge group have agreed to acquire crude oil pipeline and storage systems from Shell Pipeline Company LP and Shell Oil Products US for an aggregate of US$140.5 million. The majority of the assets, involving systems located at, or originating from, Cushing, Oklahoma, will be acquired by Enbridge Energy Partners, L.P. (NYSE: EEP) ("Enbridge Partners") for approximately US$131 million, as separately announced today by Enbridge Partners. Enbridge owns an effective 12.2% interest in Enbridge Partners and manages it through an affiliate,

Enbridge Energy Management, L.L.C. (NYSE: EEQ). A wholly owned subsidiary of Enbridge will acquire two smaller systems in the Wood River/Patoka corridor in southern Illinois for US$9.5 million. Closing of the purchases is anticipated to occur in the first quarter of 2004, subject to regulatory approvals and rights of first refusal.

The systems to be acquired by Enbridge Partners consist of three different pipelines totaling 615 miles, and two crude oil storage terminals with a total of 9.5 million barrels of capacity. The systems to be acquired by Enbridge Inc. include a 60% interest in the Woodpat Pipeline from Wood River Illinois, to Patoka, Illinois, plus a 500,000-barrel terminal at Patoka.

"We're pleased with the continued progress which we're making to expand and diversify the asset base of Enbridge Partners.

Enbridge will benefit from the accretion in distributable cash flow through its equity share in the Partnership and the General Partner incentive," said Patrick D. Daniel, President & Chief Executive Officer of Enbridge.

"The southern Illinois assets being acquired directly by Enbridge involve a small investment but play an important role within our overall market access initiative. This initiative is intended to enhance value to Canadian producers by providing access to new markets for their crude oil. The Woodpat Pipeline will complement the previously announced Spearhead and Southern Access Pipelines by providing an additional connection to Patoka. From Patoka we plan to provide enhanced access to new markets in eastern PADD II. Patoka is also one of the potential jumping off points for alternative paths to new markets on the U.S. Gulf Coast, to which we are planning to develop access."

"The storage facility at Patoka also fits well. It will provide increased operational flexibility and term storage options for shippers wishing to access these new markets either through the Woodpat Pipeline, or through our existing Mustang Pipeline joint venture which runs from Chicago south to Patoka."

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