BP to sell some US assets to Buckeye Partners for $225 million

Buckeye Partners, one of the leading petroleum distributors in the US, yesterday agreed to buy some of BP's refined petroleum products terminals and pipelines in the US, for $225 million.

Pennsylvania-based Buckeye is buying BP's North America Unit 33, refined petroleum products terminals with total storage capacity exceeding 10 million barrels and approximately 1,000 miles of refined petroleum products pipelines, including BP's approximately 50 per cent interest in Inland Corporation.

The terminal and pipeline assets are located in the Midwestern, Southeastern, and Western US.

''This transaction is a key step in our continued expansion and geographic diversification efforts and further facilitates our participation in several key growth markets outside our current system footprint,'' said Forrest Wylie, Buckeye's chairman and CEO.

''This acquisition provides stable tariff and fee-based revenue streams that are supported by multi-year throughput commitments by BP. We expect the acquisition to be immediately accretive to our distributable cash flow.

In addition, we have identified several opportunities for further commercial development of these assets and anticipate a smooth integration and rapid realisation of operating synergies with our existing assets,'' he added.

The $239-billion London-based oil giant has been selling non-core assets to recover the cost of the devastating Gulf of Mexico oil spill that cost the company nearly $41 billion. (See: Gulf oil spill costs BP $41-bn; plans to divest US assets) The company has since sold off nearly $22 billion in assets.

BP had last year said that it would disinvest $30-billion worth of non core assets by the end of 2011. It has already sold several assets in South America, Vietnam, Egypt, Africa, Vietnam, Pakistan and the US.