Tulsa World: SemGroup Energy adding customers

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SemGroup Energy adding customers
The energy firm is replacing the business of bankrupt SemGroup LP.

By Staff Reports
Published: 6/5/2009 2:23 AM
Last Modified: 6/5/2009 4:22 AM

Complete coverage: Read all the stories and documents related to the SemGroup collapse.

Tulsa-based SemGroup Energy Partners LP announced it has signed additional asphalt storage customers.

SemGroup Energy has been working to diversify its customer base to replace business that had come from its former parent, SemGroup LP, which is in Chapter 11 bankruptcy.

SemGroup Energy offers fee-based storage, terminal and transport services in oil and asphalt. The addition increases the number of its facilities under contract or lease to 45 of the 46 it owns.

"The execution of these additional contracts essentially completes the task to get our asphalt facilities under contract," Jerry Parsons, SemGroup Energy's executive vice president of asphalt operations, said in a press release.

"We now have agreements with 13 counterparties for our asphalt facilities with terms primarily extending through Dec. 31, 2011."

SemGroup Energy, or SGLP, will operate the facilities under the storage agreements and the contract customers will operate the locations under the lease agreements.

SGLP will receive storage fees or lease payments from the new clients.

According to company officials, SGLP's revenues from these deals will be less than what previously was received under its terminalling and storage agreement with SemGroup

LP.

Late last month, SGLP released its long-delayed financial report for last year's third quarter. The document showed publicly traded SGLP had an $11.85 million net loss for the three-month period. The company's total "current assets" as of Sept. 30, however, rose to $48.8 million from $13.9 million six months earlier.

The net loss was due to an $18 million noncash charge related to the early vesting of units under SGLP's long-term incentive plan, a company spokesman said.

SemGroup LP spun off millions of dollars' worth of storage, terminal and pipeline assets to form SGLP and take it public in July 2007.

A year later, SemGroup LP filed for Chapter 11 protection in U.S. Bankruptcy Court in Wilmington, Del. The company's traders, including co-founder Tom Kivisto, lost more than $2.4 billion on the oil futures market, court records indicate.

The public SGLP was not a debtor in that bankruptcy but lost a majority of the revenue it received in its throughput agreement with the parent SemGroup. The public subsidiary also fell into credit default, and hedge funds Alerian Capital Management and Manchester Securities took control of the SGLP board after the parent SemGroup defaulted on a $150 million loan.

In recent months, SGLP has been releasing some positive news, including gaining a two-year credit waiver from its senior lending group.

Shares of SGLP were unchanged Thursday at $6 per unit on the over-the-counter "pink sheets" electronic market.

SemGroup Energy Partners LP

Headquarters: Tulsa.

Business: owns and operates a diversified portfolio of complementary midstream energy assets.

Crude oil storage: About 8.2 million barrels of crude oil storage oklahoma and Texas, 6.8 million barrels of which are located in Cushing.

Oil pipeline: 1,150 miles, primarily in oklahoma and Texas.

Transportation and storage: 200 oil and oilfield services vehicles in Kansas, Colorado, New mexico, oklahoma and Texas.

Terminal storage: About 7.4 million barrels of combined asphalt and residual fuel capacity at 46 terminals in 23 states. By Staff Reports

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Some reader comments for this story were copied from "SemGroup Energy gains more asphalt storage clients," which was published on 6/4/2009.

	Report Comment Hawktalk, (6/5/2009 8:21:09 AM) Sounds like Jerry's in line for another nice bonus.
	Report Comment lost, (6/9/2009 4:48:40 AM) Ergon leased 20 or 22 of the terminals - who leased the remaining 20 or so?
	Report Comment bewildered, (6/9/2009 9:34:42 PM) I have heard Holly Corp. leased at least one.
	Report Comment GCWKR, (6/17/2009 6:54:25 PM) Maybe now that they are heading up the right track the plant manager at GC will stop the cover ups...spills ...injury's...safety issues.

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