K&G Buys 50 BP Colorado Stations
Seven-Eleven Japan Seeks to Buy 7-Eleven
Kinder Morgan to Acquire Terasen
Arizona Entrepreneur Forms Alternative Fuels Company
Tesoro to Offer ULS Diesel in Alaska
Circle K Upgrading Arizona Stores

K&G BUYS 50 BP COLORADO STATIONS

DENVER, CO. — K&G Petroleum, based in Lone Tree, CO., has purchased 50 company-owned gasoline stations in Colorado from BP. Terms of the deal were not disclosed.

BP had announced earlier in the year that it planned to sell off its 100 company-operated stations in Colorado.

K&G will continue to operate the BP sites as service stations and said it plans to keep the qualified employees currently working at the stations. Approximately 250 workers are currently employed at BP's former stations.

The stations themselves, however, are being rebranded to the Conoco brand and image. K&G has been a ConocoPhillips marketer since 1995 and says they expect the reimaging to be complete on the sites "by early 2006."

Before the acquisition, K&G owned 17 service stations in the metro Denver area operating under the Conoco brand and manages 17 Shell-branded stations. In addition, the company owns eight stations in Oklahoma; seven in Tulsa with the Phillips brand and one in Ponca City with the Conoco brand.

"We've always been interested in growing our business and this was a tremendous opportunity due to the quality of BP's assets," said K&G Business Development Manager Byron Cook, announcing the deal. "They have good locations and aren't rundown, shabby facilities."

Cook added, "We've been very impressed by the BP people. They're run by good people."

As for ConocoPhillips, the company is pleased to add the stations to their branded network. "Denver has been and will continue to be an important core growth area for ConocoPhillips," said Clayton Reasor, president of U.S. Marketing for ConocoPhillips. "We are pleased to be building on our relationship with K&G and growing our Conoco brand in the area."

SEVEN-ELEVEN JAPAN SEEKS TO BUY 7-ELEVEN

NEW YORK, NY. — Seven-Eleven Japan Co. has acquired U.S. company 7-Eleven Inc., considered the first major convenience store chain, as of Nov. 9.

The Japanese company originally offered $1.2 billion in cash to acquire the company's outstanding stock for $32.50 per share. That offer was recommended against by the 7-Eleven Board of Directors and rejected by the stockholders. When the Japanese firm upped the ante and offered $37.50 per share enough stockholders accepted the price to allow the acquisition of the c-store company.

The Japanese company said it will take 7-Eleven, which operates approximately 5,800 c-stores in the U.S. and Canada, private. In addition, Seven-Eleven Japan said they will increase investment in store merchandising, renovations, distribution, logistics, and information systems to keep the c-stores competitive in the marketplace.

Seven-Eleven Japan held over 70% of Dallas-based 7-Eleven as well as operating over 10,000 7-Eleven branded c-stores in Japan prior to this action; it now holds 100% of the company's shares.

The company's operations will be headed by Toshifumi Suzuki, chairman and CEO of Seven-Eleven Japan Co. in Japan. The 7-Eleven North American operations will remain headquartered in Dallas, TX.

In one of the first major changes under the new leadership, 7-Eleven CEO Jim Keyes resigned from the company and its Board of Directors at the end of November. A 20-year veteran with the company, Keyes was credited with bringing record sales and profits to the c-store chain.

Keyes has been replaced in the post by Joseph "Joe" DePinto. The former vice president of operations at 7-Eleven, DePinto most recently served as president of video game retailer GameStop Corp.

7-Eleven Senior Vice President and CFO Edward Moneypenny also announced he was leaving the c-store company soon after Keyes' resignation. Moneypenny will be succeeded by Stanley Reynolds who had been serving as treasurer of the corporation.

KINDER MORGAN TO ACQUIRE TERASEN

VANCOUVER, B.C. — Kinder Morgan Inc. has announced that it plans to acquire to expand its pipeline holding in Canada with the acquisition of Vancouver, B.C.-based Terasen Inc. for approximately C$6.9 billion.

The deal would include Terasen's subsidiaries Terasen Gas Inc. and Terasen Pipelines which are operating under the name TransMountain Inc.

Terasen's pipelines control two liquid pipelines in western Canada and move approximately 20% of Alberta's total oil throughput. It is expected oil production in the area will increase in coming years and the acquisition will put Kinder Morgan into a strong position to benefit from the expansion.

ARIZONA ENTREPRENEUR FORMS ALTERNATIVE FUELS COMPANY

GILBERT, AZ. — Local businessman Dave Thompson is founding a new company to focus on developing alternative fuels.

The new venture will focus on the production and storage of hydrogen fuels as well as solar-energy projects for utilities. It is expected to begin operations by the end of October with four employees and an initial investment from Thompson of $1 million.

Locally renowned, Thompson founded Spectrum Astro, a company which manufactured satellites. The company grew to 500 employees and $134 million in annual sales before Thompson sold it to General Dynamics Corp. last year. Pressured to run for Governor, Thompson announced at the end of September that he would not seek office but would, instead, launch the alternative fuels company.

Thompson said the goal of his new company is to have innovative alternative fuel products ready to demonstrate within 12 months.

TESORO TO OFFER ULS DIESEL IN ALASKA

SAN ANTONIO — Tesoro announced that they will invest $45 million over the next three years to upgrade its Kenai Refinery to produce ultra-low sulfur diesel for the Alaska market.

When the upgrade is completed, Tesoro predicts they will be able to refine up to 10,000 barrels per day of ultra-low sulfur diesel. Limited volumes of the ULS diesel will be available from the refinery by the EPA's June 2006 deadline for use of the fuel.

In conjunction with this action, Tesoro Alaska has signed a deal to supply gasoline and ultra-low sulfur diesel fuel to Flint Hills Resources Alaska. As part of the contract, Tesoro will supply up to 6,000 barrels per day of product to Flint Hills Resources' Anchorage facility.

"We are pleased to be working with Tesoro to ensure that Alaska's future needs for ultra-low sulfur diesel are met in a timely and responsive manner," said Todd Craig, vice president of Alaska marketing for Flint Hills Resources. "The combined effort of Tesoro and Flint Hills Resources to provide clean fuels to Alaskans demonstrates how industry can come together in making cleaner fuels a priority."

The Alaskan refinery is the last of Tesoro's six refineries to begin the conversion to ULS diesel.

CIRCLE K UPGRADING ARIZONA STORES

PHOENIX, AZ. — Looking to increase its market presence in Arizona and fend off increasing competition, Circle K is in the process of upgrading its image in Arizona.

Parent company Couche-Tard is renovating the interiors of approximately 50 of its 520 Arizona Circle K convenience stores. In some instances, the c-stores will be converted to themed stores. The Circle K store near the University of Arizona will include University of Arizona Wildcats sports paraphernalia and have a hardwood floor that looks like the floor of a basketball court. A Circle K store in Maricopa includes a John Wayne theme. Other area stores will adopt a Southwestern theme.

One theme that will be removed from the Circle K stores is the NASCAR theme. Many Circle K stores still sport the NASCAR theme from a reimaging in the 1990s when Tosco owned the Circle K chain and had a marketing deal with the motor racing organization.

In addition, quick-service restaurants will be added to some locations with offerings ranging from pizza, sandwiches, Mexican food, and subs. The Arizona stores are the first Circle K stores to include QSRs.

It is expected the renovations will be completed by April 2006.

Originally published in the December 2005 issue of O&A Marketing News.
Copyright 2005 by KAL Publications Inc.