NGL Energy Partners and Magnum Liquids have formed a JV focusing on the storage of natural gas liquids and refined products.
The JV combined NGL's Sawtooth storage facility, a natural gas liquids storage facility with 6.1 million barrels of capacity in five existing salt caverns, with Magnum's refined products rights and adjacent leasehold.
NGL will sell an interest in Sawtooth to Magnum for $45 million in cash due at closing.
Magnum will contribute its right, title and interest in certain leasehold and other assets located at the site, which will be utilised to expand Sawtooth's existing operations and allow for the addition of refined products storage at the facility.
NGL will own approximately 67.6% of the joint venture and Magnum will own the remaining 32.4% at closing.
Mike Krimbill, NGL's CEO: 'We are very excited to bring together NGL's Sawtooth natural gas liquids storage asset with the refined products storage rights and commercial expertise of the Magnum team.
'This new joint venture will allow Sawtooth to utilise existing capacity to store refined products with very minimal capital requirements. It will also accelerate the earnings potential and broaden the scope of services offered at the facility.'
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