NuStar will acquire a 75% ownership stake in the joint venture for a price between $50m and $60m. The joint venture will give NuStar majority ownership and operational control of two petroleum terminals and an offshore loading facility in Turkey.
The transaction, which is expected to be immediately accretive to NuStar Energy’s distributable cash flow per unit, is expected to close in October.
The two terminals, which will be wholly owned by the joint venture, are located in Mersin, Turkey. An existing terminal owned by S-Oil has 606,000 barrels of storage capacity in 20 tanks, primarily for gas oil and distillates.
The new Aves terminal, which will begin operations this month, has 740,000 barrels of storage capacity in 24 tanks, mostly for oil products. The joint venture plans to expand the combined storage capacity of the terminals by approximately 930,000 barrels by the end of 2011.
Both terminals are connected via pipelines to the newly christened Savka offshore platform located approximately three miles off the Mediterranean Sea coast. The platform, 67% of which will be owned by the joint venture, can simultaneously offload product from two Aframax-size vessels that weigh up to 80,000 dead weight tons (dwt) each.
Both terminals receive product via the platform and discharge via truck rack to the regional market or via the platform for export. The joint venture is also evaluating additional terminal construction projects in different parts of Turkey.
Curt Anastasio, president of NuStar, said: “This is a tremendous opportunity for NuStar because the Mediterranean region has great strategic advantages. Turkey has a booming economy, and petroleum demand is increasing significantly faster in Turkey than other European countries.”
