US-based Emerge Energy Services has signed an agreement for the sale of its fuels business to motor fuels distributor Sunoco for $178.5m.
The fuels business consists of Emerge’s wholly-owned subsidiaries, Direct Fuels and Birmingham-based Allied Energy.
The business includes two transmix processing plants with attached refined product terminals located in the Birmingham, Alabama, and greater Dallas, Texas, metro areas.
Together, the plants have the capacity to process more than 10,000 barrels per day of transmix.
The terminals have more than 800,000 barrels of storage capacity.
Emerge plans to use the sale proceeds to reduce its outstanding debt.
Upon completion of the sale, Emerge will have all of its assets and operations focused on its sand segment.
This segment is engaged in the businesses of mining, processing and distributing silica sand, which serves as a key input for the hydraulic fracturing of oil and natural gas wells.
Emerge Energy Services board chairman Ted Beneski said: "This agreement with Sunoco is the result of a thorough process undertaken to maximise value for unitholders.
"We are pleased with the results of this process and could not be happier to be partnering on this transaction with Sunoco, a top operator with a stellar reputation in the marketplace. The Fuels Business will be in good hands."
Subject to regulatory approval and customary closing conditions, the sale of the fuels business is expected to be completed during the third quarter of this year.
