Oil & Gas - Bahamas

Buckeye pegs Borco expansion at US$350mn-400mn

Buckeye pegs Borco expansion at US$350mn-400mn

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A storage expansion project at Bahamas Oil Refining Company International (Borco) will cost US$350mn-400mn, announced Forrest Wylie, CEO of Buckeye Partners (NYSE: BPL).

Last quarter, Buckeye purchased an 80% interest in FR Borco Coop Holdings, the indirect owner of Borco, from affiliates of FRC Founders Corporation for US$1.36bn; and a 20% stake from Vopak Bahamas for US$340mn.

The project aims to add 7.5Mb of clean product and fuel storage, Wylie said in a presentation. Borco boasts storage capacity of 21.6Mb.

The executive added that the 3.5Mb first phase will get underway this quarter and come online in the second half next year. Commercial terms have been reached for the majority of the first phase capacity, according to the company.

The Borco acquisition was preceded in December by Buckeye's purchase of the Yabucoa refined petroleum products terminal in Puerto Rico from a Shell (NYSE: RDS-B) affiliate.

Yabucoa was Buckeye's first acquisition outside continental US as part of a geographic expansion strategy.