SAN ANTONIO--(BUSINESS WIRE)--Dec. 17, 2012--
NuStar Energy L.P. (NYSE: NS) announced today that it has entered into a
purchase agreement to sell its San Antonio refinery and related assets,
including a terminal in Elmendorf, TX and a pipeline connecting the
terminal and refinery, to Calumet Specialty Products Partners,
L.P. (“Calumet”) for $100 million, plus closing date inventory estimated
to be $15 million. NuStar purchased the refinery and terminal out of
bankruptcy in April 2011 for $41 million, and the company has invested
approximately $54 million since then on improvements to the refinery.
NuStar announced its plans to sell the refinery last month as part of
its strategic redirection away from the earnings volatility associated
with the margin-based refining business in order to further grow its
more stable, fee-based pipeline and storage operations through internal
growth projects and acquisitions, especially in the Eagle Ford Shale
region and other U.S. shale plays, where NuStar already has extensive
pipeline and storage operations. NuStar will use proceeds from the
transaction, which is expected to have an effective date of January 1,
2013 and close on January 2, to fund the growth of those fee-based
pipeline and storage operations.
“As we stated when we announced our intent to sell the refinery, it was
an excellent opportunistic purchase for us, even though fuels refining
wasn’t part of our strategic plan,” said NuStar President and CEO Curt
Anastasio. “The refinery has an outstanding group of employees and we
enjoyed working with them to make a tremendous amount of improvements to
the refinery that made it a safer and more environmentally sound
facility that is also much more reliable and profitable.
“This transaction will give the refinery employees the opportunity to be
a part of a refining company with multiple refineries that has the depth
of refining resources and expertise to provide the support the refinery
needs to succeed over the long-term,” Anastasio added. “This is
especially important since we completed a joint venture for our asphalt
refining assets with Lindsay Goldberg that essentially makes the San
Antonio refinery a ‘stand-alone’ facility, which is a very difficult
position for a refinery because it limits resources and available
capital. Calumet is committed to safety excellence, as well as continued
improvements at the refinery and in the surrounding community. And one
of the key reasons we chose Calumet’s bid is because they are well-known
for their commitment to their employees. Our San Antonio refinery
employees received significant increases in their compensation and
benefits when they joined NuStar, and Calumet is also known for their
strong compensation and benefits programs.”
Located on the South Side of San Antonio, the 14,500-barrel-per-day
refinery produces and sells various products, including jet fuels,
ultra-low sulfur diesel (ULSD), naphtha, reformates, liquefied petroleum
gas (LPG), specialty solvents and other highly specialized fuels, to
commercial and retail customers and the U.S. military. The Elmendorf
terminal, which is approximately 12 miles away from the refinery, stores
the crude oil that is processed at the refinery.
To significantly improve efficiency, NuStar built and recently put into
service a 12-mile pipeline between the terminal and the refinery that
now moves the crude to the refinery. The effort effectively removed
approximately 80 crude delivery trucks per day from San Antonio roads.
Not only is this pipeline reducing traffic and cutting transportation
costs, it also is expected to reduce refinery unplanned outages and
increase refinery runs because the crude oil delivered by pipeline has a
more consistent quality. To further enhance the safety of refinery
employees, the company moved all non-operating personnel out of the
refinery and into an 18,000-square-foot office complex at Brooks City
Base in San Antonio that includes a state-of-the-art laboratory. In
addition to safety and reliability improvements, NuStar also has
conducted significant environmental cleanup as well as beautification
efforts that benefited the surrounding community.
About NuStar Energy L.P.
NuStar Energy L.P., a publicly traded master limited partnership based
in San Antonio, is one of the largest independent liquids terminal and
pipeline operators in the nation. NuStar currently has 8,573 miles of
pipeline; 87 terminal and storage facilities that store and distribute
crude oil, refined products and specialty liquids; a fuels refinery with
a throughput capacity of 14,500 barrels per day; and 50% ownership in
two asphalt refineries with a combined throughput capacity of 104,000
barrels per day. The Partnership’s combined system has approximately 95
million barrels of storage capacity, and NuStar has operations in the
United States, Canada, Mexico, the Netherlands, including St. Eustatius
in the Caribbean, the United Kingdom and Turkey. For more information,
visit NuStar Energy L.P.'s Web site at www.nustarenergy.com.
Cautionary Statement Regarding Forward-Looking Statements
This press release includes forward-looking statements within the
meaning of the Securities Litigation Reform Act of 1995 regarding future
events and the future financial performance of NuStar Energy L.P. All
forward-looking statements are based on the partnership's beliefs as
well as assumptions made by and information currently available to the
partnership. These statements reflect the partnership's current views
with respect to future events and are subject to various risks,
uncertainties and assumptions. These risks, uncertainties and
assumptions are discussed in NuStar Energy L.P.'s 2010 annual report on
Form 10-K and subsequent filings with the Securities and Exchange
Commission.
Source: NuStar Energy L.P.
NuStar Energy, L.P., San Antonio
Investors, Chris Russell, Vice
President,
Investor Relations: 210-918-3057
chris.russell@nustarenergy.com
or
Media,
Mary Rose Brown, Senior Vice President,
Administration: 210-918-2314
maryrose.brown@nustarenergy.com
Web
site: http://www.nustarenergy.com