Under the terms of the agreement, Buckeye has agreed to pay BP $225 million in cash, subject to closing adjustments. Subject to regulatory approvals and pre-emption rights of co-owners, the transaction is expected to complete during the second quarter of 2011.
The planned divestment [image-nocss] was originally announced in October 2009 as a move to simplify BP's downstream portfolio, increasing efficiency and decreasing capital employed, while maintaining BP's marketing footprint in the United States. BP expects to continue to market its fuel through the terminals and will continue with the customer relationships currently in place.
The deal gives Buckeye Partners an additional storage capacity exceeding 10 million barrels and approximately 1,000 miles of refined petroleum products pipelines.
The terminal and pipeline assets are located in the Midwestern, Southeastern and Western United States, further extending Buckeye's operations into new geographic markets.
"This transaction is a key step in our continued expansion and geographic diversification efforts and further facilitates our participation in several key growth markets outside our current system footprint," said Forrest E. Wylie, Buckeye's chairman and CEO.
Houston-based Buckeye Partners L.P. is a publicly traded partnership that owns and operates one of the largest independent refined petroleum products pipeline systems in the United States in terms of volumes delivered, with approximately 5,400 miles of pipeline. Buckeye also owns 69 liquid petroleum products terminals with aggregate storage capacity of approximately 53 million barrels, operates approximately 2,600 miles of pipeline under agreements with major oil and chemical companies, owns a high-performance natural gas storage facility in Northern California, and markets refined petroleum products in certain regions served by its pipeline and terminal operations.
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