Secure Energy Services Inc. (SES) has announced the completion of two tuck-in acquisitions, providing the company with a strategic midstream footprint in one of the largest crude oil storage and trading hubs in North America. SES has acquired a 27% interest in a crude oil storage facility comprised of four aboveground 175 000 bbl tanks located in Cushing, Oklahoma, and a 51% interest in an 80 acre parcel of undeveloped land adjacent to it. The total purchase price of the acquisitions was US$10.4 million, paid in cash at closing on 11 April 2019.
The facility was constructed in 2015 and is strategically located on 10 acres of land in southern Cushing with long-term connection agreements in place, ultimately providing connectivity to all major inbound and outbound pipelines in Cushing.
SES' majority investment in the 80 acre parcel of land provides the company with the option to develop additional midstream infrastructure in the trading hub. The strategic partners of SES have a long history in constructing similar scale storage infrastructure in the Cushing market and have developed relationships with major companies in the area. SES intends to support any further investment with long-term contracts providing it with certainty over future cash flows.
These transactions provide a measured and strategic entry into a new market, supporting the continued growth and development of SES’ midstream business. Owning infrastructure in Cushing extends the company’s crude oil value chain, providing our customers with market access flexibility to optimise realised pricing and increase operating netbacks.
Read the article online at: https://www.tanksterminals.com/storage-tanks/17042019/ses-acquires-cushing-crude-oil-storage-infrastructure/