STORAGE TERMINALS
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MORE FROM STORAGE Buckeye Partners has reported strong second quarter figures, with income from continuing operations up from $91.3m last year to $144.5m and adjusted EBITDA up from $206.5m to $256.6m. This was despite first-half revenues falling by 17 per cent to $1.56bn; operating income for the first half was up 31 per cent at $370.2m. “These results continue to highlight the benefits of our diversified portfolio of fee- based assets,” says Clark C Smith, chairman, president and CEO. “The Global Marine Terminals segment drove significant growth, primarily attributable to the incremental contribution from the completion of the buildout at our Buckeye Texas Partners joint venture, as well as strong demand for storage services across that segment’s legacy assets.” Utilisation also increased in the company’s
domestic terminals on the back of higher throughput in long-haul pipelines resulting from “temporary shifts in supply and price differentials”. NuStar Energy reported second quarter
net income of $40.0m, down from the $42.4m recorded a year ago but better than expected given the fall in product prices. First half net income fell sharply from $157.0m to $84.8m. Operating income in the group’s storage division dropped from $53.8m in second quarter 2015 to $51.1m this year. “Strong refined product pipeline throughput
volumes, the benefit from 1.1m barrels of storage leased at our Piney Point, Maryland facility, along with lower than expected operating expenses, contributed to our better than expected second quarter results,” says Brad Barron, president/CEO. “As you can see, we have the right assets to withstand this current downturn in the crude markets.” Kinder Morgan reported second quarter net
income of $333m, level with last year’s result, although revenues were down by 9.2 per cent at $3.14bn. For the first half, net income was down by 9.5 per cent at $689m. Kinder Morgan’s liquids terminal division
reported “strong performance” after a number of expansions, including contributions from new operations at our Edmonton Rail, Galena Park, Pasadena and Deer Park Rail
terminals. EBDA rose by 3 per cent in the first half to reach $552m. “Contributions from our interest in the
newly formed refined products terminals joint venture with BP, our Vopak terminals acquisition and the Jones Act tankers also contributed significantly to growth in this segment,” says president/CEO Steve Kean. Construction has begun on the second of
two new deepwater berths on the Houston Ship Channel, in response to growing demand for waterborne outlets for refined products and supported by firm vessel commitments from existing customers at the Galena Park and Pasadena terminals. Work also started during the second quarter on the new Base Line crude oil terminal in Edmonton, Alberta, being developed in a 50/50 joint venture with Keyera Corp.
DOWN THE ORDER Among the smaller operators, Arc Logistics Partners reported second quarter revenues of $26.2m, up 37 per cent on last year, and net income of $6.3m, up from $2.8m a year ago. Arc’s results were boosted by the effect of the acquisition over the past year of the Philadelphia terminals from Gulf Oil and Pawnee terminal, as well as a full quarter’s
returns from the Joliet terminal. Throughput was also up at its terminals in Baltimore, Brooklyn and Toledo. American Midstream reported second
quarter adjusted EBITDA of $36.1m and distributable cash flow of $25.4m, increases 150 and 165 per cent,, respectively, over year earlier figures. Its net loss, though, increased from $2.1m to $4.6m, primarily due to higher total operating expenses and an increase in interest expenses. Its terminal business posted a gross
margin of $4.1m for the second quarter, up from $2.8m last year, after increases in utilised storage capacity at the Harvey and Westwego terminals and contractual storage rate escalations. Valero Energy Partners reported second
quarter operating revenues of $87.7m, up from $60.2m last year, and net income of $49.4m, up from $33.7m last year. The increases were primarily due to the acquisition of the Corpus Christi terminals in October 2015 and the McKee terminal in April 2016. “We delivered another quarter of solid earnings and distribution growth, underpinned by our continued focus on safe and reliable operations,” says Joe Gorder, chairman/CEO. HCB
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