Press release from Business Wire
NuStar Energy L.P. To Expand International Terminal Operations Into Turkey
<p class=' bwtextaligncenter'> <i>Joint Venture Will Give NuStar Majority Ownership and Operational Control of Turkish Petroleum Terminals and Ownership in Offshore Loading Facility</i> </p>
Monday, August 02, 2010
NuStar Energy L.P. To Expand International Terminal Operations Into Turkey08:25 EDT Monday, August 02, 2010 SAN ANTONIO (Business Wire) -- NuStar Energy L.P. (NYSE: NS) today announced that it has entered into a joint venture with Turkish companies S-Oil and Aves that will give NuStar majority ownership and operational control of two petroleum terminals and an offshore loading facility in Turkey. NuStar will acquire a 75 percent ownership stake in the joint venture for a price between $50 million and $60 million. The transaction, which is expected to be immediately accretive to NuStar Energy's distributable cash flow per unit, is expected to close in October. The two terminals, which will be wholly owned by the joint venture, are located in Mersin, Turkey. An existing terminal owned by S-Oil has 606,000 barrels of storage capacity in 20 tanks, primarily for gas oil and distillates. The new Aves terminal, which will begin operations this month, has 740,000 barrels of storage capacity in 24 tanks, mostly for oil products. The joint venture plans to expand the combined storage capacity of the terminals by approximately 930,000 barrels by the end of 2011. Both terminals are connected via pipelines to the newly christened SAVKA offshore platform located approximately three miles off the Mediterranean Sea coast. The platform, 67 percent of which will be owned by the joint venture, can simultaneously offload product from two Aframax-size vessels that weigh up to 80,000 dead weight tons (dwt) each. Both terminals receive product via the platform and discharge via truck rack to the regional market or via the platform for export. The joint venture is also evaluating additional terminal construction projects in different parts of Turkey. “This is a tremendous opportunity for NuStar because the Mediterranean region has great strategic advantages,” said NuStar President and CEO Curt Anastasio. “Turkey has a booming economy, and petroleum demand is increasing significantly faster in Turkey than other European countries. As we have said previously, petroleum supply and demand imbalances in the Mediterranean region present strong logistics opportunities. We are also fortunate to have outstanding partners in S-Oil and Aves. With their knowledge of the market combined with NuStar's terminal operations experience, we expect to develop world-class operations in Turkey that will be very lucrative for all involved.” “We are also fortunate because these are new, well-built and well-run facilities with outstanding employees,” Anastasio added. “All of the terminal employees will be retained, and we look forward to having them on our team.” The joint venture will be overseen by a four-person board of directors, and as majority owners of the joint venture, NuStar will appoint top management and oversee daily operations. “We are very enthusiastic about becoming partners in our petroleum storage facilities with NuStar, which is a symbol of quality and trust in the global oil storage business,” said Senan Idin, Chairman of Aves and S-Oil. “Their immense expertise in the business will definitely add value to our operations. And by making new investments we intend to cover the oil storage capacity gap in Turkey that is the result of ever-increasing domestic demand for oil products and the country's obligation to comply with International Energy Agency (IEA) strategic stock keeping policies.” “We believe that the partnership is also an important stepping stone for reaching Turkey's long-term goal to become an energy corridor country,” Idin added. “Turkey is a key country for transportation of Iraqi, Russian and former Soviet Union (FSU) countries' tremendous oil and natural gas resources to world markets.” About NuStar Energy L.P. NuStar Energy L.P. is a publicly traded, limited partnership based in San Antonio, with 8,417 miles of crude oil and refined product pipelines; 89 terminal and storage facilities that store and distribute crude oil, refined products and specialty liquids; and two asphalt refineries with a combined throughput capacity of 104,000 barrels per day. The partnership's combined system has over 93 million barrels of storage capacity. One of the largest asphalt refiners and marketers in the U.S. and the second largest independent liquids terminal operator in the nation, NuStar has operations in the United States, the Netherlands Antilles, Canada, Mexico, the Netherlands and the United Kingdom. For more information, visit NuStar Energy L.P.'s Web site at www.nustarenergy.com. About S-Oil S-Oil is a joint stock company that has been operating with Turkish Energy Markets Regulation Authority (EMRA) Distribution License since 2005. The company has over 190 retail fuel outlets in Turkey, and it is the 8th largest importer of fuel into the Turkish market, according to the 2009 EMRA Petroleum Sector Report. The company's Mersin Terminal, which began operations in 2003, has been widely used to supply refined oil products to Turkish and Iraq markets. For detailed information on S-Oil, please visit www.soil.com.tr. About Aves Aves has been engaged in international commodity trading since 2004, and today the company is a well-known operator in Mediterranean gasoil and diesel markets. The company has been one of the major gasoil suppliers of SOMO (State Oil Marketing Organization) of Iraq. In 2009, Aves began to supply sunflower seed oil to Turkey and instantly became one of the largest suppliers in the nation. The company also operates a dry goods bonded warehouse on the Turkish-Iraq border. For detailed information on Aves, please visit www.avesas.com.tr.