Moda Midstream and EnCap Flatrock Midstream Agree to Sell Moda Ingleside Energy Center and Other Assets to Enbridge for $3 Billion
September 07 2021 - 6:05AM
Business Wire
- Alongside its financial sponsor EnCap Flatrock Midstream, Moda
Midstream will retain its ownership interest in Vopak Moda Houston,
a 50/50 joint venture between Moda and Royal Vopak.
- Vopak Moda Houston recently commissioned its deepwater dock and
has constructed storage and terminaling infrastructure for its
industrial gas product line.
- Moda will continue to pursue additional liquids terminaling
opportunities.
Liquids terminaling and logistics company Moda Midstream, LLC
(“Moda”) and Moda’s financial sponsor EnCap Flatrock Midstream
(“EFM”) today announced they have entered into a definitive
agreement to sell the Moda Ingleside Energy Center (“MIEC”) and
other Moda assets to Enbridge Inc. (NYSE, TSX: ENB) for an
enterprise value, net of working capital and cash, of approximately
$3 billion, subject to closing adjustments.
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Moda Ingelside Energy Center (Photo:
Business Wire)
Located in Ingleside, Texas, MIEC is the nation’s largest crude
export terminal by volume, having loaded more than 25 percent of
all U.S. Gulf Coast crude exports in 2020. MIEC has an aggregate
storage capacity of more than 15 million barrels and an export
capacity of 1.6 million barrels per day. The asset serves as a
critical link connecting Permian and Eagle Ford production to
international markets. MIEC’s proximity to open water combined with
its very large crude carrier (VLCC) capability and rapid loading
rates position it globally as one of the most important export
facilities in the world. MIEC provides customers an unparalleled
advantage due to its wellhead-to-water access and direct
connectivity to next-generation long-haul crude pipelines,
including Cactus I, Cactus II, Gray Oak, EPIC and the Harvest
Ingleside pipeline.
Other assets included in the transaction are Moda’s Taft
Terminal located near MIEC; a minority, non-operating interest in
the Cactus II Pipeline; a 100 percent interest in Moda’s Viola
Pipeline; and Moda’s St. James Development Project, a brownfield
joint-development opportunity to build independent third-party
logistics solutions for customers in the St. James, Louisiana,
area. Both the Cactus II and Viola pipelines connect to MIEC.
At closing, Moda Executive Vice President, COO and Founder
Javier del Olmo will join Enbridge as Vice President, USGC
Terminaling Operations. Key Moda personnel and the entire MIEC team
will join Mr. del Olmo at Enbridge as the core of the new USGC
Terminaling team in Enbridge’s Liquids Pipelines business unit. The
transaction is subject to customary regulatory approvals and
closing conditions and is expected to close by the end of this
year.
Moda and EFM will retain ownership in Vopak Moda Houston, a
world-class deepwater storage and terminaling facility in the Port
of Houston, the number one port in the United States in terms of
total waterborne tonnage and home to the nation’s largest and
world’s second-largest petrochemical complex. Vopak Moda Houston is
the first greenfield terminal development in the port in more than
a decade and will serve as a vital growth platform for its
joint-venture partners, Royal Vopak and Moda Midstream.
Vopak Moda Houston recently commissioned its deepwater dock and
has constructed storage and terminaling infrastructure for its
industrial gas product line. Moda’s success in Houston is a
testament to the determination and hard work across the
organization since the formation of Vopak Moda Houston. Moda is
confident the team will continue to provide new innovative liquids
supply chain solutions and support for customers’ energy transition
logistics needs by capitalizing on Vopak Moda Houston’s strong
foundation and ideal location.
To execute on continued growth at Vopak Moda Houston and other
terminaling opportunities, Moda Midstream President, CEO and
Founder Bo McCall will become Chairman of Moda Midstream, and
current Executive Vice President, CFO and Founder Jonathan Ackerman
will serve as President and CEO. Ian Levine, Moda’s current Vice
President of Corporate Strategy and Treasurer will become Vice
President, Strategy and CFO.
From Moda Midstream
“MIEC is a flagship asset,” said Moda Midstream President, CEO
and Founder Bo McCall. “We are very proud of the safe and
responsible growth we have achieved since we purchased the asset
less than three years ago. The site was originally designed by the
U.S. Navy to support a carrier battle group and, despite the
uncertainty following its closure, has developed into the nation’s
largest exporter of crude oil, creating jobs and economic
prosperity for the Coastal Bend. I want to congratulate everyone on
the Moda team for their excellent work and many accomplishments. We
are all excited to watch and support MIEC’s continued development
and operational excellence under the ownership of a world-class
company like Enbridge.”
From EnCap Flatrock Midstream
“When we first backed the Moda management team, we had high
expectations of what this talented group would achieve,” said EnCap
Flatrock Managing Partner Billy Lemmons. “Bo, Jon, Javier and their
outstanding team have exceeded our every expectation. This is a
significant transaction that will produce strong results for our
investors and add value to Enbridge’s impressive asset portfolio.
In addition, we are excited to continue our partnership with the
Moda team to further enhance Vopak Moda Houston’s growth and
development and explore new opportunities.”
Advisers
Credit Suisse Securities (USA) LLC acted as exclusive financial
adviser to Moda, and Vinson & Elkins LLP acted as legal
counsel. Shearman & Sterling acted as legal counsel to EnCap
Flatrock. Barclays acted as financial adviser to Enbridge, and
Sidley Austin LLP acted as legal counsel.
About Moda Midstream, LLC
Moda Midstream, LLC is a liquids terminaling and logistics
company that provides independent terminal, storage and
distribution solutions to refiners, petrochemical manufacturers,
marketers and producers of crude oil, condensate, NGLs, refined
products and other bulk liquids. Moda concentrates on providing
safe, reliable solutions to third parties. Moda’s mission is to be
the logistics and terminaling provider of choice. Moda is backed by
EnCap Flatrock Midstream. Please visit www.modamidstream.com.
About EnCap Flatrock Midstream
EnCap Flatrock Midstream provides value-added growth capital to
proven management teams focused on midstream infrastructure
opportunities across North America. The firm was formed in 2008 by
a partnership between EnCap Investments L.P. and Flatrock Energy
Advisors, LLC. Based in San Antonio with offices in Oklahoma City
and Houston, the firm manages investment commitments of nearly $9
billion from a broad group of prestigious institutional investors.
EnCap Flatrock Midstream is currently making commitments to new
management teams from EFM Fund IV, a $3.25 billion fund. For more
information, please visit www.efmidstream.com.
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version on businesswire.com: https://www.businesswire.com/news/home/20210907005269/en/
Casey Nikoloric, Managing Principal TEN|10 Group, LLC
303.433.4397, x101 o 303.507.0510 m
casey.nikoloric@ten10group.com
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