Enterprise Products Partners LP executed definitive agreements to sell its offshore Gulf of Mexico pipelines and services business to Genesis Energy, LP for approximately US$1.5 billion in cash.
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Image from Enterprise. |
The transaction is expected to close during 3Q 2015. Enterprise’s offshore pipelines and services business segment include its ownership interest in nine crude oil pipeline systems with more than 1100mi of pipeline; nine natural gas pipeline systems totaling approximately 1200mi of pipeline; and its ownership interest in six offshore hub platforms.
Enterprise expects to record non-cash asset impairment and related charges of approximately $100 million, or $0.05 per common unit on a fully-diluted basis in connection with the sale of its offshore Gulf of Mexico pipelines and services business. Since these assets were viewed as held-for-sale at 30 June 2015, these non-cash charges will be reflected in Enterprise’s consolidated results for the three and six months ended 30 June 2015.
“We are pleased to execute this agreement to sell our offshore Gulf of Mexico business to Genesis,” said Michael A. Creel, chief executive officer for Enterprise’s general partner. “In recent years, earnings from our offshore business represented only 3% of Enterprise’s gross operating margin, and our offshore assets do not effectively integrate with our downstream crude oil and natural gas pipeline systems.”
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