Valero Partners Wynnewood LLC, an indirect wholly owned subsidiary of Valero Energy Partners LP, has acquired a 40 per cent undivided interest in the Hewitt segment of Plains All American Pipeline, L.P.’s (Plains) Red River pipeline for approximately USD $70 million.
The Hewitt segment of the pipeline is a newly constructed 138 mile, 16 inch crude oil pipeline with 150,000 bpd of capacity. The purchase also included a 40 per cent undivided interest in two 150,000 shell barrel capacity tanks, which are located at Hewitt Station. The pipeline began supplying crude oil to Valero’s refinery in Ardmore (Oklahoma) in January 2017.
Along with this acquisition, the partnership entered into a 10 year throughput agreement with a subsidiary of Valero Energy Corporation. The agreement includes a minimum volume commitment, a five year renewal term and no direct commodity price exposure.