Louisiana-based bulk liquid storage operator Blackwater Midstream has seen storage revenues were up by 78% this quarter over the comparable 2009 period reaching $1,250,000 (970,000) for 2010 against $701,000 for 2009.
Leased barrel utilisation climbed from 38% as of December 2008 to 77% as of June 2010.
Michael Suder, CEO, attributed the significantly improved results to more tank capacity due to expansion within its fence line, additional blue chip customers, favourable long-term contractual rates, and overall greater capacity use.
We are in an industry where demand outstrips supply. As an independent developer, manager, and third party provider of bulk liquid storage terminals, we take no commodity price risk and we enjoy generous profit margins. There is a high degree of predictability in our numbers, Suder states.
[ ] Our Westwego facility [ ] was purchased in December 2008 for $4.8 million, independently appraised then for $6.6 million. Since December 2008 we have added 150,000 barrels of capacity, a ship dock for ocean going vessels and other capital improvements. We are currently in the planning and pre-construction of phase II, which will add 400,000 barrels of additional capacity. Just this month the facility was appraised at a value of $38 million, anticipating the completion of the phase II tanks, almost a five-fold increase in value in twenty months.
Today, Blackwater has two terminals, Westwego, Louisiana and Brunswick, Georgia. Its vision and strategy is for a continuing programme of acquiring under-achieving, under-utilised storage terminals.