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Andeavor Logistics to acquire Western Refining Logistics for $1.5bn

Published 15 August 2017

US pipeline company Andeavor Logistics has entered into an agreement to acquire its rival Western Refining Logistics (WNRL) for $1.5bn.

The acquisition is part of Andeavor Logistics’ efforts to expand into the prolific Permian Basin in Texas and New Mexico.

Andeavor Logistics plans to make an annual investment of at least $500 to $600m on organic growth and acquisitions.

Andeavor chairman and CEO, and Andeavor Logistics' and WNRL's general partners chief executive officer Greg Goff said: "Andeavor Logistics is well positioned for sustainable growth through the execution of our organic growth programs and strategic acquisitions, including drop downs from Andeavor.”

The acquisition is expected to enable Andeavor Logistics to capture additional organic growth opportunities in the Permian Basin.

The transaction is expected to be completed in the fourth quarter 2017. It is subject to customary closing conditions, including regulatory and approval from holders of a majority of the WNRL units.

While Goldman Sachs is the lead financial advisor to Andeavor in the transaction, Sullivan & Cromwell is its legal advisor.

In August, Andeavor announced an investment of nearly $225m in the Conan Crude Oil Pipeline System in the Delaware Basin.

The pipeline, which is being constructed by Andeavor, is expected to be transferred to Andeavor Logistics after its completion.

Operating mainly in the mid-continent and western US, Andeavor Logistics owns and operates a network of crude oil, refined products and natural gas pipelines. It also owns and operates crude oil and refined products truck terminals, marine terminals and dedicated storage facilities.

Headquartered in El Paso, Texas, WNRL is a growth-oriented master limited partnership formed to own, operate, develop and acquire logistics assets related to the terminalling, transportation and storage of crude oil and refined products.

Its assets include nearly 1134km of pipelines, approximately 12.4 million barrels of active storage capacity, distribution of wholesale petroleum products and crude oil and asphalt trucking.


Image: The acquisition is part of Andeavor Logistics’ efforts to expand into the prolific Permian Basin. Photo: courtesy of supakitmod/FreeDigitalPhotos.net.