Kinder Morgan Energy Partners (KMP) has formed a joint crude oil venture with Deeprock Energy Resources and Mercuria Energy Trading in Cushing, Oklahoma, US.
KMP is to invest $25 million (€18 million) for a 50% stake in an existing crude oil tank farm that has a one million barrel capacity. The money will also go towards the construction of three new storage tanks that will be able to hold 750,000 barrels.
The new tanks are predicted to be in service by Q3 2011 and Deeprock will continue to be the construction manager and operator of the terminal.
Mercuria will stay as the anchor tenant for the next five years with the chance to extend its contract after this. As part of the deal, KMP will also be given the chance to further develop on Deeprock’s 254 acres.
‘This joint venture with Deeprock and Mercuria, in conjunction with our recently announced investment in the WATCO rail company, creates a great platform for future expansions in this key crude oil market,’ says KMP Terminals president Jeff Armstrong.