Kinder Morgan Energy Partners (KMP) has formed a crude oil joint venture with Deeprock Energy Resources and Mercuria Energy.
KMP will invest $25m to acquire a 50% stake in an existing crude oil tank farm with storage capacity of one million barrels, and to construct three new storage tanks that will have an incremental storage capacity of 750,000 barrels.
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Deeprock will operate the terminal as construction manager and Mercuria will be the anchored tenant for the capacity for the next five years with an option to extend.
KMP has also entered into a development agreement with Deeprock, which allows KMP an option to participate in future expansions on Deeprock’s 254 acres of remaining undeveloped land.
Mercuria Energy president Michael Redenbaugh said the investment would give the firm the potential to utilise additional storage tanks and truck rack expansions for its trading business.
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By GlobalData
