DALLAS -- (Business Wire)
HollyFrontier Corporation (NYSE: HFC) (“HollyFrontier”) and Holly Energy
Partners, L.P. (NYSE: HEP) (“Holly Energy”) today announced an agreement
in principle for the acquisition by Holly Energy of the newly
constructed naphtha fractionation and hydrogen generation units at
HollyFrontier’s El Dorado refinery. Holly Energy is expected to pay
HollyFrontier cash consideration of approximately $62.0 million, subject
to the execution of definitive agreements and other customary closing
conditions. Both HollyFrontier and Holly Energy expect the proposed
transaction will close during the fourth quarter of 2015.
In connection with the closing of the proposed transaction,
HollyFrontier and Holly Energy expect to enter into 15-year tolling
agreements containing minimum quarterly throughput commitments from
HollyFrontier. Holly Energy expects that the transaction will be
immediately accretive to unitholders.
About HollyFrontier Corporation:
HollyFrontier Corporation, headquartered in Dallas, Texas, is an
independent petroleum refiner and marketer that produces high value
light products such as gasoline, diesel fuel, jet fuel and other
specialty products. HollyFrontier operates through its subsidiaries a
135,000 barrels per stream day ("bpsd") refinery located in El Dorado,
Kansas; a 125,000 bpsd refinery in Tulsa, Oklahoma; a 100,000 bpsd
refinery located in Artesia, New Mexico; a 52,000 bpsd refinery located
in Cheyenne, Wyoming; and a 31,000 bpsd refinery in Woods Cross, Utah.
HollyFrontier markets its refined products principally in the Southwest
U.S., the Rocky Mountains extending into the Pacific Northwest and in
other neighboring Plains states. A subsidiary of HollyFrontier also
currently owns a 39% interest (including a 2% general partner interest)
in Holly Energy Partners, L.P.
About Holly Energy Partners, L.P.:
Holly Energy Partners, L.P., headquartered in Dallas, Texas, provides
petroleum product and crude oil transportation, tankage and terminal
services to the petroleum industry, including HollyFrontier Corporation,
which currently owns a 39% interest (including a 2% general partner
interest), in the Partnership. The Partnership owns and operates
petroleum product and crude pipelines, tankage, terminals and loading
facilities located in Texas, New Mexico, Oklahoma, Arizona, Washington,
Kansas, Wyoming, Idaho and Utah. In addition, the Partnership owns a 75%
interest in UNEV Pipeline, LLC, the owner of a Holly Energy operated
refined products pipeline running from Salt Lake City, Utah to Las
Vegas, Nevada, and related product terminals, a 50% interest in Frontier
Pipeline Company, a 296-mile crude oil pipeline running from Casper,
Wyoming to Frontier Station, Utah, and a 25% interest in SLC Pipeline
LLC, a 95-mile intrastate pipeline system serving refineries in the Salt
Lake City, Utah area.
The following is a “safe harbor” statement under the Private Securities
Litigation Reform Act of 1995: The statements in this press release
relating to matters that are not historical facts are “forward-looking
statements” within the meaning of the federal securities laws.
Forward-looking statements are inherently uncertain and necessarily
involve risks that may affect the business prospects and performance of
HollyFrontier and/or Holly Energy, and actual results may differ
materially from those discussed in this press release. Such risks and
uncertainties include but are not limited to risks and uncertainties
with respect to HollyFrontier’s and Holly Energy’s ability to agree on
terms for definitive documentation relating to the dropdown assets
transfer and, if definitive documentation is agreed and executed and the
dropdown assets transfer is consummated, the ability of Holly Energy to
successfully integrate the dropdown assets into its business and fully
realize the benefits of the proposed transfer, the actions of actual or
potential competitive suppliers and transporters of refined petroleum
products in HollyFrontier’s or Holly Energy’s markets, the demand for
and supply of crude oil and refined products, the spread between market
prices for refined products and market prices for crude oil, the
possibility of constraints on the transportation of refined products,
the possibility of inefficiencies or shutdowns in refinery operations or
pipelines, effects of governmental regulations and policies, the
availability and cost of financing to HollyFrontier and Holly Energy,
the effectiveness of HollyFrontier’s and Holly Energy’s capital
investments and marketing strategies, HollyFrontier’s and Holly Energy’s
efficiency in carrying out construction projects, HollyFrontier’s and
Holly Energy’s ability to complete acquisitions and to integrate any
existing or future acquired operations, the possibility of terrorist
attacks and the consequences of any such attacks, and general economic
conditions. Additional information on risks and uncertainties that could
affect the business prospects and performance of HollyFrontier and Holly
Energy is provided in the most recent reports of HollyFrontier and Holly
Energy filed with the Securities and Exchange Commission. All
forward-looking statements included in this press release are expressly
qualified in their entirety by the foregoing cautionary statements. The
forward-looking statements speak only as of the date made and, other
than as required by law, HollyFrontier and Holly Energy undertake no
obligation to publicly update or revise any forward-looking statements,
whether as a result of new information, future events or otherwise.
View source version on businesswire.com: http://www.businesswire.com/news/home/20150903005089/en/
Contacts:
HollyFrontier Corporation
Julia Heidenreich, 214-954-6510
Vice
President, Investor Relations
or
Craig Biery, 214-954-6510
Investor
Relations
Source: HollyFrontier Corporation and Holly Energy Partners, L.P.
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