Genesis Energy, L.P. (NYSE: GEL) today announced the company plans to invest approximately $125 million to improve existing assets and develop new infrastructure in Louisiana to connect into Exxon Mobil Corporation’s (NYSE: XOM) Baton Rouge Refinery, one of the largest refinery complexes in North America with more than 500,000 barrels per day of refining capacity. The project is expected to generate positive economic benefits both for the community of Baton Rouge and the state of Louisiana.
“With the expansion of our operations in Louisiana, Genesis looks forward to a strong future in the state and to increasing our contribution to the local economy,” Genesis Chief Executive Officer Grant Sims said. “This project positions Genesis as an efficient conduit for crude oil supply and logistics in the region.”
Genesis will improve its existing terminal at Port Hudson, Louisiana and build a new 18 mile 20” diameter crude oil pipeline connecting Port Hudson to the Maryland Terminal and continuing downstream to the Anchorage Tank Farm. The company also plans to build a new crude oil unit train facility at the Baton Rouge Maryland Terminal.
At Port Hudson, Genesis will construct approximately 200,000 barrels of storage capacity to complement its 216,000 barrels of existing tank capacity and make improvements to its existing barge dock and truck station. The new 18 mile pipeline will have an ultimate capacity of about 350,000 barrels per day, and in addition to its connection to the ExxonMobil Baton Rouge Refinery, the pipeline will have potential access to other local refineries representing approximately 140,000 barrels per day.Project construction is scheduled to begin in early 2013. The Port Hudson upgrades and new crude oil pipeline are expected to be completed by the end of 2013 and the Maryland Terminal completion is scheduled for the second quarter of 2014. Genesis intends to finance the transaction with funds available under its revolving credit facility. Genesis has entered into definitive agreements with ExxonMobil in which ExxonMobil will grant Genesis a land lease at the Maryland Terminal site and secure preferential rights for throughput at the facilities.
Check Out Our Best Services for Investors
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Model portfolio
- Stocks trading below $10
- Intraday trade alerts