Calumet Specialty Products Partners LP has signed definitive agreements to sell the ownership of its Superior, Wisconsin, refinery and various related assets to Husky Superior Refining Holding Corp., a wholly owned unit of Husky Energy. Under the agreement, Husky has agreed to pay $435 million in cash, plus an additional payment for net working capital, inventories and reimbursement of certain capital spending. The transaction is subject to customary closing conditions and regulatory approvals.
Calumet CEO Tim Go commented, "The divestiture of our Superior refinery is in line with Calumet's strategic vision to become the premier specialty petroleum products company in the world. This transaction provides both financial and strategic benefits for our unitholders as we further position Calumet to move forward on our stated objectives, including strengthening our balance sheet, lowering our leverage, and freeing up capital resources that will allow us to better invest and fund future EBITDA enhancing growth strategies within our core specialties portfolio. The transaction also reduces our go-forward exposure to commodity pricing and volatility.
"Equally important, we are excited to find with Husky a great home for our employees at Superior and want to thank them for their contributions to our organization over the last few years. Their dedication and efforts have made Superior an attractive value proposition for Husky, who will retain the Superior employees and will assume the union contract and pension plan. Additionally, Husky has committed to invest in key capital projects at Superior, including the Superior Flexibility Project, which will allow the plant to improve its operational efficiency."
The Superior refinery has permitted capacity of 50,000 bpd and processes light and heavy crude oil from the Bakken shale formation in North Dakota and western Canada into fuel products and asphalt. The business also includes refinery terminal and truck/rail racks, two offsite asphalt terminals and truck racks, an offsite product terminal and truck rack, a marine terminal, a pipeline connection to the Magellan system, crude gathering assets in North Dakota and certain rail logistics assets. The Superior refinery has been a part of the Wisconsin community since 1951 and enjoys excellent relations with local businesses and governments.
Husky, headquartered in Calgary, Alberta, has approximately 5,200 employees and an average daily production of about 320,000 barrels of oil equivalent per day. The company has two main areas of focus:
- The Integrated Corridor includes natural gas, nonthermal oil, NGLs and thermal production from Western Canada, the Lloydminster upgrading and asphalt refining complex, the Husky Midstream Limited Partnership, and the Lima and Toledo refineries in the U.S. Midwest.
- The Offshore business includes operations and exploration in the Asia Pacific region and in the Atlantic offshore Newfoundland and Labrador. Each area generates high-netback production with near- and long-term investment potential.
For more information, visit www.Calumetspecialty.com or www.huskyenergy.ca.
