Williams acquires product pipeline from Tesoro
Williams Energy Partners LP signed an agreement to acquire the Northern Great Plains products system, a 430-mile refined petroleum products pipeline, from Tesoro Petroleum Corp. for $110 million.
By OGJ editors
HOUSTON, Aug. 26 -- Williams Energy Partners LP, a unit of Tulsa-based Williams Cos. Inc., signed an agreement to acquire the Northern Great Plains products system, a 430-mile refined petroleum products pipeline, from Tesoro Petroleum Corp. for $110 million.
The system, which includes four terminals, connects San Antonio-based Tesoro's 58,000 b/d Mandan, ND, refinery to Minneapolis, Minn. The terminals are in Jamestown and Moorhead, ND, and Sauk Centre and Roseville, Minn. The deal excludes Tesoro's refinery and terminal, its crude-gathering system in western North Dakota, and its network of retail outlets. The deal is expected to close in mid-October, pending appropriate regulatory approvals.
Williams said the system is expected to earn it about $15 million/year, before interest, taxes, depreciation, and amortization. "This asset is an excellent strategic fit with our Williams Pipe Line system and provides the partnership with additional stable, fee-based revenues," said Don Wellendorf, Williams CEO.
Tesoro said it would use the sales proceeds to pay down a portion of its bank debt as well as for general corporate purposes.