FTAI Energy Partners, operating as Jefferson Energy Companies, has entered into a definitive agreement to acquire the Port Arthur Terminal in Texas and a 50% interest in the Diluent Recovery Unit in Hardisty, Alberta, from USD Group for approximately $255 million in cash. Jefferson is a subsidiary of FTAI Infrastructure.
The acquired assets are expected to generate approximately $50 million in annual EBITDA over the next 12 months, and the transaction is expected to close during the fourth quarter of 2026, subject to required regulatory approvals.
The acquisition will be financed through the assumption of existing indebtedness associated with the acquired business and an acquisition debt facility secured by Jefferson and its subsidiaries.
The transaction substantially expands Jefferson’s crude oil logistics operations and adds long-term contracted cash flow to the company’s infrastructure portfolio.
FTAI Infrastructure said the acquired assets are expected to more than double Jefferson’s existing adjusted EBITDA.
The assets operate as an integrated origin-to-destination logistics platform for moving crude oil into the Beaumont refinery hub.
They are supported by a long-term take-or-pay agreement with minimum volume commitments from an investment-grade counterparty, providing contractual revenue visibility.
The Port Arthur Terminal is designed to handle approximately 50,000 barrels of crude oil per day arriving by rail.
Crude received at the terminal can then be transported through an owned 12-mile, 24-inch pipeline system connecting with Phillips 66’s Beaumont terminal.
That connection provides access to refiners in Beaumont, Lake Charles, and other Gulf Coast markets.
The transaction also adds Jefferson’s interest in the Diluent Recovery Unit in Hardisty, Alberta, expanding the company’s position across the crude oil transportation chain.
Jefferson intends to combine the newly acquired infrastructure with its existing terminal operations to create additional commercial opportunities.
The company currently operates multimodal terminal facilities at the Port of Beaumont, one of North America’s major refining and petrochemical centers.
Its facilities provide transloading, storage, handling, blending, and related services for crude oil, refined products, and ammonia, with access to rail, highway, and marine transportation.
Jefferson has already obtained a commitment for acquisition financing to support the transaction.
The company is also evaluating whether to combine the acquired assets with Jefferson Bond Borrower LLC, the subsidiary that currently owns Jefferson’s primary terminal business and a portion of its Jefferson South terminal.
If that structure is pursued, Jefferson could fund part of the transaction through the issuance of Additional Parity Bonds under Jefferson Bond Borrower’s existing indenture.
For FTAI Infrastructure, the acquisition expands its exposure to midstream assets supported by contracted cash flows and infrastructure with significant barriers to entry.
FTAI Infrastructure focuses on investments across rail, ports and terminals, and power and gas infrastructure.
The company is externally managed by an affiliate of Fortress Investment Group.
Support: Jefferies served as financial advisor to Jefferson, while Houlihan Lokey advised USD Group. Barclays served as capital finance advisor to Jefferson in arranging funding for the transaction.
Vinson & Elkins, Bennett Jones, and Skadden, Arps, Slate, Meagher & Flom served as legal advisors to Jefferson, while Gibson, Dunn & Crutcher represented USD Group.
The acquisition is intended to strengthen Jefferson’s position in Gulf Coast crude oil logistics while adding a new long-term customer and substantial incremental earnings.
KEY QUOTES:
“The acquisition of USD’s assets is an ideal fit and highly accretive for our Jefferson segment, more than doubling Jefferson’s existing Adjusted EBITDA with contracted cash flow under a long-term agreement with minimum volume commitments from an investment-grade counterparty. The transaction significantly de-leverages Jefferson’s balance sheet and, we believe, creates substantial incremental value at Jefferson.”
Ken Nicholson, CEO Of FTAI Infrastructure
“Combining the USDG assets with our existing Jefferson terminals is a game-changer for our platform, adding a new long-term customer to our revenue base and providing multiple growth opportunities ahead. We look forward to working with USDG’s team of high quality professionals to continue to grow the acquired assets as well as our existing Jefferson business.”
Hank Alexander, CEO Of Jefferson Energy Companies
