Colonial Pipeline Co. plans to expand into the fuel terminal business by acquiring refined products terminals in Chattanooga, Charlotte, North Carolina and Fredericksburg, Virginia.
Colonial, the largest refined products pipeline in America, is buying terminals from Lincoln Terminal Co., which already relies upon Colonial for fuel delivery to the tanks and distribution terminals.
Terms of the sale were not announced, but the deal is expected to be completed within three months and will provide Colonial a total of 525,000 barrels of storage, including 175,000 barrels of storage at the company's Chattanooga facility on Cromwell Road.
"This acquisition provides an excellent opportunity for Colonial to move into the terminal business, offering a complementary service to the markets, including Colonial Pipeline Company's customers, and lays the groundwork for further strategic expansion," Colonial Pipeline said in an announcement of the purchase. "Terminals are a natural extension of Colonial's overall business, providing the opportunity to serve customers in new ways while building and strengthening relationships."
Lincoln Terminal Co, based in Greenville, South Carolina, bought the Chattanooga terminal in 2013 for $2.35 million from Benton Oil Co., according to Hamilton County property tax records.
Lincoln Terminal Co, based in Greenville, South Carolina / Contributed photo.Lincoln also bought its other terminals it is selling, but it will keep its other fuel terminal in Natchez, Mississippi. The facilities are capable of storing gasoline, biodiesel, diesel, ethanol and butane, according to the Lincoln Energy Solutions website.
Colonial Terminals Operating Co. LLC, which is purchasing the Lincoln Energy terminals, is a unit of affiliate company Colonial Enterprises, Inc., which operates a pipeline system that spans more than 5,500 miles and links Gulf Coast refineries to markets throughout the Eastern half of the United States.