09 November 2011 16:24 [Source: ICIS news]
HOUSTON (ICIS)--US energy transportation and service company Magellan Limited Partners confirmed on Wednesday that it is looking for a buyer for its extensive ammonia pipeline system.
"Magellan has retained an investment adviser to assist in a sale," company spokesman Bruce Heine said.
Magellan operates an 1,100-mile pipeline and terminal system that delivers ammonia from production facilities in Texas and Oklahoma to various points in the US midwest, including terminals as far north as Iowa and Minnesota and as far west as Nebraska.
"We are assessing the potential sale of our ammonia pipeline system," Magellan chief executive Mike Mears said in a statement to investors on 2 November.
"This system has historically not been a large contributor to our financial results and has not been a core component of our asset portfolio," he said.
Oklahoma-based Magellan's major asset is a 9,600-mile pipeline system for refined petroleum products that includes 50 terminals and seven storage locations.
Mears said Magellan has been performing extensive integrity management work on the ammonia system for the past few years, putting the company in a position to market the asset.
"While we cannot say for sure that we will sell the ammonia pipeline, we can say that initial non-binding indications of interest were promising enough that we believe a sale could be likely within the next year," he said.
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