Holly Energy Partners and Holly Corp. purchase the newly constructed 16-inch pipeline connecting Holly’s refining facilities in Lovington, N.M. to Holly’s refining facilities in Artesia, N.M., for $34.2 million.

Holly Energy expects this pipeline acquisition will result in approximately $6.6 million of incremental annual revenue.

The acquisition, paid in cash, was financed through HEP’s revolving credit facility.

Holly Energy has invested $7.9 million for additional pipeline infrastructure improvements on the intermediate pipelines between Holly’s Lovington and Artesia, refining facilities.

In connection with this transaction, Holly and Holly Energy are restructuring the Holly Intermediate Pipelines Agreement to incorporate this new pipeline and improvements under the Holly IPA, to increase the minimum revenue commitment on the part of Holly, and to extend the term of the agreement by four years to June 1, 2024.

This transaction has been approved by the Boards of Directors for both Holly and Holly Energy after approvals by the Holly Audit Committee, which is comprised solely of outside directors of Holly, and the Conflicts Committee for Holly Energy, which is comprised solely of independent outside directors for Holly Energy.

“This pipeline will support expanded volumes from the recent Navajo Refinery expansion and contribute additional revenues for Holly Energy,” said Matt Clifton, chairman and CEO of Holly and Holly Energy.