New #midstream JV To Build 700,000 Barrel Oil Storage Facility Along Houston Gulf Coast #magellan #transportation

By 29th June 2015 Industry News No Comments

Magellan Midstream Partners and LBC Tank Terminals announced Monday the formation of a $95 million joint venture for a crude oil storage and transportation project in the Houston Gulf Coast region.

The 50/50 limited liability company will be named Seabrook Logistics. The assets to be built and owned by the JV include over 700,000 barrels of new crude oil storage and other distribution infrastructure located adjacent to LBC’s existing terminal in Seabrook, Texas. Additionally, the JV will build and own a new 18-inch diameter pipeline that will link the new storage to an existing third party pipeline that will move crude oil to a Houston-area refinery.

A deal has also been executed to allow the JV to use LBC’s dock suitable for industry standard Aframax vessels with up to a 45-foot draft and two large docks, which will provide efficient marine access with flexible loading and unloading services at the Seabrook facility.

As noted above, the project is now estimated to coast about $95 million and is supported by a long-term storage and transportation commitment with a major refiner. Magellan will be responsible for building, maintaining and operating the new pipeline, and LBC will be responsible for building, maintaining and operating the new storage tanks and other terminal assets.

The new pipeline infrastructure and storage facility are anticipated to be operational in Q1-17.

Magellan Midstream primarily transports, stores and distributes refined petroleum products and crude oil. Magellan owns the longest refined petroleum products pipeline system in the country, with access to nearly 50% of the U.S.’s refining capacity, and can store more than 95 million barrels of petroleum products such as gasoline, diesel fuel and crude oil.

LBC Tank Terminals is one of the largest global operators of bulk liquid storage facilities for chemical petroleum products and base oil products. LBC owns and operates a global network of terminals at key locations in the U.S., Europe and China, while offering loading/unloading services for all modes of transportation.

Michael Mears, Magellan’s President and CEO, said, “Magellan is excited about developing a new project with LBC in the Houston market to provide a cost efficient and reliable option to store, transport and distribute crude oil along the Gulf Coast…We also see growth opportunities at this new facility through the potential connection and integration of this terminal into Magellan’s Houston crude oil and refined products pipeline systems.”

Meanwhile, LBC’s CEO Walter Wattenbergh commented, “LBC is pleased to enter into this joint venture with Magellan. This expansion of our Houston area terminal is an important step in LBC’s growth strategy…We look forward to executing this project as a part of our expansion plans in the crude and refined products markets in the U.S.”
Source: Industry News {$excerpt:n}