Alliance Energy Services agreed to acquire a Benson, MN, propane terminal from Kinder Morgan Energy Partners LP (KMP) for $5 million. The terminal supplies more than 75 million gallons per year from the Cochin Pipeline System and has a storage capacity of about 1.4 million gallons.
KMP will quit receiving propane into Cochin next spring prior to the company’s Cochin Reversal Project, which involves the modification of the western leg of its pipeline. The move will allow light condensate to move northwest from Kankakee County, IL to terminal facilities near Fort Saskatchewan, Alberta. Propane deliveries to the terminal are expected to continue until May 2014. Alliance Energy plans to build out the terminal to accept propane via rail, beginning rail operations by June after the close of the acquisition.
“This acquisition represents the first step of our plan to add rail terminals that will bring Canadian and U.S. propane production to the upper Midwest markets,” said Jason Doyle, president of Alliance.