By October 11, 2016 0 Comments Read More →

Phillips 66 Partners announces $1.3 billion acquisition

Phillips 66 Partners

Greg Garland, chairman and CEO of Phillips 66.

HOUSTON – Phillips 66 Partners LP has reached agreement with Phillips 66 to acquire 30 crude, refined products and NGL logistics assets for total consideration of $1.3 billion.

The Partnership plans to fund the acquisition with a combination of debt and $196 million in new PSXP units issued to Phillips 66, to be allocated proportionally between common units and general partner units allowing the general partner to maintain its 2 per cent general partner interest.

The transaction is anticipated to close this month, subject to satisfaction of customary closing conditions, and is expected to be immediately accretive to unitholders.

Upon closing, the Partnership will be entitled to receive the cash earnings associated with the acquired assets as of Oct. 1, 2016.

The acquisition consideration reflects an approximate 8.7 times multiple based on the forecasted full year 2017 earnings before interest, taxes, depreciation and amortization attributable to the assets of approximately $150 million.

“As our largest dropdown acquisition to date, this represents a milestone for the Partnership and will provide additional fee-based income and diversity to our already strong midstream portfolio,” said Greg Garland, Phillips 66 Partners chairman and CEO.

“We remain committed to maintaining a stable, fee-based, growing business model at Phillips 66 Partners, and are on track to deliver on our commitment to a five-year distribution compound annual growth rate of 30 per cent through 2018.”

The transaction includes the following assets:

  • A crude pipeline and terminal system that provides crude supply for Phillips 66’s Ponca City Refinery, consisting of 503 miles of pipeline and 1.7 million barrels of storage;
  • A refined products and NGL pipeline and terminal system that provides product takeaway transportation services for Phillips 66’s Ponca City Refinery, consisting of 524 miles of pipeline and 1.7 million barrels of storage;
  • A crude pipeline and terminal system that provides crude supply for Phillips 66’s Billings Refinery, consisting of a 79 per cent undivided interest in a 623-mile pipeline and 570,000 barrels of storage;
  • A refined products pipeline and terminal system that provides product takeaway transportation services for Phillips 66’s Billings Refinery, consisting of 342 miles of pipeline and 386,000 barrels of storage;
  • A refined products and NGL terminal system that provides storage services for Phillips 66’s Bayway Refinery, consisting of 2.0 million barrels of storage;
  • A crude pipeline and terminal system that provides crude supply for the Phillips 66-operated Borger Refinery, consisting of 1,089 miles of pipeline and 400,000 barrels of storage; and
  • A refined products pipeline and terminal system that provides product takeaway transportation services for the Phillips 66-operated Borger Refinery, consisting of 93 miles of pipeline, a 33 per cent undivided interest in a 102-mile segment and a 54 per cent undivided interest in a 19-mile segment of a 121-mile pipeline, a 50 per cent interest in a 293-mile pipeline and 700,000 barrels of storage.
Phillips 66 partners

Ph: 432-978-5096 Website: www.mapleleafmarketinginc.com

 

Posted in: Energy Financial

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