May 7, 2015 [Business Wire] - Blueknight Energy Partners, L.P. , a midstream energy company focused on providing integrated services for companies engaged in the production, distribution and marketing of crude oil, asphalt and other petroleum products, announced today that a wholly-owned subsidiary of BKEP has acquired a Cheyenne, Wyoming asphalt terminalling facility previously owned by Simon Contractors, a multi-state, heavy highway contractor.
In addition, BKEP has entered into a long-term lease contract with Western States Asphalt, Inc., a regional asphalt marketing company based in Spokane, Washington, to lease the Cheyenne facility.
Western States Asphalt has been a customer of BKEP since 2009 and leases additional sites in the region. Western States Asphalt will continue supplying various products and services to the existing customer base out of the Cheyenne facility, which was constructed in 2003 and includes approximately 10 acres of land and 220,000 barrels of asphalt storage. The facility produces and handles polymer modified asphalt concrete, emulsions and asphalt cement for a variety of customers in the Wyoming and surrounding markets.
The transaction will be financed by borrowings under BKEP’s existing credit facility, and BKEP expects the transaction to be immediately accretive to distributable cash flow.
“We are pleased to add the Cheyenne, Wyoming, asphalt terminal to our network of asphalt processing and storage facilities,” stated Mark Hurley, BKEP’s Chief Executive Officer. “This transaction is consistent with our communicated strategy of growing our asphalt business, primarily through acquisitions, and will be immediately accretive to our unitholders. Western States is a key long-term customer, and we took this opportunity to restructure their existing contracts and incorporate the new Cheyenne facility into those agreements as part of our ongoing relationship.”
Todd Hilde, President of Western States Asphalt, added, “The addition of the Cheyenne, Wyoming facility, along with the long-term restructure of the existing contract agreements, further enhances our ability to serve our growing customer base in the Northwest United States. We’ve enjoyed a great working relationship with BKEP and look forward to working with them on additional growth initiatives in the future.”
