By OGJ editors
HOUSTON, Mar. 21 -- Williams Cos. Inc., Tulsa, has agreed to sell its Williams Pipe Line Co. unit to affiliate Williams Energy Partners LP for at least $900 million as the parent continues selling its noncore assets in a previously announced company restructuring (OGJ Online, Feb. 4, 2002).
Williams Pipe Line consists of 6,747 miles of pipeline delivering petroleum products to 11 Midwestern states. Last year, the system transported 260 million bbl. The deal includes 39 storage and distribution terminals having an aggregate storage capacity of 26.5 million bbl.
Williams Cos. originally purchased the pipeline from Great Lakes Pipe Line Co. in 1966 for $287.6 million.
Williams Pres. and CEO Steve Malcolm said the transaction "will add immediate cash, strengthen our balance sheet, and allow us to continue to share in the profitability of the pipeline because of our general and limited partner interests in Williams Energy Partners."
Last month, Williams Cos. announced plans to sell the unit, saying Williams Energy Partners was the likely buyer (OGJ, Feb. 11, 2002, p. 36). The sale is expected to close by the end of the second quarter. Williams Energy Partners is a master limited partnership holding marine and land terminals as well as an ammonia pipeline.
In another recent transaction, Williams announced Mar. 7 that it planned to sell its Kern River Gas Transmission Co. for $960 million in cash and debt to Berkshire Hathaway Inc. unit MidAmerican Energy Holdings Co., Des Moines, Iowa (OGJ, Mar. 18, 2002, p. 43).