In a deal overseen by Sidley Austin, Houston-based American Midstream Partners sold $138.5 million worth of refined oil terminals to a joint venture between a fuel storage and transportation company and a crude oil logistics firm.

The deal, consummated in February, was announced in a statement by DKGP Energy Terminals, a joint venture between Delek Logistics Partners and Green Plains Partners. DKGP bought American Midstream's terminals in North Little Rock, Arkansas, and Caddo Mills, Texas.

Cliff Vrielink, co-managing partner of Sidley's Houston office and co-leader of Sidley's global energy practice, was the lead attorney on the transaction. Vrielin did not respond to a call for comment.

According to the DKGP joint statement from Delek and Green Plains, “DKGP will consist of the assets purchased from an affiliate of American Midstream and assets contributed by Delek Logistics, with a total value of approximately $162.5 million.”

DKGP estimates it will generate an annualized earnings before interest, taxes, depreciation and amortization (EBITDA) of roughly $19.2 million in 2019.

The Arkansas terminal is said to have a throughput capacity of 17,100 barrels per day;  Greenville tank farm, located in Caddo Mills, Texas, will have “approximately 330,000 barrels of aggregate shell capacity, which will be valued at approximately $24.0 million, along with approximately $57.25 million in cash. Green Plains Partners will contribute approximately $81.25 million in cash to DKGP,” according to the statement.

DKGP's board is tasked with overseeing the joint venture and will appoint an affiliate of Delek Logistics as the operator with the maintenance and operation of the facilities.

“We are excited to partner with Green Plains Partners for its potential ethanol volumes, logistics expertise and industry knowledge as the domestic markets expand blending, and look forward to the future of this joint venture,” said Uzi Yemin, chairman and chief executive officer of Delek Logistics' general partner.

“This is a great opportunity as it fits our strategy to grow through assets in markets that we are very familiar with, and by contributing our complementary existing logistics assets in east Texas and Little Rock, Arkansas, we expect to create additional synergies within the joint venture,” Yemin continued. “In addition to serving third party customers, it should be well positioned to provide additional logistics support to Delek US Tyler, Texas, and El Dorado, Arkansas, refineries. Our financial flexibility should give us the ability to finance this investment under our revolving credit facility, while we continue to look for opportunities for future growth.”

Todd Becker, president and chief executive officer at Green Plains Partners, also expressed optimism over the deal.

“This transaction helps us start achieving our goal of diversifying Green Plains Partners revenue and income streams,” Becker said. “We believe this joint venture with Delek Logistics creates significant value for both our partnership unitholders and Green Plains Inc. shareholders. We anticipate that this new joint venture will be immediately accretive to earnings and we look forward to building on our relationship with Delek Logistics.”