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Holly Energy Partners is a Delaware limited partnership formed in early 2004 by Holly Corporation. We hold a particularly strategic position within the industry for several reasons: Our assets are located in attractive high-growth markets: Our pipelines and terminals serve our customers' marketing operations in the Southwest and Rocky Mountain regions of the U.S. and northern Mexico. In many of our core markets, demand for light refined products exceeds local production, due in part to above-average population growth. Population growth in these markets should increase demand for light refined products shipped on our pipelines. A substantial part of our business operates under long-term contracts: We conduct most of our operations pursuant to long-term contracts, which enhance the stability and predictability of our revenues and cash flows. We also expect that our long-standing customer relationships will lead to repeat business and the renewal of all our short-term contracts. Our assets are modern, efficient, and well maintained: We continually invest in the maintenance and integrity of our assets, including inspection and repair programs to comply with federal regulations. Since 1998, we have inspected approximately 98% of the pipelines Holly contributed to HEP via "smart-pig" technology, and recent hydro-testing has validated allowable operating pressures. Our assets are operated via satellite communications systems from our control center, where state-of-the-art computers continuously monitor real-time operational data. We have a strategic relationship with Holly Corporation: The substantial majority of our refined product pipelines are directly linked to Holly Corporation's refineries. In 2007, about 96% of the light refined products from its Navajo Refinery and 100% from its Woods Cross Refinery were carried or terminalled through our assets. Holly Corporation and its affiliates own a 2% interest in us and a 43% limited partner interest in us and the incentive distribution rights. We are contractually bound to Holly Corporation's growth initiatives: In the past year, we benefited from Holly Corporation's acquisition of Northwest terminals and expansion of its Navajo Refinery. Should Holly Corporation further expand its refineries, the additional production will likely be transported, stored, and distributed through our pipelines and terminals. Our omnibus agreement with Holly Corporation grants us an opportunity to acquire certain types of transportation and distribution assets that are part of any acquisition it makes. Our financial flexibility allows us to pursue growth opportunities: We have a $100 million credit agreement, available for general partnership purposes such as capital expenditures and acquisitions. Along with our ability to issue new partnership units, we have significant resources to finance expansion and acquisitions. We have an experienced management team with a proven track record: We benefit from the vast experience and long-standing industry relationships of our management team. Our senior management has run Holly Corporation's pipeline and terminals business for many years and brings many years of energy industry experience to Holly Energy Partners. Page Last Updated on : 2/18/08 |
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Did You Know? In 1867, having put together all of their lines, W.H. Abbott and Henry Harley formed a new company, the Allegheny Transportation Company, and put president of the Erie Railroad Jay Gould on the board. This is considered the first great pipeline company. More... |
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