The Enterprise offshore business has assets that include approximately 2,350 miles of offshore crude oil and natural gas pipelines, as well as six offshore hub platforms.
Some of the active drilling and development regions in the US are served by the business, including deepwater production fields in the Gulf of Mexico offshore Texas, Louisiana, Mississippi, and Alabama.
Following the acquisition, Genesis will own a 36% interest in the Poseidon Oil Pipeline System, a 50% interest in the Southeast Keathley Canyon Oil Pipeline System (SEKCO), and a 50% interest in the Cameron Highway Oil Pipeline System (CHOPS).
According to Genesis, the offshore business assets will expand the company’s existing offshore pipelines business.
The business includes the company’s interests in the three oil pipelines.
Genesis Energy CEO Grant Sims said: “These offshore assets will substantially enlarge our portfolio of strategic infrastructure in the Gulf of Mexico, which is one of the most prolific producing regions in the United States.
“We believe the acquisition will be immediately accretive to our cash available for distribution per common unit and will improve our credit metrics over time, which should accelerate an increase in our credit ratings in the future.”
The acquisition will provide Genesis with additional opportunities to develop organic growth projects in its offshore pipeline segment.
Upon closing of the transaction, Genesis and affiliates of Enterprise will enter a transition services agreement to ensure the continued operation of the business.
Enterprise plans to use the proceeds to finance the first installment of its recent acquisition of EFS Midstream in the Eagle Ford.
The acquisition is slated for completion in July 2015.