Tulsa World: Chinese win SemGroup LP assets

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Chinese win SemGroup LP assets
Tulsa-based QuikTrip and Magellan Midstream fall short.

By ROD WALTON World Staff Writer
Published: 8/14/2009 2:26 AM
Last Modified: 8/14/2009 4:02 AM

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

A bankruptcy judge Thursday approved the sale of SemGroup's refined petroleum terminals to the U.S. subsidiary of a Chinese commodities conglomerate.

Noble Americas Corp. offered $65.35 million last month — topping bids by Tulsa-based companies QuikTrip Corp. and Magellan Midstream Partners LP — for SemFuel gasoline storage facilities in various states, including at the Glenpool tank farm. Noble is a wholly owned subsidiary of the Hong Kong-based Noble Group.

U.S. Bankruptcy Judge Brendan L. Shannon also approved a motion by SemGroup co-founders Tom Kivisto, Gregory Wallace and Kevin Foxx, among others, to let them use proceeds from a $10 million insurance policy to cover their defense costs. The judge, however, said SemGroup and the defendants, who are pitted against each other in court, will have to find common ground on how much of that money they can use.

Earlier this summer, QuikTrip hoped to enter the terminal business by bidding for SemFuel operations in Fort Worth. Magellan Midstream was willing to pay $23 million for terminals in El Dorado, Kan.; Des Moines, Iowa; west Tulsa; and Glenpool.

Both Tulsa companies initially had the best offers, but Noble Americas outbid them by the Aug. 3 auction in New York.

Noble also beat out

U.S. Oil's $14.1 million bid for terminals in Green Bay, Wis.; Bettendorf, Iowa; and Rogers City, Mich.

Bankrupt SemGroup LP has been selling off its SemFuel and SemMaterials asphalt assets to help pay off creditors and focus on crude oil gathering, storage and transportation in the future.

Kivisto, who was fired last year and later sued by his former company, led a group of ex-SemGroup executives hoping to use a $10 million directors-and-officers insurance policy in the lawsuit. SemGroup challenged that, saying that at least part of the benefits belong to the company.

Shannon, ruling from Wilmington, Del., gave both sides time to work out an amount allowed to the defendants, but said he was willing to set with a figure if they cannot agree, according to reports.

A court-appointed Bankruptcy Examiner alleged that Kivisto, Wallace and Foxx mismanaged the company while SemGroup's liquidity crisis deepened. Former CEO Kivisto, former chief financial officer Wallace and former treasurer Brent Cooper, another defendant, also were accused of misleading creditors, according to the examiner's report.

Foxx is no longer on the SemGroup management team but is CEO of publicly traded SemGroup Energy Partners, which is not part of the bankruptcy. Former chief accounting officer Alex Stallings is also part of the group sued by his former employer.

Rod Walton 581-8457
rod.walton@tulsaworld.com By ROD WALTON World Staff Writer

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	Report Comment Mar, Tulsa (8/14/2009 10:48:47 AM) Oh great, just what we need, more U.S. companies owned by the Chinese. We don't have to worry about fighting a war with China. They will just take us over from the inside out.
	Report Comment O&Gtrader, ft. worth (8/14/2009 11:21:02 AM) Noble's paid prices will look pretty cheap in hindsight when the market self-corrects one of these years.
	Report Comment Alix Smart, (8/14/2009 12:31:36 PM) gotta love those chinese! who alse ya gonna count on when the tough get going? Lazy Roundeye? nope that's who sold it!!

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