Sprague Resources, a company engaged in the purchase, storage, distribution and sale of refined petroleum products and natural gas, has announced that its operating subsidiary, Sprague Operating Resources, has signed a definitive agreement to purchase the assets of Castle Oil Corporation and certain of its affiliates.
Included in the agreement is Castle’s Port Morris terminal and its associated wholesale, commercial, and retail fuel distribution business for a combined $56 million (€44.8 million) in cash and SRLP units, plus payments for Castle’s inventory as of closing.
Castle’s Port Morris terminal is the largest deepwater petroleum products terminal in New York City, with a total storage capacity of 907,000 barrels, handling distillates, residual fuel, asphalt and biodiesel. The terminal includes an interconnected tank system enabling on-site blending and is located on the East River with deepwater marine access on multiple ship and barge berths.
The acquisition is subject to customary closing conditions, including the expiration or termination of the waiting period under the Hart-Scott-Rodino Act, and is expected to close before the end of the 2014.
The Port Morris facility will increase Sprague’s total in-service storage capacity to more than 10.9 million barrels across eighteen terminals.