Denbury reacquires NEJD, Free State CO2 pipelines
Denbury Inc., Plano, Tex., has restructured CO2 pipeline arrangements with Genesis Energy LPs covering the 183-mile Northeast Jackson Dome (NEJD) Pipeline system which runs south from Denbury’s Jackson Dome CO2 source field to near Donaldsonville, La., where it connects into Denbury’s Green Pipeline extending across south Louisiana and southeast Texas to near Houston; and the 86-mile Free State Pipeline which runs from Jackson Dome to Denbury’s oil fields in eastern Mississippi.
Under terms executed Oct. 30, Denbury reacquired the NEJD Pipeline system from Genesis in exchange for $70 million, to be paid in four equal payments in 2021, representing full settlement of all remaining obligations under the NEJD secured financing lease; and reacquired the Free State Pipeline from Genesis in exchange for a one-time payment of $22.5 million.
In May 2008, Denbury had conveyed ownership of the NEJD pipeline system to Genesis for $175 million and entered into a 20-year financing lease agreement to repay Genesis its principal amount plus interest at an effective rate of 10.25%.
In May 2008, Denbury sold the Free State pipeline to Genesis for $75 million and entered into a 20-year transportation services agreement with Genesis.
