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Sumitomo, ING Arrange Debt Facility for Pin Oak Terminals

April 21, 2017, 07:14 AM
Filed Under: Oil & Gas

Pin Oak Terminals LLC announced that it has closed on a debt facility provided by co-lead arrangers Sumitomo Mitsui Banking Corporation (SMBC) and ING Capital LLC to complete construction of the current phase of contracted tanks at Pin Oak's site in Mt. Airy, La.

Combined with the $100 million equity investment that was announced in December 2016 led by Dauphine Midstream LLC and Mercuria Energy Group Ltd., Pin Oak has secured capital to develop an independent logistics hub to service customers in Louisiana and the U.S. Gulf Coast.

The Pin Oak terminal is projected to become operational sometime during summer 2017.

Industry sources tell OPIS that the terminal will initially offer storage for gasoline and ethanol. It's possible that later in the year -- during the fourth quarter -- the terminal will offer storage for refinery intermediate feedstocks such as vacuum gasoil (VGO) and straight run residual fuel.

Looking beyond initial operations to when full build-out of the terminal is completed, the terminal could potentially feature a total of 12 million bbl of storage capacity, industry sources tell OPIS.

"Closing on this debt facility further confirms the market's belief that Pin Oak will be a premier storage and logistics facility," Pin Oak CEO Mike Reed said. "Since our announcement of the equity financing in late 2016, we have seen strong interest from customers. Our customers know we will be constructing and operating a premier terminal, and the equity and debt financings further demonstrate that Pin Oak will be a long-standing premier destination on the U.S. Gulf Coast to meet growing demand."

"Mercuria is pleased to have worked with two of its key financing partners, ING and SMBC, on this important project in the United States," said Brian Falik, Mercuria's Chief Investment Officer - Americas. "We have a close pulse on the market, and we firmly believe that this terminal will be a critical point in the logistics chain for our customers. Since the announcement of our equity investment in December 2016, we have been excited to watch firsthand as market demand for Pin Oak's first class service offerings continues to grow."

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