Slides from presentation to be used on September 16, 2009

Statements contained in this presentation that state management’s expectations or

predictions of the future are forward-looking statements intended to be covered by the

safe harbor provisions of the Securities Act of 1933 and the Securities Exchange Act of

1934.

The

words

“believe,”

“expect,”

“should,”

“estimates,”

and

other

similar

expressions identify forward-looking statements. It is important to note that actual

results could differ materially from those projected in such forward-looking statements.

We undertake no duty to update any forward-looking statement to conform the

statement to actual results or changes in the company’s expectations. For more

information concerning factors that could cause actual results to differ from those

expressed

forecasted,

see

NuStar

Energy

L.P.’s

and

NuStar

Holdings,

LLC’s

respective annual reports on Form 10-K and quarterly reports on Form 10-Q, filed with

the

Securities

and

Exchange

Commission

and

available

NuStar’s

websites

www.nustarenergy.com

and

www.nustargp.com.

Forward Looking Statements

High quality, large and diverse asset footprint with

operations in eight different countries including the

U.S., Mexico, Netherlands, Netherland Antilles (i.e.

Caribbean), England, Ireland, Scotland and Canada

Third largest independent liquids terminal operator in

the world and second largest in the U.S. that

provides significant growth opportunities

What Sets NuStar Apart from its Peers

No. 1 asphalt producer on the East Coast and No. 3 asphalt producer in the U.S.

Investment grade credit rating with demonstrated access to capital markets in difficult conditions

Lower cost of capital versus majority of peers

Incentive Distribution Rights (IDRs) capped at 25% vs. 50% for most MLPs

Strong corporate culture of taking care of employees, making safety a top priority, achieving operational

excellence and contributing time and money to our communities

Recognized in 2008 as one of the best companies to work for in America and for our strong safety record

Experienced and proven management team with substantial equity ownership and industry experience

NuStar

Energy L.P. (NYSE: NS) is a leading

publicly traded growth-oriented partnership with

a market capitalization of nearly $2.9 billion and

an enterprise value of approximately $4.9 billion

One of the largest independent petroleum pipeline

and terminal operators in the U.S. and one of the

largest asphalt refiners and marketers in the U.S.

NuStar

GP Holdings, LLC (NYSE: NSH) holds

the 2% general partner interest, 18.4% of the

common units and incentive distribution rights in

NuStar

Energy L.P.

NuStar

Overview –

Two Publicly Traded Companies

NSH

IPO Date:

4/16/2001

7/19/2006

Unit Price (9/11/09):

$51.84

$23.52

Annual Distribution/Unit:

$4.23

$1.72

Yield (9/11/09):

8.16%

7.20%

Market Equity Capitalization:

$2,823 million

$1,001 million

Enterprise Value:

$4,899 million

$996 million

Total Assets (6/30/09):

$4,862 million

$577 million

Debt/Capitalization (6/30/09):

49.1%

n/a

Fortune 500 Ranking:

485

n/a

46%

36%

18%

Percentage of Expected 2009 Segment

Operating Income

Approximately 82% of NuStar Energy’s segment operating income in 2009 is expected to come from fee-

based operations

Remainder of expected 2009 segment operating income relates to margin-based asphalt and fuels

marketing segment

Storage (~46%)

Transportation (~36%)

Refined Product Terminals

Crude Oil Storage

Refined Product Pipelines*

Crude Oil Pipelines

Asphalt & Fuels Marketing (~18%)

Asphalt

Fuels Marketing

Product Supply, Wholesale and Fuel Oil

Marketing

Bunkering

Diversified Operations from Three

Business Segments

* Includes primarily distillates, gasoline, propane, jet fuel, ammonia and other light ends. Does not include natural gas.

Global Leader in Independent

Liquids Storage

NuStar

is the third largest independent liquids terminal operator in the world and second largest in the U.S.

Completed

expansion

projects

under

our

$400

million

construction

program,

which

contributed

around

8.5

million

barrels of incremental storage capacity

Of the roughly 91 million barrels of storage capacity, approximately 50 million barrels are crude oil and heavy fuel

products, 39 million barrels are refined products and 2 million barrels are biofuels

Source: Company Websites & Management Presentations

173

104

Independent Liquids Storage Capacity

(Millions of Barrels)

Distributable Cash Flow ($ in Millions)

EBITDA ($ in Millions)

2008

was

record

year

financially

primarily

due

contribution

from

asphalt

operations

and

growth

projects

Despite challenging economic and market conditions, reported record second quarter 2009 earnings of

$75.1 million, or $1.38 per unit, over nine times higher than lasts year’s $8.1 million, or $0.15 per unit

For the six months ended June 30, 2009, earnings were $106.8 million, or $1.96 per unit, significantly

higher than the $57.7 million, or $1.11 per unit, for the six months ended June 30, 2008

Note: 2005

and

2006

distributable

cash

flow

and

EBITDA

are

from

continuing

operations

Historical Growth in Earnings

2001

2002

2003

2004

2005

2006

2007

2008

$63

$77

$112

$133

$219

$322

$353

$492

2001

2002

2003

2004

2005

2006

2007

2008

$56

$68

$86

$102

$154

$214

$221

$319

$4.085

$3.835

$3.60

$3.365

$3.20

$2.95

$2.75

$2.40

2001

2002

2003

2004

2005

2006

2007

2008

NS Annual Distribution Since IPO

* Based on NS annualized distribution of $0.60 per unit in 2001

** Based on NSH annualized distribution of $0.32 per unit in 2006

NSH Annual Distribution Since IPO

$1.28

$1.38

$1.58

2006

2007

2008

~8.0% CAGR

~11% CAGR

NS Distribution Coverage Applicable to LPs

NuStar Energy L.P. reported a strong distribution coverage

ratio of 2.14 times applicable to limited partners for 2Q09

and 1.67 times for the six months ended June 30, 2009

1.20x

1.25x

1.28x

1.30x

1.19x

1.16x

1.10x

1.33

2001

2002

2003

2004

2005

2006

2007

2008

Consistent Distribution Growth While

Maintaining a Solid Distribution Coverage

-50%

-40%

-30%

-20%

-10%

10%

20%

30%

40%

50%

9/11/08

11/2/08

12/24/08

2/14/09

4/7/09

5/29/09

7/20/09

9/11/09

Despite

the

market

turmoil,

both

NuStar

companies

have

weathered

the

storm

well,

beating

their

respective peer groups and market indices

Total Return –

Last Twelve Months (LTM)

Source: Barclays Capital

NuStar

Companies Outperforming During

Challenging Economic times

NS 15%

S&P 500 (14)%

Alerian

MLP Index 10%

NSH Peers 22%

NSH 28%

Note: NSH GP Peers Total Return Index is weighted on market capitalization of each company and includes the following companies: AHD, AHGP, BGH, EPE, ETE, HPGP, MGG, and NRGP.

The Alerian MLP Index is a composite of the 50 most prominent energy master limited partnerships calculated by Standard & Poor's using a float-adjusted market capitalization

methodology.

Maintaining Sufficient Liquidity

with Disciplined Financial Strategy

NS Current Revolver Availability

Rate on NS revolver based on LIBOR plus 50 bps, currently around

83 bps

Rate on NSH revolver based on LIBOR plus 450 bps

Financial Covenant Tests:

Debt-to-EBITDA cannot exceed 5.0 to 1.0 times

Following

acquisition

$100

million

more,

NuStar

may

increase

Debt-to-EBITDA

5.5

times

for

two

consecutive

quarters

Total Bank Credit

$1,223

Less:

Borrowings

(823)

Letters of Credit

(60)

Revolver Liquidity

$340

(Dollars in Millions)

NSH Current Revolver Availability

Total Bank Credit $19.5

Less:

Borrowings -

Letters of Credit -

Revolver Liquidity $19.5

(Dollars in Millions)

2009

$20.7

2010

$0.8

2011

$0.8

2012

$1,185.1*

2013

$481.0

2014

$0.6

* Primarily includes maturity of revolver, which expires

December 2012, and $350 million of senior notes

NS Debt Maturities (6/30/09)

NSH Debt Maturities (6/30/09)

2009

2011

2012

2013

2014

** NSH’s

revolving credit facility expires on

July 16, 2010

Actuals

June 2009 YTD

Reliability

Other

Internal Growth

Total

Capital Forecast

Transportation

13,908

11,057

15,936

26,993

Storage

44,145

46,799

79,797

126,596

Corporate - IS

3,770

5,053

1,481

854

7,388

Asphalt & Fuels Marketing

7,184

11,316

10,930

22,246

Total Forecast

69,007

74,225

1,481

107,517

183,223

2009 Forecast

Internal Growth Spending Forecast has been

Increasing as Capital Markets Improve

Now targeting nearly $107.5 million of strategic growth capital spending for 2009 versus our previous target of $98 million and

versus $80 million at the start of 2009

Difference from $98 million relates to additional storage projects at our St. Eustatius terminal and one of our UK terminals and

upgrade projects to handle additional products at two of our West Coast terminals

$107.5 million should contribute approximately $29 million of operating income annually

Other major 2009 strategic projects include:

Approximately $19 million of pipeline projects on NuStar’s East pipeline and at our St. James, LA facility to increase the capacity and

flexibility of our two pipelines and to accommodate new and existing customers

Approximately $12 million to finish up tank expansion projects at NuStar’s Texas City, TX facility as part of our $400 million

construction program

Approximately $26 million at our Texas City, TX facility to improve and upgrade it to make it a world-class heavy oil terminal

Approximately $13 million at our Paulsboro and Savannah asphalt facilities to improve crude flexibility and rates, improve the energy

efficiency of the refineries and increase the production of polymer modified and warm-mix asphalt

NuStar Energy L.P. Board of Directors recently approved full funding for an $85 million internal growth program associated with

our Texas City, Texas terminal facility, of which approximately $40 million is already included in our 2009 internal growth forecast

(Dollars in Millions)

Significant Long-Term Internal Growth and

Acquisition Opportunities

Acquisition Criteria

Accretive to distributable cash flows

Strong internal growth potential

Synergistic with existing operations (i.e. ties in with

strategy)

Storage –

Continue to evaluate domestic and

international storage opportunities in strategic hub

locations

Amsterdam/Rotterdam/Antwerp

–

Evaluating

opportunities to acquire storage facilities to meet

growing demand

Asphalt –

Continue to evaluate production and

logistics opportunities to expand markets

Acquisitions

Internal Growth

Storage:

Black

Oil

Strategy

–

Continue

implement

strategy

building

crude oil and heavy fuel oil storage at Texas City, TX and St.

James, LA facilities

St. Eustatius –

Evaluating opportunities to expand or acquire

nearby terminals to increase presence in the Caribbean market

Amsterdam/Rotterdam/Antwerp

–

Evaluating

opportunities

build storage facilities to meet growing demand

United

Kingdom

–

Build-out

existing

terminals

Pipelines:

Ammonia

Pipeline

–

Evaluating

additional

pipeline

laterals

industrial end users

Central/South

Texas

–

Evaluating

opportunities

increase

utilization of assets to meet demand in these growing market

Additional projects to address crude flexibility, improve quality of

light products, produce roofing flux and blend crude to optimize

operations

Evaluating around $500 million of acquisition and internal growth opportunities over the next few years

Asphalt:

Compared to 2008, we continue to expect higher results from our storage segment and comparable or better results

from our transportation segment in 2009; however, results from our asphalt operations will be lower than anticipated

Third and fourth quarter 2009 results from our asphalt operations will be lower than expected primarily due to reduced

product margins

Asphalt prices have not kept pace with the over 50% increase in crude oil prices 2009 year-to-date, which reduces our product

margin

Our product margin per barrel for the third quarter of 2009 is expected to be in the range of $4.50 to $5.50 per barrel

We expect fourth quarter 2009 earnings from our asphalt operations to follow the typical seasonal pattern of decline

Fourth quarter 2009 asphalt prices are forecasted to decline at a faster rate than crude prices

Although we continue to expect that federal stimulus construction work will materialize primarily in 2010 and 2011, only a

small percentage of the dedicated federal stimulus funds have been spent in 2009, or, roughly $1.4 billion of the nearly $27

billion available for highway projects

We expect a positive impact to public sector asphalt demand primarily in 2010 and 2011 when most of the federal stimulus

spending is expected to occur

Private sector activity expected to be limited for the balance of 2009 by the continued weak economy

Economic recovery should support private sector demand

EBITDA from our asphalt operations now expected to be in the range of $50 to $80 million for the full year of 2009, which,

while not as high as expected earlier in the year, is still a solid contribution in a demonstrably weak worldwide economy

The two-year EBITDA contribution on our acquisition of the former CITGO asphalt refineries, excluding the 2008 hedging loss in

our asphalt operations, is expected to be in the range of $200 to $230 million (or $140 million to $170 million including the

hedging loss)

Based on the latest forecast, we now expect third quarter 2009 earnings to be in the range of $0.80 to $1.20 per unit

NuStar Energy L.P. 2009 Outlook

A tariff increase of 7.6% effective July 1, 2009, lower operating expenses and the start-up of the East

pipeline

project

June

2009

should

contribute

comparable

better

operating

income

2009

versus

2008 despite lower throughputs

Lower throughputs in 2009 have primarily been the result of the sale of pipeline assets, as well as planned turnarounds

and unplanned outages

Expect to see an uptick in fourth quarter throughputs compared to the third quarter of 2009, primarily due to a lighter

refinery maintenance schedule

Expect Stable Profits in Transportation Segment in 2009 Despite

Lower Throughputs Resulting Primarily from Assets Sales

Impact from sale of pipelines :

ConocoPhillips sale of their JV Interest in

the El Paso pipeline to Valero Energy in

2Q08 (~32 mbpd)

NuStar’s

sale of the Skelly-Belvieu

pipeline in 4Q08 (~12 mbpd)

NuStar’s

sale of the Trans-Texas and

Ardmore-Wynnewood pipelines in 2Q09

(~ 60 mbpd)

Revenue per barrel should be

significantly higher in 3Q09 primarily

due to 7.6% tariff increase and sale

of pipeline assets with a relatively

low revenue per barrel

E = Estimate

965-975

860-870

911

104

1,006

1,001

1,112

1,050

Targeting an incremental $35 to $40 million of EBITDA in 2009 as

we benefit from a full year’s contribution primarily from completed

projects under our $400 million construction program and rate

increases on renewed contracts

Total annualized EBITDA contribution from $400 million construction

program expected to be in the range of $55 to $60 million

Of the $35 to $40 million increase in 2009, approximately 20 percent is

expected to come from rate increases and 80 percent from completed

storage projects

Expect

benefit

from

contango

markets

the

extent

that

certain

of our storage contract revenues are up for renewal:

29% -

1 Year or Less

28% -

1 to 3 Years

23% -

3 to 5 Years

19% -

Greater than 5 Years

Lower throughputs in our storage segment don’t necessarily

translate into weaker earnings since the majority of our business

is leased

Approximately 90% of our revenues in the storage segment come from

leased assets or assets connected to pipelines in our transportation

segment

St.

Eustatius

Terminal

–

13.0

bbls

storage

capacity

Texas

City,

Terminal

–

2.7

bbls

storage

capacity

Expect Higher Profits in Storage Segment

in 2009 Despite Lower Throughputs

While Asphalt Supply Through June 2009 Continues to Remain Below Historical

Averages,

Asphalt

Demand

has

been

Trending

Lower…

Asphalt

Margins

Still Better Than Historical Margins Even Before Coker Impact

Unseasonably wet weather on the U.S. East Coast and weak public and private road demand due to the poor

economy has caused asphalt demand to lag compared to last year

Asphalt demand through June 2009 was over 12% lower than 2008 and nearly 25% below the 5-year average

Impact should result in a deferral and not a cancellation of road work projects

Continue

expect

positive

impact

asphalt

demand

primarily

2010

and

2011

when

most

the

stimulus

spending is expected to occur and economic recovery supports private sector demand

Asphalt

margins

have

already

improved

compared

history

even

before

the

coker

story

fully

kicks

2011-2012

U.S. Asphalt Demand (000 barrels)

Source: U.S. Energy Information Administration. Data only available through June 2009

$3.78

$8.78

$5.50-$6.50

U.S. East Coast Product Margin ($ per barrel)

5,000

10,000

15,000

20,000

25,000

Jan

Feb

Mar

Apr

May

June

July

Aug

Sept

Oct

Nov

Dec

2006

2007

2008

2009

5-Year Avg.

2000 to 2007 is prior to NuStar’s acquisition of the former CITGO Asphalt Refineries and does not include GAAP accounting timing differences such as the financial impact from specific

winter-fill strategies.

** Excludes impact from $61 million hedging loss incurred in 2008

Lower Asphalt Production and Imports Through

June 2009 Continue to Point to Below Average Supply

U.S. refiners have cut crude oil runs to avoid driving weak

margins lower, resulting in reduced refinery production,

including asphalt

Narrow light-heavy crude oil spreads are causing complex

refiners to run less heavy crude oil and more light crude oil,

resulting in less bottom-of-the barrel production, including

asphalt

Asphalt production through June 2009 was over 5% lower

than 2008 and over 17% lower than the 5-year average

U.S. Asphalt Production (000 barrels)

U.S. Asphalt Imports (000 barrels)

Continued lack of asphalt imports is also contributing

to less asphalt supply

Asphalt imports through June 2009 were nearly 19%

lower than 2008 and over 40% lower than the 5-year

average

Source of data for graphs: U.S. Energy Information Administration. Data only available through June 2009

1,000

2,000

3,000

Jan

Feb

Mar

Apr

May

June

July

Aug

Sept

Oct

Nov

Dec

5,000

10,000

15,000

20,000

Jan

Feb

Mar

Apr

May

Jun

Jul

Aug

Sep

Oct

Nov

Dec

2006

2007

2008

2009

Year Avg.

2006

2007

2008

2009

4-Year Avg.

Announced U.S. Coker Projects:

Despite Some Delays/Cancellations, Long-Term Impact of

Coker Projects on Asphalt Supply Still Intact

Source: PIRA Refinery Database; Company Information

Approximately 95% of the announced coker

projects listed are either complete or have a high likelihood of

completion (i.e. firm projects)

Most of the coker

capacity is still expected to come on-line in 2011 and 2012, which should contribute to further

tightening of asphalt supply

No.

Refinery

PADD

Announced Coker

Capacity (Mbpd)

Announced

Crude Capacity

(Mbpd)

Start Up

Date

Status

Coffeyville Resources -

Coffeyville, Kansas

2.0

8.0

1Q 2007

Complete

BP -

Toledo, Ohio

2.0

10.0

1Q 2007

Complete

Valero -

Port Arthur, Texas

III

25.0

75.0

1Q 2007

Complete

Frontier -

Cheyenne, Wyoming

4.3

3Q 2007

Complete

Chevron -

El Segundo, California

15.0

4Q 2007

Complete

Sinclair –

Sinclair, Wyoming

20.0

11.0

4Q 2007

Complete

ConocoPhillips -

Borger, Texas

III

25.0

4Q 2007

Complete

Cenex

Laurel, Montana

15.0

1Q 2008

Complete

Frontier -

El Dorado, Kansas

3.0

11.0

2Q 2008

Complete

Tesoro -

Martinez, California

4.4

2Q 2008

Complete

ConocoPhillips -

Los Angeles, California

5.0

4Q 2008

Complete

Marathon -

Garyville, Louisiana

III

44.0

180.0

4Q 2009

Firm

Hunt -

Tuscaloosa, Alabama

III

18.5

15.0

3Q 2010

Firm

ConocoPhillips -

Wood River, Illinois

65.0

55.0

1Q 2011

Firm

Atofina

Petrochemicals Inc.-

Port Arthur, Texas

III

50.0

1Q 2011

Firm

BP/Husky -

Toledo, Ohio

25.0

1Q 2011

Firm

BP -

Whiting, Indiana

95.0

30.0

1Q 2012

Firm

Motiva -

Port Arthur, Texas

III

40.0

325.0

1Q 2012

Firm

Marathon -

Detroit, Michigan

28.0

13.0

2Q 2012

Probable

Total US Expansion

486.2

733.0

Expansions Completed through 2008

120.7

115.0

Firm

Expansions

2009

2012

337.5

605.0

Probable

Expansions

2009

2012

28.0

13.0

Execution of Game Plan…

We Intend to:

Financial

Maintain sufficient liquidity with

disciplined financial strategy near term

Work towards having negative outlook

removed from rating agency

Execute and deliver on capital projects

Maintain higher coverage ratio on

margin-related businesses

Continue to grow the distribution at NuStar Energy L.P. and NuStar GP Holdings, LLC

Operational

Continue to excel in safety and

environmental

Improve bottom-line by implementing

cost reductions and energy efficiency

programs

Continue to make NuStar one of the

top workplaces in the nation by taking

care of employees and giving back to

the communities

Corporate Culture

Asphalt

Pursue attractive production and

logistics opportunities to take

advantage of tight supply and demand

fundamentals

Implement projects to provide crude

flexibility and reduce seasonality

Maintain proportion of operating

income from margin-based and fee-

based assets

Storage

Pursue attractive opportunities to

either build or acquire storage facilities

both domestically and internationally

Continue to sign up long-term

contracts for new storage construction

Continue to take advantage of strong

demand for storage by leasing out

facilities at attractive rates

Evaluate attractive opportunities to

add incremental capacity and

increase utilization of assets in

growing markets that NuStar serves

Transportation

One of the largest independent petroleum pipeline and terminal liquids operators in the world

Provides world class pipeline and terminalling services to some of the world’s largest crude oil producers, integrated

oil companies, chemical companies, oil traders and refineries

Pipeline and storage businesses are widely considered to somewhat recession resistant

One of the largest asphalt refiners and marketers in the U.S.

Expect to benefit from better-than-historic asphalt margins over the long-term as supply continues to tighten and

demand improves

Economic stimulus package expected to provide further growth in U.S. asphalt demand primarily in 2010 and 2011

Committed to investment grade rating and demonstrated access to capital in difficult markets

Fitch and Moody’s recently revised their outlook to stable from negative

Will continue to work with other rating agency to have negative outlook removed

Large and diversified asset footprint in the U.S. and internationally allows for ample acquisition

and internal growth opportunities

Capital

spending

forecast

has

been

increasing

capital

markets

improve

Expect to continue to have plenty of opportunities to grow the business over the next few years

Summary

Reconciliation of Net Income to EBITDA to

Distributable Cash Flow

The following is a reconciliation of income from continued operations to EBITDA and distributable cash flow:

2001

2002

2003

2004

2005

2006

2007

2008

Income from continuing operations

45,873

55,143

69,593

78,418

107,675

149,906

150,298

254,018

Plus interest expense, net

3,811

4,880

15,860

20,950

41,388

66,266

76,516

90,818

Plus income tax expense

395

4,713

5,861

11,448

11,006

Plus depreciation and amortization expense

13,390

16,440

26,267

33,149

64,895

100,266

114,293

135,709

EBITDA

63,074

76,858

111,720

132,517

218,671

322,299

352,555

491,551

Less equity earnings from joint ventures

3,179

3,188

2,416

1,344

2,319

5,882

6,833

8,030

Less interest expense, net

3,811

4,880

15,860

20,950

41,388

66,266

76,516

90,818

Less reliability capital expenditures

2,786

3,943

10,353

9,701

23,707

35,803

40,337

55,669

Less income tax expense

4,713

5,861

11,448

11,006

Plus mark-to-market impact on hedge transactions

3,131

(9,784)

Plus charges reimbursed by general partner

575

Plus distributions from joint ventures

2,874

3,590

2,803

1,373

4,657

5,141

544

2,835

Plus other non-cash items

2,672

Distributable cash flow

56,172

68,437

85,894

101,895

153,873

214,203

221,096

319,079

Note: 2005 and 2006 distributable cash flow and EBITDA are from continuing operations.

Year Ended December 31,

NuStar Energy L.P. utilizes EBITDA, which is not defined in United States generally accepted accounting principles, as a financial measure because it is a widely

accepted financial indicator used by investors to compare partnership performance. In addition, management believes that this measure provides investors an

enhanced perspective of the operating performance of the partnership's assets and the cash that the business is generating. EBITDA is not intended to represent

cash flows for the period, nor is it presented as an alternative to operating income. EBITDA should not be considered in isolation or as a substitute for a measure

of performance prepared in accordance with United States generally accepted accounting principles.

(Dollars in Thousands)

2009 Asphalt Operations EBITDA

Reconciliations

(Dollars in Thousands)

Asphalt and Fuels

Marketing Segment

Less Non-Asphalt

Operations

Asphalt Operations

2009:

Projected operating income range

$ 50,000 - $ 81,000

$ 19,000 - $ 20,000

$ 31,000 - $ 61,000

Plus projected depreciation and amortization expense

19,000

Projected EBITDA range

$ 69,000 - $ 100,000

$ 19,000 - $ 20,000

$ 50,000 - $ 80,000

2008:

Operating income

112,506

36,239

76,267

Plus depreciation and amortization expense

14,734

552

14,182

EBITDA

127,240

36,791

90,449

Combined 2009 and 2008:

Projected two-year operating income range

$ 162,506 - 193,506

$ 55,239 - 56,239

$ 107,267 - 137,267

Plus projected two-year depreciation and

amortization expense

33,734

552

33,182

Projected two-year EBITDA range

196,240 - 227,240

55,791 - 56,791

140,449 - 170,449

Plus hedging loss in 2Q08

60,704

Projected two-year adjusted EBITDA range

$ 256,944 - 287,944

$ 55,791 - 56,791

$ 201,153 - 231,153

EBITDA in the following reconciliation relates to our operating segments or a portion of an operating segment. For purposes of segment reporting we do

not allocate general and administrative expenses to our reported operating segments because those expenses relate primarily to the overall management

at the entity level. Therefore, EBITDA reflected in the following reconciliations excludes any allocation of general and administrative expenses consistent

with our policy for determining segmental operating income, the most directly comparable GAAP measure.

2009 Storage Segment EBITDA

Reconciliations

(Dollars in Thousands)

EBITDA in the following reconciliation relates to our operating segments or a portion of an operating segment. For purposes of segment reporting we

do not allocate general and administrative expenses to our reported operating segments because those expenses relate primarily to the overall

management at the entity level. Therefore, EBITDA reflected in the following reconciliations excludes any allocation of general and administrative

expenses consistent with our policy for determining segmental operating income, the most directly comparable GAAP measure.

Storage Segment

Projected incremental operating income range

$ 40,000 -

45,000

Plus projected incremental depreciation and

amortization expense

15,000

Projected incremental EBITDA range

$ 55,000 -

60,000

Projected incremental operating income range

$ 30,500 -

$ 35,500

Plus projected incremental depreciation and

amortization expense

4,500

Projected incremental EBITDA range

$ 35,000 -

$ 40,000

The following is a reconciliation of projected incremental operating income to projected incremental EBITDA for the year ended

December 31, 2009 for our storage segment:

Storage Segment

The following is a reconciliation of projected incremental operating income to projected incremental EBITDA on an annual basis related to our

$400 million construction program for our Storage Operations: