Colonial Pipeline Acquires Ownership In Six Petroleum Terminals

ATLANTA, Ga. — Colonial Pipeline Co. has acquired an undivided ownership in six southern petroleum product terminals located along its pipeline system. 

The acquisition of the interest is in terminals at Birmingham, Ala.; Doraville and Macon, Ga.; Chattanooga and Knoxville, Tenn.; and Spartanburg, S.C.

“By offering terminalling services, we can provide our customers with a more cost-efficient and better integrated distribution system,” said David L. Lemmon, the Atlanta-based president and chief executive officer of Colonial Pipeline, about the agreed-upon purchase. ​“This will give us the ability to receive customer products at the refinery gate and transport them seamlessly through our system all the way to tank trucks. The benefits to our customers include increased local supply stability, increased flexibility for product grades, reduced product inventory requirements and more predictable distribution costs.” 

The price Colonial is paying for the interest in the terminals was not disclosed. 

“Given the current consolidation in the terminal business and Colonial’s position as leader in the oil transportation industry, we believe it’s important for our company to play a prominent role as the consolidator of terminals along our system,” Lemmon said. ​“Our challenge is to aggressively enter this business, yet remain objective in providing logistics services to our customers so we don’t compete with them directly.” 

“These strategic initiatives are being launched to achieve specific business objectives, including to expand our company’s presence in the shipper supply chain, to improve our competitive position in local markets, to customize services for our customers and to increase sales and profitability for our shareholders,” Lemmon explained. 

Colonial Pipeline operates more than 5,300 miles of underground pipeline that transport gasoline, kerosene, diesel fuel, defense fuels and home heating oil from Gulf Coast refineries to marketing terminals in 12 Southeastern and Eastern Seaboard states. Daily deliveries by the company average 80 million gallons. The company had 1997 revenues of $576.2 million.