Alon USA Energy Inc. said Monday afternoon that it had finalized the purchase of a crude and unfinished products pipeline system from Houston-based Kinder Morgan Inc. for $4.5 million.


The Dallas company said the acquisition would assist in the planned production increase of its refineries in Long Beach and Paramount, which the company bought in early 2006.


Alon said the purchase will increased its port operations to 90,000 barrels per day by next year. The system, nicknamed the "Black Oil" system, includes approximately six miles of active and 13 miles of inactive pipelines in the Long Beach.


"Logistics are critical in any environment, but they are especially valuable in densely populated areas such as the Los Angeles basin," said Alon Chief Executive Jeff Morris in a statement.


Morris added that the pipeline system will allow the company to better optimize its current pipeline network, giving them direct access to marine terminals and refineries in the Los Angeles/Long Beach Port complex which is the largest in the nation.


Alon owns and operates four refineries in Texas, California and Oregon, with an aggregate crude oil capacity of approximately 170,000 barrels per day. Alon sells its gasoline and diesel products through more than 900 FINA branded locations across the Southwest.

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