UPDATE 2-Buckeye buys Trafigura's prized Texas oil assets

Wed Sep 3, 2014 11:45am EDT

(Adds comments from Trafigura)

Sept 3 (Reuters) - Oil logistics specialist Buckeye Partners LP said it will pay $860 million for control of Trafigura's prized oil facilities in the Texas shale hub, while expectations rise that Washington will relax its ban on crude oil exports.

U.S. firm Buckeye will buy 80 percent of the global commodities trader's assets in its Corpus Christi complex, including a deep-water tanker-loading terminal, liquefied petroleum gas (LPG) storage and a small refining unit known as a condensate splitter.

Trafigura will hold on to the remaining 20 percent in the Corpus Christi facility, described in Trafigura's 2013 annual report as "one of the company's most important strategic assets ... at the centre of the action in the world's largest, most dynamic, energy market".

The deal comes at a time of increased pressure on the U.S. administration to lift a ban on crude oil exports imposed in the 1970s, a move that would allow overseas markets to tap into the country's huge shale resources.

"The logic of the deal was very simple - we invested a lot of money to create infrastructure that was needed to support rising trade flows from the Eagle Ford shale," said the head of Trafigura's corporate affairs Andrew Gowers.

"The market for oil infrastructure assets in the United States is very liquid. Now we have decided it was time to realise return on capital invested," he added.

Trafigura said in its 2013 annual report that its total planned capital expenditure on its South Texas assets would amount to around $850 million.

The sale of 80 percent for $860 million plus Buckeye's planned investments in facilities value the business at over $1.3 billion.

Buckeye said it expected Buckeye Texas Partners to invest about $240-$270 million through to the first quarter of 2016.

Earlier this year, Trafigura reduced its stake in its mid-stream energy company Puma Energy and said it could find a partner in the future for its metals warehousing and logistics unit Impala.

Trafigura has said it has no plan to become public, like its rival Glencore, which has gradually turned from a trader into a mining company by building up asset exposure.

"We invest in assets to support trading business but we remain flexible and can also invest together with partners," said Gowers. (Reporting by David Sheppard, Ron Bousso and Dmitry Zhdannikov in London and Sneha Banerjee in Bangalore; editing by David Clarke and David Evans)

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