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8-K - FORM 8-K - NuStar Energy L.P.d8k.htm
8
th
Annual Wells Fargo Pipeline
and MLP Symposium
December 8, 2009
Curt Anastasio, CEO and
President
Exhibit 99.1


Statements contained in this presentation that state management’s expectations or
predictions of the future are forward-looking statements intended to be covered by the
safe harbor provisions of the Securities Act of 1933 and the Securities Exchange Act of
1934.
The
words
“believe,”
“expect,”
“should,”
“estimates,”
and
other
similar
expressions identify forward-looking statements.  It is important to note that actual
results could differ materially from those projected in such forward-looking statements. 
We undertake no duty to update any forward-looking statement to conform the
statement to actual results or changes in the company’s expectations. For more
information concerning factors that could cause actual results to differ from those
expressed or forecasted, see NuStar
Energy L.P.’s and NuStar
GP Holdings, LLC’s
respective annual reports on Form 10-K and quarterly reports on Form 10-Q, filed with
the Securities and Exchange Commission and available on NuStar’s
websites at
www.nustarenergy.com
and
www.nustargp.com.
Forward Looking Statements
2


NuStar Overview
3


NuStar
Energy L.P. (NYSE: NS) is a leading
publicly traded growth-oriented partnership
with a market capitalization of around $3.2
billion and an enterprise value of
approximately $5.1 billion
One of the largest independent petroleum
pipeline and terminal operators in the U.S. and
one of the largest asphalt refiners and
marketers in the U.S.
NuStar
GP Holdings, LLC (NYSE: NSH)
holds the 2% general partner interest, 16.8%
of the common units and incentive distribution
rights in NuStar
Energy L.P.
NuStar
Overview –
Two Publicly Traded Companies
NS
NSH
IPO Date:
4/16/2001
7/19/2006
Unit Price (12/3/09):
$52.26
$24.90
Annual Distribution/Unit:
$4.26
$1.74
Yield (12/3/09):
8.15%
6.99%
Market Capitalization:
$3,147 million
$1,060 million
Enterprise Value:
$5,060 million
$1,058 million
Total Assets (9/30/09):
$4,670 million
$581 million
Debt/Capitalization (9/30/09):
46.5%
n/a
Fortune 500 Ranking:
485
n/a
4


Asset Stats:
Operations in eight different
countries including the U.S., Mexico,
Netherlands, Netherlands Antilles
(i.e. Caribbean), England, Ireland,
Scotland and Canada
8,417 miles of crude oil and refined
product pipelines
Own 82 terminal facilities and four
crude oil storage tank facilities
Over 91 million barrels of storage
capacity
2 asphalt refineries on the U.S. East
Coast capable of processing
104,000 bpd of crude oil
Large and Diverse Geographic Footprint                  
with Assets in Key Locations
5


44%
36%
20%
Percentage of Expected 2009                 
Segment Operating Income
Approximately 80% of NuStar Energy’s segment operating income in 2009 is expected to come
from fee-based transportation and storage segments
Remainder of expected 2009 segment operating income relates to margin-based asphalt and fuels
marketing segment
Storage: ~44%
Transportation: ~36%
Refined Product Terminals
Crude Oil Storage
Refined Product Pipelines*
Crude Oil Pipelines
Asphalt & Fuels Marketing: ~20%
Asphalt
Fuels Marketing
Product Supply, Wholesale and Fuel Oil
Marketing
Bunkering
Diversified Operations from Three
Business Segments
*  Includes primarily distillates, gasoline, propane, jet fuel, ammonia and other light ends.  Does not include natural gas. 
6


Global Leader in Independent                      
Liquids Storage
NuStar
is the third largest independent liquids terminal operator in the world and second largest in the U.S.
Completed expansion projects in early 2009 under our $400 million construction program, which contributed
around 8.5 million barrels of incremental storage capacity
Of the roughly 91 million barrels of storage capacity, approximately 50 million barrels are crude oil and heavy fuel
products, 39 million barrels are refined products and 2 million barrels are biofuels
Source:  Company Websites & Management Presentations
7


Distributable Cash Flow ($ in Millions)
EBITDA ($ in Millions)
In this difficult economy, still expect a solid EBITDA contribution and higher distributable cash flow in 2009 compared to 2008
Strong performances from fee-based storage and transportation segments have partially offset lower relative performance from the
asphalt operations
Two-year EBITDA contribution from the acquisition of the former CITGO asphalt refineries, excluding the hedging loss, expected to
be
in
the
range
of
$220
to
$235
million
far
superior
to
the
typical
MLP
acquisition
Other accomplishments in 2009:
All
three
rating
agencies
upgraded
their
outlook
on
NuStar’s
debt
rating
to
stable
from
negative
Increased
the
distribution
at
NuStar
Energy
L.P.
and
NuStar
GP
Holdings, LLC
Continued excellence in safety and environmental achieving numerous awards for performance
Continue to ranked nationally, regionally and locally as one of the top places to work in America
Renewed focus on significantly higher growth opportunities in 2010 now that the capital markets have improved
Note:
2005
and
2006
distributable
cash
flow
and
EBITDA
are
from
continuing
operations
Solid Growth in Earnings Since
April 2001 IPO
2001
2002
2003
2004
2005
2006
2007
2008
$56
$68
$86
$102
$154
$214
$221
$319
2001
2002
2003
2004
2005
2006
2007
2008
$63
$77
$112
$133
$219
$322
$353
$492
8


$4.085
$3.835
$3.60
$3.365
$3.20
$2.95
$2.75
$2.40
2001
2002
2003
2004
2005
2006
2007
2008
NS Annual Distribution Since IPO
*
*     Based on NS annualized distribution of $0.60 per unit in 2001
**  Based on NSH annualized distribution of $0.32 per unit in 2006
NSH Annual Distribution Since IPO
$1.28
$1.38
$1.58
2006
2007
2008
**
~8.0% CAGR
~11% CAGR
Increased the distribution at NuStar Energy L.P. to $1.065
per unit in the third quarter of 2009 from previous $1.0575
per unit
Represents an increase of over five percent in the
distribution for the first three quarters of 2009 compared to
2008
Strong distribution coverage ratio of 1.47 times for the nine
months ended 2009
While fourth quarter distribution coverage will be weaker
due to the seasonality of the asphalt operations, still expect
a solid distribution coverage ratio for the full year of 2009
Consistent Distribution Growth While                
Maintaining a Solid Distribution Coverage
9
Increased the distribution at NuStar GP Holdings, LLC
to $0.435 per unit in the third quarter of 2009 from
previous $0.43 per unit
Represents an increase of nearly 13 percent in the
distribution for the first three quarters of 2009
compared to 2008


All of NuStar Energy L.P.’s Distribution has been Covered by the
Non-Asphalt Distributable Cash Flows for the Period NuStar has
Owned the Asphalt Operations
2008
9 Mos. Ended                        
September 30, 2009
Non-Asphalt Distributable Cash Flows*                
$271.5
$246.9
Total Distribution
252.8
198.1
Excess Distributable Cash Flows
$18.7
$48.8
% of Distribution Covered by
Non-Asphalt Distributable Cash Flows
100%
100%
Asphalt EBITDA
$90.4**
$69.1
Asphalt Distributable Cash Flows
$47.5**
$32.4
50% Holdback on Asphalt
Distributable Cash Flows
$23.8
$16.2
Cumulative Asphalt Distributable Cash Flows
Available for Future Distributions   
$23.8
$40.0
(Dollars in Millions)
*   Includes transportation, storage and fuels marketing operations
**  Includes $61 million hedging loss.  Adjusted Asphalt EBITDA was $151.2 million and adjusted distributable cash flows were $108.2 million without the
hedging loss.
Cumulative holdback of distributable cash flows from the asphalt
operations expected to be available should their
be a shortfall in the distributable cash flows from the non-asphalt operations
10


Financial Overview
11


Large Increase in Internal Growth Capital Expected in
2010 that Will Seed the Next Phase of NuStar’s
Growth
12
(Dollars in Millions)
$142
$126
$313
$81
Transportation
Storage
Asphalt & Fuels Marketing
$221
$62
$30
Earlier in 2009, we were cautious on our capital spending given the challenging economic and capital market
conditions and we lightened our internal growth program to around $80 million
As capital markets have improved throughout 2009, our internal growth program increased and currently stands at
around $126 million
2010 internal growth program is significantly higher at nearly $315 million and includes projects to:
Build new storage for large creditworthy customers under long-term contracts (i.e. 5 to 8 years)
Develop and improve logistics at key terminals
Expand our pipeline systems in fast-growing regions
Put in place the necessary infrastructure at key terminals to capture incremental ethanol and biofuel
volumes
Optimize our asphalt operations
Expand our fuel oil blending and bunkering operations
Develop new crude supply logistics to capitalize on heavy crude oil imbalances


Maintaining Sufficient Liquidity                               
with Disciplined Financial Strategy
NS Current Revolver Availability
Recent NuStar
Energy L.P. equity offering to be used primarily for future potential acquisitions and growth capital expenditures
Pending the use of the proceeds for other purposes, proceeds from the equity offering have been applied to reduce outstanding
borrowings under its revolving credit facility
Other than
the
acquisition
of
the
former
CITGO
asphalt
refineries
in
2008
and
the
Kaneb
acquisition
in
2005, NuStar
Energy L.P. has
not issued equity since August 2003
Total Bank Credit
$1,215
Less:
Borrowings
(537)
Letters of Credit
(60)
Revolver Liquidity
$618*
(Dollars in Millions)
NSH Current Revolver Availability
Total Bank Credit              $19.5
Less:
Borrowings                      14.3
Letters of Credit                   -
Revolver Liquidity              $  5.2
(Dollars in Millions)
2009
$11.2
2010            $0.8
2011
$0.8
2012
$990.6**
2013        $480.9
2014
$0.6
**  Primarily includes maturity of revolver, which expires
December 2012, and $350 million of senior notes
NS Debt Maturities (9/30/09)
Note:  NSH’s
revolving credit facility expires on July 16, 2010
13
No significant near-term debt
maturities
Bond markets continue to remain
strong for investment grade MLPs
like NuStar
Energy L.P.
* Debt-to-EBITDA cannot exceed 5.0 to 1.0 times


Business Segment Overview –
Storage
14


NuStar’s
Storage Segment Expected to Benefit in 2009 from              
Completed Projects and  Rate Increases on Renewed Contracts –
Lower Throughputs not Expected to have a Material Impact to Results
15
2009 storage results should exceed 2008 results as we are targeting
an incremental $30 to $35 million of EBITDA
Benefits come from $400 million construction program started in 2006
and completed in early 2009 and;
Strong demand for storage in key markets and persistent contango
markets that have provided significantly higher rates on storage
contracts up for renewal
Since approximately 90% of our revenues come from leased assets,
lower throughputs are not expected to have a material impact to
NuStar
Energy L.P.’s results
Flatter
contango
market
not
expected
to
impact
NuStar
as
we
continue
to sign up large, credit worthy customers under long-term contracts
18% -
1 Year or Less
30% -
1 to 3 Years
39% -
3 to 5 Years
13% -
Greater than 5 Years
While
we
will
not
see
as
much
incremental
benefit
in
2010
compared
to
2009
as
NuStar
cut
2009
growth
capital
and
the
$400
million construction program has ended, we expect that new internal growth opportunities will be primarily in storage
Targeting an incremental $18 to $22 million of EBITDA from storage segment in 2010 compared to 2009
Should
continue
to
benefit
from
the
move
towards
renewable
fuels
as
we
implement
infrastructure
at
certain
of
our
terminals to
handle biofuels
and collect additional fees from customers
NuStar
has over 2 million barrels of biofuels
storage
Refined
product
demand
growth
outside
the
U.S.
should
benefit
companies
like
NuStar
that
are
developing
international storage
opportunities


Business Segment Overview –
Transportation
16


NuStar’s Transportation Segment Should Benefit from                   
Growth in Product Demand, Although Growth Will be Slower in    
the U.S. Than Developing Nations
17
2009 transportation results should be equal to or slightly better than 2008
results despite lower volumes due to :
Higher revenue per barrel related to (a) 7.6% tariff increase effective July 1,
2009 and (b) sale of pipeline assets with moderate throughputs, but a low
revenue per barrel
Lower operating expenses mainly due to lower power costs
Most industry experts are predicting that 2010 product demand should recover
slightly as the economy improves, net of fuel efficiency estimates
Experts project world oil demand to increase 1% to 2%, gasoline demand to
increase by around 1%, distillate demand to increase by over 3% and jet fuel
demand to increase by around 1%
Refinery utilization is projected to continue to be low, or in the range of 80% to
85%
Refined product demand growth expected to be less in the U.S. and primarily
international, mainly the Far East, Middle East and parts of  Latin America
Expect NuStar’s throughput volumes to increase slightly in 2010 compared to
2009, excluding the impact of the assets sales, and in-line with our view of a
modest economic recovery next year
Recently announced refinery closures not expected to impact NuStar’s results
While we are currently projecting the tariff adjustment to be around 1.5% lower
starting July 1, 2010 compared to the July 2009 adjustment, the 2010 calendar
year rate should be slightly higher than the 2009 calendar year rate


Revenue
per
barrel
higher
in
the
second
half
of
2009
compared
to
same
period
last
year
primarily
due
to
7.6%
tariff
increase and sale of pipeline assets with a relatively low revenue per barrel
Expect to see an uptick in fourth quarter 2009 throughputs compared to the third quarter of 2009, primarily due to a
lighter refinery maintenance schedule
Decline in Throughput Volumes in 2009 Mainly Due to Assets
Sales, Unplanned Outages and Planned Turnarounds…Less Due
to Economic Run Cuts
Impact from sale of pipelines :
ConocoPhillips
sale
of
their
JV
Interest
in
the El Paso pipeline to Valero Energy in
2Q08 (~32 mbpd)
NuStar’s
sale
of
the
Skelly-Belvieu
pipeline in 4Q08 (~12 mbpd)
NuStar’s
sale
of
the
Trans-Texas
and
Ardmore-Wynnewood pipelines in 2Q09
(~ 60 mbpd)
911
104
1,006
1,001
56
1,112
1,050
43
38
35
18
863
104
920 -
940


Business Segment Overview –
Asphalt & Fuels Marketing
19


Expect 2009 EBITDA from our asphalt operations to be in the range
of $70 to $85 million and 2009 EBITDA from our fuels marketing
operations to be in the range of $15 to $20 million
Asphalt operations have earned nearly $70 million of EBITDA and
fuels marketing operations have earned nearly $11 million of EBITDA
in the first nine months of 2009
Fourth quarter 2009 asphalt profits are shaping up to be better than
we anticipated as we have seen an uncharacteristic rise in asphalt
prices for this time of year
Fourth quarter product margin per barrel expected to be in the range
of $5.75 to $6.25 per barrel
2009 winter-fill season on the U.S. East Coast off to a slow start due
to high asphalt replacement costs
This could bode well for 2010 as it is expected to further tighten
asphalt supply
Despite Lower Than Anticipated Asphalt Results in
2009, Still Expect a Solid Contribution
20
Expect improved results from our asphalt operations in 2010 as we expect a higher margin per barrel as demand should increase
slightly, aided by the stimulus package, and supply should continue to be tight, primarily due to low refinery utilization rates
Although
stimulus
fund
outlays
have
ramped
up
recently,
it
still
represents
only
a
small
percentage
of
the
total
apportioned
or, roughly
$4.2 billion of the $27.5 billion available for highway projects
Expect significantly higher stimulus fund outlays in 2010
Industry groups have recently stepped up their efforts to urge Congress to pass a multi-year highway funding bill instead of passing
further continuing resolutions


While Asphalt Supply Through September 2009 Continues to Remain Below
Historical
Averages,
Asphalt
Demand
has
been
Trending
Lower…
Asphalt
Margins still Better Than Historical Margins Even Before Coker Impact
Weak public and private road demand due to the poor economy and lower than expected stimulus funds have
caused asphalt demand to lag compared to last year
Asphalt demand through September 2009 was around 13% lower than 2008 and nearly 27% below the 5-year average
Impact should result in a deferral and not a cancellation of road work projects
Continue
to
expect
a
positive
impact
to
asphalt
demand
primarily
in
2010
and
2011
when
most
of
the
stimulus
spending is expected to occur and economic recovery supports private sector demand
Asphalt
margins
have
already
improved
compared
to
history
even
before
the
coker
story
fully
kicks
in
2011-2012
Two-year average for 2008 and 2009 of around $7.70 per barrel significantly higher than the $3.78 per barrel for the sever years
prior to when NuStar
owned the asphalt refineries
U.S. Asphalt Demand (000 barrels)
Source:  U.S. Energy Information Administration.  Data only available through August 2009
21
U.S. East Coast Product Margin ($ per barrel)
2000 to 2007 is prior to NuStar’s acquisition of the former CITGO Asphalt Refineries and is based on the estimated margin for that period. 
** Excludes impact from $61 million hedging loss incurred in 2008


Lower Asphalt Production and Imports Through                   
September 2009 Continue to Benefit Margins
U.S. refiners have cut crude oil runs to avoid driving weak
margins lower, resulting in reduced refinery production,
including asphalt
Narrow light-heavy crude oil spreads are causing complex
refiners to run less heavy crude oil and more light crude oil,
resulting in less bottom-of-the barrel production, including
asphalt
Asphalt production through September 2009 was nearly 7.5%
lower than 2008 and over 20% lower than the 4-year average
U.S. Asphalt Production (000 barrels)
U.S. Asphalt Imports (000 barrels)
Continued lack of asphalt imports is also contributing
to less asphalt supply
Asphalt imports through September 2009 were nearly
18% lower than 2008 and nearly 48% lower than the 5-
year average
Source of data for graphs:  U.S. Energy Information Administration.  Data only available through August 2009
22
5,000
10,000
15,000
20,000
Jan
Feb
Mar
Apr
May
Jun
Jul
Aug
Sep
Oct
Nov
Dec
2006
2007
2008
2009
4-Year Avg.
0
1,000
2,000
3,000
Jan
Feb
Mar
Apr
May
June
July
Aug
Sept
Oct
Nov
Dec
2006
2007
2008
2009
5-Year Avg.


Announced U.S. Coker Projects:
Despite Some Delays/Cancellations, Long-Term Impact of
Coker Projects on Asphalt Supply Still Intact
Source:  PIRA Refinery Database; Company Information
Approximately 95% of the announced coker projects listed are either complete or have a high likelihood of completion (i.e.
firm projects)
Most of the coker capacity is still expected to come on-line starting next year and through 2013, which should contribute to
further tightening of asphalt supply
23
No.
Refinery
PADD
Announced
Coker Capacity
(Mbpd)
Announced
Crude Capacity
(Mbpd)
Start Up
Date
Status
1
Coffeyville Resources - Coffeyville, Kansas
II
2.0
                    
8.0
                   
1Q 2007
Complete
2
BP - Toledo, Ohio
II
2.0
                    
10.0
                
1Q 2007
Complete
3
Valero - Port Arthur, Texas
III
25.0
                   
75.0
                
1Q 2007
Complete
4
Frontier - Cheyenne, Wyoming
IV
4.3
                    
-
                
3Q 2007
Complete
5
Chevron - El Segundo, California
V
15.0
                   
-
                
4Q 2007
Complete
6
Sinclair – Sinclair, Wyoming
IV
20.0
                   
11.0
                
4Q 2007
Complete
7
ConocoPhillips - Borger, Texas
III
25.0
                   
-
                
4Q 2007
Complete
8
Cenex - Laurel, Montana
IV
15.0
                   
-
                
1Q 2008
Complete
9
Frontier - El Dorado, Kansas
II
3.0
                    
11.0
                
2Q 2008
Complete
10
Tesoro - Martinez, California
V
4.4
                    
-
                
2Q 2008
Complete
11
ConocoPhillips - Los Angeles, California
V
5.0
                    
-
                
4Q 2008
Complete
12
Marathon - Garyville, Louisiana
III
44.0
                   
180.0
              
1Q 2010
Firm
13
Hunt - Tuscaloosa, Alabama
III
18.5
                   
15.0
                
4Q 2010
Firm
14
Atofina Petrochemicals Inc.- Port Arthur, Texas
III
50.0
                   
-
                
1Q 2011
Firm
15
ConocoPhillips - Wood River, Illinois
II
65.0
                   
55.0
                
3Q 2011
Firm
16
BP - Whiting, Indiana
II
95.0
                   
30.0
                
1Q 2012
Firm
17
Motiva - Port Arthur, Texas
III
95.0
                   
325.0
              
1Q 2012
Firm
18
Marathon - Detroit, Michigan
II
28.0
                   
13.0
                
2Q 2013
Probable
Total US Expansion
516.2
                
733.0
              
Expansions Completed through 2008
120.7
                
115.0
              
Firm Expansions 2009-2013
367.5
                
605.0
              
Probable Expansions 2009-2013
28.0
                  
13.0
                


Majority of business derived from attractive set of fee-based storage and transportation assets that
support  U.S. energy infrastructure
Provides
world
class
pipeline
and
terminalling
services
to
some
of
the
world’s
largest
crude
oil
producers,
integrated
oil
companies, chemical companies, oil traders and refineries
Pipeline and storage businesses are widely considered to be somewhat recession resistant
Investors
provided
optionality
on
the
performance
of
the
asphalt
operations
since
the
non-asphalt
distributable
cash
flows
are
expected
to
cover
all
of
the
distribution
for
the
period
NuStar
has
owned
the
asphalt refineries
Two-year contribution from the acquisition of the former CITGO asphalt refineries, excluding the hedging loss,
expected
to
be
in
the
range
of
$220
to
$235
million
far
superior
to
the
typical
MLP
acquisition
Coker thesis still intact
-
Asphalt operations expected to benefit from better-than-historic asphalt margins over the
long-term as supply continues to tighten and demand improves
Economic stimulus package expected to benefit U.S. asphalt demand primarily in 2010 and 2011
Strong balance sheet and investment grade rating
All
three
rating
agencies
recently
revised
their
outlook
on
NuStar
Energy
L.P.
to
stable
from
negative
Attractive yield with quarterly distributions that are largely tax deferred
Large and diversified asset footprint in the U.S. and internationally allows for ample acquisition and
internal growth opportunities
$500 million of attractive internal growth projects over the next two to three years with nearly $315 million              
budgeted for 2010
Most of new growth projects expected to be in the storage segment
Investment Highlights
24


Questions & Answers


Appendix
26


(Dollars in Thousands)
Reconciliation of Non-GAAP Financial
Information
27
The following is a reconciliation of income from continued operations to EBITDA and distributable cash flow:
2001
2002
2003
2004
2005
2006
2007
2008
Income from continuing operations
45,873
$            
55,143
$            
69,593
$            
78,418
$            
107,675
$          
149,906
$          
150,298
$          
254,018
$          
Plus interest expense, net
3,811
                
4,880
                
15,860
              
20,950
              
41,388
              
66,266
              
76,516
              
90,818
              
Plus income tax expense
-
                     
395
                    
-
                     
-
                     
4,713
                
5,861
                
11,448
              
11,006
              
Plus depreciation and amortization expense
13,390
              
16,440
              
26,267
              
33,149
              
64,895
              
100,266
            
114,293
            
135,709
            
EBITDA
63,074
              
76,858
              
111,720
            
132,517
            
218,671
            
322,299
            
352,555
            
491,551
            
Less equity earnings from joint ventures
3,179
                
3,188
                
2,416
                
1,344
                
2,319
                
5,882
                
6,833
                
8,030
                
Less interest expense, net
3,811
                
4,880
                
15,860
              
20,950
              
41,388
              
66,266
              
76,516
              
90,818
              
Less reliability capital expenditures
2,786
                
3,943
                
10,353
              
9,701
                
23,707
              
35,803
              
40,337
              
55,669
              
Less income tax expense
-
                     
-
                     
-
                     
-
                     
4,713
                
5,861
                
11,448
              
11,006
              
Plus mark-to-market impact on hedge transactions
-
                     
-
                     
-
                     
-
                     
-
                     
-
                     
3,131
                
(9,784)
               
Plus charges reimbursed by general partner
-
                     
-
                     
-
                     
-
                     
-
                     
575
                    
-
                     
-
                     
Plus distributions from joint ventures
2,874
                
3,590
                
2,803
                
1,373
                
4,657
                
5,141
                
544
                    
2,835
                
Plus other non-cash items
-
                     
-
                     
-
                     
-
                     
2,672
                
-
                     
-
                     
-
                     
Distributable cash flow
56,172
$            
68,437
$            
85,894
$            
101,895
$          
153,873
$          
214,203
$          
221,096
$          
319,079
$          
Note:  2005 and 2006 distributable cash flow and EBITDA are from continuing operations.
Year Ended December 31,
NuStar
Energy L.P. utilizes EBITDA, which is not defined in United States generally accepted accounting principles, as a financial measure because it is a widely
accepted financial indicator used by investors to compare partnership performance. In addition, management believes that this measure provides investors an enhanced
perspective of the operating performance of the partnership's assets and the cash that the business is generating. EBITDA is not
intended to represent cash flows for the
period, nor is it presented as an alternative to operating income. EBITDA should not be considered in isolation or as a substitute for a measure of performance prepared
in accordance with United States generally accepted accounting principles.


28
(Dollars in Thousands)
Reconciliation of Non-GAAP Financial Information: 
Asphalt & Fuels Marketing
EBITDA
in
the
following
reconciliations
relate
to
our
operating
segments
or
a
portion
of
an
operating
segment.
For
purposes
of
segment
reporting
we
do
not
allocate
general
and
administrative
expenses
to
our
reported
operating
segments
because
those
expenses
relate
primarily
to
the
overall
management
at
the
entity
level.
Therefore,
EBITDA
reflected
in
the
following
reconciliations
excludes
any
allocation
of
general
and
administrative
expenses consistent with our policy for determining segmental operating income, the most directly comparable GAAP measure.
Asphalt Operations
Fuels Marketing
Operations
Asphalt and Fuels
Marketing Segment
Operating income
76,267
$                   
36,239
$                   
112,506
$                 
Plus depreciation and amortization expense
14,182
552
14,734
Plus hedging loss in 2Q08
60,704
-
60,704
Adjusted EBITDA
151,153
$                 
36,791
$                   
187,944
$                 
Asphalt Operations
Fuels Marketing
Operations
Asphalt and Fuels
Marketing Segment
Projected operating income range
$    51,000 -
$ 66,000
$    15,000 -
$ 20,000
$    66,000 -
$ 86,000
Plus projected depreciation and
amortization expense
19,000
-
19,000
Projected EBITDA range
$    70,000 -
$ 85,000
$    15,000 -
$ 20,000
$  85,000 -
$ 105,000
Combined two-year adjusted EBITDA range
from asphalt operations
$  221,153 -
$ 236,153
Asphalt Operations
Fuels Marketing
Operations
Asphalt and Fuels
Marketing Segment
Operating income
54,562
$                   
10,736
$                   
65,298
$                   
Plus depreciation and amortization expense
14,536
-
14,536
EBITDA
69,098
$                   
10,736
$                   
79,834
$                   
The following is a reconciliation of operating income to EBITDA for our asphalt operations and fuels marketing operations:
Nine Months Ended
September 30, 2009
The following is a reconciliation of operating income to adjusted EBITDA for our asphalt operations and fuels marketing
Twelve Months Ended
December 31, 2008
Projected Twelve Months Ended
December 31, 2009


29
(Dollars in Thousands)
Reconciliation of Non-GAAP Financial Information: 
Asphalt & Fuels Marketing (continued)
EBITDA
in
the
following
reconciliations
relate
to
our
operating
segments
or
a
portion
of
an
operating
segment.
For
purposes
of
segment
reporting
we
do
not
allocate
general
and
administrative
expenses
to
our
reported
operating
segments
because
those
expenses
relate
primarily
to
the
overall
management
at
the
entity
level.
Therefore,
EBITDA
reflected
in
the
following
reconciliations
excludes
any
allocation
of
general
and
administrative
expenses consistent with our policy for determining segmental operating income, the most directly comparable GAAP measure.
Twelve Months
Ended December
31, 2008
Nine Months Ended
September 30,2009
Asphalt operations operating income
76,267
$                    
54,562
$                    
  Plus depreciation and amortization associated with asphalt operations
14,182
14,536
Asphalt operations EBITDA
90,449
                     
69,098
                     
18,640
11,982
  Less interest expense
20,150
19,455
  Less income tax expense
-
476
  Less reliability capital expenditures
4,126
4,789
Asphalt operations distributable cash flow
47,533
$                    
32,396
$                    
  Plus hedging loss in 2Q08
60,704
-
                              
Asphalt operations distributable cash flow excluding hedging loss
108,237
$                 
32,396
$                    
Distributable cash flow
319,079
$                 
279,292
$                 
  Less asphalt operations distributable cash flow
47,533
32,396
Non-asphalt operations distributable cash flow
271,546
$                 
246,896
$                 
  Less general & administrative expense
The following is a reconciliation of operating income to EBITDA and distributable cash flow for our asphalt operations:
Allocated to asphalt operations for distributable cash flow purposes


30
(Dollars in Thousands)
Reconciliation of Non-GAAP Financial Information: 
Storage
Projected incremental operating income range
$     25,500 -  30,500
Plus projected incremental depreciation and
amortization expense
4,500
Projected incremental EBITDA range
$     30,000 -  35,000
Projected incremental operating income range
$     13,500 -  17,500
Plus projected incremental depreciation and
amortization expense
4,500
Projected incremental EBITDA range
$     18,000 -  22,000
The
following
is
a
reconciliation
of
projected
incremental
operating
income
to
projected
incremental
EBITDA
for
the
year
ended
December
31,
2009
for
our storage segment:
The
following
is
a
reconciliation
of
projected
incremental
operating
income
to
projected
incremental
EBITDA
for
the
year
ended
December
31,
2010
for
our storage segment:
Storage Segment
Storage Segment
EBITDA in the following reconciliation relates to our operating segments or a portion of an operating segment. For purposes of segment reporting we do
not
allocate
general
and
administrative
expenses
to
our
reported
operating
segments
because
those
expenses
relate
primarily
to
the
overall
management at the entity level. Therefore, EBITDA reflected in the following reconciliations excludes any allocation of general and administrative
expenses consistent with our policy for determining segmental operating income, the most directly comparable GAAP measure.