Stonepeak Infrastructure Partners, which along with Cogent Energy Solutions and Granite Peak Group, developed the Casper Crude to Rail terminal in September 2013, has decided to sell the asset to USD Partners, a Houston-based master limited partnership (MLP), for a total consideration of $225 million.
“The sale represents a strong exit for Stonepeak,” one source told Infrastructure Investor in reference to the relatively short holding period.
According to a statement released by USD Partners, the purchase price includes $208.3 million of cash and $16.7 million of limited partner units issued to the sellers (1.7 million common units at $9.62 per share).
Located in Casper, Wyoming, adjacent to Casper Natrona County International Airport, the terminal supports access to multiple refining centres across the US.
The terminal, which began operating in September 2014, comprises a unit train-capable crude oil loading rail terminal with 100,000 barrels per day of capacity, six storage tanks with a capacity of 900,000 barrels and a six-mile pipeline, owned by Spectra Energy, that carries Canadian crude oil from Alberta to Casper.
“Additionally, the terminal’s footprint and modular design allows for the addition of a second loading station and an additional 1.1 million barrels of storage capacity with minimal disruption to existing operations and relatively low incremental capital costs,” USD Partners said in a statement.
The terminal, in which Stonepeak holds a controlling stake, is supported by take-or-pay contracts with primarily investment-grade refiners and a weighted-average remaining contract life of approximately three years.
The transaction is expected to close in the fourth quarter of this year.
Established in 2011, Stonepeak describes itself as a North America-focused private equity firm with a conservative yet opportunistic approach to infrastructure investing.
It invests in the energy, power, transportation, utilities, water and communications sectors. It currently manages $1.7 billion in assets, according to its website.
Stonepeak declined to comment.