Broward County Commission Regular Meeting
Director's Name: Glenn Wiltshire (Acting Director)
Department: Port Everglades Division: Director’s Office
Information
Requested Action
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MOTION TO APPROVE ten-year License Agreement between Broward County and Global Terminal Holdings LLC for Bulk Petroleum Product Pipelines at Port Everglades, with a term beginning retroactively on December 21, 2023, and ending on December 20, 2033; and authorize the Mayor and Clerk to execute same.
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Why Action is Necessary
License Agreements with a term that exceed one year require approval by the Broward County Board of County Commissioners.
What Action Accomplishes
Approves a new ten-year License Agreement with Global Terminal Holdings LLC that replaces two ten-year Bulk Petroleum license agreements being terminated between Motiva Enterprises LLC and Broward County expiring on March 8, 2029, and May 3, 2030.
Goal Related Icon(s)
☒County Commission
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Previous Action Taken
None
Summary Explanation/Background
THE PORT EVERGLADES DEPARTMENT RECOMMENDS APPROVAL.
This action supports the Broward County Board of County Commissioners' (“Board”) Value of “Building Partnerships and working collaboratively with others to meet shared objectives” and the Goal of “Ensuring economic opportunities and a sustainable economy, with an emphasis on Broward's lower and middle class.”
The Port Everglades Chief Executive/Port Director received a letter from Motiva Enterprises LLC (“Motiva”) dated November 29, 2023, requesting assignment of their Bulk Petroleum Product Pipelines license agreements to Global Terminal Holdings LLC (“Global”) resulting from Motiva’s agreement to sell certain terminal facilities and related assets anticipated to close in December 2023.
Subsequently, Broward County received a letter from Global, dated December 7, 2023, requesting assignment of the same Bulk Petroleum Product Pipelines license agreements between Motiva and Broward County at Port Everglades resulting from Global’s agreement to purchase certain of Motiva’s terminal facilities and related assets on or about December 21, 2023.
Global is an affiliate of Global Partners LP of Waltham, Mass. Global Partners LP owns or leases 49 liquid energy terminals in the United States, with storage capacity totaling 18.3 million barrels, with access to a network of marine loading facilities, as well as the Colonial, Plantation, Enterprise, Explorer and Magellan refined product pipelines. Global Partners LP recently completed its $305.8 million purchase of 25 terminals from Motiva.
Prior to the purchase, Motiva owned and operated three petroleum storage and distribution terminals within the Port Everglades Jurisdictional Area and holds two Bulk Petroleum Product Pipelines License Agreements. One agreement, approved by the Board on October 6, 2020 (Item No. 11), pertains to the underground pipelines connecting the Motiva terminals located on private property within Port Everglades on S.E. 26th Street and S.E. 28th Street, commonly referred to as Motiva East. A second agreement for an additional terminal, located in Port Everglades on Spangler Blvd. and commonly referred to as Motiva West, was the subject of a separate ten-year license agreement approved by the Board on March 28, 2019 (Item No. 6). In addition, Global requested a new license agreement for use of a strip of land which had been included in a previously expired Petroleum Product Pipelines License Agreement approved by the Board on May 4, 2010 (Item No. 6) and administratively amended on June 12, 2018, during the Summer Recess.
These terminals have operated at Port Everglades since the 1940s, subject to a series of agreements that provide a licensed area for the installation, maintenance, and operation of bulk petroleum pipelines. The Port generates revenues from dockage and other fees applicable to oceangoing vessels using Port berths, as well as from wharfage fees paid by Motiva on all petroleum products moving through the pipelines as outlined in the Port Everglades Tariff. An additional annual license fee is charged for the use of right-of-way on Port property where wharfage charges are not applicable, including two strips of land containing pipelines used to connect non-contiguous Motiva tankage.
Upon discussion with Motiva and Global’s senior Counsel, it was mutually agreed to terminate the two existing Motiva agreements in lieu of proceeding with the originally requested assignments and to execute a single new Bulk Petroleum Product Pipeline License Agreement for the three terminals, effective retroactive to Global’s purchase of the Motiva assets on December 21, 2023.
The License Agreement has been reviewed by the Port Everglades Risk Manager and approved as to form by the Office of the County Attorney. The Agreement is pending final execution by Global, and receipt of signature pages will be noted in the Monday Night Memo prior to the Board meeting.
Source of Additional Information
Neil J. Kutchera, Assistant Port Director, Energy and Innovation, Port Everglades Department, (954) 468-3520
Fiscal Impact
Fiscal Impact/Cost Summary
Over the ten-year term of the license agreement, the County anticipates receiving in excess of $80 million revenue from dockage, wharfage, and other Tariff fees. There is an additional annual non-tariff fee of $6,475 in the first year, escalating annually by the greater of the increase in the Consumer Price Index or 3% throughout the life of the Agreement, for the use of Port right-of-way for pipelines connecting the Global facilities.