Post on 13-Feb-2019
transcript
Buckeye Partners, L.P.2004 ANNUAL REPORT Buckeye Partners, L.P.
Buckeye Partners, L.P., through its subsidiary partnerships, is one of the nation’s largestindependent pipeline common carriers of refined petroleum products with nearly 4,500 miles of pipeline. The Partnership also provides bulk storage services at terminals in Illinois, Indiana,Massachusetts, Michigan, Missouri, New York, Ohio and Pennsylvania and operates approxi-mately 1,300 miles of pipeline under agreement with chemical companies.
OPERATING SYSTEMS LegendBuckeye Pipe Line Company, L.P.Buckeye Gulf Coast Pipe Lines, L.P.Everglades Pipe Line Company, L.P.Laurel Pipe Line Company, L.P.Norco Pipe Line Company, LLCWood River Pipe Lines, LLCBuckeye Terminals, LLCDelivery point to customers’ marketing terminals
West Shore Pipeline CompanyWest Texas LPG Pipeline Limited Partnership
JOINT VENTURE INTERESTS
2 >
BUCKEYE GP LLCDirectorsWilliam H. Shea, Jr.
Chairman of the BoardDirector since 2000
Brian F. Billings 1
Director since 1986
Michael B. Hoffman
Director since 2004
Edward F. Kosnik 1 2
Director since 1986
Joseph A. LaSala, Jr. 1
Director since 2001
David M. Leuchen
Director since 2004
Jonathan O’Herron 1 2
Director since 1997
Frank S. Sowinski
Director since 2001
Andrew W. Ward 2
Director since 20041
Member of Audit Committee2
Member of Finance Committee
OfficersWilliam H. Shea, Jr.
President and Chief Executive Officer
Stephen C. Muther
Senior Vice PresidentAdministration General Counsel and Secretary
Robert B. Wallace
Senior Vice President Finance and Chief Financial Officer
Eric Gustafson
Senior Vice President – Operations and Technology (effective 1/1/2005)
PARTNERSHIP INFORMATIONPartnership CharacteristicsAs a publicly traded partnership, Buckeye Partners, L.P. differs in several ways from
stock corporations:
• A partner in a publicly traded partnership owns units of the partnership rather than
shares of stock and receives cash distributions rather than dividends. The cash distribu-
tions are not taxable as long as the partner’s tax basis in the partnership exceeds zero.
• Generally, a corporation is subject to federal and state income taxes but a partnership
is not. All of the income, gains, losses and deductions of a partnership are passed
through to its partners who are required to show their allocated share of these
amounts on their personal income tax returns.
• While a holder of corporate stock receives a Form 1099 each year detailing required
tax data, a unit holder of a partnership receives a tax reporting package including
Schedule K-1 and other forms to file with their income tax return. This tax reporting
package shows a partner’s allocable share of the partnership’s income, gains, losses
and deductions.
• Compared to corporate form of organization, the partnership form enables Buckeye
to distribute to investors a greater percentage of cash generated by the business.
Investor InformationFor more information about the Partnership please contact:
Buckeye Partners, L.P.
Stephen R. Milbourne
Manager, Investor Relations
5 Radnor Corporate Center, Suite 500
100 Matsonford Road Radnor, PA 19087
(800) 422-2825
smilbourne@buckeye.com
or visit us on the Web at: www.buckeye.com
Partnership OfficeBuckeye Partners, L.P.
Post Office Box 368
5002 Buckeye Road, Emmaus, PA 18049
(484) 232-4000
Transfer Agent and RegistrarEquiServe Trust Company, N.A.
Post Office Box 43069, Providence, RI 02940-3069
www.equiserve.com
(800) 519-3111
Unitholder Tax InformationPricewaterhouse Coopers, LLP
K-1 Support
P.O. Box 799060, Dallas, TX 75379
(800) 230-7224
Equal OpportunityBuckeye Partners, L.P. provides equal opportunity in all aspects of employment without
regard to race, color, creed, religion, ancestry, national origin, gender, age, disability,
veteran status, and martial status.
Design: Sundberg & Associates, New York, NY Photography: Roger Tully Officers portrait: Ed Wheeler
1 >
2004 2003 2002 2001 2000 1999 1998 1997 1996 1995
FINANCIAL DATA(millions,except per unit)
Revenue $323.5 $272.9 $247.3 $232.4 $208.6 $200.8 $184.5 $185.0 $183.0 $183.5
Operating income $122.1 $109.3 102.4 98.3 91.5 95.9 74.4 72.1 68.8 71.5
Income from continuing operations $82.9 $30.2 71.9 69.4 64.5 71.1 52.0 6.4 49.3 49.8
Net income1
$82.9 $30.2 71.9 69.4 96.3 76.3 52.0 6.4 49.3 49.8
Per unit:2
Income from continuing operations $2.76 $1.05 $2.65 $2.56 $2.38 $2.63 $1.93 $0.25 $2.03 $2.05
Net income $2.76 $1.05 $2.65 $2.56 $3.56 $2.82 $1.93 $0.25 $2.03 $2.05
Cash distributions $2.64 $2.54 $2.50 $2.45 $2.40 $2.18 $2.10 $1.72 $1.50 $1.40
OPERATING DATADaily pipeline volumes
(thousand barrels per day) 1,200.6 1,136.4 1,101.4 1,090.4 1,061.5 1,056.1 1,031.2 1,024.0 1,007.1 1,009.8
Barrel miles (billions) 56.0 52.6 51.6 50.3 47.5 47.1 44.3 44.1 43.9 44.3
Average tariff rate
(cents per barrel) 55.8 55.0 53.3 51.9 50.4 50.1 48.8 49.0 49.3 48.7
1 2003 includes a charge on early extinguishment of debt of $45.5 million; 2000 includes earnings from discontinued operations of $5.7 million plus a gain on the sale of discontinued operations
of $26.2 million; 1999 includes earnings from discontinued operations of $5.2 million; 1997 includes a charge on early extinguishment of debt of $42.4 million.
2 1997 to 1995 restated to reflect 2-for-1 unit split.
Financial and Operating Highlights
1,250
1,200
1,150
1,100
1,050
1,000
950
90095 96 97 98 99 00 01 02 03 04
PIPELINE VOLUMEBarrels per Day in Thousands
130
120
110
100
90
80
70
60
95 96 97 98 99 00 01 02 03 04
OPERATING INCOMEDollars in Millions
160
140
120
100
80
60
40
20
095 96 97 98 99 00 01 02 03 04
TERMINAL THROUGHPUT VOLUMEBarrels per Day in Thousands
$2.75
$2.50
$2.25
$2.00
$1.75
$1.50
$1.25
$1.0095 96 97 98 99 00 01 02 03 04
CASH DISTRIBUTIONSDollars per Unit
4,500
4,250
4,000
3,750
3,500
3,250
3,000
2,750
2,50095 96 97 98 99 00 01 02 03 04
MILES OF PIPELINE
340
300
260
220
180
140
10095 96 97 98 99 00 01 02 03 04
REVENUEDollars in Millions
2 >
2004 was another year of strong growth
and exciting change for Buckeye Partners.
Highlights of the year include:
• Excellent financial results with new
records for pipeline volumes, revenue,
operating income, and net income from
continuing operations
• Three increases in the level of cash distri-
butions paid to our unitholders, with
another increase announced in the first
quarter of 2005
• The purchase of the General Partner
by Carlyle/Riverstone Global Energy
Fund II, LP
• Acquisition of five refined petroleum
products pipelines and twenty-four
refined petroleum products terminals
from affiliates of Shell Oil Products US
FINANCIAL AND OPERATING RESULTSPartnership net income for 2004 was
$82.9 million or $2.76 per unit, compared
with 2003 net income before a special
charge related to the prepayment of long-
term debt of $75.6 million or $2.64 per unit
(2003 net income, which included the
$45.5 million special charge, was $30.2
million or $1.05 per unit). In 2004, pipeline
volumes increased by 64,200 barrels per
day, or 5.6 percent, and revenue increased
by $50.6 million, or 18.5 percent, to a record
$323.5 million. Operating income for 2004
increased by $12.8 million, or 11.7 percent,
to $122.1 million. These excellent financial
results add another year of strong growth
to Buckeye’s record of consistent financial
performance. These results were the basis
for the Board of Directors to approve three
increases in the quarterly cash distribu-
tions during 2004. A fourth increase in the
distribution was announced in the first
quarter of 2005.
NEW OWNER OF GENERAL PARTNERIn May, we welcomed Carlyle/Riverstone
as the new owner of the General Partner
of Buckeye. Riverstone’s representatives
Michael B. Hoffman, David M. Leuschen
and Andrew W. Ward were appointed to
our Board of Directors. Carlyle/Riverstone’s
experience in the energy industry, and its
relationship with investment banks and
other institutions active in the capital
markets, have already proven to be a
valuable resource in facilitating the growth
of the Partnership. We look forward to
working with the Carlyle/Riverstone team
as we build on our record of providing solid
financial returns to our unitholders.
ACQUISITIONS AND GROWTHOn October 1, 2004, we completed the
largest acquisition in Partnership history
with the addition of five refined products
pipelines and twenty-four petroleum
products terminals in the Midwestern
United States. The pipeline systems and
terminals were acquired from affiliates
of Shell Oil Products, US. The pipeline
systems originate in the St. Louis area
and connect to Buckeye’s existing pipeline
To Our Unitholders
These acquisitions fit well with our strategy ofowning and operating refined products pipelineand terminals that provide stable fee-based revenues by serving demand-oriented markets.
3 >
system at several locations. Thesepipelines add approximately 900 miles to our system and significantly expand the Partnership’s service territory in theMidwest. The terminals, located in Indiana,Illinois, Michigan, Missouri and Ohio, addapproximately 9.3 million barrels of stor-age capacity, and more than triple our terminal throughput volumes. Integrationof these new assets into the Buckeye system has proceeded on schedule. Weexpect final integration to be completedduring the second quarter of 2005.
In January 2005, we also announced anagreement to purchase a major pipelinesystem and interests in five associatedproducts terminals from affiliates ofExxonMobil Corporation. The pipeline system originates at a refinery owned byValero in Paulsboro, New Jersey and servescustomers in Pennsylvania and New York.The pipelines complement the Partnership’sexisting infrastructure in the NortheasternUnited States. We plan to connect one ofthe acquired pipelines to our existingpipeline system in the vicinity of Allentown,Pennsylvania.This connection will provideincreased options and flexibility for our customers. The proposed acquisition isexpected to close in the first half of 2005,subject to regulatory approvals and othercustomary closing conditions.
Both of these acquisitions will pro-vide new growth opportunities forBuckeye. The acquisitions fit well withour strategy of owning and operatingrefined products pipeline and terminalsthat provide stable fee-based revenues by serving demand-oriented markets.We will continue to pursue growthopportunities which are consistent with
this strategy, and which will enhance thevalue of your investment in Buckeye.
ACKNOWLEDGEMENTS AND THANKSBuckeye’s success is the result of the con-tributions and hard work of many people.I am particularly grateful to our manage-ment team and employees; their ability,experience, dedication and hard workwere demonstrated once again this yearas we integrated the largest acquisition inBuckeye’s history while competently main-taining the daily operations of our existingpipelines and terminals. I am also pleasedto welcome the new employees that havejoined the Buckeye family to support theoperation and maintenance of the newlyacquired assets. We value the skills andconsiderable experience these newemployees bring to our workforce.
I would also like to thank our customersfor entrusting us with their business. We
appreciate their confidence in us. Weremain committed to providing them withreliable, safe, and cost-effective service.
On behalf of our Board of Directorsand employees, I would like to thank Mr.Alfred W. Martinelli for more than 45 yearsof service, wise guidance and counsel toBuckeye. Al ably served as Chairman of the Board from the formation of thePartnership in December 1986 until hisretirement in May 2004. We extend ourvery best wishes to Al for a healthy andhappy retirement.
Sincerely,
William H. Shea, Jr.Chairman of the Board of DirectorsBuckeye GP LLCAs General Partner
From Left to Right:
William H. Shea, Jr., President and Chief Executive
Officer and Chairman of the Board
Robert B. Wallace, Senior Vice President
Finance and Chief Financial Officer
Stephen C. Muther, Senior Vice President
Administration, General Counsel and Secretary
4 >
2,000 Approximately two thousand tanktrucks load petroleum productseach day at terminals owned andoperated by Buckeye.
tank trucks
5 >
Buckeye Partners, L.P. is a publicly traded
master limited partnership that provides
pipeline transportation and refined petro-
leum products terminalling and storage
services through facilities that we own
and operate in the United States.
Buckeye provides pipeline transporta-
tion services principally in the Northeast
and upper Midwest states through our
pipeline operating subsidiaries, Buckeye
Pipe Line Company, L.P., Everglades Pipe Line
Company, L.P., Laurel Pipe Line Company, L.P.,
Norco Pipe Line Company, LLC and Wood
River Pipe Lines LLC. Buckeye operates one of
the nation’s largest independent common
carrier pipeline networks providing refiners,
wholesalers, marketers, airlines, railroads
and other commercial end-users with
dependable, all-weather transportation
of refined petroleum products. Buckeye’s
unique combination of experienced and
responsive professional staff, technical
expertise and modern transportation facili-
ties has earned the Partnership a reputation
for high-quality, safe, reliable and efficient
transportation services.
Buckeye provides terminalling and
refined products storage services through
Buckeye Terminals, LLC, and affiliate sub-
sidiaries. Buckeye Terminals owns and
operates 38 refined petroleum terminals
with an aggregate storage capacity
of approximately 15.4 million barrels in
Illinois, Indiana, Massachusetts, Michigan,
Missouri, New York, Ohio and Pennsylvania.
Buckeye also owns Buckeye Gulf
Coast Pipe Lines, L.P., which operates and
maintains pipelines under agreements
with major oil and chemical companies.
In addition, Buckeye is the largest stock-
holder of West Shore Pipe Line Company,
holds a 20% interest in West Texas LPG
Pipeline, L.P., and is a majority owner of
WesPac Pipelines, Ltd. WesPac specializes
in constructing and operating jet fuel
pipelines serving airport facilities.
BUSINESS STRATEGYBuckeye’s objective is to increase the
value of our unitholders’ investment by
consistently growing our cash flow and
the cash available for distribution to our
unitholders. Our business strategy to
accomplish this objective is to:
• Own and operate high-quality logistics
assets
• Increase throughput on our pipelines
and terminals that have available
capacity
• Expand our pipeline and terminals to
facilitate customer-generated growth
• Maintain and enhance the integrity
of our pipelines and terminals
• Focus on providing superior customer
service in order to remain the provider
of choice in markets served, and
• Pursue selective strategic acquisition
opportunities that complement our
existing asset base or provide entry
into new markets.
Partnership Overview
The average pipeline tariff ratecharged by Buckeye for transporting one gallon of petroleum product to its deliverydestination. Besides being thesafest mode, pipelines are also thecheapest and most efficient meansfor moving petroleum products toconsumption markets.
1.3¢
6 >
PIPELINE OPERATIONSBuckeye owns and operates approximately
4,500 miles of pipelines serving approxi-
mately 100 delivery locations. The
Company transports refined petroleum
products including gasoline, jet fuel,
diesel fuel, heating oil and kerosene from
major supply sources to industry-owned
terminals located within major end-use
markets. Buckeye also transports other
refined products, such as propane and
butane, refinery feedstocks and blending
components. Transportation service is typi-
cally provided on a common carrier basis
under published tariffs for approximately
110 customers. Buckeye is not affiliated
with any major oil company and does not
own the material that it transports.
Buckeye provides an efficient and
vital transportation link between major
petroleum refining and supply locations
and consumption centers, including
major metropolitan areas. With pipeline
volumes driven primarily by demand in
the end-use markets it services, Buckeye’s
business is stable because it is geographi-
cally diversified, connected to many
different sources of supply, serves numer-
ous delivery locations and fosters strong
customer loyalty.
Buckeye’s Eastern MarketsBuckeye’s pipelines in the East Region
serve markets in New Jersey, Pennsylvania,
New York, Connecticut and Massachusetts.
On Buckeye Pipe Line Company, L.P.’s
eastern pipelines, most shipments origi-
nate in New York Harbor at Linden, New
Jersey. At Linden, receipts are handled from
numerous sources including connecting
pipelines, deepwater and bulk storage
terminals and local refineries. Over 3.0
million barrels of tankage at Buckeye’s
Linden station accommodate the staging
of product into Buckeye’s various out-
bound pipelines. From Linden, product
moves west to Macungie, Pennsylvania
or east to the three major New York City
airports (Kennedy, LaGuardia and Newark)
and commercial marketing terminals on
Long Island.
At Macungie nearly 2.0 million barrels
of tankage facilitate the shipment of
products to delivery points in central and
western Pennsylvania and central and
western New York State. Market areas
include Reading, Harrisburg, Altoona,
Pittsburgh and Scranton/ Wilkes-Barre in
Pennsylvania and Binghamton, Syracuse,
Utica, Rochester and Buffalo (through a
connecting carrier) in New York.
Buckeye also owns a pipeline that
originates in New Haven, Connecticut
and carries refined products to the
Hartford, Connecticut and Springfield,
Massachusetts areas, including Bradley
Buckeye delivered approximately100 million barrels of jet fuel lastyear to the 11 major airports in our service territory.
barrels100,000,000
7 >
4,500milesWith the October 2004 purchase ofthe Wood River Pipe Lines, Buckeyeadded 895 miles of pipeline bringingthe system total to approximately4,500 miles.
8 >
Assuming an average fill-up of 15 gallons, Buckeye delivers enough gasolineto refuel approximately 2.1 million vehicles each day — 365 days a year.
2.1million
9 >
International Airport in Connecticut and
Westover Air Force Base in Massachusetts.
Laurel Pipe Line Company, L.P.’s large
diameter pipeline transports product from
five refineries and connecting pipeline
carriers in southern New Jersey and
Philadelphia to delivery terminals across
Pennsylvania. Laurel is also connected to
a major interstate pipeline with access to
U. S. Gulf Coast refineries. Market areas
served by Laurel are primarily centered
around Reading, Harrisburg, Altoona and
Pittsburgh. Buckeye and Laurel facilities
are interconnected near Reading,
Pennsylvania, providing customers in
central and western Pennsylvania with
product supply flexibility and efficient
distribution from both the New York
Harbor and Philadelphia supply origins.
Buckeye’s Midwest MarketsIn the Midwest, Buckeye Pipe Line
Company, L.P. operates a network of
pipelines that transport a wide range of
refined products to markets in Indiana,
Michigan, Ohio and Pennsylvania. These
pipelines offer the flexibility of multiple
origin and delivery points. The heart of
the network is the north-south corridor
linking Lima and Toledo, Ohio with Detroit,
Michigan. Source points include refineries
at Whiting, Indiana; Detroit, Michigan;
and Lima and Toledo, Ohio. In addition,
Buckeye is connected to terminals and
pipelines with access to the U. S. Gulf
Coast. Major delivery areas in the Midwest
include Huntington and Indianapolis,
Indiana; Detroit, Flint, Owosso and Bay
City, Michigan; Columbus, Lima, Toledo
and Cleveland, Ohio; and Pittsburgh,
Pennsylvania.
In the Midwest, Buckeye also handles
liquefied petroleum gases (“LPG’s”) and
refinery feedstocks. LPG’s are transported
to Huntington, Indiana; Lima and Toledo,
Ohio; and Woodhaven, Michigan.
Feedstocks, such as naphtha and alky-
lates, are transported to refineries at
Lima, Toledo and Detroit.
Norco Pipe Line Company, LLC owns
and operates a 422-mile refined petroleum
products pipeline that runs from Hartsdale,
Indiana west to Galesburg, Illinois and east
to Toledo, Ohio, with two 11-mile pipelines
connecting major storage terminals in
Hartsdale and East Chicago, Indiana.
Norco’s major markets are Toledo, Ohio;
South Bend, Indiana; and Peoria, Illinois.
Wood River Pipe Lines LLC owns and
operates 5 pipelines which transport
refined petroleum products from the St.
Louis area to markets in Indiana, Illinois,
Missouri and Ohio. The 309-mile North
Line delivers refined products to the
Chicago area and other markets in Illinois
and Indiana, and connects to Buckeye Pipe
Line at East Chicago, Indiana. The 355-mile
East Line delivers refined products across
Illinois and Indiana and connects to
Buckeye Pipe Line at Lima, Ohio. The 191-
mile Two Rivers pipeline transports refined
products to Buckeye Terminals’ 1.3 million
barrel facility on the Ohio River in Mt.
Vernon, Indiana. The 24-mile ATF line deliv-
ers jet fuel to the Lambert-St. Louis Airport,
and the 16-mile St. Louis Line carries
refined products to terminals in St. Louis.
EvergladesEverglades Pipe Line Company, L.P. oper-
ates a 37-mile pipeline that transports
commercial aviation fuels from Port
Everglades, Florida to Fort Lauderdale-
Hollywood International Airport and
Miami International Airport.
10 >
Refined Products TransportedThe total long-haul volume of petroleum
products delivered during 2004 averaged
approximately 1,200,600 barrels per
day, which was 64,200 barrels per day,
or 5.6 percent above 2003 shipments.
GasolineApproximately 50 percent of Buckeye’s
deliveries are various grades of gasoline,
including regular, mid-grade, and
premium unleaded gasoline, natural
gasoline and other blend stocks.
Gasoline demand is largely related
to general economic activity.
DistillateDistillate volumes account for approxi-
mately 25 percent of Buckeye’s pipeline
volume and include diesel fuel, heating
oil and kerosene. Diesel fuel is used pre-
dominantly by over-the-road truck carriers
and demand largely depends on general
economic activity. Heating oil and
kerosene consumption are generally
used for space heating and demand is
more directly related to the weather.
Jet FuelBuckeye serves the airline industry
through direct connections to eight
major airports, as well as through indirect
connections to numerous other airports.
Buckeye also delivers military jet fuel to
various military bases. Approximately
23 percent of Buckeye’s pipeline deliveries
are jet fuel.
Other ProductsBuckeye also transports liquefied
petroleum gases and other specialty
products. LPGs, including butane and
propane, are used for space heating and
crop drying, as well as by refineries as
blending components. Feedstocks, such
as naphtha and alkylates, are used by
refineries in the production of gasoline
and other finished refined products.
These volumes are primarily transported
on Buckeye’s Midwest system, and
account for slightly more than 2 percent
of pipeline volumes.
TERMINAL OPERATIONSBuckeye Terminals, LLC significantly
increased the number of petroleum
storage and truck loading terminals it
owns and operates to a total of 38 active
facilities as part of the acquisition from
affiliates of Shell Oil Company in the
fourth quarter. The company now operates
terminals in the states of Missouri,
Indiana, Illinois, Michigan, New York, Ohio
and Pennsylvania. Volumes handled at
the truck loading terminals owned
throughout 2004 averaged 78,150 barrels
per day, an increase of 5,750 barrels per
day or 7.9% over the throughput handled
at the same terminals during 2003. In
addition, throughput averaging 82,600
barrels per day was handled during 2004
at the truck loading facilities acquired
from Shell during the calendar year.
During 2004, projects were completed
Buckeye has more than 750 highly skilled employees dedicated to providingsafe and reliable transportation and terminalling services to our customers.
750employees
11 >
1billiongallons of storage Buckeyes tanks have the capacity to
hold more the 25 million barrels ofpetroleum products; at 42 gallonsper barrel, that’s more than 1 billiongallons of storage.
at several of the company’s terminals to
upgrade automation systems, improve the
integrity of terminal assets, optimize use of
system capacity, and add new business or
improve customer service. The acquisition
of the assets from Shell significantly
increases Buckeye’s role in the terminal
industry and the company has invested
significantly in new resources and operat-
ing infrastructure to support this growing
component of its overall business.
CONTRACT PIPELINE OPERATIONS Buckeye Gulf Coast Pipe Lines, L.P. (“BGC”)
operates and/or maintains approximately
1,200 miles of gas and liquid pipelines in
the United States’ Gulf Coast area. BGC is
also the majority owner and operator of a
90-mile crude butadiene pipeline system
that extends from the Houston Ship
Channel to the Beaumont, Texas area.
BGC has contracts with owners of major
chemical plants to operate their pipelines,
and underground storage facilities. BGC
also owns pipelines which are leased to
third parties. BGC has an experienced
staff of engineering, construction and
operating personnel dedicated to provid-
ing superior and cost effective pipeline
and storage service to the oil and gas and
petrochemical industries. During 2004,
BGC completed a 14 mile pipeline from
Mont Belvieu, Texas to the Houston
ship channel area.
JOINT VENTURESAND MINORITYINTERESTSWesPac Pipelines Ltd.
(“WesPac”) is a joint
venture between
Buckeye and Kealine
Partners that owns
and operates
pipelines serving
the Reno/Tahoe
International Airport
in Nevada and the
San Diego Airport in
California. WesPac
focuses on building
pipelines directly to
airports to replace
trucking as the final
leg in the transporta-
tion chain. WesPac
identifies airports in high growth areas
that currently do not have direct pipeline
supply. During 2004, WesPac began
construction of a new pipeline and
terminal to serve customers at the
Memphis Airport in Tennessee.
Through its subsidiary Buckeye Pipe
Line Holdings, L.P., the Partnership owns
an approximate 25% equity interest in
West Shore Pipe Line Company and a
20% partnership interest in West Texas
LPG Pipeline Limited Partnership. West
Shore owns and operates a refined
products pipeline system that originates
in the Chicago, Illinois area and extends
north to Green Bay Wisconsin and north-
west to Madison,Wisconsin. West Texas
LPG owns and operates a natural gas
liquids pipeline system that delivers NGLs
to Mont Belvieu, Texas, from gathering
fields in West and Central Texas and
New Mexico, as well as NGLs transported
from the Rocky Mountain region via
connecting pipelines.
12 >
Buckeye has more than 230 thousand neighbors alongits rights-of-way in the communities where it operates.
230,000neıghbors
Buckeye Partners, L.P., through its subsidiary partnerships, is one of the nation’s largestindependent pipeline common carriers of refined petroleum products with nearly 4,500 miles of pipeline. The Partnership also provides bulk storage services at terminals in Illinois, Indiana,Massachusetts, Michigan, Missouri, New York, Ohio and Pennsylvania and operates approxi-mately 1,300 miles of pipeline under agreement with chemical companies.
OPERATING SYSTEMS LegendBuckeye Pipe Line Company, L.P.Buckeye Gulf Coast Pipe Lines, L.P.Everglades Pipe Line Company, L.P.Laurel Pipe Line Company, L.P.Norco Pipe Line Company, LLCWood River Pipe Lines, LLCBuckeye Terminals, LLCDelivery point to customers’ marketing terminals
West Shore Pipeline CompanyWest Texas LPG Pipeline Limited Partnership
JOINT VENTURE INTERESTS
2 >
BUCKEYE GP LLCDirectorsWilliam H. Shea, Jr.
Chairman of the BoardDirector since 2000
Brian F. Billings 1
Director since 1986
Michael B. Hoffman
Director since 2004
Edward F. Kosnik 1 2
Director since 1986
Joseph A. LaSala, Jr. 1
Director since 2001
David M. Leuchen
Director since 2004
Jonathan O’Herron 1 2
Director since 1997
Frank S. Sowinski
Director since 2001
Andrew W. Ward 2
Director since 20041
Member of Audit Committee2
Member of Finance Committee
OfficersWilliam H. Shea, Jr.
President and Chief Executive Officer
Stephen C. Muther
Senior Vice PresidentAdministration General Counsel and Secretary
Robert B. Wallace
Senior Vice President Finance and Chief Financial Officer
Eric Gustafson
Senior Vice President – Operations and Technology (effective 1/1/2005)
PARTNERSHIP INFORMATIONPartnership CharacteristicsAs a publicly traded partnership, Buckeye Partners, L.P. differs in several ways from
stock corporations:
• A partner in a publicly traded partnership owns units of the partnership rather than
shares of stock and receives cash distributions rather than dividends. The cash distribu-
tions are not taxable as long as the partner’s tax basis in the partnership exceeds zero.
• Generally, a corporation is subject to federal and state income taxes but a partnership
is not. All of the income, gains, losses and deductions of a partnership are passed
through to its partners who are required to show their allocated share of these
amounts on their personal income tax returns.
• While a holder of corporate stock receives a Form 1099 each year detailing required
tax data, a unit holder of a partnership receives a tax reporting package including
Schedule K-1 and other forms to file with their income tax return. This tax reporting
package shows a partner’s allocable share of the partnership’s income, gains, losses
and deductions.
• Compared to corporate form of organization, the partnership form enables Buckeye
to distribute to investors a greater percentage of cash generated by the business.
Investor InformationFor more information about the Partnership please contact:
Buckeye Partners, L.P.
Stephen R. Milbourne
Manager, Investor Relations
5 Radnor Corporate Center, Suite 500
100 Matsonford Road Radnor, PA 19087
(800) 422-2825
smilbourne@buckeye.com
or visit us on the Web at: www.buckeye.com
Partnership OfficeBuckeye Partners, L.P.
Post Office Box 368
5002 Buckeye Road, Emmaus, PA 18049
(484) 232-4000
Transfer Agent and RegistrarEquiServe Trust Company, N.A.
Post Office Box 43069, Providence, RI 02940-3069
www.equiserve.com
(800) 519-3111
Unitholder Tax InformationPricewaterhouse Coopers, LLP
K-1 Support
P.O. Box 799060, Dallas, TX 75379
(800) 230-7224
Equal OpportunityBuckeye Partners, L.P. provides equal opportunity in all aspects of employment without
regard to race, color, creed, religion, ancestry, national origin, gender, age, disability,
veteran status, and martial status.
Design: Sundberg & Associates, New York, NY Photography: Roger Tully Officers portrait: Ed Wheeler
Buckeye Partners, L.P.2004 ANNUAL REPORT Buckeye Partners, L.P.