PBF Energy (PBF) to Purchase Chalmette Refinery, Other Assets for $322M Plus Working Capital
- Wall St slumps as investors fret on rate hikes and recession
- Think September Was Bad? Watch Out for 'Octoberphobia', Stock Trader's Almanac Warns
- Goldman Sachs Slashes Year-End Target on S&P 500 to 3,600
- Oil: The 'R'-Word Rules as U.S. Crude Below $80 for Worst Week in 7
- Bond Crash of 2022 is a 'Doozy' - BofA
PBF Energy Inc. (NYSE: PBF) announced today that its subsidiary has signed a definitive agreement to purchase Chalmette Refining, LLC, consisting of the 189,000 barrel per day Chalmette Refinery and related logistics assets, from ExxonMobil and PDV Chalmette, LLC. With the acquisition PBF will increase its total throughput capacity to over 725,000 barrels per day. The purchase price for the assets is $322 million, plus working capital including inventory to be valued at closing. PBF Energy does not expect to issue equity to finance any portion of this transaction. The transaction is expected to be approximately 20% accretive to 2016 consensus earnings in the first year of operation and is expected to close prior to year-end 2015, subject to customary closing conditions and regulatory approvals.
- 189,000 barrel per day high-complexity, coking refinery in PADD 3
- Attractive MLP assets including ownership interests in three pipelines, crude and products storage facilities, a marine terminal and a clean products truck rack
- Expected to be immediately accretive to earnings
“The acquisition of the Chalmette Refinery, and its associated logistics assets, represents a significant step in the strategic growth of PBF Energy and PBF Logistics. Upon completion, we will have increased our refining capacity by 35 percent and added meaningful Gulf Coast assets to our businesses. We will have operations in the Gulf Coast, Mid-Continent and East Coast and have diversified and increased our commercial footprint and flexibility,” said Tom Nimbley, PBF Energy’s Chief Executive Officer. “We are committed to the continued safe and environmentally responsible operations of the facility and look forward to welcoming Chalmette’s well-trained and professional workforce to the PBF family.”
PBF’s Executive Chairman Tom O’Malley commented, “The PBF management team that the board has put in place has a proven track record of purchasing and integrating accretive acquisitions and chose the right opportunity in Chalmette to build on that track record at an attractive cost per complexity barrel.”
The Chalmette Refinery, located outside of New Orleans, Louisiana, is a 189,000 barrel per day, dual-train coking refinery with a Nelson Complexity of 12.7 and is capable of processing both light and heavy crude oil. The facility is strategically positioned on the Gulf Coast with strong logistics connectivity that offers flexible raw material sourcing and product distribution opportunities, including the potential to export products.
In addition to refining assets, the transaction includes 100 percent ownership of the MOEM Pipeline, providing access to the Empire Terminal, as well as the CAM Connection Pipeline, providing access to the LOOP facility through a third party pipeline. The transaction also includes 80 percent ownership in each of the Collins Pipeline Company and T&M Terminal Company, both located in Collins, Mississippi, which provide a significant clean products outlet for the refinery via the Plantation and Colonial Pipelines. Also included in the transaction are a marine terminal capable of importing waterborne feedstocks and loading or exporting finished products; a clean products truck rack which provides access to local markets; and a crude and product storage facility with approximately 7.5 million barrels of shell capacity. PBF estimates the acquired MLP-qualifying pre-tax earnings from the logistics assets of Chalmette Refining, LLC, to be at least $30 million.
Conference Call Information
At 2:00 p.m. ET today, PBF Energy will host a conference call to discuss the transaction. The call is also being webcast and can be accessed at PBF Energy's website, http://www.pbfenergy.com. The call can also be heard by dialing (888) 632-3382 or (785) 424-1677, conference ID: PBF0618. The audio replay will be available two hours after the end of the call through July 2, 2015, by dialing (800) 839-3413 or (402) 220-7236.
Serious News for Serious Traders! Try StreetInsider.com Premium Free!
You May Also Be Interested In
- UBS Analyst Negative on Evercore (EVR) and Moelis & Company (MC) - Downgrades to Sell
- Nordic American Tanker (NAT) CEO sees solid rates and earnings
- Costco's (COST) Value Proposition Unmatched, Stock Remains Top Pick - Analysts Bullish on COST Despite PT Cuts
Create E-mail Alert Related CategoriesCorporate News, Hot Corp. News, Mergers and Acquisitions, Trading Halts
Related EntitiesCrude Oil, Earnings, Definitive Agreement
Sign up for StreetInsider Free!
Receive full access to all new and archived articles, unlimited portfolio tracking, e-mail alerts, custom newswires and RSS feeds - and more!