Magellan CEO Explains Benefit Of Merge With ONEOK

Tulsa-based ONEOK and Magellan Midstream Partners have more than 50,000 miles of pipeline across the United States and now the two companies are eyeing a merger that could have a major impact on the energy industry.

Wednesday, August 9th 2023, 2:24 pm

By: News On 6, Jonathan Polasek


-

Two Tulsa-based companies, ONEOK and Magellan Midstream Partners, are expected to merge in the coming weeks.

ONEOK would buy Magellan and have a big impact on the energy industry. Aaron Milford, the president and CEO of Magellan said he believes the merger will create a more diversified energy infrastructure business.

"The energy business is going to look different in the future than it has in the past. This company, we think, will be better positioned to be a contributor to that future energy industry, and be stronger as a result of it," Milford said.

How Do Magellan And ONEOK Differ As Companies?

Magellan focuses more on petroleum products such as gasoline, jet fuel, diesel, and crude oil. ONEOK focuses more on natural gas liquids and natural gas. Together, the two companies will have around 50,000 miles of combined pipeline right in the central corridor of the United States.

Milford said one question the two companies are still looking at is how to use the assets they both own regarding pipeline infrastructure to do more with them, but they are excited about how it could play out for them in the future.

"We think there's probably $200-$400 million or more of annual benefit that we will get from this combination that neither one of us can get by ourselves," Milford said.

How Will A Merger Impact Employees At Magellan And ONEOK?

Magellan employs over 1,700 people with just over 800 employees working in Tulsa. Milford said that he expects most of those jobs to stay in norteast Oklahoma.

"That’s actually a really important point for us. It was another point with ONEOK that they were another local Tulsa company that will allow us to stay and keep a large presence right here in Tulsa. It was an important point for us," Milford said.

As far as unitholders in Magellan go, Milford said that this merger is a positive. He believes that this merger will maximize the unitholders' value.

"This deal maximizes the value of investment in Magellan. We firmly believe it. So, what it does for unitholders is it makes them better off and maximizes their value. At the end of the day, that's what we are about," Milford said.

Milford said that this merger will create a stronger company, and the unitholders should vote to approve the merger. Milford said that other regulatory hurdles have already been cleared, and that Magellan is now waiting on the results from the unitholders. There will be a special meeting on September 21 where unitholders can vote to approve the merger. Unitholders can also vote ahead of the special meeting, and Milford said they are encouraged to do so.

logo

Get The Daily Update!

Be among the first to get breaking news, weather, and general news updates from News on 6 delivered right to your inbox!

More Like This

August 9th, 2023

August 5th, 2023

July 31st, 2023

July 10th, 2023

Top Headlines

May 22nd, 2024

May 22nd, 2024

May 22nd, 2024

May 22nd, 2024