Holly selling storage capacity to Plains for $40M

Holly selling crude oil storage capacity to Plains All American Pipeline for $40M

• On 2:12 pm EDT, Wednesday October 21, 2009

DALLAS (AP) -- Independent petroleum refiner Holly Corp. is selling 400,000 barrels of crude oil storage capacity to Plains All American Pipeline LP for $40 million, the companies said on Tuesday.

Shares of both companies climbed Wednesday afternoon. The deal also includes six tanks, three receiving pipelines and related assets and contract rights related to Holly's Tulsa refinery, which Holly acquired from Sunoco in June.

Under an agreement, Holly will pay Plains a set amount per month for the exclusive use of the storage tanks as a fee for crude oil received by Holly through the pipeline receiving facilities.

Holly said it will maintain ownership of the remaining 2.8 million barrels of intermediate and finished petroleum product tanks.

Holly shares gained $1.56, or 5 percent, to $32.82 in afternoon trading, while Plains All American climbed $1.05, or 2.1 percent, to $50.51.