NuStar to sell San Antonio refinery

San Antonio-based NuStar Energy LP said Monday it has agreed to sell its San Antonio refinery and related assets to an Indianapolis-based master limited partnership for $115 million.

Calumet Specialty Products Partners LP has agreed to pay NuStar pay $100 million for the plant on San Antonio’s Southeast Side, along with about $15 million for inventory.

NuStar purchased the refinery and terminal out of bankruptcy in April 2011 for $41 million, and the company has invested about approximately $54 million since then on improvements to the 14,500-barrel-a-day plant, which produces ultra-low sulfur diesel, jet fuel, specialty solvents, reformats, naphtha and vacuum gas oil.

NuStar said last month that it would sell the refinery as part of a plan to focus on its more stable, fee-based pipeline and storage operations, especially in the Eagle Ford Shale of South Texas as well as other U.S. shale plays where it has operations.

The pipeline operator said it will use proceeds from the transaction, expected to close on January 2, to pay for growth of its fee-based pipeline and storage operations.

NuStar CEO Curt Anastasio said the transaction “will give the refinery employees the opportunity to be a part of a refining company with multiple refineries that has the depth of refining resources and expertise to provide the support the refinery needs to succeed over the long-term.”

As part of its purchase, Calumet will acquire a terminal in Elmendorf, a 12-mile pipeline that links the refinery to the terminal, as well as storage at the terminal.

Both NuStar and Calumet are publicly traded master limited partnerships.

Calumet is a producer of specialty hydrocarbon products such as lubricating oils, solvents, waxes and asphalt used in consumer, industrial and automotive products. It has 10 plants in the United States.