By MELODIE WARNER
Plains All American Pipeline agreed to acquire five crude-oil rail terminals from US Development Group for $500 million as the pipeline company looks to expand its nationwide rail network.
The deal includes three crude-oil rail loading terminals in the Eagle Ford, Bakken and Niobrara producing regions, a rail unloading terminal at St. James, La., and a project to construct a crude oil unloading terminal near Bakersfield, Calif.
"These assets represent a very attractive addition to our existing North American rail activities, substantially improving our scale, scope, and flexibility," said CEO Greg L. Armstrong.
Plains expects to complete the purchase before the year end.
The company said its North American crude-oil rail business will include five loading terminals and three unloading terminals, following the acquisition and projects currently under development.
Plains, which transports, stores and sells oil and natural gas, receives fees for many of its services, so it is less affected by the volatility of oil and gas prices. The partnership also holds a 48% stake in PAA Natural Gas Storage L.P., the company's gas-storage spinoff.
The company said it currently owns about 18,000 miles of liquids pipelines, 120 million bbl of liquids storage capacity and handles more than 3 million bbl of physical product on a daily basis.
Dow Jones Newswires