Three weeks after parent company SemGroup LP filed for bankruptcy on $3.2 billion in trading losses in crude deals on the New York Mercantile Exchange and over-the-counter energy derivative markets (see Daily GPI, July 28; July 24), SemGroup Energy Partners LP (SGLP), the only publicly traded subsidiary of SemGroup, announced through a Friday filing with the Securities and Exchange Commission (SEC) that it is in a spot of bother as well and might have to sell a portion or all of its assets.

In the filing Friday SGLP said it was unable to file its Form 10-Q at the SEC for the period ended June 30 by the Aug. 14 deadline due to problems that have arisen from its association with SemGroup. While SGLP noted that it is not a party to its parent’s bankruptcy, it informed the SEC that 82% of its revenues for the six months ended June 30 came from services it provided to SemGroup and its subsidiaries.

The partnership added that it is cooperating with the SEC in a recently commenced informal inquiry, has received a grand jury subpoena and has been named as a defendant in several securities class action lawsuits.

“Parent’s bankruptcy filings have had and may in the future continue to have a number of other impacts on the partnership’s business and management,” SGLP told the SEC in its filing. “The partnership is currently pursuing various strategic alternatives for its business and assets including the possibility of entering into storage contracts with third party customers and the sale of all or a portion of its assets. The uncertainty relating to parent’s bankruptcy filings may make it more difficult to pursue merger opportunities or enter into storage contracts with third-party customers.”

SGLP said its management and the board of directors of its general partner are evaluating the impact of these matters on the financial statements, noting that the company expects to file its 10-Q for the quarter ended June 30 as soon as is “reasonably practicable” after the evaluation has been completed.

SGLP owns, operates and develops midstream energy assets, providing crude oil terminaling and storage services at its facilities in Oklahoma, Kansas and Texas. SemGroup provides diversified services for end-users and consumers of crude oil, natural gas, natural gas liquids, refined products and asphalt. Services include purchasing, selling, processing, transporting, terminaling and storage in the United States, Canada, Mexico, Wales, Switzerland and Vietnam.

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