SemGroup marketing business units, looking to identify assets for sale

New York, Sept. 9 - SemGroup LP said it has begun marketing "several" of its business units.

In addition, the company is in the process of "developing an extensive business plan" to identify which assets will be sold and which could be reorganized and remain under SemGroup's ownership.

The announcements were part of a list of accomplishments that SemGroup said it presented to a meeting of creditors on Tuesday.

"This is a large and complex reorganization, yet we are making remarkable progress toward our ultimate goal of either selling or restructuring our assets for the benefit of our creditors," said Lisa Donahue, SemGroup chief restructuring officer, in a news release. "There is a great deal left to be done, but we have come a long way in the seven weeks since we initiated the reorganization."

SemGroup also said it has obtained approval for an interim $150 million debtor-in-possession facility and is hoping to obtain approval for the full $250 million - although unsecured creditors are objecting to that.

It has identified a first wave of unprofitable contracts and filed a motion with the bankruptcy court to reject them.

Construction of SemGroup's White Cliffs pipeline from Platteville, Colo., to Cushing, Okla., is expected to be completed on Dec. 1. Construction of crude oil storage tanks in Cushing is continuing.

SemGroup added that it has completed negotiations with its joint-venture partner for funding and continued construction of its natural gas storage facility at Wyckoff, N.Y., and reached a settlement with its public partner, SemGroup Energy Partners, LP, on agreements related to throughout, storage, terminalling and adequate assurance.

SemGroup said it has $400 million in cash, most of which will be used to purchase energy products for subsequent sale.

SemGroup, a Tulsa, Okla., privately held limited partnership that provides midstream services to North America's energy industry, filed for bankruptcy on July 22 in the U.S. Bankruptcy Court for the District of Delaware. Its Chapter 11 case number is 08-11525.

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