Kinder Morgan Energy Partners said Dec. 23 that it is buying
American Petroleum Tankers (APT) and State Class Tankers (SCT) from affiliates
of The Blackstone Group and Cerberus Capital Management for $962 million in
cash.
“This is a strategic and complementary extension of our
existing crude oil and refined products transportation business,” John
Schlosser, president of KMP’s Terminals division said in a statement.
APT and SCT are involved in the marine transportation of
crude oil, condensate and refined products in the United States domestic trade.
APT’s fleet consists of five medium range product tankers,
each with 330,000 barrels of cargo capacity. With an average vessel age of about
four years, the APT fleet is one of the youngest in the industry. Each vessel
is operating pursuant to long-term time charters with major integrated oil
companies, major refiners and the US Navy.
Crowley Maritime operates APT's vessels.
SCT has commissioned the construction of four medium range
product tankers, each with 330,000 barrels of cargo capacity. The vessels are
scheduled to be delivered in 2015 and 2016 and are being built by General
Dynamics’ NASSCO shipyard. Kinder Morgan says it plans to invest about $214
million to complete construction of the SCT vessels.
“Product demand is growing and sources of supply continue to
change, in part due to the increased shale activity,” Schlosser explained. “As
a result, there is more demand for waterborne transportation to move these
products. We are purchasing tankers that provide stable fee-based cash flow
through multi-year contracts with major credit worthy oil producers.”
The transaction, which is subject to standard regulatory
approvals, is expected to close during the first quarter of 2014.
