Dynegy Inc., Houston, has sold its US crude oil business to Seminole Transportation & Trading Inc. The sale comprises Dynegy's entire US crude oil enterprise, including its transportation and marketing operations and assets in Texas, Oklahoma, and Louisiana. Financial terms of the deal were not disclosed.
According to Dynegy Chairman and CEO Chuck Watson, "The decision to seek an alternative for our crude oil business is based upon our long-term corporate strategy to redeploy capital into our energy convergence businesses. This sale will further strengthen our financial position, supporting the continued expansion of our generation portfolio in strategic locations throughout the country and thereby move us closer to our goal of capturing a 10-15% share of the wholesale power market."
The deal includes Dynegy Crude Gathering & Marketing Inc., Dynegy Crude Gathering Services Inc., and Dynegy Oil Pipeline Co. Seminole's operating subsidiary, Seminole Transportation & Gathering Inc. (STG), will be the primary operating entity.
STG CEO Thomas Kivisto said, "The strategic location of the main lines and related storage facilities connecting into Cushing, Okla., are a significant part of this acquisition."
As part of the acquisition, STG acquired 28 oil transports, 29 pipeline injection stations, 1.9 million bbl of terminal-owned storage capacity, and 2,000 miles of proprietary and common carrier gathering pipelines. Of the 1.9 million bbl of storage, 792,000 bbl of capacity is in Cushing.
