10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 _________________________________________

FORM 10-Q

 _________________________________________

(Mark One)

x	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
	For the quarterly period ended September 30, 2012

OR

o	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
	For the transition period from _______ to _______

Commission File Number 1-32940

_________________________________________

NUSTAR GP HOLDINGS, LLC

(Exact name of registrant as specified in its charter)

_________________________________________

Delaware	85-0470977
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)
19003 IH-10 West San Antonio, Texas	78257
(Address of principal executive offices)	(Zip Code)

Registrant’s telephone number, including area code (210) 918-2000

 _________________________________________

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes  x    No  o

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).    Yes  x    No  o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule12b-2 of the Exchange Act:

Large accelerated filer	x	Accelerated filer	£
Non-accelerated filer	o  (Do not check if a smaller reporting company)	Smaller reporting company	£

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).    Yes  o   No  x

The number of common units outstanding as of October 31, 2012 was 42,586,483.

tNUSTAR GP HOLDINGS, LLC AND SUBSIDIARIES

FORM 10-Q

TABLE OF CONTENTS

PART I – FINANCIAL INFORMATION
Item 1.	Financial Statements:
	Consolidated Balance Sheets as of September 30, 2012 and December 31, 2011	3
	Condensed Consolidated Statements of Comprehensive Income (Loss) for the Three and Nine Months Ended September 30, 2012 and 2011	4
	Consolidated Statements of Cash Flows for the Nine Months Ended September 30, 2012 and 2011	5
	Condensed Notes to Consolidated Financial Statements	6
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	16
Item 4.	Controls and Procedures	24
PART II – OTHER INFORMATION
Item 1.	Legal Proceedings	25
Item 5.	Other Information	26
Item 6.	Exhibits	27
SIGNATURES		28

2

PART I – FINANCIAL INFORMATION

Item 1. Financial Statements

NUSTAR GP HOLDINGS, LLC

CONSOLIDATED BALANCE SHEETS

(Thousands of Dollars)

	September 30, 2012			December 31, 2011
	(Unaudited)
Assets
Current assets:
Cash and cash equivalents	$	2,660		$	1,354
Receivable from related party	14,736			6,735
Income tax receivable	—			2,619
Other receivables	3			302
Deferred income tax assets, net	4,735			4,378
Other current assets	181			204
Total current assets	22,315			15,592
Investment in NuStar Energy L.P.	482,678			547,230
Long-term receivable from NuStar Energy L.P.	16,004			14,502
Deferred income tax assets, net	13,710			11,703
Total assets	$	534,707		$	589,027
Liabilities and Members’ Equity
Current liabilities:
Short-term debt	$	21,000		$	16,500
Accounts payable	576			257
Accrued compensation expense	21,217			19,476
Accrued liabilities	439			462
Income tax payable	249			—
Taxes other than income tax	527			1,287
Total current liabilities	44,008			37,982
Long-term liabilities	57,753			44,162
Commitments and contingencies (Note 8)
Members’ equity	462,056			529,548
Accumulated other comprehensive loss	(29,110		)	(22,665		)
Total members’ equity	432,946			506,883
Total liabilities and members’ equity	$	534,707		$	589,027

See Condensed Notes to Consolidated Financial Statements.

3

NUSTAR GP HOLDINGS, LLC

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

(Unaudited, Thousands of Dollars, Except Unit and Per Unit Data)

	Three Months Ended September 30,						Nine Months Ended September 30,
	2012			2011			2012			2011
Equity in earnings (loss) of NuStar Energy L.P.	$	9,185		$	18,996		$	(11,471	)	$	53,257
General and administrative expenses	(654		)	(749		)	(2,306		)	(2,235		)
Other income (expense), net	10,702			108			10,808			(557		)
Interest expense, net	(158		)	(116		)	(442		)	(459		)
Income (loss) before income tax benefit	19,075			18,239			(3,411		)	50,006
Income tax benefit	90			123			414			600
Net income (loss)	$	19,165		$	18,362		$	(2,997	)	$	50,606
Comprehensive income (loss)	$	19,225		$	(3,191	)	$	(9,442	)	$	25,763
Basic and diluted net income (loss) per unit	$	0.45		$	0.43		$	(0.07	)	$	1.19
Weighted-average number of basic units outstanding	42,575,563			42,544,659			42,575,183			42,544,659
Weighted-average number of diluted units outstanding	42,575,563			42,570,271			42,575,183			42,580,118

See Condensed Notes to Consolidated Financial Statements.

4

NUSTAR GP HOLDINGS, LLC

CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited, Thousands of Dollars)

	Nine Months Ended September 30,
	2012			2011
Cash Flows from Operating Activities:
Net (loss) income	$	(2,997	)	$	50,606
Adjustments to reconcile net (loss) income to net cash provided by operating activities:
Equity in loss (earnings) of NuStar Energy L.P.	11,471			(53,257		)
Distributions of equity in earnings from NuStar Energy L.P.	—			53,257
Gain related to NuStar Energy L.P.'s issuance of limited partner units	(10,689		)	(124		)
(Gain) loss on sale of NuStar Energy L.P. limited partner units in connection with unit-based compensation	(119		)	681
Benefit for deferred income tax	(2,364		)	(1,989		)
Changes in current assets and liabilities (Note 6)	(2,240		)	(4,650		)
Decrease in other assets	—			1,189
Increase in long-term receivable from NuStar Energy L.P.	(1,502		)	(1,783		)
Increase in long-term liabilities	13,591			8,871
Other, net	121			134
Net cash provided by operating activities	5,272			52,935
Cash Flows from Investing Activities:
Distributions from NuStar Energy L.P.	68,473			10,923
Investment in NuStar Energy L.P.	(14,961		)	(4,966		)
Proceeds from sale of NuStar Energy L.P. units in connection with unit-based compensation	2,795			4,721
Net cash provided by investing activities	56,307			10,678
Cash Flows from Financing Activities:
Proceeds from short-term debt borrowings	21,000			—
Repayment of short-term debt	(16,500		)	(5,500		)
Distributions to unitholders	(65,141		)	(61,903		)
Other, net	368			—
Net cash used in financing activities	(60,273		)	(67,403		)
Net increase (decrease) in cash and cash equivalents	1,306			(3,790		)
Cash and cash equivalents at the beginning of the period	1,354			5,304
Cash and cash equivalents at the end of the period	$	2,660		$	1,514

See Condensed Notes to Consolidated Financial Statements.

5

NUSTAR GP HOLDINGS, LLC

CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

1. ORGANIZATION AND BASIS OF PRESENTATION

Organization

NuStar GP Holdings, LLC (NuStar GP Holdings) (NYSE: NSH) is a publicly held Delaware limited liability company. Unless otherwise indicated, the terms “NuStar GP Holdings,” “we,” “our” and “us” are used in this report to refer to NuStar GP Holdings, LLC, to one or more of our consolidated subsidiaries or to all of them taken as a whole.

We have no operations or sources of income or cash flows other than our investment in NuStar Energy L.P. (NuStar Energy) (NYSE: NS). As of September 30, 2012, we owned approximately 15.1% of NuStar Energy, consisting of the following:

• the 2% general partner interest;

• 100% of the incentive distribution rights (IDR) issued by NuStar Energy, which entitle us to receive increasing percentages of the cash distributed by NuStar Energy, currently at the maximum percentage of 23%; and

• 10,391,275 common units of NuStar Energy representing a 13.1% limited partner interest.

NuStar Energy is a publicly held Delaware limited partnership engaged in the terminalling and storage of petroleum products, the transportation of petroleum products and anhydrous ammonia, and petroleum refining and marketing. NuStar Energy has terminal facilities in the United States, Canada, Mexico, the Netherlands, including St. Eustatius in the Caribbean, the United Kingdom and Turkey.

Basis of Presentation

These unaudited condensed consolidated financial statements include the accounts of NuStar GP Holdings and subsidiaries in which it has a controlling interest. Intercompany balances and transactions have been eliminated in consolidation.

We account for our ownership interest in NuStar Energy using the equity method. Therefore, our financial results reflect a portion of NuStar Energy’s net income (loss) based on our ownership interest in NuStar Energy. We have no separate operating activities apart from those conducted by NuStar Energy and therefore generate no revenues from operations.

These unaudited condensed consolidated financial statements have been prepared in accordance with United States generally accepted accounting principles (GAAP) for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X of the Securities Exchange Act of 1934. Accordingly, they do not include all of the information and notes required by GAAP for complete consolidated financial statements. In the opinion of management, all adjustments considered necessary for a fair presentation have been included. All such adjustments are of a normal recurring nature unless otherwise indicated. Financial information for the three and nine months ended September 30, 2012 and 2011 included in these Condensed Notes to Consolidated Financial Statements is derived from our unaudited condensed consolidated financial statements. Operating results for the three and nine months ended September 30, 2012 are not necessarily indicative of the results that may be expected for the year ending December 31, 2012. The consolidated balance sheet as of December 31, 2011 has been derived from the audited consolidated financial statements as of that date. These condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto included in our Annual Report on Form 10-K for the year ended December 31, 2011.

2. INVESTMENT IN NUSTAR ENERGY

NuStar Energy’s Equity Offering

On September 10, 2012, NuStar Energy issued 7,130,000 common units representing limited partner interests at a price of $48.94 per unit and received proceeds of $336.8 million. In conjunction with NuStar Energy’s issuance of common units, we contributed $7.1 million to NuStar Energy in order to maintain our 2% general partner interest and our ownership in NuStar Energy was reduced from 16.3% at December 31, 2011 to 15.1% at September 30, 2012. This issuance resulted in a gain of $10.7 million for the three and nine months ended September 30, 2012, which is included in “Other income (expense), net” on our consolidated statements of comprehensive income (loss), and represents the increase in the value of our proportionate share of NuStar Energy’s capital.

6

NUSTAR GP HOLDINGS, LLC

CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

NuStar Energy’s Asphalt Operations

On September 28, 2012, NuStar Energy sold a 50% voting interest (the Asphalt Sale) in NuStar Asphalt LLC (Asphalt JV) previously a wholly owned subsidiary of NuStar Energy, to an affiliate of Lindsay Goldberg LLC (Lindsay Goldberg), a private investment firm. Asphalt JV owns and operates asphalt refining assets that were previously wholly owned by NuStar Energy, including the asphalt refineries located in Paulsboro, New Jersey and Savannah, Georgia (collectively, the Asphalt Operations). Lindsay Goldberg paid $175.0 million for the Class A equity interests (Class A Interests) of Asphalt JV, while NuStar Energy retained the Class B equity interests with a fair value of $52.0 million (Class B Interests) of Asphalt JV. The Class A Interests have a distribution preference over the Class B Interests, as well as a liquidation preference.

NuStar Asphalt Refining, LLC and NuStar Marketing LLC are wholly-owned subsidiaries of NuStar Asphalt LLC. Unless otherwise indicated, the term “Asphalt JV” is used in this report to refer to Asphalt JV, to one or more of its consolidated subsidiaries or to all of them taken as a whole.

At closing, NuStar Energy received $261.3 million from Asphalt JV for inventory related to the Asphalt Operations, pending a final inventory valuation. Additionally, NuStar Energy deconsolidated Asphalt JV, recognized a loss of $21.6 million on the Asphalt Sale and started reporting its remaining investment in Asphalt JV using the equity method of accounting.

In anticipation of the Asphalt Sale, NuStar Energy recorded an impairment loss of $266.4 million in the second quarter of 2012 to write-down the carrying value of long-lived assets related to the Asphalt Operations, including fixed assets, goodwill, intangible assets and other long-term assets to their estimated fair value.

7

NUSTAR GP HOLDINGS, LLC

CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

Summary Financial Information

Condensed consolidated financial information reported by NuStar Energy is presented below (in thousands of dollars):

	September 30, 2012		December 31, 2011
	(Unaudited)
Balance Sheet Information:
Current assets	$	864,240	$	1,200,923
Property, plant and equipment, net	3,155,090		3,430,468
Goodwill	822,911		846,717
Long-term receivable from related party	170,711		—
Other long-term assets, net	350,932		403,082
Total assets	$	5,363,884	$	5,881,190
Current liabilities	$	1,110,400	$	943,800
Long-term debt, less current portion	1,518,543		1,928,071
Other long-term liabilities	62,842		144,984
Total liabilities	2,691,785		3,016,855
NuStar Energy partners' equity	2,659,185		2,852,201
Noncontrolling interest	12,914		12,134
Total liabilities and partners’ equity	$	5,363,884	$	5,881,190

	Three Months Ended September 30,				Nine Months Ended September 30,
	2012		2011		2012			2011
	(Thousands of Dollars)
Statement of Comprehensive (Loss) Income Information:
Revenues	$	1,744,766	$	1,824,350	$	5,382,363		$	4,648,150
Operating income (loss)	50,722		92,977		(107,255		)	266,059
Net income (loss)	4,342		70,281		(216,214		)	191,402

Other

Our investment in NuStar Energy reconciles to NuStar Energy’s total partners’ equity as follows:

	September 30, 2012			December 31, 2011
	(Thousands of Dollars)
NuStar Energy’s total partners’ equity	$	2,659,185		$	2,852,201
NuStar GP Holdings’ ownership interest in NuStar Energy	15.1		%	16.3		%
NuStar GP Holdings’ share of NuStar Energy’s partners’ equity	401,537			464,909
Step-up in basis related to NuStar Energy’s assets and liabilities, including equity method goodwill, and other	81,141			82,321
Investment in NuStar Energy	$	482,678		$	547,230

8

NUSTAR GP HOLDINGS, LLC

CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

3. RELATED PARTY TRANSACTIONS

We had a receivable from related party of $14.7 million and $6.7 million, as of September 30, 2012 and December 31, 2011, respectively, mainly relating to payroll, employee benefit plans and unit-based compensation of NuStar Energy. We also had a long-term receivable of $16.0 million and $14.5 million from NuStar Energy as of September 30, 2012 and December 31, 2011, respectively, related to amounts payable for retiree medical benefits and other post-employment benefits. The following table represents total transactions charged to related parties:

	Three Months Ended September 30,				Nine Months Ended September 30,
	2012		2011		2012		2011
	(Thousands of Dollars)
Expenses for payroll, employee benefit plans and unit-based compensation for NuStar Energy	$	55,048	$	45,976	$	163,424	$	150,718
Other	1,184		160		3,312		311
Total transactions charged to related parties	$	56,232	$	46,136	$	166,736	$	151,029

GP Services Agreement

NuStar Energy and NuStar GP, LLC, a wholly owned subsidiary of NuStar GP Holdings, entered into a services agreement, effective January 1, 2008 (the GP Services Agreement). The GP Services Agreement provides that NuStar GP, LLC will furnish administrative and certain operating services necessary to conduct the business of NuStar Energy. All employees providing services to both NuStar GP Holdings and NuStar Energy are employed by NuStar GP, LLC; therefore, NuStar Energy reimburses NuStar GP, LLC for all employee costs, other than the expenses allocated to NuStar GP Holdings (the Holdco Administrative Services Expense). The GP Services Agreement will terminate on December 31, 2012, renewing automatically every two years unless terminated by either party upon six months’ prior written notice. The aggregate amounts of Holdco Administrative Services Expense that we incurred were $0.2 million and $0.3 million for three months ended September 30, 2012 and 2011, respectively and $1.0 million for each of the nine-month periods ended September 30, 2012 and 2011.

Asphalt JV Services Agreement

In conjunction with NuStar Energy’s Asphalt Sale, we entered into a services agreement with Asphalt JV, effective September 28, 2012 (the Asphalt JV Services Agreement). The Asphalt JV Services Agreement provides that we will furnish certain administrative and other operating services necessary to conduct the business of Asphalt JV. Asphalt JV will compensate us for these services through an annual fee totaling $10.0 million, subject to adjustment based on the annual merit increase percentage applicable to our employees for the most recently completed contract year. The Asphalt JV Services Agreement will terminate on December 31, 2017 and will automatically renew for successive two-year terms. Asphalt JV may terminate the Asphalt JV Services Agreement at any time, with 180 days prior written notice or reduce the level of service with 45 days prior written notice.

Asphalt JV Employee Services Agreement

In conjunction with NuStar Energy’s Asphalt Sale, we entered into an employee services agreement with Asphalt JV, effective September 28, 2012 (the Asphalt JV Employee Services Agreement). The Asphalt JV Employee Services Agreement provides that certain of our employees will provide employee-services to Asphalt JV. In exchange Asphalt JV will reimburse us for the compensation expense of those employees at the same rates that were in effect at the effective date of the Asphalt JV Employee Services Agreement, including an annual bonus amount that does not exceed our target bonus plan. The employees covered under the Asphalt JV Employee Services Agreement will not be entitled to any new unit-based compensation grants from us, and Asphalt JV will not be responsible for unit-based compensation costs prior to the effective date. The Asphalt JV Employee Services Agreement will terminate on December 31, 2012.

9

NUSTAR GP HOLDINGS, LLC

CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

4. DISTRIBUTIONS FROM NUSTAR ENERGY

The following table reflects the allocation of NuStar Energy’s cash distributions earned for the periods indicated among its general and limited partners:

	Three Months Ended September 30,				Nine Months Ended September 30,
	2012		2011		2012		2011
	(Thousands of Dollars, Except Per Unit Data)
General partner interest	$	1,961	$	1,628	$	5,525	$	4,847
General partner incentive distribution	10,805		8,972		30,437		26,503
Total general partner distribution	12,766		10,600		35,962		31,350
Limited partner distribution	11,374		11,271		33,808		33,506
Total distributions to NuStar GP Holdings	24,140		21,871		69,770		64,856
Public unitholders’ distributions	73,911		59,543		206,433		177,513
Total cash distributions	$	98,051	$	81,414	$	276,203	$	242,369
Cash distributions per unit applicable to limited partners	$	1.095	$	1.095	$	3.285	$	3.265

On August 10, 2012, NuStar Energy paid a quarterly cash distribution totaling $89.1 million, or $1.095 per unit, related to the second quarter of 2012. On October 25, 2012, NuStar Energy announced a quarterly cash distribution of $1.095 per unit related to the third quarter of 2012. This distribution will be paid on November 14, 2012 to unitholders of record on November 9, 2012 and will total $98.1 million.

5. FAIR VALUE MEASUREMENTS

We segregate the inputs used in measuring fair value into three levels: Level 1, defined as observable inputs such as quoted prices in active markets; Level 2, defined as inputs other than quoted prices in active markets that are either directly or indirectly observable; and Level 3, defined as unobservable inputs in which little or no market data exists.

The following liabilities are measured at fair value on a recurring basis:

	September 30, 2012
	Level 1		Level 2		Level 3		Total
	(Thousands of Dollars)
Accrued compensation expense:
NuStar Energy restricted units and performance awards	$	16,954	$	—	$	—	$	16,954
NuStar Energy unit options	—		399		—		399
Total	$	16,954	$	399	$	—	$	17,353
	December 31, 2011
	Level 1		Level 2		Level 3		Total
	(Thousands of Dollars)
Accrued compensation expense:
NuStar Energy restricted units and performance awards	$	13,622	$	—	$	—	$	13,622
NuStar Energy unit options	—		1,953		—		1,953
Total	$	13,622	$	1,953	$	—	$	15,575

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NUSTAR GP HOLDINGS, LLC

CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

The fair value of our accrued compensation expense for NuStar Energy restricted units and performance awards is determined using the NuStar Energy unit price at the reporting date. The fair value of our accrued compensation expense for NuStar Energy unit options is determined using the Black-Scholes option-pricing model on the reporting date based on the following weighted-average assumptions:

	September 30, 2012		December 31, 2011
Expected life in years	6.5		6.3
Expected volatility	19.8	%	20.3	%
Expected distribution yield	8.6	%	7.7	%
Risk-free interest rate	0.2	%	0.1	%

Fair Value of Financial Instruments

We recognize cash equivalents, receivables, payables and debt in our consolidated balance sheets at their carrying amount. The fair values of these financial instruments approximate their carrying amounts.

6. STATEMENTS OF CASH FLOWS

Changes in current assets and liabilities were as follows:

	Nine Months Ended September 30,
	2012			2011
	(Thousands of Dollars)
Decrease (increase) in current assets:
Receivable from related party	$	(6,586	)	$	(470	)
Income tax receivable	2,619			1,157
Other receivables	299			(31		)
Other current assets	(98		)	54
Increase (decrease) in current liabilities:
Accounts payable	319			274
Accrued compensation expense	1,741			(5,109		)
Accrued liabilities	(23		)	98
Income tax payable	249			(302		)
Taxes other than income tax	(760		)	(321		)
Changes in current assets and liabilities	$	(2,240	)	$	(4,650	)

Cash flows related to interest and income tax were as follows:

	Nine Months Ended September 30,
	2012			2011
	(Thousands of Dollars)
Cash paid for interest	$	316		$	312
Cash (refunded) paid for income tax	$	(918	)	$	536

11

NUSTAR GP HOLDINGS, LLC

CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

7. CREDIT FACILITY

Our 364-day revolving credit agreement dated June 29, 2012, matures on June 28, 2013 and has a borrowing capacity of up to $40.0 million, of which, up to $10.0 million may be available for letters of credit (the 2012 Credit Facility). As of September 30, 2012, we had outstanding borrowings of $21.0 million and availability of $19.0 million for borrowings under the 2012 Credit Facility. Interest on the 2012 Credit Facility is based upon, at our option, either an alternative base rate plus 0.75% or a LIBOR-based rate plus 1.75%, which was 2.0% as of September 30, 2012.

The terms of the 2012 Credit Facility require NuStar Energy to maintain, as of the end of each rolling period, consisting of any period of four consecutive quarters, a consolidated debt coverage ratio not to exceed 5.0-to-1.0. If NuStar Energy consummates an acquisition for an aggregate net consideration of at least $50.0 million, the maximum consolidated debt coverage ratio will increase to 5.5-to-1.0 for two rolling periods. Additionally, if NuStar Energy’s Asphalt Operations are not owned by an unconsolidated joint venture, the 2012 Credit Facility allows the consolidated debt coverage ratio not to exceed 6.5-to-1.0 and 6.0-to-1.0 for the rolling periods ending June 30, 2012 and September 30, 2012, respectively. Since NuStar Energy’s Asphalt Operations were owned by an unconsolidated joint venture as of September 30, 2012, the consolidated debt coverage ratio could not exceed 5.0-to-1.0 and was 4.3x. We are also required to receive cash distributions of at least $50.0 million in respect of our ownership interests in NuStar Energy for the preceding four fiscal quarters ending on the last day of each fiscal quarter. Our management believes that we are in compliance with the covenants of the 2012 Credit Facility as of September 30, 2012.

8. COMMITMENTS AND CONTINGENCIES

Contingencies

We are not currently a party to any material legal proceedings. However, NuStar Energy is subject to certain loss contingencies, the outcome of which could have an effect on NuStar Energy’s results of operations and ability to pay distributions, which would impact our results of operations and ability to pay distributions. NuStar Energy’s material contingent liabilities resulting from various litigation, claims and commitments are discussed below.

Grace Energy Corporation Matter. In 1997, Grace Energy Corporation (Grace Energy) sued subsidiaries of Kaneb Pipeline Partners, L.P. (KPP) and Kaneb Services LLC (KSL and collectively with KPP and their respective subsidiaries, Kaneb) in Texas state court. NuStar Energy acquired Kaneb on July 1, 2005. The complaint sought recovery of the cost of remediation of fuel leaks in the 1970s from a pipeline that had once connected a former Grace Energy terminal with Otis Air Force Base in Massachusetts (Otis AFB). Grace Energy alleges the Otis AFB pipeline and related environmental liabilities had been transferred in 1978 to an entity that was part of Kaneb’s acquisition of Support Terminal Services, Inc. and its subsidiaries from Grace Energy in 1993. Kaneb contends that it did not acquire the Otis AFB pipeline and never assumed any responsibility for any associated environmental damage.

In 2000, the court entered final judgment that: (i) Grace Energy could not recover its own remediation costs of $3.5 million, (ii) Kaneb owned the Otis AFB pipeline and its related environmental liabilities and (iii) Grace Energy was awarded $1.8 million in attorney costs. Both Kaneb and Grace Energy appealed the final judgment of the trial court to the Texas Court of Appeals in Dallas. In 2001, Grace Energy filed a petition in bankruptcy, which created an automatic stay of actions against Grace Energy. In September 2008, Grace Energy filed its Joint Plan of Reorganization and Disclosure Statement.

The Otis AFB is a part of a Superfund Site pursuant to the Comprehensive Environmental Response Compensation and Liability Act (CERCLA). The site contains a number of groundwater contamination plumes, two of which are allegedly associated with the Otis AFB pipeline. Relying on the final judgment of the Texas state court assigning ownership of the Otis AFB pipeline to Kaneb, the United States Department of Justice (the DOJ) advised Kaneb in 2001 that it intends to seek reimbursement from Kaneb for the remediation costs associated with the two plumes. In November 2008, the DOJ forwarded information to NuStar Energy indicating that the past and estimated future remediation expenses associated with one plume are $71.9 million. NuStar Energy reached an agreement to settle the claims of the United States government with respect to the Otis AFB pipeline and to resolve the underlying dispute between Kaneb and Grace. The settlement was approved by the United States Bankruptcy Court for the District of Delaware and a consent decree was entered by the United States District Court for the District of Massachusetts. Pursuant to the terms of the settlement, NuStar Energy paid approximately $13.1 million to the United States government in July 2012 and received releases of claims from various private parties and a covenant not to sue from the United States government. In connection with the settlement, NuStar Energy recognized a gain of $28.7 million during the second quarter of 2012.

12

NUSTAR GP HOLDINGS, LLC

CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

Other.NuStar Energy is a party to additional claims and legal proceedings arising in the ordinary course of its business. Due to the inherent uncertainty of litigation, there can be no assurance that the resolution of any particular claim or proceeding would not have a material adverse effect on NuStar Energy’s results of operations, financial position or liquidity.

9. MEMBERS’ EQUITY

The following table presents changes to our members’ equity (in thousands):

Balance as of December 31, 2011	$	506,883
Net loss	(2,997		)
Distributions to unitholders	(65,141		)
Other comprehensive loss	(6,445		)
Unit-based compensation	646
Balance as of September 30, 2012	$	432,946

Cash Distributions

The table set forth below shows our cash distributions applicable to the period in which the distributions were earned:

	Three Months Ended September 30,				Nine Months Ended September 30,
	2012		2011		2012		2011
	(Thousands of Dollars, Except Per Unit Data)
Cash distributions per unit	$	0.545	$	0.495	$	1.565	$	1.470
Total cash distributions	$	23,204	$	21,059	$	66,637	$	62,540

On August 14, 2012, we paid a quarterly cash distribution totaling $21.7 million, or $0.510 per unit, related to the second quarter of 2012. On October 25, 2012, we announced a quarterly cash distribution of $0.545 per unit related to the third quarter of 2012. This distribution will be paid on November 16, 2012 to unitholders of record on November 9, 2012, and totals $23.2 million.

10. NET INCOME (LOSS) PER UNIT

We treat restricted units granted under our long-term incentive plan as participating securities in computing net income per unit pursuant to the two-class method. Unit amounts used in the computation of basic and diluted net income (loss) per unit were as follows:

	Three Months Ended September 30,		Nine Months Ended September 30,
	2012	2011	2012	2011
Basic units outstanding:
Weighted-average number of basic units outstanding	42,575,563	42,544,659	42,575,183	42,544,659
Diluted units outstanding:
Weighted-average number of basic units outstanding	42,575,563	42,544,659	42,575,183	42,544,659
Effect of dilutive securities (a)	—	25,612	—	35,459
Weighted-average number of diluted units outstanding	42,575,563	42,570,271	42,575,183	42,580,118

(a) The computation of diluted net income (loss) per unit for the three and nine months ended September 30, 2012 excludes 300,766 outstanding options to purchase NuStar GP Holdings units as the effect of including such units would have been anti-dilutive.

13

NUSTAR GP HOLDINGS, LLC

CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

11. EMPLOYEE BENEFIT PLANS

The components of net periodic benefit cost related to our defined benefit plans were as follows:

	Pension Plans (a)						Other Postretirement Benefit Plans
	2012			2011			2012		2011
	(Thousands of Dollars)
For the three months ended September 30:
Components of net periodic benefit cost:
Service cost	$	3,904		$	3,136		$	315	$	264
Interest cost	1,003			720			244		222
Expected return on assets	(979		)	(904		)	—		—
Amortization of prior service credit	(4		)	(4		)	—		—
Amortization of net loss	348			120			35		18
Net periodic benefit cost	$	4,272		$	3,068		$	594	$	504
For the nine months ended September 30:
Components of net periodic benefit cost:
Service cost	$	11,712		$	9,348		$	945	$	777
Interest cost	3,009			2,160			732		666
Expected return on assets	(2,937		)	(2,712		)	—		—
Amortization of prior service credit	(12		)	(12		)	—		—
Amortization of net loss	1,044			362			105		54
Net periodic benefit cost	$	12,816		$	9,146		$	1,782	$	1,497

(a) Includes amounts related to the pension plan, the excess pension plan and the supplemental executive retirement plan.

12. SUBSEQUENT EVENT

TexStar Purchase Agreement

On November 2, 2012, NuStar Logistics, L.P. (NuStar Logistics), a wholly owned subsidiary of NuStar Energy, entered into an Asset Purchase Agreement (the Purchase Agreement) with TexStar Crude Oil Services, LP, TexStar Crude Oil Pipeline, LP, TexStar Midstream Utility, LP, TexStar Midstream Transport, LP, TexStar Midstream Services, LP and Frio LaSalle Pipeline, LP (collectively, the Sellers), to purchase the following assets:

• approximately 140 miles of crude oil pipelines and gathering lines that are currently under construction and upon completion will have throughput capacity of 100,000 barrels per day (the Crude Oil Pipelines);

• five terminals and storage facilities providing 643,400 barrels of storage capacity (the Crude Oil Terminals and Storage Facilities); and

• 38 miles of natural gas liquids (NGL) Y-grade pipeline and two fractionators with a combined capacity of 57,000 barrels per day (the NGL Assets); with the NGL Assets are currently under construction.

The acquisition also includes a lease for a terminal and storage facility located near Corpus Christi providing 144,000 barrels of storage capacity (the Redfish Bay Lease). The Crude Oil Pipelines, the Crude Oil Terminals and Storage Facilities and the Redfish Bay Lease are collectively referred to herein as the “Crude Oil Assets.” The Crude Oil Assets and the NGL Assets are collectively referred to herein as the “Assets.”

The purchase price for the Assets is approximately $425.0 million, subject tocertain purchase price adjustments, and is expected to close in two separate transactions. The acquisition of the Crude Oil Assets is expected to close in December 2012 (the Initial Closing), subject to customary closing conditions such as approval under the Hart-Scott Rodino Antitrust Improvements Act. The acquisition of the NGL Assets is expected to close in the first quarter of 2013 (the Second Closing),

14

NUSTAR GP HOLDINGS, LLC

CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

subject to certain closing conditions such as completion of the Initial Closing and achieving certain milestones with respect to the development of the NGL Assets. If the Second Closing does not occur, it will have no impact on the Purchase Agreement with respect to the Crude Oil Assets. The Initial Closing and the Second Closing are collectively referred to herein as the “Transaction.” Upon the Initial Closing, NuStar Logistics will pay the Sellers approximately $325.0 million and at the Second Closing, NuStar Logistics will pay the Sellers approximately $100.0 million. Both payments are subject tocertain purchase price adjustments. NuStar Logistics expects to fund the purchase price with a combination of borrowings under its revolving credit facility and potential equity or debt offerings, pending market conditions.

The parties to the Purchase Agreement have made customary representations, warranties and covenants for a transaction of this type in this industry, including, among others, Sellers' agreement to continue to operate the Assets, during the period prior to the consummation of the Transaction, in the ordinary course of business, consistent with past practice or as otherwise set forth in the Purchase Agreement. The Sellers also agreed to continue construction of the Crude Oil Assets and NGL Assets. The Purchase Agreement also contains post-closing indemnification obligations for, among other matters, breaches of representations and warranties and certain retained and assumed obligations.

The Purchase Agreement contains certain termination rights prior to consummation of the Transaction by: (i) mutual written consent of NuStar Logistics and Sellers; (ii) NuStar Logistics if casualty losses result in damages in excess of $17 million; (iii) NuStar Logistics or Sellers, as applicable, if the other party has breached a representation, warranty or covenant contained in the Purchase Agreement so that such party is incapable of fulfilling its obligations under a closing condition; (iv) by NuStar Logistics or Sellers if the Initial Closing has not occurred by December 15, 2012, subject to extension as provided in the Purchase Agreement; or (v) by NuStar Logistics or Sellers if the Second Closing has not occurred by January 31, 2013, subject to extension as provided in the Purchase Agreement.

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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

FORWARD-LOOKING STATEMENTS

This Form 10-Q contains certain estimates, predictions, projections, assumptions and other forward-looking statements that involve various risks and uncertainties. While these forward-looking statements, and any assumptions upon which they are based, are made in good faith and reflect our current judgment regarding the direction of our business, actual results will almost always vary, sometimes materially, from any estimates, predictions, projections, assumptions or other future performance suggested in this report. These forward-looking statements can generally be identified by the words “anticipates,” “believes,” “expects,” “plans,” “intends,” “estimates,” “forecasts,” “budgets,” “projects,” “will,” “could,” “should,” “may” and similar expressions. These statements reflect our current views with regard to future events and are subject to various risks, uncertainties and assumptions. Please read our annual report on Form 10-K for the year ended December 31, 2011, Part I “Risk Factors,” as well as our subsequent current and quarterly reports, for a discussion of certain of those risks, uncertainties and assumptions.

If one or more of these risks or uncertainties materialize, or if the underlying assumptions prove incorrect, our actual results may vary materially from those described in any forward-looking statement. Other unknown or unpredictable factors could also have material adverse effects on our future results. Readers are cautioned not to place undue reliance on this forward-looking information, which is as of the date of this Form 10-Q. We do not intend to update these statements unless it is required by the securities laws to do so, and we undertake no obligation to publicly release the result of any revisions to any such forward-looking statements that may be made to reflect events or circumstances after the date of this report or to reflect the occurrence of unanticipated events.

OVERVIEW

NuStar GP Holdings, LLC (NuStar GP Holdings) (NYSE: NSH) is a publicly held Delaware limited liability company. Unless otherwise indicated, the terms “NuStar GP Holdings,” “we,” “our” and “us” are used in this report to refer to NuStar GP Holdings, LLC, to one or more of our consolidated subsidiaries or to all of them taken as a whole.

Our only cash generating assets are our ownership interests in NuStar Energy L.P. (NuStar Energy), a publicly held Delaware limited partnership (NYSE: NS). As of September 30, 2012, our aggregate ownership interests in NuStar Energy consisted of the following:

• the 2% general partner interest;

• 100% of the incentive distribution rights (IDR) issued by NuStar Energy, which entitle us to receive increasing percentages of the cash distributed by NuStar Energy, currently at the maximum percentage of 23%; and

• 10,391,275 common units of NuStar Energy representing a 13.1% limited partner interest.

We account for our ownership interest in NuStar Energy using the equity method. Therefore, our financial results reflect a portion of NuStar Energy’s net (loss) income based on our ownership interest. We have no separate operating activities apart from those conducted by NuStar Energy and therefore generate no revenues from operations.

NuStar Energy is engaged in the terminalling and storage of petroleum products, the transportation of petroleum products and anhydrous ammonia, and petroleum refining and marketing. NuStar Energy has terminal facilities in the United States, Canada, Mexico, the Netherlands, including St. Eustatius in the Caribbean, the United Kingdom and Turkey.

NuStar Energy is required by its partnership agreement to distribute all of its available cash at the end of each quarter, less reserves established by its general partner, in its sole discretion, to provide for the proper conduct of NuStar Energy’s business. Similarly, we are required by our limited liability company agreement to distribute all of our available cash at the end of each quarter, less reserves established by our board of directors.

On September 28, 2012, NuStar Energy sold a 50% voting interest (the Asphalt Sale) in NuStar Asphalt LLC (Asphalt JV) previously a wholly owned subsidiary of NuStar Energy, to an affiliate of Lindsay Goldberg LLC (Lindsay Goldberg), a private investment firm. Asphalt JV owns and operates asphalt refining assets that were previously wholly owned by NuStar Energy, including the asphalt refineries located in Paulsboro, New Jersey and Savannah, Georgia (collectively, the Asphalt Operations). Lindsay Goldberg paid $175.0 million for the Class A equity interests (Class A Interests) of Asphalt JV, while NuStar Energy retained the Class B equity interests with a fair value of $52.0 million (Class B Interests) of Asphalt JV. The Class A Interests have a distribution preference over the Class B Interests, as well as a liquidation preference.

16

NuStar Asphalt Refining, LLC and NuStar Marketing LLC are wholly-owned subsidiaries of NuStar Asphalt LLC. Unless otherwise indicated, the term “Asphalt JV” is used in this report to refer to Asphalt JV, to one or more of its consolidated subsidiaries or to all of them taken as a whole.

At closing, NuStar Energy received $261.3 million from Asphalt JV for inventory related to the Asphalt Operations, pending a final inventory valuation. Additionally, NuStar Energy deconsolidated Asphalt JV, recognized a loss of $21.6 million on the Asphalt Sale and started reporting its remaining investment in Asphalt JV using the equity method of accounting.

In anticipation of the Asphalt Sale, NuStar Energy recorded an impairment loss of $266.4 million in the second quarter of 2012 to write-down the carrying value of long-lived assets related to the Asphalt Operations, including fixed assets, goodwill, intangible assets and other long-term assets to their estimated fair value.

RESULTS OF OPERATIONS

Three Months Ended September 30, 2012 Compared to Three Months Ended September 30, 2011

Financial Highlights

(Unaudited, Thousands of Dollars, Except Per Unit Data)

	Three Months Ended September 30,
	2012			2011			Change
Equity in earnings of NuStar Energy	$	9,185		$	18,996		$	(9,811	)
General and administrative expenses	(654		)	(749		)	95
Other income, net	10,702			108			10,594
Interest expense, net	(158		)	(116		)	(42		)
Income before income tax benefit	19,075			18,239			836
Income tax benefit	90			123			(33		)
Net income	$	19,165		$	18,362		$	803
Basic and diluted net income per unit	$	0.45		$	0.43		$	0.02

The following table summarizes NuStar Energy’s statement of comprehensive income data:

	Three Months Ended September 30,
	2012			2011			Change
	(Unaudited, Thousands of Dollars, Except Per Unit Data)
Revenues	$	1,744,766		$	1,824,350		$	(79,584	)
Cost of product sales	1,486,985			1,535,609			(48,624		)
Operating expenses	142,419			135,615			6,804
Depreciation and amortization expense	38,047			40,653			(2,606		)
Segment operating income	77,315			112,473			(35,158		)
General and administrative expenses	(24,954		)	(17,731		)	(7,223		)
Other depreciation and amortization expense	(1,639		)	(1,765		)	126
Operating income	$	50,722		$	92,977		$	(42,255	)
Net income	$	4,342		$	70,281		$	(65,939	)
Net (loss) income per unit applicable to limited partners	$	(0.09	)	$	0.92		$	(1.01	)
Cash distributions per unit applicable to limited partners	$	1.095		$	1.095		$	—

17

NuStar Energy’s net income decreased $65.9 million for the three months ended September 30, 2012, compared to the three months ended September 30, 2011, primarily due to a decrease in segment operating income and an increase in other expense and general and administrative expenses. NuStar Energy’s segment operating income decreased $35.2 million for the three months ended September 30, 2012, compared to the three months ended September 30, 2011, primarily due to an operating loss from the asphalt and fuels marketing segment. NuStar Energy’s other expense increased for the three months ended September 30, 2012, compared to the three months ended September 30, 2011, mainly due to a $21.6 million loss related to the Asphalt Sale.

Equity in earnings of NuStar Energy

The following table summarizes our equity in earnings of NuStar Energy:

	Three Months Ended September 30,
	2012			2011			Change
	(Thousands of Dollars)
NuStar GP Holdings’ Equity in Earnings of NuStar Energy:
General partner interest	$	(128	)	$	1,223		$	(1,351	)
General partner incentive distribution rights (IDR)	10,805			8,972			1,833
General partner’s interest in earnings and incentive distributions of NuStar Energy	10,677			10,195			482
Limited partner interest in (loss) earnings of NuStar Energy	(771		)	9,522			(10,293		)
Amortization of step-up in basis related to NuStar Energy’s assets and liabilities	(721		)	(721		)	—
Equity in earnings of NuStar Energy	$	9,185		$	18,996		$	(9,811	)

For the three months ended September 30, 2012, NuStar Energy reported a net loss per unit applicable to limited partners of $0.09, compared to net income of $0.92 per unit for the three months ended September 30, 2011. As our results related to both our general and limited partner interests are based on NuStar Energy’s results, we reported equity in loss related to our general and limited partner interests for the three months ended September 30, 2012, compared to equity in earnings for the three months ended September 30, 2011.

An increase in the number of NuStar Energy units outstanding resulting from the issuance of units in the 3rd quarter of 2012 and fourth quarter 2011, resulted in NuStar Energy increasing its total cash distributions. Since our IDR in NuStar Energy entitle us to an increasing amount of NuStar Energy’s cash distributions, our equity in earnings of NuStar Energy related to our IDR increased for the period.

Other income, net

Other income, net increased for the three months ended September 30, 2012, compared to the three months ended September 30, 2011 due to NuStar Energy’s issuance of 7,130,000 common units in September 2012. This issuance resulted in a gain of $10.7 million representing the increase in the value of our proportionate share of NuStar Energy’s capital.

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Nine Months EndedSeptember 30, 2012 Compared to Nine Months EndedSeptember 30, 2011

Financial Highlights

(Unaudited, Thousands of Dollars, Except Per Unit Data)

	Nine Months Ended September 30,
	2012			2011			Change
Equity in (loss) earnings of NuStar Energy	$	(11,471	)	$	53,257		$	(64,728	)
General and administrative expenses	(2,306		)	(2,235		)	(71		)
Other income (expense), net	10,808			(557		)	11,365
Interest expense, net	(442		)	(459		)	17
(Loss) income before income tax benefit	(3,411		)	50,006			(53,417		)
Income tax benefit	414			600			(186		)
Net (loss) income	$	(2,997	)	$	50,606		$	(53,603	)
Basic and diluted net (loss) income per unit	$	(0.07	)	$	1.19		$	(1.26	)

The following table summarizes NuStar Energy’s statement of comprehensive (loss) income data:

	Nine Months Ended September 30,
	2012			2011			Change
	(Unaudited, Thousands of Dollars, Except Per Unit Data)
Revenues	$	5,382,363		$	4,648,150		$	734,213
Cost of product sales	4,638,011			3,797,424			840,587
Operating expenses	403,348			390,480			12,868
Depreciation and amortization expense	124,451			119,443			5,008
Asset and goodwill impairment loss	268,483			—			268,483
Segment operating (loss) income	(51,930		)	340,803			(392,733		)
General and administrative expenses	(75,276		)	(69,833		)	(5,443		)
Other depreciation and amortization expense	(5,492		)	(4,911		)	(581		)
Other asset impairment loss	(3,295		)	—			(3,295		)
Gain on legal settlement	28,738			—			28,738
Operating (loss) income	$	(107,255	)	$	266,059		$	(373,314	)
Net (loss) income	$	(216,214	)	$	191,402		$	(407,616	)
Net (loss) income per unit applicable to limited partners	$	(3.40	)	$	2.49		$	(5.89	)
Cash distributions per unit applicable to limited partners	$	3.285		$	3.265		$	0.020

For the nine months ended September 30, 2012, NuStar Energy reported a net loss of $216.2 million, compared to net income of $191.4 million for the nine months ended September 30, 2011, primarily due to an operating loss of $324.0 million in the asphalt and fuels marketing segment. NuStar Energy’s operating loss in the asphalt and fuels marketing segment mainly resulted from an asset impairment charge of $266.4 million in the second quarter of 2012 related to the long-lived assets of its asphalt operations. In addition, the gross margin for NuStar Energy’s asphalt and fuels marketing segment decreased $141.4 million for the nine months ended September 30, 2012, compared to the nine months ended September 30, 2011.

19

Equity in (loss) earnings of NuStar Energy

The following table summarizes our equity in (loss) earnings of NuStar Energy:

	Nine Months Ended September 30,
	2012			2011			Change
	(Thousands of Dollars)
NuStar GP Holdings’ Equity in (Loss) Earnings of NuStar Energy:
General partner interest	$	(4,928	)	$	3,294		$	(8,222	)
General partner incentive distribution rights (IDR)	30,437			26,503			3,934
General partner’s interest in earnings and incentive distributions of NuStar Energy	25,509			29,797			(4,288		)
Limited partner interest in (loss) earnings of NuStar Energy	(34,817		)	25,623			(60,440		)
Amortization of step-up in basis related to NuStar Energy’s assets and liabilities	(2,163		)	(2,163		)	—
Equity in (loss) earnings of NuStar Energy	$	(11,471	)	$	53,257		$	(64,728	)

For the nine months ended September 30, 2012, NuStar Energy reported a net loss per unit applicable to limited partners of $3.40, compared to net income of $2.49 per unit for the nine months ended September 30, 2011. As our results related to both our general and limited partner interests are based on NuStar Energy's results, we reported equity in loss related to our general and limited partner interests for the nine months ended September 30, 2012, compared to equity in earnings for the nine months ended September 30, 2011.

NuStar Energy’s per unit distributions for the nine months ended September 30, 2012 increased, compared to the nine months ended September 30, 2011, from $3.265 to $3.285. That increase, coupled with an increase in the number of NuStar Energy units outstanding resulting from the issuance of units in the 3rd quarter of 2012 and fourth quarter of 2011, resulted in NuStar Energy increasing its total cash distributions. Since our IDR in NuStar Energy entitle us to an increasing amount of NuStar Energy’s cash distributions, our equity in earnings of NuStar Energy related to our IDR increased for the period.

Other income (expense), net

Other income (expense), net increased for the nine months ended September 30, 2012, compared to the nine months ended September 30, 2011 due to NuStar Energy’s issuance of 7,130,000 common units in September 2012. This issuance resulted in a gain of $10.7 million representing the increase in the value of our proportionate share of NuStar Energy’s capital.

TRENDS AND OUTLOOK

NuStar Energy’s Storage Segment

In the fourth quarter of 2012, NuStar Energy expects the storage segment to continue to benefit from internal growth projects completed in 2011 as well as those completed in 2012, mainly at its St. James, Louisiana terminal. NuStar Energy’s fourth quarter results should also begin to benefit from a tank expansion project at its St. Eustatius terminal in the Caribbean, which it expects to complete in the fourth quarter. However, NuStar Energy’s fourth quarter 2012 earnings are expected to be comparable to the fourth quarter of 2011 as the expected additional earnings from those completed projects should be partially offset by higher maintenance costs at several of its terminal facilities. Overall, NuStar Energy expects the full year 2012 earnings for the storage segment to exceed 2011.

NuStar Energy’s Transportation Segment

NuStar Energy expects earnings of the transportation segment for the fourth quarter and the full year 2012 to be higher as compared to the same periods in 2011. NuStar Energy’s earnings for this segment should benefit from higher throughputs related to the pipeline expansion projects completed in 2011 and in July and October of 2012 that serve Eagle Ford Shale production. NuStar Energy’s fourth quarter results will also benefit from the tariff increase in the second quarter of 2012 on its pipelines regulated by the Federal Energy Regulatory Commission.

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NuStar Energy’s Asphalt and Fuels Marketing Segment

NuStar Energy completed the sale of 50% of the Asphalt Operations in the third quarter of 2012. Upon closing of the sale, NuStar Energy deconsolidated the Asphalt Operations and will prospectively report its remaining investment using the equity method of accounting. Because of NuStar Energy’s ongoing involvement with the Asphalt Operations, it will not report its historic results of operations as discontinued operations. Therefore, NuStar Energy’s future results of operations for this segment, subsequent to deconsolidation, will not be comparable to the corresponding prior periods.

Although NuStar Energy expects fourth quarter 2012 results for its fuels marketing operations to exceed the fourth quarter of 2011, full year 2012 earnings for the fuels marketing operations are expected to be less than the full year results for the prior year, primarily due to lower earnings from heavy fuel oil and bunker fuel marketing.

NuStar Energy’s fourth quarter 2012 results for the asphalt and fuels marketing segment are expected to be higher than fourth quarter 2011 mainly due to losses sustained by the Asphalt Operations in 2011 that will no longer be reported as part of this segment.

NuStar Energy’s outlook for the partnership overall could change depending on, among other things, crude oil prices, the state of the economy, changes to refinery maintenance schedules and other factors that affect overall demand for the products it stores, transports and sells as well as changes in commodity prices for the products it markets.

We expect our equity in earnings (loss) of NuStar Energy to increase or decrease consistent with NuStar Energy’s earnings (loss).

LIQUIDITY AND CAPITAL RESOURCES

General

Our cash flows consist of distributions from NuStar Energy on our partnership interests, including the IDR that we own. Due to our ownership of NuStar Energy’s IDR, our portion of NuStar Energy’s total distributions may exceed our ownership interest in NuStar Energy. Our primary cash requirements are for distributions to members, capital contributions to maintain our 2% general partner interest in NuStar Energy in the event that NuStar Energy issues additional units, debt service requirements, benefit plan funding and general and administrative expenses. In addition, because NuStar GP, LLC, a wholly owned subsidiary of NuStar GP Holdings, elected to be treated as a taxable entity in August 2006, we may be required to pay income taxes, which may exceed the amount of tax expense recorded in the consolidated financial statements. We expect to fund our cash requirements primarily with the quarterly cash distributions we receive from NuStar Energy and borrowings under our revolving credit facility, if necessary. Additionally, NuStar Energy reimburses us for all costs incurred on their behalf, primarily employee-related costs.

Cash Distributions from NuStar Energy

NuStar Energy pays quarterly distributions within 45 days following the end of each quarter based on the partnership interests outstanding as of a record date that is set after the end of each quarter. The table set forth below shows the cash distributions earned for the periods shown with respect to our ownership interests in NuStar Energy and IDR:

	Three Months Ended September 30,						Nine Months Ended September 30,
	2012			2011			2012			2011
	(Thousands of Dollars, Except Per Unit Data)
Cash distributions per unit	$	1.095		$	1.095		$	3.285		$	3.265
Total cash distributions by NuStar Energy to all partners	$	98,051		$	81,414		$	276,203		$	242,369
Cash distributions we received from NuStar Energy:
General partner interest	$	1,961		$	1,628		$	5,525		$	4,847
General partner incentive distribution	10,805			8,972			30,437			26,503
Limited partner interest – common units	11,374			11,271			33,808			33,506
Total cash distributions to us	$	24,140		$	21,871		$	69,770		$	64,856
Distributions to us as a percentage of total cash distributions	24.6		%	26.9		%	25.3		%	26.8		%

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Cash Flows for the Nine Months Ended September 30, 2012 and September 30, 2011

Cash distributions received from NuStar Energy for the nine months ended September 30, 2012 were $68.5 million compared to $64.2 million for the nine months ended September 30, 2011. The cash distributions we received were used principally to fund distributions to our unitholders totaling $65.1 millionfor the nine months ended September 30, 2012, compared to $61.9 millionfor the nine months ended September 30, 2011. We borrowed $21.0 million from our revolving credit facility for the nine months ended September 30, 2012, mainly to repay $16.5 million on our previous revolving credit facility. Additionally, we contributed $15.0 million to NuStar Energy for the nine months ended September 30, 2012, to fund our contribution to NuStar Energy in order to maintain our 2% general partner interest following its issuance of common units in September 2012 and to purchase NuStar Energy units to satisfy awards granted in connection with unit-based compensation.

For the nine months ended September 30, 2011, we used excess cash to repay $5.5 million on our revolving credit facility and purchased $5.0 million of NuStar Energy units mainly to satisfy awards granted in connection with unit-based compensation.

Credit Facility

Our 364-day revolving credit agreement dated June 29, 2012, matures on June 28, 2013 and has a borrowing capacity of up to $40.0 million, of which, up to $10.0 million may be available for letters of credit (the 2012 Credit Facility). As of September 30, 2012, we had outstanding borrowings of $21.0 million and availability of $19.0 million for borrowings under the 2012 Credit Facility. Interest on the 2012 Credit Facility is based upon, at our option, either an alternative base rate plus 0.75% or a LIBOR-based rate plus 1.75%, which was 2.0% as of September 30, 2012.

The terms of the 2012 Credit Facility require NuStar Energy to maintain, as of the end of each rolling period, consisting of any period of four consecutive quarters, a consolidated debt coverage ratio not to exceed 5.0-to-1.0. If NuStar Energy consummates an acquisition for an aggregate net consideration of at least $50.0 million, the maximum consolidated debt coverage ratio will increase to 5.5-to-1.0 for two rolling periods. Additionally, if NuStar Energy’s Asphalt Operations are not owned by an unconsolidated joint venture, the 2012 Credit Facility allows the consolidated debt coverage ratio not to exceed 6.5-to-1.0 and 6.0-to-1.0 for the rolling periods ending June 30, 2012 and September 30, 2012, respectively. Since NuStar Energy’s Asphalt Operations were owned by an unconsolidated joint venture as of September 30, 2012, the consolidated debt coverage ratio could not exceed 5.0-to-1.0 and was 4.3x. We are also required to receive cash distributions of at least $50.0 million in respect of our ownership interests in NuStar Energy for the preceding four fiscal quarters ending on the last day of each fiscal quarter. Our management believes that we are in compliance with the covenants of the 2012 Credit Facility as of September 30, 2012.

Cash Distributions to Unitholders

Our limited liability company agreement requires that, within 50 days after the end of each quarter, we distribute all of our available cash to the holders of record of our units on the applicable record date. The table set forth below shows our cash distributions applicable to the period in which the distributions were earned:

	Three Months Ended September 30,				Nine Months Ended September 30,
	2012		2011		2012		2011
	(Thousands of Dollars, Except Per Unit Data)
Cash distributions per unit	$	0.545	$	0.495	$	1.565	$	1.470
Total cash distributions	$	23,204	$	21,059	$	66,637	$	62,540

Investment in NuStar Energy

On September 10, 2012, NuStar Energy issued 7,130,000 common units representing limited partner interests at a price of $48.94 resulting in net proceeds of $343.9 million, including $7.1 million from us in order to maintain our 2% general partner interest.

Related Party Transactions

Please refer to Note 3 of the Condensed Notes to Consolidated Financial Statements in Item 1. “Financial Statements” for total transactions charged to and amounts due from related parties, and a description of the agreements.

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Contingencies

As previously discussed, our only cash-generating assets are our indirect ownership interests in NuStar Energy. NuStar Energy is subject to certain loss contingencies, the outcomes of which could have a material effect on NuStar Energy’s results of operations and cash flows. Please refer to Note 8 of the Condensed Notes to Consolidated Financial Statements in Item 1. “Financial Statements” for a more detailed discussion of contingencies.

CRITICAL ACCOUNTING POLICIES

The preparation of financial statements in accordance with U.S. generally accepted accounting principles requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. Actual results could differ from those estimates. Our critical accounting policies are disclosed in our Annual Report on Form 10-K for the year ended December 31, 2011.

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Item 4. Controls and Procedures

(a) Evaluation of disclosure controls and procedures.

Our management has evaluated, with the participation of our principal executive officer and principal financial officer, the effectiveness of our disclosure controls and procedures (as defined in Rule 13a-15(e) under the Securities Exchange Act of 1934) as of the end of the period covered by this report, and has concluded that our disclosure controls and procedures were effective as of September 30, 2012.

(b) Changes in internal control over financial reporting.

There has been no change in our internal control over financial reporting that occurred during our last fiscal quarter that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

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PART II – OTHER INFORMATION

Item 1.    Legal Proceedings

None.

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Item 5.    Other Information

TexStar Purchase Agreement

On November 2, 2012, NuStar Logistics, L.P. (NuStar Logistics), a wholly owned subsidiary of NuStar Energy, entered into an Asset Purchase Agreement (the Purchase Agreement) with TexStar Crude Oil Services, LP, TexStar Crude Oil Pipeline, LP, TexStar Midstream Utility, LP, TexStar Midstream Transport, LP, TexStar Midstream Services, LP and Frio LaSalle Pipeline, LP (collectively, the Sellers), to purchase the following assets:

• approximately 140 miles of crude oil pipelines and gathering lines that are currently under construction and upon completion will have throughput capacity of 100,000 barrels per day (the Crude Oil Pipelines);

• five terminals and storage facilities providing 643,400 barrels of storage capacity (the Crude Oil Terminals and Storage Facilities); and

• 38 miles of natural gas liquids (NGL) Y-grade pipeline and two fractionators with a combined capacity of 57,000 barrels per day (the NGL Assets); with the NGL Assets are currently under construction.

The acquisition also includes a lease for a terminal and storage facility located near Corpus Christi providing 144,000 barrels of storage capacity (the Redfish Bay Lease). The Crude Oil Pipelines, the Crude Oil Terminals and Storage Facilities and the Redfish Bay Lease are collectively referred to herein as the “Crude Oil Assets.” The Crude Oil Assets and the NGL Assets are collectively referred to herein as the “Assets.”

The purchase price for the Assets is approximately $425.0 million, subject tocertain purchase price adjustments, and is expected to close in two separate transactions. The acquisition of the Crude Oil Assets is expected to close in December 2012 (the Initial Closing), subject to customary closing conditions such as approval under the Hart-Scott Rodino Antitrust Improvements Act. The acquisition of the NGL Assets is expected to close in the first quarter of 2013 (the Second Closing), subject to certain closing conditions such as completion of the Initial Closing and achieving certain milestones with respect to the development of the NGL Assets. If the Second Closing does not occur, it will have no impact on the Purchase Agreement with respect to the Crude Oil Assets. The Initial Closing and the Second Closing are collectively referred to herein as the “Transaction.” Upon the Initial Closing, NuStar Logistics will pay the Sellers approximately $325.0 million and at the Second Closing, NuStar Logistics will pay the Sellers approximately $100.0 million. Both payments are subject tocertain purchase price adjustments. NuStar Logistics expects to fund the purchase price with a combination of borrowings under its revolving credit facility and potential equity or debt offerings, pending market conditions.

The parties to the Purchase Agreement have made customary representations, warranties and covenants for a transaction of this type in this industry, including, among others, Sellers' agreement to continue to operate the Assets, during the period prior to the consummation of the Transaction, in the ordinary course of business, consistent with past practice or as otherwise set forth in the Purchase Agreement. The Sellers also agreed to continue construction of the Crude Oil Assets and NGL Assets. The Purchase Agreement also contains post-closing indemnification obligations for, among other matters, breaches of representations and warranties and certain retained and assumed obligations.

The Purchase Agreement contains certain termination rights prior to consummation of the Transaction by: (i) mutual written consent of NuStar Logistics and Sellers; (ii) NuStar Logistics if casualty losses result in damages in excess of $17 million; (iii) NuStar Logistics or Sellers, as applicable, if the other party has breached a representation, warranty or covenant contained in the Purchase Agreement so that such party is incapable of fulfilling its obligations under a closing condition; (iv) by NuStar Logistics or Sellers if the Initial Closing has not occurred by December 15, 2012, subject to extension as provided in the Purchase Agreement; or (v) by NuStar Logistics or Sellers if the Second Closing has not occurred by January 31, 2013, subject to extension as provided in the Purchase Agreement.

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Item 6. Exhibits

Exhibit Number		Description
10.01		Purchase and Sale Agreement by and among NuStar Energy L.P., NuStar Logistics, L.P., NuStar Asphalt Refining, LLC, NuStar Marketing LLC, NuStar Asphalt LLC and Asphalt Acquisition LLC dated as of July 3, 2012 (incorporated by reference to Exhibit 10.01 of NuStar Energy L.P.'s Current Report on Form 8-K filed July 6, 2012)
*10.02		Letter Agreement by and among Asphalt Acquisition LLC, NuStar Energy L.P., NuStar Logistics, L.P., NuStar Asphalt Refining, LLC, NuStar Marketing LLC and NuStar Asphalt LLC dated August 2, 2012
*10.03		Amendment No. 1 to Purchase and Sale Agreement dated as of September 28, 2012 by and among NuStar Energy L.P., NuStar Logistics, L.P., NuStar Asphalt Refining, LLC, NuStar Marketing LLC, NuStar GP, LLC, NuStar Asphalt LLC and Asphalt Acquisition LLC
*31.01		Rule 13a-14(a) Certification (under Section 302 of the Sarbanes-Oxley Act of 2002) of principal executive officer
*31.02		Rule 13a-14(a) Certification (under Section 302 of the Sarbanes-Oxley Act of 2002) of principal financial officer
*32.01		Section 1350 Certification (under Section 906 of the Sarbanes-Oxley Act of 2002) of principal executive officer
*32.02		Section 1350 Certification (under Section 906 of the Sarbanes-Oxley Act of 2002) of principal financial officer
*101.INS		XBRL Instance Document
*101.SCH		XBRL Taxonomy Extension Schema Document
*101.CAL		XBRL Taxonomy Extension Calculation Linkbase Document
*101.DEF		XBRL Taxonomy Extension Definition Linkbase Document
*101.LAB		XBRL Taxonomy Extension Label Linkbase Document
*101.PRE		XBRL Taxonomy Extension Presentation Linkbase Document
*	Filed herewith.

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

NUSTAR GP HOLDINGS, LLC

(Registrant)

By:	/s/ Curtis V. Anastasio
	Curtis V. Anastasio
	President and Chief Executive Officer
	November 8, 2012
By:	/s/ Steven A. Blank
	Steven A. Blank
	Executive Vice President, Chief Financial Officer and Treasurer
	November 8, 2012
By:	/s/ Thomas R. Shoaf
	Thomas R. Shoaf
	Senior Vice President and Controller
	November 8, 2012

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EX-10.02

EXHIBIT 10.02

Asphalt Acquisition LLC

August 2, 2012

NuStar Logistics, L.P.

2330 North Loop 1604 W

San Antonio, TX 78248

Attention: Bradley C. Barron, Esq.

Ladies and Gentlemen:

Reference is made to the Purchase and Sale Agreement dated as of July 3, 2012 (the “Purchase and Sale Agreement”) by and among NuStar Energy L.P., a Delaware limited partnership (“Energy”), NuStar Logistics, L.P., a Delaware limited partnership (the “Seller”), NuStar Asphalt Refining, LLC, a Delaware limited liability company (“Refining”), NuStar Marketing LLC, a Delaware limited liability company (“Marketing”), NuStar GP, LLC, a Delaware limited liability company (“GP LLC”), NuStar Asphalt LLC, a Delaware limited liability company (the “Company”), and Asphalt Acquisition LLC, a Delaware limited liability company (the “Investor,” together with the Seller, Energy, Refining, Marketing, the Company and GP LLC, the “Parties”, and each of them, a “Party”). Capitalized terms used herein but not otherwise defined shall have the meanings set forth in the Purchase and Sale Agreement.

The Parties hereby jointly extend the time period in which the Investor may provide notice of its election to have Section 8.2(b) of the Purchase and Sale Agreement apply. Such time period, which was scheduled to end 30 days following the execution of the Purchase and Sale Agreement, is extended to end on August 17, 2012. If the Investor provides such notice during such extended time period, then the Parties shall act in accordance therewith for all purposes as if such notice had been provided in accordance with Section 8.2(b) of the Purchase and Sale Agreement.

Except as expressly set forth herein, this letter agreement will not by implication or otherwise limit, impair, constitute a waiver of or otherwise affect the rights and remedies of the parties to the Purchase and Sale Agreement, and will not alter, modify, amend or in any way affect any of the terms, conditions, obligations, covenants or agreements contained in the Purchase and Sale Agreement, all of which shall continue in full force and effect.

This letter agreement and any claim, controversy or dispute arising under or related to this letter agreement shall be governed by, and construed in accordance with, the laws of the State of New York.

[Remainder of page intentionally left blank]

IN WITNESS WHEREOF, the undersigned has caused this letter agreement to be duly executed on its behalf as of the date first above written.

ASPHALT ACQUISITION LLC

By:        /s/ Michael Dees            

Name: Michael Dees

Title: Authorized Signatory

[signature page to letter agreement]

Accepted and agreed as of

the date first written above:

NUSTAR LOGISTICS, L.P.By:    NuStar GP, Inc., its

General Partner

By:     /s/ Steven A. Blank        

Name: Steven A. Blank
    Title: Executive Vice President, Chief

Financial Officer and Treasurer

NUSTAR ASPHALT REFINING, LLC

By:    /s/ Steven A. Blank        
    Name: Steven A. Blank
    Title: Executive Vice President, Chief

Financial Officer and Treasurer

NUSTAR MARKETING LLC

By:     /s/ Steven A. Blank        
    Name: Steven A. Blank
    Title: Executive Vice President, Chief

Financial Officer and Treasurer

NUSTAR ENERGY L.P.By:    Riverwalk Logistics, L.P., its    General Partner    By:    NuStar GP, LLC, its General

Partner

By:     /s/ Steven A. Blank        
    Name: Steven A. Blank
    Title: Executive Vice President, Chief

Financial Officer and Treasurer

[signature page to letter agreement]

NUSTAR GP, LLC

By:     /s/ Steven A. Blank        
    Name: Steven A. Blank
    Title: Executive Vice President, Chief

Financial Officer and Treasurer

NUSTAR ASPHALT LLCBy:    NuStar Logistics, L.P., its sole    member    By:    NuStar GP, Inc., its General

Partner

By:     /s/ Steven A. Blank        
    Name: Steven A. Blank
    Title: Executive Vice President, Chief

Financial Officer and Treasurer

[signature page to letter agreement]

EX-10.03

EXHIBIT 10.03

AMENDMENT NO. 1 TO
PURCHASE AND SALE AGREEMENT

This Amendment No. 1 (this “Amendment”) to the Purchase and Sale Agreement dated as of July 3, 2012 (together with the Exhibits, Appendices and Disclosure Letter thereto, the “Purchase and Sale Agreement”) is made as of this 28th day of September, 2012 by and among NuStar Energy L.P., a Delaware limited partnership (“Energy”), NuStar Logistics, L.P., a Delaware limited partnership (the “Seller”), NuStar Asphalt Refining, LLC, a Delaware limited liability company (“Refining”), NuStar Marketing LLC, a Delaware limited liability company (“Marketing”), NuStar GP, LLC, a Delaware limited liability company (“GP LLC”), NuStar Asphalt LLC, a Delaware limited liability company (the “Company”), and Asphalt Acquisition LLC, a Delaware limited liability company (the “Investor,” together with the Seller, Energy, Refining, Marketing, the Company and GP LLC, the “Parties”, and each of them, a “Party”).

WHEREAS the Parties entered into the Purchase and Sale Agreement as of July 3, 2012; and

WHEREAS the Parties now wish to amend the Purchase and Sale Agreement in the manner set forth in this Amendment all in accordance with the terms and conditions of the Purchase and Sale Agreement.

NOW, THEREFORE, in consideration of the foregoing recitals and other good and valuable consideration, the receipt, adequacy and sufficiency of which is hereby acknowledged by each Party, the Parties hereto agree as follows:

SECTION 1. Definitions. Capitalized terms used in this Amendment but not defined herein shall have the meanings given to them in the Purchase and Sale Agreement.

SECTION 2.Amendment to Appendix A. The definitions of “Covered Employee” and “Equivalent Wage” shall be amended to read in full:

“Covered Employee” means, as of the date hereof (a) each employee of the NuStar Affiliates who is expected to become an employee of the Company as of the Expiration Date and is identified as a “Group A Employee” in Section D of the Disclosure Letter and (b) each employee of the NuStar Affiliates who is expected to become an employee of the Company and is identified as a “Group B Employee” in Section D of the Disclosure Letter.

“Equivalent Wage” means, with respect to any Transferred Employee, the base salary (or the base wage rate) plus any shift differential applicable with respect to such Transferred Employee as of the Transfer Date applicable to such Transferred Employee.

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SECTION 3.Amendment to Appendix A. The definitions of “Active Employee”, “Employee Services Agreement”, “Expiration Date”, “Retained Employee Obligations”, “Specified Employee”, “Terminated Specified Employee”, “Transfer Date”, “Transfer Time” and “Transferred Employee” shall be added, reading in full:

“Active Employee” has the meaning specified in Section 8.9(a).

“Employee Services Agreement” shall mean that certain Employee Services Agreement dated as of September 28, 2012, among GP LLC, the Company, Refining and Marketing.

“Expiration Date” has the meaning specified in the Employee Services Agreement.

“FMLA” has the meaning specified in Section 8.9(a).

“Retained Employee Obligations” has the meaning specified in Section 8.9(b).

“Specified Employee” means each Covered Employee listed on Schedule A.

“Terminated Specified Employee” means each Specified Employee whose employment is terminated prior to the Expiration Date.

“Transfer Date” has the meaning specified in Section 8.9(a).

“Transfer Time” has the meaning specified in Section 8.9(a).

“Transferred Employee” has the meaning specified in Section 8.9(a).

SECTION 4.Amendment to Section 2.3(b). The following sentence shall be added at the end of Section 2.3(b) of the Purchase and Sale Agreement:

(a)Notwithstanding the exclusions from Purchased Inventory set forth on Section 2.3(b) of the Disclosure Letter, Purchased Inventory at the Closing may include up to 60,000 barrels of crude oil in excess of 1,000,000 barrels of crude oil; provided, however, that the market value of each such included barrel in excess of 1,000,000 barrels shall be equal to the market value thereof (as determined in accordance with Section 2.3(b) of the Disclosure Letter) discounted by $3 per barrel for purposes of calculating the Inventory Purchase Price.

SECTION 5.Amendment to Section 8.9(a). Section 8.9(a) of the Purchase and Sale Agreement shall be amended and restated to read as follows:

(a)The Company shall, or shall cause the applicable member of the Company Group to, make an offer of employment, in accordance with the

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requirements of this Section 8.9, no fewer than 30 days before the Expiration Date and to be effective as of the Expiration Date, to each Covered Employee who is actively at work, or is not actively at work due to vacation, holiday or sick days in compliance with the applicable policies of the NuStar Affiliates (each such Covered Employee, an “Active Employee”). With respect to each Covered Employee who is not an Active Employee due to short-term disability, emergency family, personal short-term, adoption, long-term disability, reserve military or full-time military leave or an approved leave of absence under the Family and Medical Leave Act of 1993, as amended (“FMLA”), the Company shall, or shall cause the applicable member of the Company Group to, make an offer of employment, in accordance with the requirements of this Section 8.9, to such Covered Employee effective as of the date on which such Covered Employee presents himself or herself to the Company (or such applicable member of the Company Group) for active employment following the Expiration Date; provided, that such date is no later than ten (10) business days following the last day on which any NuStar Affiliate would have been required to re-employ such Covered Employee in accordance with the applicable NuStar Plan, the provisions of FMLA, or the provisions of the Uniformed Services Employment and Reemployment Rights Act of 1994 and the Department of Labor regulations promulgated thereunder, or any other applicable Law, as applicable, in each case, as if the transactions contemplated by this Agreement had not occurred. For purposes of this Agreement, the term “Transferred Employee” shall refer to each Covered Employee who accepts or does not reject an offer of employment with the Company as provided for in this Section 8.9(a), the term “Transfer Time” with respect to any Transferred Employee shall refer to (A) with respect to any Transferred Employee who is an Active Employee, 12:01 a.m. on January 1, 2013 and (B) with respect to any Transferred Employee who is not an Active Employee, 12:01 a.m. on the date upon which such Transferred Employee actually begins active employment with the applicable member of the Company Group and the term “Transfer Date” with respect to any Transferred Employee shall refer to the date on which a Transferred Employee’s employment with the applicable member of the Company Group becomes effective.

SECTION 6.Amendment to Section 8.9(b). Section 8.9(b) of the Purchase and Sale Agreement shall be amended and restated to read as follows:

(a)Except with respect to any Obligations that transfer to the Company Group pursuant to Applicable Law or are Obligations of the Company Group pursuant to the Employee Services Agreement, including obligations to indemnify GP LLC and its Affiliates as provided for in Section 3.5(a) of the Employee Services Agreement, GP LLC shall retain liability and responsibility for all employment and employee benefits-related Obligations (i) incurred, or arising out of a period ending, on or prior to the Expiration Date that relate to the Covered Employees (or any dependent or beneficiary of any Covered Employee) or (ii) incurred, or arising out of a period ending, after the Expiration Date that

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relate to a Covered Employee that does not become a Transferred Employee (or any dependent or beneficiary of such Covered Employee) (such Obligations, the “Retained Employee Obligations”). Except with respect to any Obligations that transfer to the Company Group pursuant to Applicable Law or are Obligations of the Company Group pursuant to the Employee Services Agreement, neither Marketing, Refining, the Company, the Investor nor any of its Affiliates shall have any liability or responsibility for any Retained Employee Obligations. Except with respect to any Obligations (i) under any NuStar Plan or (ii) arising as a result of actions taken by any NuStar Affiliate on or prior to the Expiration Date, effective as of the Transfer Time applicable to a Transferred Employee, neither GP LLC nor any of its Affiliates shall have any liability or responsibility for any employment and employee benefits-related Obligations incurred, or arising following the Transfer Date applicable to a Transferred Employee that relate to such Transferred Employees (or any dependent or beneficiary of any such Transferred Employee).

SECTION 7.Amendment to Section 8.9(c). Section 8.9(c) of the Purchase and Sale Agreement shall be amended and restated to read as follows:

(a)Except in the event of any claim for workers’ compensation benefits, for purposes of this Section 8.9(c), the following claims and liabilities shall be deemed to be incurred as follows: (i) medical, vision, dental and/or prescription drug benefits (including hospital expenses), upon provision of the services, materials or supplies comprising any such benefits, and (ii) short and long-term disability, life, accidental death and dismemberment and business travel accident insurance benefits, upon the death, illness, injury or accident giving rise to such benefits. A claim for workers’ compensation benefits, shall be deemed to be incurred when the event giving rise to the claim (the “Workers’ Compensation Event”) occurs. If the Workers’ Compensation Event occurs in respect of a Transferred Employee over a period both preceding and following the applicable Transfer Time, the claim shall be the joint responsibility and liability of GP LLC and the Company and shall be equitably apportioned between GP LLC and the Company based upon the relative periods of time that the Workers’ Compensation Event transpired preceding and following the applicable Transfer Time.

SECTION 8.Amendment to Section 8.9(d). Section 8.9(d) of the Purchase and Sale Agreement shall be amended and restated to read as follows:

(a)GP LLC agrees to provide any required notice under and to otherwise retain all liabilities relating to the federal Worker Adjustment and Retraining Notification Act (“WARN”), or any similar state, local or foreign laws, with respect to any event, including any “plant closing” or “mass layoff” (each, as defined in WARN) or group termination or similar event, affecting Covered Employees on or prior to the Expiration Date. GP LLC shall notify the Investor prior to the Expiration Date of any “employment loss” (as defined in WARN)

5

experienced by any Covered Employees during the 90-day period prior to the Expiration Date.

SECTION 9.Amendment to Section 8.9(e). Section 8.9(e) of the Purchase and Sale Agreement shall be amended and restated to read as follows:

(a)Effective as of the Closing (except as otherwise provided in this Section 8.9(e)), the applicable members of the Company Group shall provide (and the Parties shall cooperate reasonably and in good faith to effectuate) the following:

(i)Credit for Service. Each Transferred Employee shall be credited with all years of service for which such Transferred Employee was credited while employed by GP LLC or its applicable Affiliate (“NuStar Employer”), as of the Transfer Date applicable to such Transferred Employee (or, with respect to Company Defined Benefit Plan (as defined below), through the date on which such plan is established), under any comparable or similar Company Group employee benefit plans in which such Covered Employees participate for purposes of vesting benefits (“vested service”) and participation eligibility (including eligibility to receive subsidized early retirement benefits, Social Security supplements and ancillary benefits), but in no event shall the applicable member of the Company Group have any obligation to recognize such years of service for benefit accrual in any such employee benefit plans (“credited service”) or to the extent doing so would result in a duplication of benefits. Transferred Employees will be eligible for vacation and short-term leave entitlement based on years of service under the NuStar Employer’s employee benefit plans.

(ii)Provision of Benefits. For a period of 18 months following the Closing Date, the applicable member of the Company Group shall make available to the Transferred Employees, as a group, employee benefit plans providing benefits that are no less favorable in the aggregate to those provided under the NuStar Plans as described in Section 8.9(e) of the Disclosure Letter; provided, however, that the Parties shall, in good faith, use their reasonable efforts to replicate the NuStar Plans, including, to the extent practical and not unreasonably cost prohibitive, engaging the same third-party service providers and insurers.

(iii)Defined Benefit Plans. The GP LLC shall cause the NuStar Employer’s retirement plan (the “NuStar Retirement Plan”) and related excess benefit plan (collectively, “NuStar Defined Benefit Plan”) to (1) retain all liability for pension benefits accrued by each Covered Employee as of the Expiration Date, and (2) provide for distributions in accordance with the NuStar Defined Benefit Plan’s distribution rules to any Covered Employee eligible for such distributions. As soon as practicable following

6

the Expiration Date, the applicable member of the Company Group shall establish and maintain a defined benefit plan that is qualified under Section 401 of the Code (“Company Defined Benefit Plan”). The Company Group shall cause Company Defined Benefit Plan to provide that all Transferred Employees who were eligible to participate in the NuStar Retirement Plan and who remain employed with the Company Group on the date on which Company Defined Benefit Plan is established shall be immediately eligible to participate in Company Defined Benefit Plan on the date on which Company Defined Benefit Plan is established.

(iv)Qualified Defined Contribution Plans. No later than the Expiration Date, the applicable member of the Company Group shall establish and maintain a defined contribution plan that is qualified under Section 401 of the Code (“Company Defined Contribution Plan”). The applicable member of the Company Group shall (1) cause Company Defined Contribution Plan to accept the direct rollover of Transferred Employees’ “eligible rollover distributions” (as defined in Section 401(a)(31) of the Code) and (2) use its commercially reasonable efforts to cause Company Defined Contribution Plan to accept the rollover or transfer of Transferred Employees’ outstanding participant loans .

(v)Severance Program. (A) If within one year of the Closing Date (the “Severance Period”): (1) the applicable member of the Company Group involuntarily terminates the employment of a Transferred Employee (for reasons other than just cause or to commence employment with another entity within the Company Group) or (2) a Transferred Employee elects to terminate employment with the applicable member of the Company Group rather than accept a material reduction in compensation below his or her Equivalent Wage, the applicable member of the Company Group shall provide severance pay and other benefits to such Transferred Employee as described below (“Severance Program”) in lieu of, and not otherwise in addition to, any severance to which such Transferred Employee would otherwise be entitled under any employee benefit plan, agreement or other arrangement with the Company Group. The applicable member of the Company Group shall adopt the Severance Program no later than the Expiration Date and shall not terminate it or amend it in a manner materially inconsistent with this Section 8.9(e)(v) prior to one year after the Expiration Date.

(A)The Severance Program shall provide severance pay in an amount not less than the sum of (1) the Transferred Employee’s Equivalent Wage (or his/her then-current base rate of pay, if greater) and (2) the applicable member of the Company Group’s contribution of the premium cost for any health benefits in which the Transferred Employee is participating as of the date of his or her termination from

7

employment, in each case as such Covered Employee would have received from, or had paid on his or her behalf by, the applicable member of the Company Group had such Transferred Employee remained employed by the applicable member of the Company Group through the end of the Severance Period.

Notwithstanding the foregoing, the applicable member of the Company Group may condition eligibility for any benefit under the Severance Program on the execution and non-revocation of a general and comprehensive release or waiver of any and all claims. Such release or waiver shall be in such form as the applicable member of the Company Group determines in its sole discretion.

(vi)Vacation Pay. No later than the Expiration Date, the applicable member of the Company Group shall establish and maintain a vacation pay plan or policy (“Company Vacation Pay Policy”) that shall (A) be applicable to each Transferred Employee upon the Transfer Date applicable to such Transferred Employee, (B) recognize the service that the NuStar Employer used for purposes of vacation pay accrual as of the Transfer Date applicable to such Transferred Employee and (C) provide a minimum annual vacation pay accrual equal to the amount of annual vacation granted to eligible employees under the NuStar Employer’s vacation plan; provided, however, that during the calendar year in which the Transfer Time applicable to a Transferred Employee occurs, such annual vacation pay accrual to be provided by the applicable member of the Company Group shall be reduced pro rata based on the number of days remaining in such calendar year.

(vii)Health Care Plans. No later than the Expiration Date or such other later date as mutually agreed upon by the Parties, the applicable member of the Company Group shall establish and maintain medical, mental health, substance abuse and dental plans (“Company Health Care Plans”). Company Health Care Plans shall provide that each Transferred Employee and his or her otherwise eligible dependents shall be eligible to enroll in such plans with coverage commencing immediately upon the Transfer Date applicable to such Transferred Employee. If such Transferred Employee was enrolled in the NuStar Employer’s corresponding plan as of the Transfer Date applicable to such Transferred Employee, the applicable member of the Company Group shall use its reasonable efforts to cause the Company Health Care Plans to (A) credit the expenses of the Transferred Employee that were credited toward deductibles and co-insurance for the plan year in which the Transfer Date applicable to such Transferred Employee occurs under the applicable NuStar Employer’s benefit plans that provide medical, mental health, substance abuse and dental coverage (“NuStar Health Care Plans”) against

8

satisfaction of any deductibles and co-insurance for such plan year under Company Heath Care Plans, (B) not require a physical examination or other proof of insurability and (C) waive all coverage exclusions and limitations relating to waiting periods or pre-existing conditions. In addition, the applicable member of the Company Group will use its reasonable best efforts to cause Company Health Care Plans to waive any pre-existing condition limitation where required to comply with the provisions of the Health Insurance Portability and Accountability Act of 1996.

SECTION 10.Amendment to Section 8.9(f). Section 8.9(f) of the Purchase and Sale Agreement shall be amended and restated to read as follows:

(a)Effective as of the Transfer Time applicable to a Transferred Employee, the Company Group covenants that the Company Group shall be responsible for the administration of and shall assume any and all obligations arising under the continuation coverage requirements of Section 4980B of the Code and Part 6 of Title I of ERISA (“COBRA”) or other applicable law with respect to such Transferred Employee and his or her beneficiaries who experience a “Qualifying Event” (as defined in COBRA) on or after the Closing Date.

SECTION 11.Amendment to Section 8.9(g). Section 8.9(g) of the Purchase and Sale Agreement shall be amended and restated to read as follows:

(a)Effective as of the Expiration Date, the applicable member of the Company Group covenants to adopt the Savannah CBA and Paulsboro CBA, as applicable (and all existing contract extension agreements, memoranda of agreement, letters of understanding and similar agreements and instruments relating thereto) and shall recognize such labor unions as the exclusive representative of the Covered Employees represented thereby immediately prior to the Expiration Date.

SECTION 12.Sections 8.9(i) and 8.9(j). Sections 8.9(i) and 8.9(j) of the Purchase and Sale Agreement are hereby added, reading in full:

(i)    Notwithstanding anything to the contrary in this Section 8.9 (including Section 8.9(b)), the Company shall, after the Closing, promptly reimburse GP LLC for (i) 50% of any early retirement incentive supplement payments made by GP LLC and its Affiliates (including any applicable Plan) to Terminated Specified Employees (“Early Retirement Payments”); provided that in no event shall the Company be obligated to reimburse an amount in excess of $500,000 in the aggregate in Early Retirement Payments, and (ii) in the case of any Specified Employee who accepts employment with a NuStar Affiliate at another location, the reasonable relocation costs incurred by such NuStar Affiliate in connection with any relocation of such Specified Employee with regards to such change in employment, in all cases to an extent consistent with the NuStar

9

relocation program; provided that in no event shall the Company be obligated to reimburse an amount in excess of $55,000 in respect of any such relocated Specified Employee. In the event that any portion of the Early Retirement Payments are paid other than in a lump-sum payment, for the purposes of the Company’s reimbursement obligations under clause (i) of the immediately preceding sentence, the calculation of the Early Retirement Payments shall include a good faith estimate of the lump-sum present value of such periodic payments based on the same discount rate and the period of such payments used to determine the annuity payments.

(j)    This Agreement shall not be interpreted in such a manner as to require any party hereto to violate any obligation it may have pursuant to any collective bargaining agreement.  Nothing in this Agreement is intended to limit, expand or alter in any way the rights or obligations conferred by any collective bargaining agreement.

SECTION 13.Section 8.16. Section 8.16 is hereby added as follows, reading in full:

Section 8.16Statoil Contract. At the Closing, a member of the Company Group will deliver by wire transfer of immediately available funds to the Seller an amount equal to $4,300,000 (the “Statoil Payment”) in respect of transactions relating to that certain letter agreement, dated as of September 25, 2012, between Statoil Brasil Óleo e Gás Limitada (“Statoil”) and Marketing (the “Statoil Letter Agreement”), which, subject to certain terms and conditions, terminates the Statoil Contract.  If, upon compliance by Marketing with the terms and conditions of the Statoil Letter Agreement, the Statoil Contract does not terminate for any reason (other than (i) a material breach by Marketing of the Statoil Contract after the Closing or (ii) the entering into of an agreement between Marketing and Statoil after the Closing to amend or not to terminate the Statoil Contract), the Seller promptly shall return the Statoil Payment in immediately available funds to such member of the Company Group.

SECTION 14.Amendment to Exhibit A. Exhibit A is hereby deleted in its entirety and replaced in its entirety with Exhibit A to this Amendment.

SECTION 15.Amendment to Exhibit B. Exhibit B is hereby deleted in its entirety and replaced in its entirety with Exhibit B to this Amendment.

SECTION 16.Amendment to Section 2.3(a)(ii) of the Disclosure Letter. Section 2.3(a)(ii) of the Disclosure Letter is hereby deleted in its entirety and replaced in its entirety with Exhibit C to this Amendment.

SECTION 17.Amendment to Section D of the Disclosure Letter. Section D of the Disclosure Letter is hereby deleted in its entirety and replaced in its entirety with Exhibit D to this Amendment.

10

SECTION 18.Schedule A. Exhibit E to this Amendment is hereby added as Schedule A.

SECTION 19.Limited Amendment. Except as specifically amended or supplemented hereby, the Purchase and Sale Agreement shall continue in full force and effect in accordance with the provisions thereof as in existence on the date hereof. From and after the date hereof, any reference to the Purchase and Sale Agreement shall mean the Purchase and Sale Agreement as amended hereby.

SECTION 20.Counterparts. This Amendment may be executed in one or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same agreement and shall become effective when one or more counterparts have been signed by each of the Parties and delivered to the other Parties.

SECTION 21.Governing Law. This Amendment shall be governed by and construed in accordance with the laws of the State of New York, without giving effect to any choice of law rules thereof which may permit or require the application of the laws of another jurisdiction.

[Signature pages follow]

IN WITNESS WHEREOF, the Parties have duly executed this Amendment, all as of the day and year first above written.

NUSTAR LOGISTICS, L.P.

By:    NuStar GP, Inc., its General Partner

By: /s/ Steven A. Blank            

Name: Steven A. Blank

Title: Executive Vice President, Chief Financial Officer and Treasurer

[Signature Page to Amendment No. 1 to Purchase and Sale Agreement]

NUSTAR ASPHALT REFINING, LLC

By: /s/ Steven A. Blank            

Name: Steven A. Blank

Title: Executive Vice President, Chief Financial Officer and Treasurer

[Signature Page to Amendment No. 1 to Purchase and Sale Agreement]

NUSTAR MARKETING LLC

By: /s/ Steven A. Blank            

Name: Steven A. Blank

Title: Executive Vice President, Chief Financial Officer and Treasurer

[Signature Page to Amendment No. 1 to Purchase and Sale Agreement]

NUSTAR ENERGY L.P.

By: Riverwalk Logistics, L.P., its General Partner

By: NuStar GP, LLC, its General Partner

By: /s/ Steven A. Blank        

Name: Steven A. Blank

Title: Executive Vice President, Chief Financial Officer and Treasurer

[Signature Page to Amendment No. 1 to Purchase and Sale Agreement]

NUSTAR GP, LLC

By: /s/ Steven A. Blank        

Name: Steven A. Blank

Title: Executive Vice President, Chief Financial Officer and Treasurer    

[Signature Page to Amendment No. 1 to Purchase and Sale Agreement]

NUSTAR ASPHALT LLC

By: NuStar Logistics, L.P., its sole member

By: NuStar GP, Inc., its General Partner

By: /s/ Steven A. Blank        

Name: Steven A. Blank

Title: Executive Vice President, Chief Financial Officer and Treasurer

[Signature Page to Amendment No. 1 to Purchase and Sale Agreement]

ASPHALT ACQUISITION LLC

By: /s/ Michael Dees            

Name: Michael Dees

Title: Authorized Signatory

[Signature Page to Amendment No. 1 to Purchase and Sale Agreement]

EX-31.01

Exhibit 31.01

CERTIFICATION PURSUANT TO SECTION 302

OF THE SARBANES-OXLEY ACT OF 2002

I, Curtis V. Anastasio, certify that:

1. I have reviewed this quarterly report on Form 10-Q of NuStar GP Holdings, LLC. (the “registrant”);

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5. The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Date: November 8, 2012

/s/ Curtis V. Anastasio

Curtis V. Anastasio

President and Chief Executive Officer

EX-31.02

Exhibit 31.02

CERTIFICATION PURSUANT TO SECTION 302

OF THE SARBANES-OXLEY ACT OF 2002

I, Steven A. Blank, certify that:

1. I have reviewed this quarterly report on Form 10-Q of NuStar GP Holdings, LLC. (the “registrant”);

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5. The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Date: November 8, 2012

/s/ Steven A. Blank

Steven A. Blank

Executive Vice President, Chief Financial Officer and

Treasurer

EX-32.01

Exhibit 32.01

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of NuStar GP Holdings, LLC (the Company) on Form 10-Q for the quarter ended September 30, 2012, as filed with the Securities and Exchange Commission on the date hereof (the Report), I, Curtis V. Anastasio, President and Chief Executive Officer of the Company, hereby certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

1. The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

2. The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

/s/ Curtis V. Anastasio

Curtis V. Anastasio

President and Chief Executive Officer

November 8, 2012

A signed original of the written statement required by Section 906 has been provided to NuStar GP Holdings, LLC and will be retained by NuStar GP Holdings, LLC and furnished to the Securities and Exchange Commission or its staff upon request.

EX-32.02

Exhibit 32.02

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of NuStar GP Holdings, LLC (the Company) on Form 10-Q for the quarter ended September 30, 2012, as filed with the Securities and Exchange Commission on the date hereof (the Report), I, Steven A. Blank, Executive Vice President, Chief Financial Officer and Treasurer of the Company, hereby certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

1. The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

2. The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

/s/ Steven A. Blank

Steven A. Blank

Executive Vice President, Chief Financial Officer and

Treasurer

November 8, 2012

A signed original of the written statement required by Section 906 has been provided to NuStar GP Holdings, LLC and will be retained by NuStar GP Holdings, LLC and furnished to the Securities and Exchange Commission or its staff upon request.

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STATEMENTS OF CASH FLOWS Table 2 (Details) (USD $) In Thousands, unless otherwise specified	9 Months Ended
	Sep. 30, 2012	Sep. 30, 2011
Cash flows related to interest and income tax
Cash paid for interest	$ 316	$ 312
Cash (refunded) paid for income tax	$ (918)	$ 536

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EMPLOYEE BENEFIT PLANS Table (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended		9 Months Ended
	Sep. 30, 2012	Sep. 30, 2011	Sep. 30, 2012	Sep. 30, 2011
Pension Plans (the pension plan, the excess pension plan and the SERP) [Member]
Defined Benefit Plan Disclosure [Line Items]
Service cost	$ 3,904	$ 3,136	$ 11,712	$ 9,348
Interest cost	1,003	720	3,009	2,160
Expected return on assets	(979)	(904)	(2,937)	(2,712)
Amortization of prior service credit	(4)	(4)	(12)	(12)
Amortization of net loss	348	120	1,044	362
Net periodic benefit cost	4,272	3,068	12,816	9,146
Other Postretirement Benefit Plans [Member]
Defined Benefit Plan Disclosure [Line Items]
Service cost	315	264	945	777
Interest cost	244	222	732	666
Expected return on assets	0	0	0	0
Amortization of prior service credit	0	0	0	0
Amortization of net loss	35	18	105	54
Net periodic benefit cost	$ 594	$ 504	$ 1,782	$ 1,497

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RELATED PARTY TRANSACTIONS Narrative 2 (Details) (USD $) In Millions, unless otherwise specified	3 Months Ended		9 Months Ended
	Sep. 30, 2012	Sep. 30, 2011	Sep. 30, 2012	Sep. 30, 2011
Asphalt JV [Member] | Asphalt JV Services Agreement [Member]
Related Party Transaction [Line Items]
Services Agreements, Description			The Asphalt JV Services Agreement provides that we will furnish certain administrative and other operating services necessary to conduct the business of Asphalt JV. Asphalt JV will compensate us for these services through an annual fee totaling $10.0 million, subject to adjustment based on the annual merit increase percentage applicable to our employees for the most recently completed contract year.
Services Agreements, Termination Date			Dec. 31, 2017
Asphalt JV [Member] | Asphalt JV Employee Services Agreement [Member]
Related Party Transaction [Line Items]
Services Agreements, Description			The Asphalt JV Employee Services Agreement provides that certain of our employees will provide employee-services to Asphalt JV. In exchange Asphalt JV will reimburse us for the compensation expense of those employees at the same rates that were in effect at the effective date of the Asphalt JV Employee Services Agreement, including an annual bonus amount that does not exceed our target bonus plan. The employees covered under the Asphalt JV Employee Services Agreement will not be entitled to any new unit-based compensation grants from us, and Asphalt JV will not be responsible for unit-based compensation costs prior to the effective date.
Services Agreements, Termination Date			Dec. 31, 2012
NuStar Energy [Member] | GP Services Agreement [Member]
Related Party Transaction [Line Items]
Services Agreements, Description			The GP Services Agreement provides that NuStar GP, LLC will furnish administrative and certain operating services necessary to conduct the business of NuStar Energy. All employees providing services to both NuStar GP Holdings and NuStar Energy are employed by NuStar GP, LLC; therefore, NuStar Energy reimburses NuStar GP, LLC for all employee costs, other than the expenses allocated to NuStar GP Holdings
Services Agreements, Termination Date			Dec. 31, 2012
Holdco administrative services expense	$ 0.2	$ 0.3	$ 1.0	$ 1.0

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ORGANIZATION AND BASIS OF PRESENTATION Narrative (Details)	9 Months Ended
	Sep. 30, 2012	Dec. 31, 2011
Schedule of Equity Method Investments [Line Items]
Percent ownership in NuStar Energy	15.10%	16.30%
General partner interest percentage	2.00%
Percent of incentive distribution rights (IDR) issued by NuStar Energy	100.00%
Maximum percentage of cash distributed by NuStar Energy	23.00%
Common units of NuStar Energy	10,391,275
Percent of limited partner interest	13.10%

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MEMBERS' EQUITY Table 1 (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended			9 Months Ended
	Sep. 30, 2012	Jun. 30, 2012	Sep. 30, 2011	Sep. 30, 2012	Sep. 30, 2011
Changes to our members’ equity
Balance as of December 31, 2011				$ 506,883
Net loss	19,165		18,362	(2,997)	50,606
Distributions to unitholders		(21,700)		(65,141)	(61,903)
Other comprehensive loss				(6,445)
Unit-based compensation				646
Balance as of September 30, 2012	$ 432,946			$ 432,946

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FAIR VALUE MEASUREMENTS Table 2 (Details) (NS unit options [Member])	9 Months Ended	12 Months Ended
	Sep. 30, 2012	Dec. 31, 2010
NS unit options [Member]
The fair value of our accrued compensation expense for NuStar Energy unit options is determined using the Black-Scholes option-pricing model on the reporting date based on the following weighted-average assumptions:
Expected life in years	6.5	6.3
Expected volatility	19.80%	20.30%
Expected distribution yield	8.60%	7.70%
Risk-free interest rate	0.20%	0.10%

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SUBSEQUENT EVENT Narrative (Details) (TexStar Asset Purchase Agreement [Member], USD $) In Millions, unless otherwise specified	9 Months Ended
	Sep. 30, 2012
Subsequent Event [Line Items]
NuStar Energy's Date Of Agreement, Assets To Be Acquired	Nov. 02, 2012
NuStar Energy's Purchase Price Of Assets To Be Acquired	$ 425.0
NuStar Energy's Description Of Termination Rights	The Purchase Agreement contains certain termination rights prior to consummation of the Transaction by: (i) mutual written consent of NuStar Logistics and Sellers; (ii) NuStar Logistics if casualty losses result in damages in excess of $17 million; (iii) NuStar Logistics or Sellers, as applicable, if the other party has breached a representation, warranty or covenant contained in the Purchase Agreement so that such party is incapable of fulfilling its obligations under a closing condition; (iv) by NuStar Logistics or Sellers if the Initial Closing has not occurred by December 15, 2012, subject to extension as provided in the Purchase Agreement; or (v) by NuStar Logistics or Sellers if the Second Closing has not occurred by January 31, 2013, subject to extension as provided in the Purchase Agreement.
Crude Oil Pipelines [Member]
Subsequent Event [Line Items]
NuStar Energy's Assets To Be Acquired	approximately 140 miles of crude oil pipelines and gathering lines that are currently under construction and upon completion will have throughput capacity of 100,000 barrels per day (the Crude Oil Pipelines)
Crude Oil Terminals and Storage Facilities [Member]
Subsequent Event [Line Items]
NuStar Energy's Assets To Be Acquired	five terminals and storage facilities providing 643,400 barrels of storage capacity (the Crude Oil Terminals and Storage Facilities)
NGL Assets [Member]
Subsequent Event [Line Items]
NuStar Energy's Assets To Be Acquired	38 miles of natural gas liquids (NGL) Y-grade pipeline and two fractionators with a combined capacity of 57,000 barrels per day (the NGL Assets)
Redfish Bay Lease [Member]
Subsequent Event [Line Items]
NuStar Energy's Assets To Be Acquired	a lease for a terminal and storage facility located near Corpus Christi providing 144,000 barrels of storage capacity (the Redfish Bay Lease)
Initial Closing [Member]
Subsequent Event [Line Items]
NuStar Energy's Amount To Be Paid For Assets To Be Acquired	325.0
Second Closing [Member]
Subsequent Event [Line Items]
NuStar Energy's Amount To Be Paid For Assets To Be Acquired	$ 100.0

XML

FAIR VALUE MEASUREMENTS

9 Months Ended

Sep. 30, 2012

FAIR VALUE MEASUREMENTS [Abstract]

FAIR VALUE MEASUREMENTS

FAIR VALUE MEASUREMENTS

We segregate the inputs used in measuring fair value into three levels: Level 1, defined as observable inputs such as quoted prices in active markets; Level 2, defined as inputs other than quoted prices in active markets that are either directly or indirectly observable; and Level 3, defined as unobservable inputs in which little or no market data exists.

The following liabilities are measured at fair value on a recurring basis:

	September 30, 2012
	Level 1		Level 2		Level 3		Total
	(Thousands of Dollars)
Accrued compensation expense:
NuStar Energy restricted units and performance awards	$	16,954	$	—	$	—	$	16,954
NuStar Energy unit options	—		399		—		399
Total	$	16,954	$	399	$	—	$	17,353
	December 31, 2011
	Level 1		Level 2		Level 3		Total
	(Thousands of Dollars)
Accrued compensation expense:
NuStar Energy restricted units and performance awards	$	13,622	$	—	$	—	$	13,622
NuStar Energy unit options	—		1,953		—		1,953
Total	$	13,622	$	1,953	$	—	$	15,575

The fair value of our accrued compensation expense for NuStar Energy restricted units and performance awards is determined using the NuStar Energy unit price at the reporting date. The fair value of our accrued compensation expense for NuStar Energy unit options is determined using the Black-Scholes option-pricing model on the reporting date based on the following weighted-average assumptions:

	September 30, 2012		December 31, 2011
Expected life in years	6.5		6.3
Expected volatility	19.8	%	20.3	%
Expected distribution yield	8.6	%	7.7	%
Risk-free interest rate	0.2	%	0.1	%

Fair Value of Financial Instruments

We recognize cash equivalents, receivables, payables and debt in our consolidated balance sheets at their carrying amount. The fair values of these financial instruments approximate their carrying amounts.

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MEMBERS' EQUITY Table 2 (Details) (USD $) In Thousands, except Per Share data, unless otherwise specified	3 Months Ended		9 Months Ended
	Sep. 30, 2012	Sep. 30, 2011	Sep. 30, 2012	Sep. 30, 2011
Our cash distributions applicable to the period in which the distributions were earned
Cash distributions per unit	$ 0.545	$ 0.495	$ 1.565	$ 1.470
Total cash distributions	$ 23,204	$ 21,059	$ 66,637	$ 62,540

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INVESTMENT IN NUSTAR ENERGY Table 2 (Details) (NuStar Energy [Member], USD $) In Thousands, unless otherwise specified	3 Months Ended		9 Months Ended
	Sep. 30, 2012	Sep. 30, 2011	Sep. 30, 2012	Sep. 30, 2011
NuStar Energy [Member]
Statement of Comprehensive (Loss) Income Information:
Revenues	$ 1,744,766	$ 1,824,350	$ 5,382,363	$ 4,648,150
Operating income (loss)	50,722	92,977	(107,255)	266,059
Net income (loss)	$ 4,342	$ 70,281	$ (216,214)	$ 191,402

XML

INVESTMENT IN NUSTAR ENERGY Table 1 (Details) (NuStar Energy [Member], USD $) In Thousands, unless otherwise specified	Sep. 30, 2012	Dec. 31, 2011
NuStar Energy [Member]
Balance Sheet Information:
Current assets	$ 864,240	$ 1,200,923
Property, plant and equipment, net	3,155,090	3,430,468
Goodwill	822,911	846,717
Long-term receivable from related party	170,711	0
Other long-term assets, net	350,932	403,082
Total assets	5,363,884	5,881,190
Current liabilities	1,110,400	943,800
Long-term debt, less current portion	1,518,543	1,928,071
Other long-term liabilities	62,842	144,984
Total liabilities	2,691,785	3,016,855
NuStar Energy partners' equity	2,659,185	2,852,201
Noncontrolling interest	12,914	12,134
Total liabilities and partners’ equity	$ 5,363,884	$ 5,881,190

XML

MEMBERS' EQUITY Narrative (Details) (USD $) In Thousands, except Per Share data, unless otherwise specified	3 Months Ended			9 Months Ended
	Sep. 30, 2012	Jun. 30, 2012	Sep. 30, 2011	Sep. 30, 2012	Sep. 30, 2011
Distributions (dates and totals)
Total cash distributions, paid		$ (21,700)		$ (65,141)	$ (61,903)
Cash distributions per unit, paid		$ 0.510
Cash distributions, payment date	Nov. 16, 2012	Aug. 14, 2012
Total cash distributions, earned	$ 23,204		$ 21,059	$ 66,637	$ 62,540
Cash distributions per unit, declared	$ 0.545		$ 0.495	$ 1.565	$ 1.470
Cash distributions, record date	Nov. 09, 2012

XML

INVESTMENT IN NUSTAR ENERGY Table 3 (Details) (USD $) In Thousands, unless otherwise specified	Sep. 30, 2012	Dec. 31, 2011
Reconcilliation of NuStar Energy’s total partners’ equity to our investment in NuStar Energy
NuStar GP Holdings’ ownership interest in NuStar Energy	15.10%	16.30%
NuStar GP Holdings’ share of NuStar Energy’s partners’ equity	$ 401,537	$ 464,909
Step-up in basis related to NuStar Energy’s assets and liabilities, including equity method goodwill, and other	81,141	82,321
Investment in NuStar Energy	482,678	547,230
NuStar Energy [Member]
Reconcilliation of NuStar Energy’s total partners’ equity to our investment in NuStar Energy
NuStar Energy’s total partners’ equity	$ 2,659,185	$ 2,852,201

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RELATED PARTY TRANSACTIONS Narrative 1 (Details) (USD $) In Thousands, unless otherwise specified	Sep. 30, 2012	Dec. 31, 2011
Related Party Transaction [Line Items]
Receivable from NuStar Energy	$ 14,736	$ 6,735
Long-term receivable from NuStar Energy	$ 16,004	$ 14,502

XML

DISTRIBUTIONS FROM NUSTAR ENERGY

9 Months Ended

Sep. 30, 2012

DISTRIBUTIONS FROM NUSTAR ENERGY [Abstract]

DISTRIBUTIONS FROM NUSTAR ENERGY

DISTRIBUTIONS FROM NUSTAR ENERGY

The following table reflects the allocation of NuStar Energy’s cash distributions earned for the periods indicated among its general and limited partners:

	Three Months Ended September 30,				Nine Months Ended September 30,
	2012		2011		2012		2011
	(Thousands of Dollars, Except Per Unit Data)
General partner interest	$	1,961	$	1,628	$	5,525	$	4,847
General partner incentive distribution	10,805		8,972		30,437		26,503
Total general partner distribution	12,766		10,600		35,962		31,350
Limited partner distribution	11,374		11,271		33,808		33,506
Total distributions to NuStar GP Holdings	24,140		21,871		69,770		64,856
Public unitholders’ distributions	73,911		59,543		206,433		177,513
Total cash distributions	$	98,051	$	81,414	$	276,203	$	242,369
Cash distributions per unit applicable to limited partners	$	1.095	$	1.095	$	3.285	$	3.265

On August 10, 2012, NuStar Energy paid a quarterly cash distribution totaling $89.1 million, or $1.095 per unit, related to the second quarter of 2012. On October 25, 2012, NuStar Energy announced a quarterly cash distribution of $1.095 per unit related to the third quarter of 2012. This distribution will be paid on November 14, 2012 to unitholders of record on November 9, 2012 and will total $98.1 million.

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RELATED PARTY TRANSACTIONS Table (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended		9 Months Ended
	Sep. 30, 2012	Sep. 30, 2011	Sep. 30, 2012	Sep. 30, 2011
Related Party Transaction [Line Items]
Expenses for payroll, employee benefit plans and unit-based compensation for NuStar Energy	$ 55,048	$ 45,976	$ 163,424	$ 150,718
Other	1,184	160	3,312	311
Total transactions charged to related parties	$ 56,232	$ 46,136	$ 166,736	$ 151,029

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CREDIT FACILITY Narrative (Details) (USD $)	9 Months Ended		1 Months Ended
	Sep. 30, 2012	Dec. 31, 2011	Jun. 29, 2012 NuStar Energy Consolidated Debt Coverage Ratio [Member]	Jun. 29, 2012 Cash Distributions Covenant [Member]	Jun. 29, 2012 2012 Credit Facility [Member]
Line of Credit Facility [Line Items]
Credit Facility, Name					364-day revolving credit agreement
Credit Facility, Maturity Date					Jun. 28, 2013
Credit Facility, Borrowing Capacity					$ 40,000,000
Credit Facility, Letters of Credit Capacity					10,000,000
Outstanding Borrowings Under the Credit Facility	21,000,000	16,500,000
Credit Facility, Borrowing Availability	$ 19,000,000
Credit Facility, Interest Rate Description					Interest on the 2012 Credit Facility is based upon, at our option, either an alternative base rate plus 0.75% or a LIBOR-based rate plus 1.75%
Credit Facility, Interest Rate	2.00%
Credit Facility, Covenant Terms			The terms of the 2012 Credit Facility require NuStar Energy to maintain, as of the end of each rolling period, consisting of any period of four consecutive quarters, a consolidated debt coverage ratio not to exceed 5.0-to-1.0. If NuStar Energy consummates an acquisition for an aggregate net consideration of at least $50.0 million, the maximum consolidated debt coverage ratio will increase to 5.5-to-1.0 for two rolling periods. Additionally, if NuStar Energy’s Asphalt Operations are not owned by an unconsolidated joint venture, the 2012 Credit Facility allows the consolidated debt coverage ratio not to exceed 6.5-to-1.0 and 6.0-to-1.0 for the rolling periods ending June 30, 2012 and September 30, 2012, respectively. Since NuStar Energy’s Asphalt Operations were owned by an unconsolidated joint venture as of September 30, 2012, the consolidated debt coverage ratio could not exceed 5.0-to-1.0	receive cash distributions of at least $50.0 million in respect of our ownership interests in NuStar Energy for the preceding four fiscal quarters ending on the last day of each fiscal quarter
NuStar Energy's Consolidated Debt Coverage Ratio	4.3

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CONSOLIDATED BALANCE SHEETS (USD $) In Thousands, unless otherwise specified	Sep. 30, 2012	Dec. 31, 2011
Assets
Cash and cash equivalents	$ 2,660	$ 1,354
Receivable from related party	14,736	6,735
Income tax receivable	0	2,619
Other receivables	3	302
Deferred income tax assets, net	4,735	4,378
Other current assets	181	204
Total current assets	22,315	15,592
Investment in NuStar Energy L.P.	482,678	547,230
Long-term receivable from NuStar Energy L.P.	16,004	14,502
Deferred income tax assets, net	13,710	11,703
Total assets	534,707	589,027
Liabilities and Members' Equity
Short-term debt	21,000	16,500
Accounts payable	576	257
Accrued compensation expense	21,217	19,476
Accrued liabilities	439	462
Income tax payable	249	0
Taxes other than income tax	527	1,287
Total current liabilities	44,008	37,982
Long-term liabilities	57,753	44,162
Commitments and contingencies (Note 8)
Members' equity	462,056	529,548
Accumulated other comprehensive loss	(29,110)	(22,665)
Total members' equity	432,946	506,883
Total liabilities and members' equity	$ 534,707	$ 589,027

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NET INCOME (LOSS) PER UNIT Table (Details)	3 Months Ended		9 Months Ended
	Sep. 30, 2012	Sep. 30, 2011	Sep. 30, 2012	Sep. 30, 2011
Basic and diluted units outstanding:
Weighted-average number of basic units outstanding	42,575,563	42,544,659	42,575,183	42,544,659
Effect of dilutive securities	0	25,612	0	35,459
Weighted-average number of diluted units outstanding	42,575,563	42,570,271	42,575,183	42,580,118
Antidilutive Securities Excluded from Computation of Earnings Per Unit
NSH options outstanding excluded from the calculation of diluted net income (loss) per unit	300,766		300,766

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INVESTMENT IN NUSTAR ENERGY

9 Months Ended

Sep. 30, 2012

INVESTMENT IN NUSTAR ENERGY [Abstract]

INVESTMENT IN NUSTAR ENERGY

INVESTMENT IN NUSTAR ENERGY

NuStar Energy’s Equity Offering

On September 10, 2012, NuStar Energy issued 7,130,000 common units representing limited partner interests at a price of $48.94 per unit and received proceeds of $336.8 million. In conjunction with NuStar Energy’s issuance of common units, we contributed $7.1 million to NuStar Energy in order to maintain our 2% general partner interest and our ownership in NuStar Energy was reduced from 16.3% at December 31, 2011 to 15.1% at September 30, 2012. This issuance resulted in a gain of $10.7 million for the three and nine months ended September 30, 2012, which is included in “Other income (expense), net” on our consolidated statements of comprehensive income (loss), and represents the increase in the value of our proportionate share of NuStar Energy’s capital.

NuStar Energy’s Asphalt Operations

On September 28, 2012, NuStar Energy sold a 50% voting interest (the Asphalt Sale) in NuStar Asphalt LLC (Asphalt JV) previously a wholly owned subsidiary of NuStar Energy, to an affiliate of Lindsay Goldberg LLC (Lindsay Goldberg), a private investment firm. Asphalt JV owns and operates asphalt refining assets that were previously wholly owned by NuStar Energy, including the asphalt refineries located in Paulsboro, New Jersey and Savannah, Georgia (collectively, the Asphalt Operations). Lindsay Goldberg paid $175.0 million for the Class A equity interests (Class A Interests) of Asphalt JV, while NuStar Energy retained the Class B equity interests with a fair value of $52.0 million (Class B Interests) of Asphalt JV. The Class A Interests have a distribution preference over the Class B Interests, as well as a liquidation preference.

NuStar Asphalt Refining, LLC and NuStar Marketing LLC are wholly-owned subsidiaries of NuStar Asphalt LLC. Unless otherwise indicated, the term “Asphalt JV” is used in this report to refer to Asphalt JV, to one or more of its consolidated subsidiaries or to all of them taken as a whole.

At closing, NuStar Energy received $261.3 million from Asphalt JV for inventory related to the Asphalt Operations, pending a final inventory valuation. Additionally, NuStar Energy deconsolidated Asphalt JV, recognized a loss of $21.6 million on the Asphalt Sale and started reporting its remaining investment in Asphalt JV using the equity method of accounting.

In anticipation of the Asphalt Sale, NuStar Energy recorded an impairment loss of $266.4 million in the second quarter of 2012 to write-down the carrying value of long-lived assets related to the Asphalt Operations, including fixed assets, goodwill, intangible assets and other long-term assets to their estimated fair value.

Summary Financial Information

Condensed consolidated financial information reported by NuStar Energy is presented below (in thousands of dollars):

	September 30, 2012		December 31, 2011
	(Unaudited)
Balance Sheet Information:
Current assets	$	864,240	$	1,200,923
Property, plant and equipment, net	3,155,090		3,430,468
Goodwill	822,911		846,717
Long-term receivable from related party	170,711		—
Other long-term assets, net	350,932		403,082
Total assets	$	5,363,884	$	5,881,190
Current liabilities	$	1,110,400	$	943,800
Long-term debt, less current portion	1,518,543		1,928,071
Other long-term liabilities	62,842		144,984
Total liabilities	2,691,785		3,016,855
NuStar Energy partners' equity	2,659,185		2,852,201
Noncontrolling interest	12,914		12,134
Total liabilities and partners’ equity	$	5,363,884	$	5,881,190

	Three Months Ended September 30,				Nine Months Ended September 30,
	2012		2011		2012			2011
	(Thousands of Dollars)
Statement of Comprehensive (Loss) Income Information:
Revenues	$	1,744,766	$	1,824,350	$	5,382,363		$	4,648,150
Operating income (loss)	50,722		92,977		(107,255		)	266,059
Net income (loss)	4,342		70,281		(216,214		)	191,402

Other

Our investment in NuStar Energy reconciles to NuStar Energy’s total partners’ equity as follows:

	September 30, 2012			December 31, 2011
	(Thousands of Dollars)
NuStar Energy’s total partners’ equity	$	2,659,185		$	2,852,201
NuStar GP Holdings’ ownership interest in NuStar Energy	15.1		%	16.3		%
NuStar GP Holdings’ share of NuStar Energy’s partners’ equity	401,537			464,909
Step-up in basis related to NuStar Energy’s assets and liabilities, including equity method goodwill, and other	81,141			82,321
Investment in NuStar Energy	$	482,678		$	547,230

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DISTRIBUTIONS FROM NUSTAR ENERGY Narrative (Details) (NuStar Energy [Member], USD $)	3 Months Ended			9 Months Ended
	Sep. 30, 2012	Mar. 31, 2012	Sep. 30, 2011	Sep. 30, 2012	Sep. 30, 2011
NuStar Energy [Member]
Distributions from NuStar Energy (dates and totals)
Quarterly cash distribution, date paid	11/14/2012	8/10/2012
NuStar Energy's total cash distribution, paid		$ 89,100,000
Quarterly cash distribution per unit	$ 1.095	$ 1.095	$ 1.095	$ 3.285	$ 3.265
Distributions, date of record	11/9/2012
NuStar Energy's total cash distribution, earned	$ 98,051,000		$ 81,414,000	$ 276,203,000	$ 242,369,000

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MEMBERS' EQUITY (Tables)

9 Months Ended

Sep. 30, 2012

MEMBERS’ EQUITY [Abstract]

Changes in Members’ Equity

Balance as of December 31, 2011	$	506,883
Net loss	(2,997		)
Distributions to unitholders	(65,141		)
Other comprehensive loss	(6,445		)
Unit-based compensation	646
Balance as of September 30, 2012	$	432,946

Our cash distributions applicable to the period in which the distributions were earned

	Three Months Ended September 30,				Nine Months Ended September 30,
	2012		2011		2012		2011
	(Thousands of Dollars, Except Per Unit Data)
Cash distributions per unit	$	0.545	$	0.495	$	1.565	$	1.470
Total cash distributions	$	23,204	$	21,059	$	66,637	$	62,540

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FAIR VALUE MEASUREMENTS Table 1 (Details) (USD $) In Thousands, unless otherwise specified	Sep. 30, 2012	Dec. 31, 2011
Accrued compensation expense:
NuStar Energy restricted units and performance awards	$ 16,954	$ 13,622
NuStar Energy unit options	399	1,953
Total	17,353	15,575
Level 1 [Member]
Accrued compensation expense:
NuStar Energy restricted units and performance awards	16,954	13,622
NuStar Energy unit options	0	0
Total	16,954	13,622
Level 2 [Member]
Accrued compensation expense:
NuStar Energy restricted units and performance awards	0	0
NuStar Energy unit options	399	1,953
Total	399	1,953
Level 3 [Member]
Accrued compensation expense:
NuStar Energy restricted units and performance awards	0	0
NuStar Energy unit options	0	0
Total	$ 0	$ 0

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EMPLOYEE BENEFIT PLANS (Tables)

9 Months Ended

Sep. 30, 2012

EMPLOYEE BENEFIT PLANS [Abstract]

The components of net periodic benefit cost related to our defined benefit plans

	Pension Plans (a)						Other Postretirement Benefit Plans
	2012			2011			2012		2011
	(Thousands of Dollars)
For the three months ended September 30:
Components of net periodic benefit cost:
Service cost	$	3,904		$	3,136		$	315	$	264
Interest cost	1,003			720			244		222
Expected return on assets	(979		)	(904		)	—		—
Amortization of prior service credit	(4		)	(4		)	—		—
Amortization of net loss	348			120			35		18
Net periodic benefit cost	$	4,272		$	3,068		$	594	$	504
For the nine months ended September 30:
Components of net periodic benefit cost:
Service cost	$	11,712		$	9,348		$	945	$	777
Interest cost	3,009			2,160			732		666
Expected return on assets	(2,937		)	(2,712		)	—		—
Amortization of prior service credit	(12		)	(12		)	—		—
Amortization of net loss	1,044			362			105		54
Net periodic benefit cost	$	12,816		$	9,146		$	1,782	$	1,497

(a) Includes amounts related to the pension plan, the excess pension plan and the supplemental executive retirement plan.

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RELATED PARTY TRANSACTIONS

9 Months Ended

Sep. 30, 2012

Related Party Transactions [Abstract]

RELATED PARTY TRANSACTIONS

3. RELATED PARTY TRANSACTIONS

We had a receivable from related party of $14.7 million and $6.7 million, as of September 30, 2012 and December 31, 2011, respectively, mainly relating to payroll, employee benefit plans and unit-based compensation of NuStar Energy. We also had a long-term receivable of $16.0 million and $14.5 million from NuStar Energy as of September 30, 2012 and December 31, 2011, respectively, related to amounts payable for retiree medical benefits and other post-employment benefits. The following table represents total transactions charged to related parties:

	Three Months Ended September 30,				Nine Months Ended September 30,
	2012		2011		2012		2011
	(Thousands of Dollars)
Expenses for payroll, employee benefit plans and unit-based compensation for NuStar Energy	$	55,048	$	45,976	$	163,424	$	150,718
Other	1,184		160		3,312		311
Total transactions charged to related parties	$	56,232	$	46,136	$	166,736	$	151,029

GP Services Agreement

NuStar Energy and NuStar GP, LLC, a wholly owned subsidiary of NuStar GP Holdings, entered into a services agreement, effective January 1, 2008 (the GP Services Agreement). The GP Services Agreement provides that NuStar GP, LLC will furnish administrative and certain operating services necessary to conduct the business of NuStar Energy. All employees providing services to both NuStar GP Holdings and NuStar Energy are employed by NuStar GP, LLC; therefore, NuStar Energy reimburses NuStar GP, LLC for all employee costs, other than the expenses allocated to NuStar GP Holdings (the Holdco Administrative Services Expense). The GP Services Agreement will terminate on December 31, 2012, renewing automatically every two years unless terminated by either party upon six months’ prior written notice. The aggregate amounts of Holdco Administrative Services Expense that we incurred were $0.2 million and $0.3 million for three months ended September 30, 2012 and 2011, respectively and $1.0 million for each of the nine-month periods ended September 30, 2012 and 2011.

Asphalt JV Services Agreement

In conjunction with NuStar Energy’s Asphalt Sale, we entered into a services agreement with Asphalt JV, effective September 28, 2012 (the Asphalt JV Services Agreement). The Asphalt JV Services Agreement provides that we will furnish certain administrative and other operating services necessary to conduct the business of Asphalt JV. Asphalt JV will compensate us for these services through an annual fee totaling $10.0 million, subject to adjustment based on the annual merit increase percentage applicable to our employees for the most recently completed contract year. The Asphalt JV Services Agreement will terminate on December 31, 2017 and will automatically renew for successive two-year terms. Asphalt JV may terminate the Asphalt JV Services Agreement at any time, with 180 days prior written notice or reduce the level of service with 45 days prior written notice.

Asphalt JV Employee Services Agreement

In conjunction with NuStar Energy’s Asphalt Sale, we entered into an employee services agreement with Asphalt JV, effective September 28, 2012 (the Asphalt JV Employee Services Agreement). The Asphalt JV Employee Services Agreement provides that certain of our employees will provide employee-services to Asphalt JV. In exchange Asphalt JV will reimburse us for the compensation expense of those employees at the same rates that were in effect at the effective date of the Asphalt JV Employee Services Agreement, including an annual bonus amount that does not exceed our target bonus plan. The employees covered under the Asphalt JV Employee Services Agreement will not be entitled to any new unit-based compensation grants from us, and Asphalt JV will not be responsible for unit-based compensation costs prior to the effective date. The Asphalt JV Employee Services Agreement will terminate on December 31, 2012.

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CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) (USD $) In Thousands, except Share data, unless otherwise specified	3 Months Ended		9 Months Ended
	Sep. 30, 2012	Sep. 30, 2011	Sep. 30, 2012	Sep. 30, 2011
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)
Equity in earnings (loss) of NuStar Energy L.P.	$ 9,185	$ 18,996	$ (11,471)	$ 53,257
General and administrative expenses	(654)	(749)	(2,306)	(2,235)
Other income (expense), net	10,702	108	10,808	(557)
Interest expense, net	(158)	(116)	(442)	(459)
Income (loss) before income tax benefit	19,075	18,239	(3,411)	50,006
Income tax benefit	90	123	414	600
Net income (loss)	19,165	18,362	(2,997)	50,606
Comprehensive income (loss)	$ 19,225	$ (3,191)	$ (9,442)	$ 25,763
Basic net income (loss) per unit	$ 0.45	$ 0.43	$ (0.07)	$ 1.19
Diluted net income (loss) per unit	$ 0.45	$ 0.43	$ (0.07)	$ 1.19
Weighted-average number of basic units outstanding	42,575,563	42,544,659	42,575,183	42,544,659
Weighted-average number of diluted units outstanding	42,575,563	42,570,271	42,575,183	42,580,118

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INVESTMENT IN NUSTAR ENERGY (Tables)

9 Months Ended

Sep. 30, 2012

INVESTMENT IN NUSTAR ENERGY [Abstract]

NuStar Energy's Balance Sheet Information

	September 30, 2012		December 31, 2011
	(Unaudited)
Balance Sheet Information:
Current assets	$	864,240	$	1,200,923
Property, plant and equipment, net	3,155,090		3,430,468
Goodwill	822,911		846,717
Long-term receivable from related party	170,711		—
Other long-term assets, net	350,932		403,082
Total assets	$	5,363,884	$	5,881,190
Current liabilities	$	1,110,400	$	943,800
Long-term debt, less current portion	1,518,543		1,928,071
Other long-term liabilities	62,842		144,984
Total liabilities	2,691,785		3,016,855
NuStar Energy partners' equity	2,659,185		2,852,201
Noncontrolling interest	12,914		12,134
Total liabilities and partners’ equity	$	5,363,884	$	5,881,190

NuStar Energy's Statement of Comprehensive (Loss) Income Information

	Three Months Ended September 30,				Nine Months Ended September 30,
	2012		2011		2012			2011
	(Thousands of Dollars)
Statement of Comprehensive (Loss) Income Information:
Revenues	$	1,744,766	$	1,824,350	$	5,382,363		$	4,648,150
Operating income (loss)	50,722		92,977		(107,255		)	266,059
Net income (loss)	4,342		70,281		(216,214		)	191,402

Reconcilliation of NuStar Energy’s total partners’ equity to our investment in NuStar Energy

	September 30, 2012			December 31, 2011
	(Thousands of Dollars)
NuStar Energy’s total partners’ equity	$	2,659,185		$	2,852,201
NuStar GP Holdings’ ownership interest in NuStar Energy	15.1		%	16.3		%
NuStar GP Holdings’ share of NuStar Energy’s partners’ equity	401,537			464,909
Step-up in basis related to NuStar Energy’s assets and liabilities, including equity method goodwill, and other	81,141			82,321
Investment in NuStar Energy	$	482,678		$	547,230

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Document and Entity Information	9 Months Ended
	Sep. 30, 2012	Oct. 31, 2012
Document and Entity Information [Abstract]
Document Type	10-Q
Amendment Flag	false
Document Period End Date	Sep. 30, 2012
Document Fiscal Year Focus	2012
Document Fiscal Period Focus	Q3
Trading Symbol	nsh
Entity Registrant Name	NuStar GP Holdings, LLC
Entity Central Index Key	0001223786
Current Fiscal Year End Date	--12-31
Entity Filer Category	Large Accelerated Filer
Entity Common Stock, Shares Outstanding		42,586,483

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RELATED PARTY TRANSACTIONS (Tables)

9 Months Ended

Sep. 30, 2012

Related Party Transactions [Abstract]

Schedule of Related Party Transactions [Text Block]

	Three Months Ended September 30,				Nine Months Ended September 30,
	2012		2011		2012		2011
	(Thousands of Dollars)
Expenses for payroll, employee benefit plans and unit-based compensation for NuStar Energy	$	55,048	$	45,976	$	163,424	$	150,718
Other	1,184		160		3,312		311
Total transactions charged to related parties	$	56,232	$	46,136	$	166,736	$	151,029

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CONSOLIDATED STATEMENTS OF CASH FLOWS (USD $) In Thousands, unless otherwise specified	9 Months Ended
	Sep. 30, 2012	Sep. 30, 2011
Cash Flows from Operating Activities:
Net (loss) income	$ (2,997)	$ 50,606
Adjustments to reconcile net (loss) income to net cash provided by operating activities:
Equity in loss (earnings) of NuStar Energy L.P.	11,471	(53,257)
Distributions of equity in earnings from NuStar Energy L.P.	0	53,257
Gain related to NuStar Energy L.P.'s issuance of limited partner units	(10,689)	(124)
(Gain) loss on sale of NuStar Energy L.P. limited partner units in connection with unit-based compensation	(119)	681
Benefit for deferred income tax	(2,364)	(1,989)
Changes in current assets and liabilities (Note 6)	(2,240)	(4,650)
Decrease in other assets	0	1,189
Increase in long-term receivable from NuStar Energy L.P.	(1,502)	(1,783)
Increase in long-term liabilities	13,591	8,871
Other, net	121	134
Net cash provided by operating activities	5,272	52,935
Cash Flows from Investing Activities:
Distributions from NuStar Energy L.P.	68,473	10,923
Investment in NuStar Energy L.P.	(14,961)	(4,966)
Proceeds from sale of NuStar Energy L.P. units in connection with unit-based compensation	2,795	4,721
Net cash provided by investing activities	56,307	10,678
Cash Flows from Financing Activities:
Proceeds from short-term debt borrowings	21,000	0
Repayment of short-term debt	(16,500)	(5,500)
Distributions to unitholders	(65,141)	(61,903)
Other, net	368	0
Net cash used in financing activities	(60,273)	(67,403)
Net increase (decrease) in cash and cash equivalents	1,306	(3,790)
Cash and cash equivalents at the beginning of the period	1,354	5,304
Cash and cash equivalents at the end of the period	$ 2,660	$ 1,514

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COMMITMENTS AND CONTINGENCIES

9 Months Ended

Sep. 30, 2012

COMMITMENTS AND CONTINGENCIES [Abstract]

COMMITMENTS AND CONTINGENCIES

COMMITMENTS AND CONTINGENCIES

Contingencies

We are not currently a party to any material legal proceedings. However, NuStar Energy is subject to certain loss contingencies, the outcome of which could have an effect on NuStar Energy’s results of operations and ability to pay distributions, which would impact our results of operations and ability to pay distributions. NuStar Energy’s material contingent liabilities resulting from various litigation, claims and commitments are discussed below.

Grace Energy Corporation Matter. In 1997, Grace Energy Corporation (Grace Energy) sued subsidiaries of Kaneb Pipeline Partners, L.P. (KPP) and Kaneb Services LLC (KSL and collectively with KPP and their respective subsidiaries, Kaneb) in Texas state court. NuStar Energy acquired Kaneb on July 1, 2005. The complaint sought recovery of the cost of remediation of fuel leaks in the 1970s from a pipeline that had once connected a former Grace Energy terminal with Otis Air Force Base in Massachusetts (Otis AFB). Grace Energy alleges the Otis AFB pipeline and related environmental liabilities had been transferred in 1978 to an entity that was part of Kaneb’s acquisition of Support Terminal Services, Inc. and its subsidiaries from Grace Energy in 1993. Kaneb contends that it did not acquire the Otis AFB pipeline and never assumed any responsibility for any associated environmental damage.

In 2000, the court entered final judgment that: (i) Grace Energy could not recover its own remediation costs of $3.5 million, (ii) Kaneb owned the Otis AFB pipeline and its related environmental liabilities and (iii) Grace Energy was awarded $1.8 million in attorney costs. Both Kaneb and Grace Energy appealed the final judgment of the trial court to the Texas Court of Appeals in Dallas. In 2001, Grace Energy filed a petition in bankruptcy, which created an automatic stay of actions against Grace Energy. In September 2008, Grace Energy filed its Joint Plan of Reorganization and Disclosure Statement.

The Otis AFB is a part of a Superfund Site pursuant to the Comprehensive Environmental Response Compensation and Liability Act (CERCLA). The site contains a number of groundwater contamination plumes, two of which are allegedly associated with the Otis AFB pipeline. Relying on the final judgment of the Texas state court assigning ownership of the Otis AFB pipeline to Kaneb, the United States Department of Justice (the DOJ) advised Kaneb in 2001 that it intends to seek reimbursement from Kaneb for the remediation costs associated with the two plumes. In November 2008, the DOJ forwarded information to NuStar Energy indicating that the past and estimated future remediation expenses associated with one plume are $71.9 million. NuStar Energy reached an agreement to settle the claims of the United States government with respect to the Otis AFB pipeline and to resolve the underlying dispute between Kaneb and Grace. The settlement was approved by the United States Bankruptcy Court for the District of Delaware and a consent decree was entered by the United States District Court for the District of Massachusetts. Pursuant to the terms of the settlement, NuStar Energy paid approximately $13.1 million to the United States government in July 2012 and received releases of claims from various private parties and a covenant not to sue from the United States government. In connection with the settlement, NuStar Energy recognized a gain of $28.7 million during the second quarter of 2012.

Other.NuStar Energy is a party to additional claims and legal proceedings arising in the ordinary course of its business. Due to the inherent uncertainty of litigation, there can be no assurance that the resolution of any particular claim or proceeding would not have a material adverse effect on NuStar Energy’s results of operations, financial position or liquidity.

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CREDIT FACILITY

9 Months Ended

Sep. 30, 2012

CREDIT FACILITY [Abstract]

CREDIT FACILITY

CREDIT FACILITY

Our 364-day revolving credit agreement dated June 29, 2012, matures on June 28, 2013 and has a borrowing capacity of up to $40.0 million, of which, up to $10.0 million may be available for letters of credit (the 2012 Credit Facility). As of September 30, 2012, we had outstanding borrowings of $21.0 million and availability of $19.0 million for borrowings under the 2012 Credit Facility. Interest on the 2012 Credit Facility is based upon, at our option, either an alternative base rate plus 0.75% or a LIBOR-based rate plus 1.75%, which was 2.0% as of September 30, 2012.

The terms of the 2012 Credit Facility require NuStar Energy to maintain, as of the end of each rolling period, consisting of any period of four consecutive quarters, a consolidated debt coverage ratio not to exceed 5.0-to-1.0. If NuStar Energy consummates an acquisition for an aggregate net consideration of at least $50.0 million, the maximum consolidated debt coverage ratio will increase to 5.5-to-1.0 for two rolling periods. Additionally, if NuStar Energy’s Asphalt Operations are not owned by an unconsolidated joint venture, the 2012 Credit Facility allows the consolidated debt coverage ratio not to exceed 6.5-to-1.0 and 6.0-to-1.0 for the rolling periods ending June 30, 2012 and September 30, 2012, respectively. Since NuStar Energy’s Asphalt Operations were owned by an unconsolidated joint venture as of September 30, 2012, the consolidated debt coverage ratio could not exceed 5.0-to-1.0 and was 4.3x. We are also required to receive cash distributions of at least $50.0 million in respect of our ownership interests in NuStar Energy for the preceding four fiscal quarters ending on the last day of each fiscal quarter. Our management believes that we are in compliance with the covenants of the 2012 Credit Facility as of September 30, 2012.

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NET INCOME (LOSS) PER UNIT (Tables)

9 Months Ended

Sep. 30, 2012

NET INCOME (LOSS) PER UNIT [Abstract]

Unit amounts used in the computation of basic and diluted net (loss) income per unit

	Three Months Ended September 30,		Nine Months Ended September 30,
	2012	2011	2012	2011
Basic units outstanding:
Weighted-average number of basic units outstanding	42,575,563	42,544,659	42,575,183	42,544,659
Diluted units outstanding:
Weighted-average number of basic units outstanding	42,575,563	42,544,659	42,575,183	42,544,659
Effect of dilutive securities (a)	—	25,612	—	35,459
Weighted-average number of diluted units outstanding	42,575,563	42,570,271	42,575,183	42,580,118

(a) The computation of diluted net income (loss) per unit for the three and nine months ended September 30, 2012 excludes 300,766 outstanding options to purchase NuStar GP Holdings units as the effect of including such units would have been anti-dilutive.

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DISTRIBUTIONS FROM NUSTAR ENERGY (Tables)

9 Months Ended

Sep. 30, 2012

DISTRIBUTIONS FROM NUSTAR ENERGY [Abstract]

The allocation of NuStar Energy’s cash distributions earned for the periods indicated among its general and limited partners

	Three Months Ended September 30,				Nine Months Ended September 30,
	2012		2011		2012		2011
	(Thousands of Dollars, Except Per Unit Data)
General partner interest	$	1,961	$	1,628	$	5,525	$	4,847
General partner incentive distribution	10,805		8,972		30,437		26,503
Total general partner distribution	12,766		10,600		35,962		31,350
Limited partner distribution	11,374		11,271		33,808		33,506
Total distributions to NuStar GP Holdings	24,140		21,871		69,770		64,856
Public unitholders’ distributions	73,911		59,543		206,433		177,513
Total cash distributions	$	98,051	$	81,414	$	276,203	$	242,369
Cash distributions per unit applicable to limited partners	$	1.095	$	1.095	$	3.285	$	3.265

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EMPLOYEE BENEFIT PLANS

9 Months Ended

Sep. 30, 2012

EMPLOYEE BENEFIT PLANS [Abstract]

EMPLOYEE BENEFIT PLANS

EMPLOYEE BENEFIT PLANS

The components of net periodic benefit cost related to our defined benefit plans were as follows:

	Pension Plans (a)						Other Postretirement Benefit Plans
	2012			2011			2012		2011
	(Thousands of Dollars)
For the three months ended September 30:
Components of net periodic benefit cost:
Service cost	$	3,904		$	3,136		$	315	$	264
Interest cost	1,003			720			244		222
Expected return on assets	(979		)	(904		)	—		—
Amortization of prior service credit	(4		)	(4		)	—		—
Amortization of net loss	348			120			35		18
Net periodic benefit cost	$	4,272		$	3,068		$	594	$	504
For the nine months ended September 30:
Components of net periodic benefit cost:
Service cost	$	11,712		$	9,348		$	945	$	777
Interest cost	3,009			2,160			732		666
Expected return on assets	(2,937		)	(2,712		)	—		—
Amortization of prior service credit	(12		)	(12		)	—		—
Amortization of net loss	1,044			362			105		54
Net periodic benefit cost	$	12,816		$	9,146		$	1,782	$	1,497

(a) Includes amounts related to the pension plan, the excess pension plan and the supplemental executive retirement plan.

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MEMBERS' EQUITY

9 Months Ended

Sep. 30, 2012

MEMBERS’ EQUITY [Abstract]

MEMBERS' EQUITY

MEMBERS’ EQUITY

The following table presents changes to our members’ equity (in thousands):

Balance as of December 31, 2011	$	506,883
Net loss	(2,997		)
Distributions to unitholders	(65,141		)
Other comprehensive loss	(6,445		)
Unit-based compensation	646
Balance as of September 30, 2012	$	432,946

Cash Distributions

The table set forth below shows our cash distributions applicable to the period in which the distributions were earned:

	Three Months Ended September 30,				Nine Months Ended September 30,
	2012		2011		2012		2011
	(Thousands of Dollars, Except Per Unit Data)
Cash distributions per unit	$	0.545	$	0.495	$	1.565	$	1.470
Total cash distributions	$	23,204	$	21,059	$	66,637	$	62,540

On August 14, 2012, we paid a quarterly cash distribution totaling $21.7 million, or $0.510 per unit, related to the second quarter of 2012. On October 25, 2012, we announced a quarterly cash distribution of $0.545 per unit related to the third quarter of 2012. This distribution will be paid on November 16, 2012 to unitholders of record on November 9, 2012, and totals $23.2 million.

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NET INCOME (LOSS) PER UNIT

9 Months Ended

Sep. 30, 2012

NET INCOME (LOSS) PER UNIT [Abstract]

NET INCOME (LOSS) PER UNIT

NET INCOME (LOSS) PER UNIT

We treat restricted units granted under our long-term incentive plan as participating securities in computing net income per unit pursuant to the two-class method. Unit amounts used in the computation of basic and diluted net income (loss) per unit were as follows:

	Three Months Ended September 30,		Nine Months Ended September 30,
	2012	2011	2012	2011
Basic units outstanding:
Weighted-average number of basic units outstanding	42,575,563	42,544,659	42,575,183	42,544,659
Diluted units outstanding:
Weighted-average number of basic units outstanding	42,575,563	42,544,659	42,575,183	42,544,659
Effect of dilutive securities (a)	—	25,612	—	35,459
Weighted-average number of diluted units outstanding	42,575,563	42,570,271	42,575,183	42,580,118

(a) The computation of diluted net income (loss) per unit for the three and nine months ended September 30, 2012 excludes 300,766 outstanding options to purchase NuStar GP Holdings units as the effect of including such units would have been anti-dilutive.

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SUBSEQUENT EVENT

9 Months Ended

Sep. 30, 2012

SUBSEQUENT EVENT [Abstract]

Subsequent Event [Text Block]

SUBSEQUENT EVENT

TexStar Purchase Agreement

On November 2, 2012, NuStar Logistics, L.P. (NuStar Logistics), a wholly owned subsidiary of NuStar Energy, entered into an Asset Purchase Agreement (the Purchase Agreement) with TexStar Crude Oil Services, LP, TexStar Crude Oil Pipeline, LP, TexStar Midstream Utility, LP, TexStar Midstream Transport, LP, TexStar Midstream Services, LP and Frio LaSalle Pipeline, LP (collectively, the Sellers), to purchase the following assets:

• approximately 140 miles of crude oil pipelines and gathering lines that are currently under construction and upon completion will have throughput capacity of 100,000 barrels per day (the Crude Oil Pipelines);

• five terminals and storage facilities providing 643,400 barrels of storage capacity (the Crude Oil Terminals and Storage Facilities); and

• 38 miles of natural gas liquids (NGL) Y-grade pipeline and two fractionators with a combined capacity of 57,000 barrels per day (the NGL Assets); with the NGL Assets are currently under construction.

The acquisition also includes a lease for a terminal and storage facility located near Corpus Christi providing 144,000 barrels of storage capacity (the Redfish Bay Lease). The Crude Oil Pipelines, the Crude Oil Terminals and Storage Facilities and the Redfish Bay Lease are collectively referred to herein as the “Crude Oil Assets.” The Crude Oil Assets and the NGL Assets are collectively referred to herein as the “Assets.”

The purchase price for the Assets is approximately $425.0 million, subject tocertain purchase price adjustments, and is expected to close in two separate transactions. The acquisition of the Crude Oil Assets is expected to close in December 2012 (the Initial Closing), subject to customary closing conditions such as approval under the Hart-Scott Rodino Antitrust Improvements Act. The acquisition of the NGL Assets is expected to close in the first quarter of 2013 (the Second Closing),

subject to certain closing conditions such as completion of the Initial Closing and achieving certain milestones with respect to the development of the NGL Assets. If the Second Closing does not occur, it will have no impact on the Purchase Agreement with respect to the Crude Oil Assets. The Initial Closing and the Second Closing are collectively referred to herein as the “Transaction.” Upon the Initial Closing, NuStar Logistics will pay the Sellers approximately $325.0 million and at the Second Closing, NuStar Logistics will pay the Sellers approximately $100.0 million. Both payments are subject tocertain purchase price adjustments. NuStar Logistics expects to fund the purchase price with a combination of borrowings under its revolving credit facility and potential equity or debt offerings, pending market conditions.

The parties to the Purchase Agreement have made customary representations, warranties and covenants for a transaction of this type in this industry, including, among others, Sellers' agreement to continue to operate the Assets, during the period prior to the consummation of the Transaction, in the ordinary course of business, consistent with past practice or as otherwise set forth in the Purchase Agreement. The Sellers also agreed to continue construction of the Crude Oil Assets and NGL Assets. The Purchase Agreement also contains post-closing indemnification obligations for, among other matters, breaches of representations and warranties and certain retained and assumed obligations.

The Purchase Agreement contains certain termination rights prior to consummation of the Transaction by: (i) mutual written consent of NuStar Logistics and Sellers; (ii) NuStar Logistics if casualty losses result in damages in excess of $17 million; (iii) NuStar Logistics or Sellers, as applicable, if the other party has breached a representation, warranty or covenant contained in the Purchase Agreement so that such party is incapable of fulfilling its obligations under a closing condition; (iv) by NuStar Logistics or Sellers if the Initial Closing has not occurred by December 15, 2012, subject to extension as provided in the Purchase Agreement; or (v) by NuStar Logistics or Sellers if the Second Closing has not occurred by January 31, 2013, subject to extension as provided in the Purchase Agreement.

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DISTRIBUTIONS FROM NUSTAR ENERGY Table (Details) (NuStar Energy [Member], USD $) In Thousands, except Per Share data, unless otherwise specified	3 Months Ended			9 Months Ended
	Sep. 30, 2012	Mar. 31, 2012	Sep. 30, 2011	Sep. 30, 2012	Sep. 30, 2011
NuStar Energy [Member]
The allocation of NuStar Energy’s cash distributions earned for the periods indicated among its general and limited partners
General partner interest	$ 1,961		$ 1,628	$ 5,525	$ 4,847
General partner incentive distribution	10,805		8,972	30,437	26,503
Total general partner distribution	12,766		10,600	35,962	31,350
Limited partner distribution	11,374		11,271	33,808	33,506
Total distributions to NuStar GP Holdings	24,140		21,871	69,770	64,856
Public unitholders’ distributions	73,911		59,543	206,433	177,513
Total cash distributions	$ 98,051		$ 81,414	$ 276,203	$ 242,369
Cash distributions per unit applicable to limited partners	$ 1.095	$ 1.095	$ 1.095	$ 3.285	$ 3.265

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STATEMENTS OF CASH FLOWS (Tables)

9 Months Ended

Sep. 30, 2012

STATEMENTS OF CASH FLOWS [Abstract]

Changes in current assets and liabilities

	Nine Months Ended September 30,
	2012			2011
	(Thousands of Dollars)
Decrease (increase) in current assets:
Receivable from related party	$	(6,586	)	$	(470	)
Income tax receivable	2,619			1,157
Other receivables	299			(31		)
Other current assets	(98		)	54
Increase (decrease) in current liabilities:
Accounts payable	319			274
Accrued compensation expense	1,741			(5,109		)
Accrued liabilities	(23		)	98
Income tax payable	249			(302		)
Taxes other than income tax	(760		)	(321		)
Changes in current assets and liabilities	$	(2,240	)	$	(4,650	)

Cash flows related to interest and income tax

	Nine Months Ended September 30,
	2012			2011
	(Thousands of Dollars)
Cash paid for interest	$	316		$	312
Cash (refunded) paid for income tax	$	(918	)	$	536

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INVESTMENT IN NUSTAR ENERGY Narrative 1 (Details) (USD $)	3 Months Ended	9 Months Ended
	Sep. 30, 2012	Sep. 30, 2012	Sep. 30, 2011	Dec. 31, 2011
Subsidiary, Sale of Stock [Line Items]
Investment in NuStar Energy in order to maintain 2% interest		$ 14,961,000	$ 4,966,000
General partner interest percentage		2.00%
Percent ownership in NuStar Energy	15.10%	15.10%		16.30%
Gain related to NuStar Energy L.P.'s issuance of limited partner units	10,689,000	10,689,000	124,000
NuStar Energy - September 2012 Offering [Member]
Subsidiary, Sale of Stock [Line Items]
Limited partner units issued by NuStar Energy		7,130,000
Price of limited partner units issued by NuStar Energy, per unit	$ 48.94	$ 48.94
Proceeds from issuance of NuStar Energy limited partner units		336,800,000
Investment in NuStar Energy in order to maintain 2% interest		$ 7,100,000

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COMMITMENTS AND CONTINGENCIES Narrative (Details) (NuStar Energy (Grace Energy Corporation Matter) [Member], USD $) In Millions, unless otherwise specified	1 Months Ended	3 Months Ended
	Jul. 31, 2012	Jun. 30, 2012	Sep. 30, 2012
NuStar Energy (Grace Energy Corporation Matter) [Member]
NuStar Energy's Commitments and Contingencies [Abstract]
Court Judgment, Remediation Costs Not Recoverable By Plaintiff			$ 3.5
Court Judgment, Attorney Costs Awarded to Plaintiff			1.8
Department of Justice Estimated Remediation Expenses			71.9
Payments For Legal Settlements	13.1
Gain on legal settlement		$ 28.7

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ORGANIZATION AND BASIS OF PRESENTATION

9 Months Ended

Sep. 30, 2012

ORGANIZATION AND BASIS OF PRESENTATION [Abstract]

ORGANIZATION AND BASIS OF PRESENTATION

ORGANIZATION AND BASIS OF PRESENTATION

Organization

NuStar GP Holdings, LLC (NuStar GP Holdings) (NYSE: NSH) is a publicly held Delaware limited liability company. Unless otherwise indicated, the terms “NuStar GP Holdings,” “we,” “our” and “us” are used in this report to refer to NuStar GP Holdings, LLC, to one or more of our consolidated subsidiaries or to all of them taken as a whole.

We have no operations or sources of income or cash flows other than our investment in NuStar Energy L.P. (NuStar Energy) (NYSE: NS). As of September 30, 2012, we owned approximately 15.1% of NuStar Energy, consisting of the following:

• the 2% general partner interest;

• 100% of the incentive distribution rights (IDR) issued by NuStar Energy, which entitle us to receive increasing percentages of the cash distributed by NuStar Energy, currently at the maximum percentage of 23%; and

• 10,391,275 common units of NuStar Energy representing a 13.1% limited partner interest.

NuStar Energy is a publicly held Delaware limited partnership engaged in the terminalling and storage of petroleum products, the transportation of petroleum products and anhydrous ammonia, and petroleum refining and marketing. NuStar Energy has terminal facilities in the United States, Canada, Mexico, the Netherlands, including St. Eustatius in the Caribbean, the United Kingdom and Turkey.

Basis of Presentation

These unaudited condensed consolidated financial statements include the accounts of NuStar GP Holdings and subsidiaries in which it has a controlling interest. Intercompany balances and transactions have been eliminated in consolidation.

We account for our ownership interest in NuStar Energy using the equity method. Therefore, our financial results reflect a portion of NuStar Energy’s net income (loss) based on our ownership interest in NuStar Energy. We have no separate operating activities apart from those conducted by NuStar Energy and therefore generate no revenues from operations.

These unaudited condensed consolidated financial statements have been prepared in accordance with United States generally accepted accounting principles (GAAP) for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X of the Securities Exchange Act of 1934. Accordingly, they do not include all of the information and notes required by GAAP for complete consolidated financial statements. In the opinion of management, all adjustments considered necessary for a fair presentation have been included. All such adjustments are of a normal recurring nature unless otherwise indicated. Financial information for the three and nine months ended September 30, 2012 and 2011 included in these Condensed Notes to Consolidated Financial Statements is derived from our unaudited condensed consolidated financial statements. Operating results for the three and nine months ended September 30, 2012 are not necessarily indicative of the results that may be expected for the year ending December 31, 2012. The consolidated balance sheet as of December 31, 2011 has been derived from the audited consolidated financial statements as of that date. These condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto included in our Annual Report on Form 10-K for the year ended December 31, 2011.

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STATEMENTS OF CASH FLOWS

9 Months Ended

Sep. 30, 2012

STATEMENTS OF CASH FLOWS [Abstract]

STATEMENTS OF CASH FLOWS

STATEMENTS OF CASH FLOWS

Changes in current assets and liabilities were as follows:

	Nine Months Ended September 30,
	2012			2011
	(Thousands of Dollars)
Decrease (increase) in current assets:
Receivable from related party	$	(6,586	)	$	(470	)
Income tax receivable	2,619			1,157
Other receivables	299			(31		)
Other current assets	(98		)	54
Increase (decrease) in current liabilities:
Accounts payable	319			274
Accrued compensation expense	1,741			(5,109		)
Accrued liabilities	(23		)	98
Income tax payable	249			(302		)
Taxes other than income tax	(760		)	(321		)
Changes in current assets and liabilities	$	(2,240	)	$	(4,650	)

Cash flows related to interest and income tax were as follows:

	Nine Months Ended September 30,
	2012			2011
	(Thousands of Dollars)
Cash paid for interest	$	316		$	312
Cash (refunded) paid for income tax	$	(918	)	$	536

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INVESTMENT IN NUSTAR ENERGY Narrative 2 (Details) (NuStar Energy [Member], USD $) In Millions, unless otherwise specified	9 Months Ended
	Sep. 30, 2012
NuStar Energy [Member]
NuStar Energy's Asphalt Operations
NuStar Energy's Disposal Date	Sep. 28, 2012
NuStar Energy's Percent Voting Interest Sold	50.00%
NuStar Energy's Sale Price Of Class A Equity Interests	$ 175.0
NuStar Energy's Fair value of Class B equity interests	52.0
NuStar Energy's Proceeds from sale of inventory	261.3
NuStar Energy's Gain (loss) from sale or disposition of assets	(21.6)
NuStar Energy's Asset Impairment Losses	$ 266.4

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STATEMENTS OF CASH FLOWS Table 1 (Details) (USD $) In Thousands, unless otherwise specified	9 Months Ended
	Sep. 30, 2012	Sep. 30, 2011
Decrease (increase) in current assets:
Receivable from related party	$ (6,586)	$ (470)
Income tax receivable	2,619	1,157
Other receivables	299	(31)
Other current assets	(98)	54
Increase (decrease) in current liabilities:
Accounts payable	319	274
Accrued compensation expense	1,741	(5,109)
Accrued liabilities	(23)	98
Income tax payable	249	(302)
Taxes other than income tax	(760)	(321)
Changes in current assets and liabilities	$ (2,240)	$ (4,650)

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FAIR VALUE MEASUREMENTS (Tables)

9 Months Ended

Sep. 30, 2012

FAIR VALUE MEASUREMENTS [Abstract]

Liabilities measured at fair value on a recurring basis

	September 30, 2012
	Level 1		Level 2		Level 3		Total
	(Thousands of Dollars)
Accrued compensation expense:
NuStar Energy restricted units and performance awards	$	16,954	$	—	$	—	$	16,954
NuStar Energy unit options	—		399		—		399
Total	$	16,954	$	399	$	—	$	17,353
	December 31, 2011
	Level 1		Level 2		Level 3		Total
	(Thousands of Dollars)
Accrued compensation expense:
NuStar Energy restricted units and performance awards	$	13,622	$	—	$	—	$	13,622
NuStar Energy unit options	—		1,953		—		1,953
Total	$	13,622	$	1,953	$	—	$	15,575

Weighted-average assumptions used in Black-Scholes Option-Pricing Model

	September 30, 2012		December 31, 2011
Expected life in years	6.5		6.3
Expected volatility	19.8	%	20.3	%
Expected distribution yield	8.6	%	7.7	%
Risk-free interest rate	0.2	%	0.1	%