CALGARY, April 15, 2019 /CNW/ - Secure Energy Services Inc. ("Secure" or the "Corporation") (TSX – SES) is pleased to announce the completion of two tuck-in acquisitions, providing the Corporation with a strategic midstream footprint in one of the largest crude oil storage and trading hubs in North America. The Corporation has acquired a 27% interest in a crude oil storage facility comprised of four above-ground 175,000 bbl tanks located in Cushing, Oklahoma ("the Facility"), and a 51% interest in an 80-acre parcel of undeveloped land adjacent to the Facility. The total purchase price of the acquisitions was US$10.4 million, paid in cash at closing on April 11, 2019.
The Facility was constructed in 2015 and is strategically located on 10 acres of land in South Cushing with long-term connection agreements in place, ultimately providing connectivity to all major inbound and outbound pipelines in Cushing. Having access to multiple Canadian crude streams and well-connected tankage will benefit our customers getting their product to market at the optimum price.
Secure's majority investment in the 80-acre parcel of land provides the Corporation with significant optionality to develop additional midstream infrastructure in one of North America's key trading hubs. The Corporation's strategic partners have a long history in constructing similar scale storage infrastructure in the Cushing market and have developed key relationships with major companies in the area. Secure intends to support any further investment with long-term contracts providing the Corporation with certainty over future cash flows.
These transactions provide a measured and strategic entry into a new market for Secure, supporting the continued growth and development of the Corporation's midstream business. Owning infrastructure in Cushing extends Secure's crude oil value chain, providing our customers with market access flexibility to optimize realized pricing and increase operating netbacks.
ABOUT SECURE ENERGY SERVICES INC.
Secure is a TSX publicly traded integrated energy business with midstream infrastructure, environmental and technical solutions divisions providing industry leading customer solutions to upstream oil and natural gas companies operating in western Canada and certain regions in the United States ("U.S.").
SOURCE SECURE Energy Services Inc.