Oiltanking Partners, L.P. Announces Crude Storage Expansion Project
April 16, 2012 06:30 AM EDT
Carlin G. Conner, President, CEO and Chairman of the Board, stated, “As expected, the dramatic increase in domestic crude oil production has created a growing need for storage capacity by oil producers and marketers interested in premium Gulf Coast crude oil pricing and our local refinery customers. This new project is the second one phase of our infrastructure and storage expansion to deal with the robust demand from both existing and new customers and is supported by new long-term storage contracts.”
“With this project, now we have announced nearly $200 million of capital investments to expand our connectivity and storage capacity since our initial public offering in July of 2011. We believe Oiltanking Partners is easily positioned for continued growth,” concluded Conner.
All environmental and internal approvals required to commence construction are in place, and the extra storage capacity is predicted to be placed into service within the fourth quarter of 2013. Once complete, the hot storage capacity will bring total active storage capacity on the Partnership to approximately 22 million barrels.
The expansion project is predicted to be accretive to distributable cash flow once the extra storage is operational and is predicted to generate returns of roughly 6-8 times EBITDA, or earnings before interest, taxes and depreciation, generally targeted for organic expansion projects. The Partnership anticipates funding the project primarily with debt.
Oiltanking Partners is a master limited partnership engaged in independent storage and transportation of crude oil, refined petroleum products and liquefied petroleum gas. We offer our services to lots of customers, including major integrated oil companies, distributors, marketers and chemical and petrochemical companies. Our assets can be found along the Gulf Coast of the usa. For additional information, visit www.oiltankingpartners.com .
This press release contains forward-looking statements, including statements as to the Partnership’s expectations for the growth of its Houston terminal. These forward-looking statements reflect Oiltanking Partners’ current views with respect to future events, according to what it believes are reasonable assumptions. No assurance may be given, however, thon these events will occur. These statements are subject to risks and uncertainties as described in Oiltanking Partners’ filings with the Securities and Exchange Commission, available at the SEC’s website at www.sec.gov . By issuing forward looking statements in accordance with current expectations, opinions, views or beliefs, Oiltanking Partners has no obligation and, except as required by law, isn’t undertaking any obligation, to update or revise these statements or provide another information with regards to such statements.
Ken Owen, Chief Financial Officer
SOURCE Oiltanking Partners, L.P.