February 28, 2011 [OPIS] - Kinder Morgan Energy Partners will invest approximately $25 million for a 50% stake in an existing 1-million-bbl tank farm, with plans to expand that storage by another 750,000 bbl later this year.
Kinder Morgan is forming a crude oil joint venture with Deeprock Energy Resources LLC and Mercuria Energy Trading. Deeprock will remain as the construction manager and will operate the terminal. Mercuria will remain as the “anchor tenant” for the facility and will have an option to extend its lease after a five-year term elapses.
Kinder Morgan also has a development agreement with Deeprock that will give it the option to participate in future expansion on some 254 acres of undeveloped land that Deeprock owns in the area.
Cushing, Okla., has seen a massive build-out of crude oil storage in recent years, thanks to its location as the NYMEX delivery hub for the WTI contract.
