Colonial Pipeline Purchases BP’s Alliance Products Pipeline And Terminal System

ATLANTA, Ga. — Atlanta-based Colonial Pipeline Company announced today that it is purchasing the Alliance Products Pipeline and Terminal System from BP. The assets include a 20-inch products pipeline that extends 147 miles from the Alliance Refinery near New Orleans, La., to Collins, Miss., as well as a 2.2 million barrel products tank farm located at Collins. 

“The addition of these assets to our system is clear testament to the fact that Colonial is fully pursuing a growth-oriented corporate strategy. In purchasing the Alliance Products System, Colonial is acquiring strategic assets that fit well in the company’s portfolio. The acquisition will produce immediate positive cash flows,” stated David Lemmon, CEO and president of Colonial. 

Commenting on the sale, Al Kozinski, BP’s Global Refining Group Vice President, said: ​“The offers we received from companies interested in purchasing the Alliance Products Pipeline System affirmed the value of this asset and the people who operate it. We plan to work closely with Colonial for a successful transition and to assist the few employees who may be affected by the sale.” 

The Alliance Products Pipeline and Terminal System, which originates at the Alliance Refinery, is strategically located for Colonial, whose existing mainlines travel through Collins, Miss. The new assets provide Colonial with more direct access to the Alliance Refinery, and will allow Colonial to work more closely with suppliers in coordinating the transportation of product from Alliance. Located in a key supply area, the assets to be acquired provide direct delivery capability to the mainlines of both the Colonial and Plantation Pipeline systems. 

“Colonial’s commitment to public safety, environmental protection, and public accountability is total,” Lemmon said of Colonial operations, ​“We will ensure that commitment is preserved as we integrate the Alliance system into our operations.” 

The purchase of the Alliance Products System is a result of BP’s decision to divest itself of the Alliance Refinery and its associated crude and products pipelines. On July 13, BP announced the sale of its Alliance Refinery to Connecticut-based, independent refiner Tosco Corporation for $660 million. The buyer of the crude system has yet to be named, but an announcement is expected in the upcoming weeks. 

Completion of the products pipeline sale is subject to the satisfaction of certain conditions, including regulatory approvals. The sale is anticipated to close during January 2001. Colonial expects to assume operation of these assets immediately following the closing. 

NOTE TO EDITORS: 

About Colonial Pipeline Company 

Colonial Pipeline Company provides a vital service to communities and businesses throughout Eastern United States. As an integral part of the nation’s transportation infrastructure, Colonial is focused on excellence in operations as it transports refined petroleum products. With a workforce and corporate philosophy dedicated to safe and environmentally-conscious operation, Colonial delivers a daily average of 80 million gallons of gasoline, diesel fuel, home heating oil, aviation and military fuels. 

As an industry leader, Colonial Pipeline is committed to the highest standards of operational excellence. Colonial’s corporate vision is to be more than a pipeline company while providing enhanced services to its customers in an ever-changing industry marketplace. 

About BP

One of the world’s largest energy companies, BP is involved in the exploration and production of crude oil and natural gas; refining, marketing, supply and transportation; manufacturing and marketing of petrochemicals; and a growing activity in gas and power and in solar generation. BP has well-established operations in Europe, North and South America, Australasia, and Africa.