Buckeye Partners, L.P. to Acquire Midwest Pipelines and Terminals

Emmaus, PA -- Buckeye Pipe Line Company LLC, the General Partner of Buckeye Partners, L.P. (the "Partnership"), today announced that it has entered into definitive agreements to acquire five major refined petroleum products pipelines and 25 petroleum products terminals in the Midwestern United States from affiliates of Shell Oil Products U.S. for a total of $530 million in cash. The pipeline systems and terminals will significantly expand the Partnership's footprint in the Midwest, and include the following:

The "North Line System," a 309-mile pipeline originating at the ConocoPhillips Wood River, Illinois refinery, which delivers refined products to greater Chicago and other areas in Illinois.

The "East Line System," a 355-mile pipeline also originating at the ConocoPhillips Wood River Refinery, which delivers refined products across Illinois and Indiana, and connects with Buckeye's existing pipeline in Lima, Ohio.

The "Two Rivers Pipeline," a 191-mile pipeline, which receives product from Explorer Pipe Line at a Shell tank farm located in Hartford, Illinois and terminates at a 1.3 million barrel terminal located on the Ohio River in Mt. Vernon, Indiana. The Mt. Vernon terminal is also among the assets to be acquired from Shell.

The "St. Louis 6-Inch Pipeline" and the "ATF Pipeline," originate at the ConocoPhillips Wood River Refinery and terminate at, respectively, a terminal in the greater St. Louis area and at the Lambert-St. Louis Airport.

In addition to these pipelines, the assets to be purchased include eight refined petroleum product distribution terminals located along the five pipelines being acquired, as well as fourteen active and three inactive distribution terminals located on other major Midwest refined products pipeline systems (such as the Wolverine and West Shore pipelines) or along the Ohio River. The twenty-five terminals being purchased have total storage capacity of approximately 10.5 million barrels. A map showing current Buckeye Partners' pipelines and terminals and the assets to be acquired is available on the Internet at www.buckeye.com/AboutUs/SystemMap/tabid/57/Default.aspx

The Partnership intends to continue to serve Shell and to actively seek third party business for the terminals it will acquire. The terminals historically have been operated by Shell as proprietary terminals. In addition, with respect to the pipelines to be acquired, the Partnership intends to make connections to other pipelines and to develop projects to expand pipeline throughput. The pipelines will be integrated into Buckeye's existing Midwest field operations, and the terminals will be integrated into the existing terminal operations conducted by Buckeye Terminals, LLC.

The transaction is expected to close within ninety days and is subject to customary due diligence and regulatory approvals. The Partnership is acquiring no inventory or intangibles in the transaction and intends to fund the transaction initially through a combination of credit facilities and bank borrowings. Following integration of the acquired assets, the Partnership expects the transaction will be accretive to cash available for distribution in the range of 15 cents per unit per annum.

William H. Shea Jr., Chairman, President and Chief Executive Officer of the General Partner, said, "We are excited about the opportunity to acquire these quality pipeline and terminal assets from Shell. The pipelines complement our existing infrastructure in the Midwest and should provide significant volume expansion opportunities in the years ahead. These pipelines serve demand- oriented markets and provide stable fee based revenues. The terminals to be acquired will expand significantly the business of Buckeye Terminals, LLC, our terminal operation, and should provide revenue expansion opportunities as we convert these historically proprietary terminals to terminals available to all shippers. We also expect to realize significant cost savings given the fact that these assets are contiguous to our existing operations in the Midwest."

Goldman, Sachs & Co. acted as the exclusive financial advisor to the Partnership in connection with the transaction.

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