Sep 25, 2003 |
PAA Acquires ArkLaTex Pipeline System from EOTT Energy |
(Houston – September 25, 2003) Plains All American Pipeline, L.P. (NYSE: PAA) announced today that it has reached definitive agreement to acquire the ArkLaTex Pipeline System and related marketing business from EOTT Energy for aggregate consideration of approximately $15.0 million, including transaction and closing costs, plus linefill requirements. The transaction is scheduled to close and will be effective October 1, 2003.
The ArkLaTex Pipeline System consists of 337 miles of crude oil gathering and mainline pipelines that originate in North Louisiana and traverse west into Texas where they deliver crude oil to markets in the Longview area. The system has the ability to deliver crude oil to the local refining market, the Mid Valley Pipeline System and the McMurrey Pipeline System. In addition, the ArkLaTex system is connected to Plains All American’s Red River Pipeline System, which the Partnership acquired in February 2003.
The ArkLaTex system currently transports approximately 18,000 barrels per day of predominantly sweet crude oil. The transaction includes approximately 590,000 barrels of crude oil storage capacity located along the system. The transaction also includes the assignment of EOTT Energy’s crude oil supply contracts in the area of the pipeline operations.
“We are pleased to continue to build and expand our presence in East Texas,” said Greg L. Armstrong, Chairman & Chief Executive Officer of the Partnership. “The ArkLaTex Pipeline System interconnects near Sabine, Texas, with our Red River Pipeline System, which we acquired earlier this year from BP, and is another solid bolt-on transaction that will complement our existing footprint in East Texas.
By integrating this asset with our other assets in the area, we hope to provide better service to our producer and refinery customers.” Armstrong noted that the planned interconnect of the Red River Pipeline System to Plains All American’s Cushing Terminal was completed in early August. Except for the historical information contained herein, the matters discussed in this news release are forward-looking statements that involve certain risks and uncertainties.
These risks and uncertainties include, among other things, successful integration and future performance of assets acquired, availability of third party production volumes for transportation and marketing, demand for various grades of crude oil and resulting changes in pricing conditions, continued creditworthiness of, and performance by, our counterparties, the effects of competition, the success of our risk management activities, successful third party drilling efforts, regulatory changes, weather interference, and other factors and uncertainties inherent in the marketing, transportation, terminalling, gathering and storage of crude oil discussed in the Partnership’s filings with the Securities and Exchange Commission.
Plains All American Pipeline, L.P. is engaged in interstate and intrastate crude oil transportation, terminalling and storage, as well as crude oil and LPG gathering and marketing activities, primarily in Texas, California, Oklahoma, Louisiana and the Canadian Provinces of Alberta and Saskatchewan. The Partnership’s common units are traded on the New York Stock Exchange under the symbol “PAA.” The Partnership is headquartered in Houston, Texas. |
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