Kinder Morgan Energy Partners to Build Additional Product Tanker

By Dow Jones Business News, 
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By Maria Armental

Kinder Morgan Energy Partners LP ( KMP ) said Monday that it will build an additional 50,000 deadweight ton LNG- conversion-ready product carrier under an expanded contract with General Dynamics Corp. ( GD ).

Construction is expected to begin in the fourth quarter of 2015, with delivery expected in the second quarter of 2017, the companies said.

The tanker will be built as a sister tanker to the four other tankers under construction at General Dynamics' NASSCO shipyard in San Diego.

"There continues to be increasing demand for waterborne transportation to move petroleum products, and these tankers will provide stable, fee-based cash flow to KMP unitholders for many years to come through multi-year contracts with major oil producers," said Rob Kurz, vice president of Kinder Morgan Terminals and president of KMP subsidiary American Petroleum Tankers.

The Jones Act, known formally as the Merchant Marine Act of 1920, requires that any shipment from one U.S. port to another be carried on vessels built in the U.S., owned by U.S. citizens, and operated by a U.S. crew.

KMP, one of the largest publicly traded pipeline limited partnerships, bought American Petroleum Tankers and State Class Tankers for $960 million in cash in January.

Write to Maria Armental at maria.armental@wsj.com

Subscribe to WSJ: http://online.wsj.com?mod=djnwires


  (END) Dow Jones Newswires
  06-16-141308ET
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This article appears in: Energy

Referenced Stocks: GD , KMI , KMP

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