United Energy Trading, LLC announces sale of Pawnee Crude Terminal to Arc Logistics Partners LP
DENVER, July 23, 2015 /PRNewswire/ -- United Energy Trading, LLC (UET) announced today that it, together with Hawkeye Midstream, LLC, has sold 100% of its subsidiary, UET Midstream, LLC (Midstream), to ARC Terminals Holdings LLC, a wholly-owned subsidiary of ARC Logistics Partners LP (ARCX), for a total adjusted sales price of $76.6 million consisting of both cash and ARCX common units.
The sale focused on the principal assets of Midstream, namely a newly-constructed, operational crude oil terminal (the Pawnee Terminal) and proximal development site both located in the heart of northeast Colorado's Niobrara play. The Pawnee Terminal is the primary injection point into Tallgrass Energy Partners' (Tallgrass) Northeast Colorado Lateral of the Pony Express Pipeline, a major pipeline transporting crude oil produced from the Bakken and Niobrara Formations to Cushing, Oklahoma.
The sale of Midstream culminates a more than 2 year process in which UET worked with Tallgrass and Niobrara producers to provide customers with long term assurance that crude oil production will move safely, reliably and cost effectively from constrained supply basins to North America's primary market hub at Cushing, OK. UET retains substantial throughput capacity at the Terminal available to third party producers, in addition to retention of major crude oil purchase contracts utilizing the Terminal and transportation to Cushing, OK.
Tom Williams, President of UET, commented: "We are thrilled to announce this transaction as one that is accretive to UET 's expanding scope as not only a marketer and logistics manager of hydrocarbon movement, but also as a now proven asset developer providing solutions to our domestic oil and gas producers. We view our successful development of Pawnee as a springboard for UET as we diversify our business in oil and gas logistics and midstream development. We also regard this transaction as a template for additional upstream, greenfields asset development providing a bridge between producers' needs and larger, acquisition minded midstream operators."
Mr. Williams continued, "in that UET is now a holder of ARCX common units, and considering ARCX's successful performance record in developing, owning, and operating critical oil and gas infrastructure, we are excited about the prospects of further growth and diversification into new markets with a larger footprint and strong partner."
UET is a privately held, Denver-based oil and gas marketing and logistics company and a subsidiary of Bismarck-based United Energy Corporation, which holds power marketing, oil and gas producing, and retail gas companies in addition to UET. UET purchases, transports, and/or sells some 1.5 bcf/day of natural gas on over 80 pipelines and approximately 150,000 bbls/day of crude oil on over 20 pipelines and via over 1,000 rail cars throughout North America.