Magellan Midstream Partners LP (NYSE: MMP) has closed on its acquisition of pipeline assets in Texas and New Mexico from Plains All American Pipeline LP (NYSE: PAA).
The pipeline system includes approximately 250 miles of common carrier pipeline that transports refined petroleum products from El Paso, Texas, delivering products north to Albuquerque, New Mexico, and transporting products south to the US-Mexico border for delivery within Mexico via a third-party pipeline.
"This pipeline system serves as a natural extension of our existing refined products pipeline system, with current connections in the El Paso market," said Michael Mears, Magellan CEO. "With this newly acquired pipeline system, Magellan is able to provide options for customers in Albuquerque and central New Mexico to access refined products from West Texas, Gulf Coast and Mid-Continent refiners."
Magellan's acquisition of the previously announced Rocky Mountain pipeline system is pending, subject to approval by the Federal Trade Commission. The Rocky Mountain acquisition includes approximately 550 miles of common carrier pipeline that distributes refined petroleum products in Colorado, South Dakota and Wyoming.
Of the previously announced combined purchase price of $190 million, $57 million was allocated to the Texas-New Mexico pipelines, which Magellan funded with cash on hand.
Magellan Midstream Partners is a publicly traded partnership that primarily transports, stores and distributes refined petroleum products and crude oil. The partnership owns the longest refined petroleum products pipeline system in the US, with access to more than 40% of the nation's refining capacity, and can store over 80 million barrels of petroleum products such as gasoline, diesel fuel and crude oil.