SIBUR signs agreement to sell its LPG Rail Cars fleet to Rail Garant
SIBUR and Rail Garant, a freight transportation group, have signed an agreement on sale of SIBUR’ fleet of liquefied petroleum gas (LPG) rail cars to Rail Garant, SIBUR says in its press release.
The deal is expected to be closed following all the necessary approvals, including the approval of regulators.
The LPG rail car fleet owned by SIBUR includes 4,364 tank cars. The deal value is valued at RR 11.5 billion.
According to the agreement, following the transaction the entire fleet will be operated by SIBUR-Trans, SIBUR’s freight operator. Half of the fleet will be leased, and the other half may be used by SIBUR-Trans for product transportation under a service contract. The contracts are valid for six years, thus, reinforcing SIBUR’s ability to transport required volumes of its own products while generating return on investments made earlier into the rail car fleet.
SIBUR-Trans will continue its operations within SIBUR Group to ensure reliable transportation of the Company's products and help develop non-public railway tracks.
SIBUR-Trans transport fleet currently includes 13,113 LPG tank cars, including 4,364 tank cars in ownership and 8,749 tank cars in lease or in operation. Additionally, SIBUR-Trans either owns or operates 3,870 tank cars for petrochemical products, 2,013 LPG tank containers, 386 tank containers for liquid cargo, and 16 all-purpose cars. SIBUR-Trans also operates public railway tracks of a total length of 330 km.
The transaction will enable Rail Garant Group to become a major player at the growing LPG transportation market and will guarantee full utilization of the fleet in spite of prevailing surplus of rail cars at the market.
The LPG transport fleet currently operated by Rail Garant Group comprises 1,500 tank cars and 1,608 tank containers. The Group also operates 6,132 tank cars for crude oil and gasoline and 1,953 tank containers for liquid chemicals.
SIBUR is a uniquely positioned vertically integrated gas processing and petrochemicals company. SIBUR owns and operates Russia’s largest gas processing business in terms of associated petroleum gas processing volumes and is a leader in the Russian petrochemicals industry.
Rail Garant Group is one of the leaders of Russian railway transportation market of industrial goods.
