1176334--3/5/2008--MARTIN_MIDSTREAM_PARTNERS

related topics

{gas, price, oil}

{tax, income, asset}

{operation, natural, condition}

{debt, indebtedness, cash}

{stock, price, operating}

{interest, director, officer}

{cost, regulation, environmental}

{stock, price, share}

{acquisition, growth, future}

{competitive, industry, competition}

{customer, product, revenue}

{financial, litigation, operation}

{condition, economic, financial}

{control, financial, internal}

{regulation, change, law}

Adverse weather conditions, including droughts, hurricanes, tropical storms and other severe weather, could reduce our results of operations and ability to make distributions to our unitholders. If we incur material liabilities that are not fully covered by insurance, such as liabilities resulting from accidents on rivers or at sea, spills, fires or explosions, our results of operations and ability to make distributions to our unitholders could be adversely affected. The price volatility of petroleum products and by-products can reduce our results of operations and ability to make distributions to our unitholders. Increasing energy prices could adversely affect our results of operations. Restrictions in our credit facility may prevent us from making distributions to our unitholders. If we do not have sufficient capital resources for acquisitions or opportunities for expansion, our growth will be limited. Our recent and future acquisitions may not be successful, may substantially increase our indebtedness and contingent liabilities, and may create integration difficulties. Demand for our terminalling and storage services is substantially dependent on the level of offshore oil and gas exploration, development and production activity. Our NGL and sulfur-based fertilizer products are subject to seasonal demand and could cause our revenues to vary. The highly competitive nature of our industry could adversely affect our results of operations and ability to make distributions to our unitholders. Our business is subject to compliance with environmental laws and regulations that may expose us to significant costs and liabilities and adversely affect our results of operations and ability to make distributions to our unitholders. The loss or insufficient attention of key personnel could negatively impact our results of operations and ability to make distributions to our unitholders. Additionally, if neither Ruben Martin nor Scott Martin is the chief executive officer of our general partner, amounts we owe under our credit facility may become immediately due and payable. Our loss of significant commercial relationships with Martin Resource Management could adversely impact our results of operations and ability to make distributions to our unitholders. Our business would be adversely affected if operations at our transportation, terminalling and storage and distribution facilities experienced significant interruptions. Our business would also be adversely affected if the operations of our customers and suppliers experienced significant interruptions. Our marine transportation business would be adversely affected if we do not satisfy the requirements of the Jones Act, or if the Jones Act were modified or eliminated. Our marine transportation business would be adversely affected if the United States Government purchases or requisitions any of our vessels under the Merchant Marine Act. Regulations affecting the domestic tank vessel industry may limit our ability to do business, increase our costs and adversely impact our results of operations and ability to make distributions to our unitholders. A decline in the volume of natural gas and NGLs delivered to our facilities could adversely affect our results of operations, cash flows and financial condition. Our profitability is dependent upon prices and market demand for natural gas and NGLs, which are beyond our control and have been volatile. Our hedging activities may have a material adverse effect on our earnings, profitability, cash flows and financial condition. We typically do not obtain independent evaluations of natural gas reserves dedicated to our gathering and pipeline systems; therefore, volumes of natural gas on our systems in the future could be less than we anticipate. We depend on certain natural gas producer customers for a significant portion of our supply of natural gas and NGLs. The loss of any of these customers could result in a decline in our volumes, revenues and cash available for distribution. We may not successfully balance our purchases and sales of natural gas, which would increase our exposure to commodity price risks. If third-party pipelines and other facilities interconnected to our natural gas and NGL pipelines and facilities become unavailable to transport or produce natural gas and NGLs, our revenues and cash available for distribution could be adversely affected. The industry in which we operate is highly competitive, and increased competitive pressure could adversely affect our business and operating results. A change in the jurisdictional characterization of some of our assets by federal, state or local regulatory agencies or a change in policy by those agencies may result in increased regulation of our assets, which may cause our revenues to decline and operating expenses to increase. Panther Interstate Pipeline Energy, LLC is also subject to regulation by FERC with respect to issues other than ratemaking. We may incur significant costs and liabilities resulting from pipeline integrity programs and related repairs. We do not own all of the land on which our pipelines and facilities are located, which could disrupt our operations. Risks Relating to an Investment in the Common Units Units available for future sales by us or our affiliates could have an adverse impact on the price of our common units or on any trading market that may develop. Unitholders have less power to elect or remove management of our general partner than holders of common stock in a corporation. Common unitholders will not have sufficient voting power to elect or remove our general partner without the consent of Martin Resource Management. Our general partner s discretion in determining the level of our cash reserves may adversely affect our ability to make cash distributions to our unitholders. Unitholders may not have limited liability if a court finds that we have not complied with applicable statutes or that unitholder action constitutes control of our business. Our partnership agreement contains provisions that reduce the remedies available to unitholders for actions that might otherwise constitute a breach of fiduciary duty by our general partner. We may issue additional common units without unitholder approval, which would dilute unitholder ownership interests. The control of our general partner may be transferred to a third party, and that party could replace our current management team, without unitholder consent. Additionally, if Martin Resource Management no longer controls our general partner, amounts we owe under our credit facility may become immediately due and payable. Our general partner has a limited call right that may require unitholders to sell their common units at an undesirable time or price. Our common units have a limited trading volume compared to other publicly traded securities. Failure to achieve and maintain effective internal controls in accordance with Section 404 of the Sarbanes-Oxley Act could have a material adverse effect on our unit price. Risks Relating to Our Relationship with Martin Resource Management Cash reimbursements due to Martin Resource Management may be substantial and will reduce our cash available for distribution to our unitholders. Martin Resource Management has conflicts of interest and limited fiduciary responsibilities, which may permit it to favor its own interests to the detriment of our unitholders. Martin Resource Management and its affiliates may engage in limited competition with us. The IRS could treat us as a corporation for tax purposes, which would substantially reduce the cash available for distribution to unitholders. A successful IRS contest of the federal income tax positions we take may adversely affect the market for our common units and the costs of any contest will be borne by our unitholders and our general partner. Unitholders may be required to pay taxes on income from us even if they do not receive any cash distributions from us. Tax gain or loss on the disposition of our common units could be different than expected. Tax-exempt entities and foreign persons face unique tax issues from owning common units that may result in adverse tax consequences to them. We treat a purchaser of our common units as having the same tax benefits without regard to the seller s identity. The IRS may challenge this treatment, which could adversely affect the value of the common units. Unitholders may be subject to state, local and foreign taxes and return filing requirements as a result of investing in our common units.

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1176334--3/5/2008--MARTIN_MIDSTREAM_PARTNERS_LP