Inter Pipeline's bulk liquid storage segment reported improved financial results thanks to the storage terminals it acquired in the UK and Netherlands from NuStar.
The company's storage segment – Inter Terminals – generated funds from operations of $26.8 million in the first quarter of 2019, a $8.1 million improvement over the first quarter of 2018. The first quarter of 2019 included $8.4 million of funds from operations from its recently acquired bulk liquid storage business in the UK and Netherlands, which operated at a 95% utilisation rate.
During the quarter, the average storage utilisation rate across all terminals was 78% compared to 82% for the same period in 2018, and 68% in the prior quarter. A backwardated pricing environment for certain petroleum products continues to impact utilisation rates, particularly at its Danish terminals.
Several new storage agreements were executed in the quarter, which has materially improved utlisation rates in Denmark and customer interest remains strong in advance of the IMO 2020 regulation, which comes into effect on January 1, 2020.
Christian Bayle, Inter Pipeline's president and CEO, says: 'During the first quarter, our oil sands transportation business continued to generate strong, stable cash flow and financial results from European storage improved meaningfully with the addition of the recently acquired UK and Amsterdam terminals.'