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      <div style="DISPLAY: block; TEXT-INDENT: 0pt">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">UNITED
  STATES</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">SECURITIES
  AND EXCHANGE COMMISSION</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Washington,
  D.C. 20549</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font id="TAB1" style="MARGIN-LEFT: 108pt"></font><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 18pt; FONT-FAMILY: Times New Roman">FORM
  10-Q</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
      <div>
        <table cellpadding="0" cellspacing="0" width="100%">
            <tr>
              <td align="left" valign="top" width="4%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0.8pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: wingdings">x</font></div>
              </td>
              <td align="left" valign="top" width="75%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">QUARTERLY
        REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES EXCHANGE ACT OF
        1934</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">For the
  quarterly period ended September 30, 2008</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">OR</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
      <div>
        <table cellpadding="0" cellspacing="0" width="100%">
            <tr>
              <td align="left" valign="top" width="4%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0.8pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: wingdings">&#168;</font></div>
              </td>
              <td align="left" valign="top" width="75%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0.8pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">TRANSITION
        REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES EXCHANGE ACT OF
        1934</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">For the
  transition period from <font style="DISPLAY: inline; TEXT-DECORATION: underline">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;</font>
  to <font style="DISPLAY: inline; TEXT-DECORATION: underline">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;</font></font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Commission
  File Number 001-33503</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 24pt; FONT-FAMILY: Times New Roman">SEMGROUP
  ENERGY PARTNERS, L.P.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(Exact
  name of registrant as specified in its charter)</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
      <div>
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            <tr>
              <td valign="middle" width="38%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
              <td valign="bottom" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
              <td colspan="2" valign="middle" width="46%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
            </tr>
            <tr>
              <td valign="top" width="38%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0.8pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Delaware</font></div>
              </td>
              <td align="left" valign="bottom" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
              <td valign="top" width="38%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0.8pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">20-8536826</font></div>
              </td>
              <td valign="top" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
            </tr>
            <tr>
              <td valign="top" width="38%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0.8pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(State
        or other jurisdiction of</font></div>
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0.8pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">incorporation
        or organization)</font></div>
              </td>
              <td align="left" valign="bottom" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
              <td valign="top" width="38%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0.8pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(IRS
        Employer</font></div>
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0.8pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Identification
        No.)</font></div>
              </td>
              <td valign="top" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
            </tr>
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      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Two
  Warren Place</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">6120
  South Yale Avenue, Suite 500</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Tulsa,
  Oklahoma 74136</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(Address
  of principal executive offices, zip code)</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Registrant&#8217;s
  telephone number, including area code: (918)&#160;524-5500</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Indicate
  by check mark whether the registrant: (1)&#160;has filed all reports required to
  be filed by Section&#160;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)&#160;has been subject to such filing
  requirements for the past 90 days.&#160;&#160;&#160;&#160;Yes&#160;&#160; <font style="DISPLAY: inline;" face="Wingdings">&#168;</font>
  &#160;&#160;&#160;&#160;No&#160;&#160; <font style="DISPLAY: inline;" face="Wingdings">x</font></font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left">
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font id="TAB2" style="LETTER-SPACING: 9pt">&#160;&#160;&#160;</font>&#160;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 (&#167;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).</font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Yes <font style="DISPLAY: inline;" face="Wingdings">o</font> No <font style="DISPLAY: inline;" face="Wingdings">o</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">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 &#8220;large accelerated filer&#8221;, &#8220;accelerated filer&#8221;, and &#8220;smaller
  reporting company&#8221; in Rule 12b-2 of the Exchange Act. (Check one):</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;Large
  accelerated filer&#160;&#160; <font style="DISPLAY: inline;" face="Wingdings">&#168;</font>
  &#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;Accelerated
  filer&#160;&#160; <font style="DISPLAY: inline;" face="Wingdings">&#168;</font></font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;Non-accelerated
  filer&#160;&#160; <font style="DISPLAY: inline;" face="Wingdings">x</font>&#160;&#160;(Do not
  check if a smaller reporting
  company)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;Smaller
  reporting company&#160;&#160; <font style="DISPLAY: inline;" face="Wingdings">&#168;</font></font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Indicate
  by check mark whether the registrant is a shell company (as defined in Rule
  12b-2 of the Exchange Act).&#160;&#160;&#160;&#160;Yes&#160;&#160; <font style="DISPLAY: inline;" face="Wingdings">&#168;</font>
  &#160;&#160;&#160;&#160;No&#160;&#160; <font style="DISPLAY: inline;" face="Wingdings">x</font></font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; BACKGROUND-COLOR: indianred"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; BACKGROUND-COLOR: white"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; BACKGROUND-COLOR: white"><font style="FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; BACKGROUND-COLOR: white"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; BACKGROUND-COLOR: white"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; BACKGROUND-COLOR: white"><font style="FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; BACKGROUND-COLOR: white"><font style="FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; BACKGROUND-COLOR: white"><font style="FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; BACKGROUND-COLOR: white"><font style="FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; BACKGROUND-COLOR: white">As
  of May 22, 2009, there were</font> <font style="FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">21,557,309</font> common
  units and <font style="FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">12,570,504</font>
  </font><font style="FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; BACKGROUND-COLOR: white"><font style="FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">subordinated</font> units
  outstanding.</font></font></font></font></font></font></font></font></font></font></font></font></font></font></font></font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
      <div>
        <hr style="MARGIN-TOP: -5px; COLOR: #000000" noshade size="1">
        <hr style="MARGIN-TOP: -13px; COLOR: #000000" noshade size="4"><br>
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          <div id="PN" style="PAGE-BREAK-AFTER: always">
            <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 8pt; FONT-FAMILY: Times New Roman">&#160;
  </font></div>
          </div>
          <div id="HDR">&#160;</div>
        </div>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt">&#160;</div>
      <div>
        <div align="left">
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                  <table cellpadding="0" cellspacing="0" width="100%">
                      <tr>
                        <td align="left" valign="bottom" width="13%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;<font style="FONT-WEIGHT: bold"><a href="#toc">Table of
        Contents</a></font></font></td>
                        <td align="left" valign="bottom" width="4%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="77%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="5%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                      </tr>
                      <tr>
                        <td align="left" valign="bottom" width="13%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                        <td align="left" valign="bottom" width="4%">
                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0.8pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;&#160;</font></div>
                        </td>
                        <td align="left" valign="bottom" width="77%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                        <td align="left" valign="bottom" width="5%" style="BORDER-BOTTOM: black 2px solid">
                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0.8pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;&#160;<font style="DISPLAY: inline; FONT-WEIGHT: bold">Page</font></font></div>
                        </td>
                        <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                      </tr>
                      <tr>
                        <td align="left" colspan="3" valign="top" width="94%">
                          <div style="DISPLAY: block; MARGIN-LEFT: 18pt; TEXT-INDENT: -18pt; MARGIN-RIGHT: 2.8pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"><a name="toc">PART I - FINANCIAL INFORMATION</a></font></div>
                        </td>
                        <td align="left" valign="bottom" width="5%">
                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0.8pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;&#160;</font></div>
                        </td>
                        <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                      </tr>
                      <tr>
                        <td valign="middle" width="13%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                        <td colspan="2" valign="middle" width="81%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                        <td colspan="2" valign="middle" width="6%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                      </tr>
                      <tr>
                        <td align="left" valign="top" width="13%">
                          <div style="DISPLAY: block; MARGIN-LEFT: 18pt; TEXT-INDENT: -18pt; MARGIN-RIGHT: 0.8pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Item&#160;I.</font></div>
                        </td>
                        <td align="left" valign="bottom" width="4%">
                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0.8pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;&#160;</font></div>
                        </td>
                        <td align="left" valign="bottom" width="77%">
                          <div style="DISPLAY: block; MARGIN-LEFT: 18pt; TEXT-INDENT: -18pt; MARGIN-RIGHT: 0.8pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"><a href="#item1">Financial Statements</a></font></div>
                        </td>
                        <td align="right" valign="bottom" width="5%">
                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0.7pt" align="right"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">1</font></font></font></div>
                        </td>
                        <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                      </tr>
                      <tr>
                        <td colspan="3" valign="middle" width="94%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td colspan="2" valign="middle" width="6%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                      </tr>
                      <tr>
                        <td colspan="3" valign="middle" width="94%">
                          <div style="MARGIN-LEFT: 117pt"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: times new roman">&#160;SemGroup
        Energy Partners, L.P.</font></div>
                        </td>
                        <td colspan="2" valign="middle" width="6%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: times new roman">&#160;</font></td>
                      </tr>
                      <tr>
                        <td colspan="3" valign="middle" width="94%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                        <td colspan="2" valign="middle" width="6%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                      </tr>
                      <tr>
                        <td valign="top" width="13%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                        <td align="left" valign="bottom" width="4%">
                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0.8pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;&#160;</font></div>
                        </td>
                        <td align="left" valign="bottom" width="77%">
                          <div style="DISPLAY: block; MARGIN-LEFT: 18pt; TEXT-INDENT: -18pt; MARGIN-RIGHT: 0.8pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"><a href="#bs">Consolidated Balance Sheets as of December 31, 2007 and
        September 30, 2008</a></font></div>
                        </td>
                        <td align="right" valign="bottom" width="5%">
                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0.7pt" align="right"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">1</font></font></font></div>
                        </td>
                        <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                      </tr>
                      <tr>
                        <td valign="middle" width="13%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                        <td colspan="2" valign="middle" width="81%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                        <td colspan="2" valign="middle" width="6%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                      </tr>
                      <tr>
                        <td valign="top" width="13%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                        <td align="left" valign="bottom" width="4%">
                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0.8pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;&#160;</font></div>
                        </td>
                        <td align="left" valign="bottom" width="77%">
                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0.8pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"><a href="#is">Consolidated Statements of Operations for the three and nine
        months ended September 30, 2007 and 2008</a></font></div>
                        </td>
                        <td align="right" valign="bottom" width="5%">
                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0.7pt" align="right"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">2</font></font></font></div>
                        </td>
                        <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                      </tr>
                      <tr>
                        <td valign="middle" width="13%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                        <td colspan="2" valign="middle" width="81%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                        <td colspan="2" valign="middle" width="6%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                      </tr>
                      <tr>
                        <td valign="top" width="13%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                        <td align="left" valign="bottom" width="4%">
                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0.8pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;&#160;</font></div>
                        </td>
                        <td align="left" valign="bottom" width="77%">
                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0.8pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"><a href="#equity">Consolidated Statements of Changes in Partners&#8217; Capital
        (Deficit) for the nine months ended September 30, 2008</a></font></div>
                        </td>
                        <td align="right" valign="bottom" width="5%">
                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0.7pt" align="right"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">3</font></font></font></div>
                        </td>
                        <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                      </tr>
                      <tr>
                        <td valign="middle" width="13%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                        <td colspan="2" valign="middle" width="81%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                        <td colspan="2" valign="middle" width="6%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                      </tr>
                      <tr>
                        <td valign="top" width="13%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                        <td align="left" valign="bottom" width="4%">
                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0.8pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;&#160;</font></div>
                        </td>
                        <td align="left" valign="bottom" width="77%">
                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0.8pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"><a href="#cf">Consolidated Statements of Cash Flows for the nine months ended
        September 30, 2007 and 2008</a></font></div>
                        </td>
                        <td align="right" valign="bottom" width="5%">
                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0.7pt" align="right"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">4</font></font></font></div>
                        </td>
                        <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                      </tr>
                      <tr>
                        <td valign="middle" width="13%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                        <td colspan="2" valign="middle" width="81%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                        <td colspan="2" valign="middle" width="6%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                      </tr>
                      <tr>
                        <td valign="top" width="13%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                        <td align="left" valign="bottom" width="4%">
                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0.8pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;&#160;</font></div>
                        </td>
                        <td align="left" valign="bottom" width="77%">
                          <div style="DISPLAY: block; MARGIN-LEFT: 18pt; TEXT-INDENT: -18pt; MARGIN-RIGHT: 0.8pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"><a href="#notes">Notes to the Consolidated Financial
        Statements</a></font></div>
                        </td>
                        <td align="right" valign="bottom" width="5%">
                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0.7pt" align="right"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">5</font></font></font></div>
                        </td>
                        <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                      </tr>
                      <tr>
                        <td valign="middle" width="13%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                        <td colspan="2" valign="middle" width="81%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                        <td colspan="2" valign="middle" width="6%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                      </tr>
                      <tr>
                        <td align="left" valign="top" width="13%">
                          <div style="DISPLAY: block; MARGIN-LEFT: 18pt; TEXT-INDENT: -18pt; MARGIN-RIGHT: 0.8pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Item&#160;2.</font></div>
                        </td>
                        <td align="left" valign="bottom" width="4%">
                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0.8pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;&#160;</font></div>
                        </td>
                        <td align="left" valign="bottom" width="77%">
                          <div style="DISPLAY: block; MARGIN-LEFT: 18pt; TEXT-INDENT: -18pt; MARGIN-RIGHT: 0.8pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"><a href="#mda">Management&#8217;s Discussion and Analysis of Financial Condition
        and Results of Operations</a></font></div>
                        </td>
                        <td align="right" valign="bottom" width="5%">
                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0.8pt" align="right"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">32</font></font></font></div>
                        </td>
                        <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                      </tr>
                      <tr>
                        <td valign="middle" width="13%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                        <td colspan="2" valign="middle" width="81%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                        <td colspan="2" valign="middle" width="6%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                      </tr>
                      <tr>
                        <td align="left" valign="top" width="13%">
                          <div style="DISPLAY: block; MARGIN-LEFT: 18pt; TEXT-INDENT: -18pt; MARGIN-RIGHT: 0.8pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Item&#160;3.</font></div>
                        </td>
                        <td align="left" valign="bottom" width="4%">
                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0.8pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;&#160;</font></div>
                        </td>
                        <td align="left" valign="bottom" width="77%">
                          <div style="DISPLAY: block; MARGIN-LEFT: 18pt; TEXT-INDENT: -18pt; MARGIN-RIGHT: 0.8pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"><a href="#quant">Quantitative and Qualitative Disclosures about Market
        Risk</a></font></div>
                        </td>
                        <td align="right" valign="bottom" width="5%">
                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0.8pt" align="right"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;&#160;55</font></font></font></div>
                        </td>
                        <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                      </tr>
                      <tr>
                        <td valign="middle" width="13%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                        <td colspan="2" valign="middle" width="81%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                        <td colspan="2" valign="middle" width="6%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                      </tr>
                      <tr>
                        <td align="left" valign="top" width="13%">
                          <div style="DISPLAY: block; MARGIN-LEFT: 18pt; TEXT-INDENT: -18pt; MARGIN-RIGHT: 0.8pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Item&#160;4T.</font></div>
                        </td>
                        <td align="left" valign="bottom" width="4%">
                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0.8pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;&#160;</font></div>
                        </td>
                        <td align="left" valign="bottom" width="77%">
                          <div style="DISPLAY: block; MARGIN-LEFT: 18pt; TEXT-INDENT: -18pt; MARGIN-RIGHT: 0.8pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"><a href="#controls">Controls and Procedures</a></font></div>
                        </td>
                        <td align="right" valign="bottom" width="5%" bgcolor="white">
                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0.8pt" align="right"><font style="DISPLAY: inline; FONT-WEIGHT: bold"><font size="2">56</font></font></div>
                        </td>
                        <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                      </tr>
                      <tr>
                        <td colspan="3" valign="middle" width="94%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                        <td colspan="2" valign="middle" width="6%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                      </tr>
                      <tr>
                        <td align="left" colspan="3" valign="top" width="94%">
                          <div style="DISPLAY: block; MARGIN-LEFT: 18pt; TEXT-INDENT: -18pt; MARGIN-RIGHT: 2.8pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"><a href="#part2">PART II. OTHER INFORMATION</a></font></div>
                        </td>
                        <td align="right" valign="bottom" width="5%">
                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0.8pt" align="right"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;57</font></font></font></div>
                        </td>
                        <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                      </tr>
                      <tr>
                        <td valign="middle" width="13%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                        <td colspan="2" valign="middle" width="81%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                        <td colspan="2" valign="middle" width="6%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                      </tr>
                      <tr>
                        <td align="left" valign="top" width="13%">
                          <div style="DISPLAY: block; MARGIN-LEFT: 18pt; TEXT-INDENT: -18pt; MARGIN-RIGHT: 0.8pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Item&#160;1.</font></div>
                        </td>
                        <td align="left" valign="bottom" width="4%">
                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0.8pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;&#160;</font></div>
                        </td>
                        <td align="left" valign="bottom" width="77%">
                          <div style="DISPLAY: block; MARGIN-LEFT: 18pt; TEXT-INDENT: -18pt; MARGIN-RIGHT: 0.8pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"><a href="#legal">Legal Proceedings</a></font></div>
                        </td>
                        <td align="right" valign="bottom" width="5%">
                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0.8pt" align="right"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;&#160;57</font></font></font></div>
                        </td>
                        <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                      </tr>
                      <tr>
                        <td valign="middle" width="13%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                        <td colspan="2" valign="middle" width="81%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                        <td colspan="2" valign="middle" width="6%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                      </tr>
                      <tr>
                        <td align="left" valign="top" width="13%">
                          <div style="DISPLAY: block; MARGIN-LEFT: 18pt; TEXT-INDENT: -18pt; MARGIN-RIGHT: 0.8pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Item
        1A.</font></div>
                        </td>
                        <td valign="bottom" width="4%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                        <td align="left" valign="bottom" width="77%">
                          <div style="DISPLAY: block; MARGIN-LEFT: 18pt; TEXT-INDENT: -18pt; MARGIN-RIGHT: 0.8pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"><a href="#risk">Risk Factors</a></font></div>
                        </td>
                        <td align="right" valign="bottom" width="5%">
                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0.8pt" align="right"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;&#160;59</font></font></font></div>
                        </td>
                        <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                      </tr>
                      <tr>
                        <td valign="top" width="13%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                        <td valign="bottom" width="4%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                        <td valign="bottom" width="77%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                        <td valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                        <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                      </tr>
                      <tr>
                        <td align="left" valign="top" width="13%">
                          <div style="DISPLAY: block; MARGIN-LEFT: 18pt; TEXT-INDENT: -18pt; MARGIN-RIGHT: 0.8pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Item
        3.</font></div>
                        </td>
                        <td valign="bottom" width="4%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                        <td align="left" valign="bottom" width="77%">
                          <div style="DISPLAY: block; MARGIN-LEFT: 18pt; TEXT-INDENT: -18pt; MARGIN-RIGHT: 0.8pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"><a href="#default">Defaults Upon Senior Securities</a></font></div>
                        </td>
                        <td align="right" valign="bottom" width="5%">
                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0.8pt" align="right"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;&#160;84</font></font></font></div>
                        </td>
                        <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                      </tr>
                      <tr>
                        <td valign="top" width="13%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                        <td valign="bottom" width="4%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                        <td valign="bottom" width="77%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                        <td valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                        <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                      </tr>
                      <tr>
                        <td align="left" valign="top" width="13%">
                          <div style="DISPLAY: block; MARGIN-LEFT: 18pt; TEXT-INDENT: -18pt; MARGIN-RIGHT: 0.8pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Item&#160;6.</font></div>
                        </td>
                        <td align="left" valign="bottom" width="4%">
                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0.8pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;&#160;</font></div>
                        </td>
                        <td align="left" valign="bottom" width="77%">
                          <div style="DISPLAY: block; MARGIN-LEFT: 18pt; TEXT-INDENT: -18pt; MARGIN-RIGHT: 0.8pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"><a href="#exhibits">Exhibits</a></font></div>
                        </td>
                        <td align="right" valign="bottom" width="5%">
                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0.8pt" align="right"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;&#160;86</font></font></font></div>
                        </td>
                        <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                      </tr>
                      <tr>
                        <td valign="middle" width="13%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                        <td colspan="2" valign="middle" width="81%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                        <td colspan="2" valign="top" width="6%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                      </tr>
                      <tr>
                        <td align="left" valign="top" width="13%">
                          <div style="DISPLAY: block; MARGIN-LEFT: 18pt; TEXT-INDENT: -18pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"><a href="#signature">SIGNATURES</a></font></div>
                        </td>
                        <td align="left" valign="bottom" width="4%">
                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0.8pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;&#160;</font></div>
                        </td>
                        <td valign="bottom" width="77%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                        <td align="left" valign="bottom" width="5%">
                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0.8pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;&#160;</font></div>
                        </td>
                        <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                      </tr>
                      <tr>
                        <td colspan="3" valign="middle" width="94%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                        <td colspan="2" valign="middle" width="6%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                      </tr>
                      <tr>
                        <td align="left" colspan="3" valign="top" width="94%">
                          <div style="DISPLAY: block; MARGIN-LEFT: 18pt; TEXT-INDENT: -18pt; MARGIN-RIGHT: 2.8pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">CERTIFICATIONS</font></div>
                        </td>
                        <td align="left" valign="bottom" width="5%">
                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0.8pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;&#160;</font></div>
                        </td>
                        <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                      </tr>
                      <tr>
                        <td colspan="3" valign="middle" width="94%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                        <td colspan="2" valign="middle" width="6%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                      </tr>
                      <tr>
                        <td colspan="3" valign="top" width="94%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                        <td valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                        <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                      </tr>
                  </table>
                </div>
              </div>
            </div>
          </div>
        </div>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
        <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div><br>
      <div id="PGBRK" style="MARGIN-LEFT: 0pt; WIDTH: 100%; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
        <div id="FTR">
          <div style="WIDTH: 100%" align="left">
            <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
          </div>
          <div id="GLFTR" style="WIDTH: 100%" align="center">
          </div>
        </div>
        <div id="PN" style="PAGE-BREAK-AFTER: always">
          <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 8pt; FONT-FAMILY: Times New Roman">&#160;
  </font></div>
          <div style="WIDTH: 100%; TEXT-ALIGN: center">
            <hr style="COLOR: black" noshade size="2">
          </div>
        </div>
        <div id="HDR">
          <div id="GLHDR" style="WIDTH: 100%" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 9pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><a href="#TOC">Table of Contents</a></font></div>
        </div>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><a name="part1">PART</a> I &#8211; FINANCIAL INFORMATION</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
      <div>
        <table cellpadding="0" cellspacing="0" width="100%">
            <tr>
              <td align="left" valign="top" width="9%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0.8pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;<a name="item1">Item&#160;</a>1.</font></div>
              </td>
              <td align="left" valign="top" width="77%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0.8pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Financial
        Statements</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><a name="BS">SEMGROUP</a> ENERGY PARTNERS, L.P.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">CONSOLIDATED
  BALANCE SHEETS</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(in
  thousands, except units)</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center">
        <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
        <div>
          <div align="left">
            <div align="center">
              <div align="center">
                <div align="center">
                  <div align="center">
                    <div align="center">
                      <div align="center">
                        <div align="center">
                          <div align="center">
                            <table cellpadding="0" cellspacing="0" width="100%">
                                <tr>
                                  <td align="left" valign="bottom" width="40%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                                  <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td colspan="2" valign="bottom" width="9%">
                                    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">As
        of December 31,</font></div>
                                  </td>
                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td colspan="2" valign="bottom" width="9%">
                                    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">As
        of September 30,</font></div>
                                  </td>
                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                </tr>
                                <tr>
                                  <td align="left" valign="bottom" width="40%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                                  <td valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td colspan="2" valign="bottom" width="9%" style="BORDER-BOTTOM: black 2px solid">
                                    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">2007</font></div>
                                  </td>
                                  <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td colspan="2" valign="bottom" width="9%" style="BORDER-BOTTOM: black 2px solid">
                                    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">2008</font></div>
                                  </td>
                                  <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                </tr>
                                <tr>
                                  <td align="left" valign="bottom" width="40%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                                  <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td colspan="6" valign="bottom" width="20%">
                                    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(unaudited)</font></div>
                                  </td>
                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                </tr>
                                <tr>
                                  <td align="left" valign="bottom" width="40%">
                                    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman; TEXT-DECORATION: underline"><font style="DISPLAY: inline; FONT-WEIGHT: bold">ASSETS</font></font></div>
                                  </td>
                                  <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="left" colspan="2" valign="bottom" width="9%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="left" colspan="2" valign="bottom" width="9%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                </tr>
                                <tr>
                                  <td align="left" valign="bottom" width="40%">
                                    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Current
        assets:</font></div>
                                  </td>
                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="left" colspan="2" valign="bottom" width="9%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="left" colspan="2" valign="bottom" width="9%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                </tr>
                                <tr bgcolor="#cceeff">
                                  <td align="left" valign="bottom" width="40%">
                                    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 18pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Cash
        and cash equivalents</font></div>
                                  </td>
                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></td>
                                  <td align="right" valign="bottom" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">416</font></td>
                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></td>
                                  <td align="right" valign="bottom" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">16,558</font></td>
                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                </tr>
                                <tr bgcolor="white">
                                  <td align="left" valign="bottom" width="40%">
                                    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 18pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Accounts
        receivable, net of allowance for doubtful accounts of $0 and
        $432</font></div>
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                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="right" valign="bottom" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="right" valign="bottom" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                </tr>
                                <tr bgcolor="#cceeff">
                                  <td align="left" valign="bottom" width="40%">
                                    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 18pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;&#160;&#160;at
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                                  </td>
                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="right" valign="bottom" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">2,666</font></td>
                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="right" valign="bottom" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">7,954</font></td>
                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                </tr>
                                <tr bgcolor="white">
                                  <td align="left" valign="bottom" width="40%">
                                    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 18pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Receivables
        from related parties, net of allowance for doubtful accounts
        of</font></div>
                                  </td>
                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="right" valign="bottom" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="right" valign="bottom" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                </tr>
                                <tr bgcolor="#cceeff">
                                  <td align="left" valign="bottom" width="40%">
                                    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$0
        for both dates</font></div>
                                  </td>
                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="right" valign="bottom" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">9,665</font></td>
                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="right" valign="bottom" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">19,291</font></td>
                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                </tr>
                                <tr bgcolor="white">
                                  <td align="left" valign="bottom" width="40%">
                                    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 18pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Prepaid
        insurance</font></div>
                                  </td>
                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="right" valign="bottom" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">797</font></td>
                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="right" valign="bottom" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">3,303</font></td>
                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                </tr>
                                <tr bgcolor="#cceeff">
                                  <td align="left" valign="bottom" width="40%" style="PADDING-BOTTOM: 2px">
                                    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 18pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Other
        current assets</font></div>
                                  </td>
                                  <td align="right" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="right" valign="bottom" width="8%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">442</font></td>
                                  <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="right" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="right" valign="bottom" width="8%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">1,666</font></td>
                                  <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                </tr>
                                <tr bgcolor="white">
                                  <td align="left" valign="bottom" width="40%" style="PADDING-BOTTOM: 2px">
                                    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 18pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Total
        current assets</font></div>
                                  </td>
                                  <td align="right" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="right" valign="bottom" width="8%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">13,986</font></td>
                                  <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="right" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="right" valign="bottom" width="8%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">48,772</font></td>
                                  <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                </tr>
                                <tr bgcolor="#cceeff">
                                  <td align="left" valign="bottom" width="40%">
                                    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Property,
        plant and equipment, net of accumulated depreciation of $40,222 and
        $74,731</font></div>
                                  </td>
                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="right" valign="bottom" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="right" valign="bottom" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                </tr>
                                <tr bgcolor="white">
                                  <td align="left" valign="bottom" width="40%">
                                    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 9pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">at
        December 31, 2007 and September 30, 2008, respectively</font></div>
                                  </td>
                                  <td align="right" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="right" valign="bottom" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">102,239</font></td>
                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="right" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="right" valign="bottom" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">289,716</font></td>
                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                </tr>
                                <tr bgcolor="#cceeff">
                                  <td align="left" valign="bottom" width="40%">
                                    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Goodwill</font></div>
                                  </td>
                                  <td align="right" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="right" valign="bottom" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">6,340</font></td>
                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="right" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="right" valign="bottom" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">6,340</font></td>
                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                </tr>
                                <tr bgcolor="white">
                                  <td align="left" valign="bottom" width="40%">
                                    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Debt
        issuance costs</font></div>
                                  </td>
                                  <td align="right" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="right" valign="bottom" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">944</font></td>
                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="right" valign="bottom" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">2,422</font></td>
                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                </tr>
                                <tr bgcolor="#cceeff">
                                  <td align="left" valign="bottom" width="40%" style="PADDING-BOTTOM: 2px">
                                    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Other
        assets, net</font></div>
                                  </td>
                                  <td align="right" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="right" valign="bottom" width="8%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">1,973</font></td>
                                  <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="right" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="right" valign="bottom" width="8%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">1,863</font></td>
                                  <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                </tr>
                                <tr bgcolor="white">
                                  <td align="left" valign="bottom" width="40%" style="PADDING-BOTTOM: 4px">
                                    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Total
        assets</font></div>
                                  </td>
                                  <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 4px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 4px double"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></td>
                                  <td align="right" valign="bottom" width="8%" style="BORDER-BOTTOM: black 4px double"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">125,482</font></td>
                                  <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 4px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 4px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 4px double"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></td>
                                  <td align="right" valign="bottom" width="8%" style="BORDER-BOTTOM: black 4px double"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">349,113</font></td>
                                  <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 4px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                </tr>
                                <tr bgcolor="#cceeff">
                                  <td align="left" valign="bottom" width="40%">
                                    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman; TEXT-DECORATION: underline"><font style="DISPLAY: inline">LIABILITIES AND PARTNERS' CAPITAL
        (DEFICIT)</font></font></div>
                                  </td>
                                  <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="right" valign="bottom" width="8%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="right" valign="bottom" width="8%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                </tr>
                                <tr bgcolor="white">
                                  <td align="left" valign="bottom" width="40%">
                                    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Current
        liabilities:</font></div>
                                  </td>
                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="right" valign="bottom" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="right" valign="bottom" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                </tr>
                                <tr bgcolor="#cceeff">
                                  <td align="left" valign="bottom" width="40%">
                                    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 18pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Accounts
        payable</font></div>
                                  </td>
                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></td>
                                  <td align="right" valign="bottom" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">3,045</font></td>
                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></td>
                                  <td align="right" valign="bottom" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">2,836</font></td>
                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                </tr>
                                <tr bgcolor="white">
                                  <td align="left" valign="bottom" width="40%">
                                    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 18pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Payables
        to related parties</font></div>
                                  </td>
                                  <td align="right" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="right" valign="bottom" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">10,227</font></td>
                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="right" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="right" valign="bottom" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">15,904</font></td>
                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                </tr>
                                <tr bgcolor="#cceeff">
                                  <td align="left" valign="bottom" width="40%">
                                    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 18pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Accrued
        interest payable</font></div>
                                  </td>
                                  <td align="right" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="right" valign="bottom" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">449</font></td>
                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="right" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="right" valign="bottom" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">-</font></td>
                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                </tr>
                                <tr bgcolor="white">
                                  <td align="left" valign="bottom" width="40%">
                                    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 18pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Accrued
        property taxes payable</font></div>
                                  </td>
                                  <td align="right" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="right" valign="bottom" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">-</font></td>
                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="right" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="right" valign="bottom" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">1,944</font></td>
                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                </tr>
                                <tr bgcolor="#cceeff">
                                  <td align="left" valign="bottom" width="40%">
                                    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 18pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Interest
        rate swap settlements payable</font></div>
                                  </td>
                                  <td align="right" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="right" valign="bottom" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">-</font></td>
                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="right" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="right" valign="bottom" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">1,505</font></td>
                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                </tr>
                                <tr bgcolor="white">
                                  <td align="left" valign="bottom" width="40%">
                                    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 18pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Unearned
        revenue</font></div>
                                  </td>
                                  <td align="right" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="right" valign="bottom" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">-</font></td>
                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="right" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="right" valign="bottom" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">453</font></td>
                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                </tr>
                                <tr bgcolor="#cceeff">
                                  <td align="left" valign="bottom" width="40%">
                                    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 18pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Other
        accrued liabilities</font></div>
                                  </td>
                                  <td align="right" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="right" valign="bottom" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">340</font></td>
                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="right" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="right" valign="bottom" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">1,956</font></td>
                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                </tr>
                                <tr bgcolor="white">
                                  <td align="left" valign="bottom" width="40%" style="PADDING-BOTTOM: 2px">
                                    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 18pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Current
        portion of capital lease obligations</font></div>
                                  </td>
                                  <td align="right" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="right" valign="bottom" width="8%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">1,236</font></td>
                                  <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="right" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="right" valign="bottom" width="8%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">992</font></td>
                                  <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                </tr>
                                <tr bgcolor="#cceeff">
                                  <td align="left" valign="bottom" width="40%" style="PADDING-BOTTOM: 2px">
                                    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 18pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Total
        current liabilities</font></div>
                                  </td>
                                  <td align="right" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="right" valign="bottom" width="8%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">15,297</font></td>
                                  <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="right" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="right" valign="bottom" width="8%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">25,590</font></td>
                                  <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                </tr>
                                <tr bgcolor="white">
                                  <td align="left" valign="bottom" width="40%">
                                    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Long-term
        debt</font></div>
                                  </td>
                                  <td align="right" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="right" valign="bottom" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">89,600</font></td>
                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="right" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="right" valign="bottom" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">448,100</font></td>
                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                </tr>
                                <tr bgcolor="#cceeff">
                                  <td align="left" valign="bottom" width="40%">
                                    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Long-term
        capital lease obligations</font></div>
                                  </td>
                                  <td align="right" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="right" valign="bottom" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">1,123</font></td>
                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="right" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="right" valign="bottom" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">418</font></td>
                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                </tr>
                                <tr bgcolor="white">
                                  <td align="left" valign="bottom" width="40%">
                                    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Interest
        rate swaps liability</font></div>
                                  </td>
                                  <td align="right" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="right" valign="bottom" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">2,233</font></td>
                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="right" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="right" valign="bottom" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">-</font></td>
                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                </tr>
                                <tr bgcolor="#cceeff">
                                  <td align="left" valign="bottom" width="40%">
                                    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Commitments
        and contingencies (Notes 4, 10 and 13)</font></div>
                                  </td>
                                  <td align="right" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="right" valign="bottom" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="right" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="right" valign="bottom" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                </tr>
                                <tr bgcolor="white">
                                  <td align="left" valign="bottom" width="40%">
                                    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Partners'
        capital (deficit):</font></div>
                                  </td>
                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="right" valign="bottom" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="right" valign="bottom" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                </tr>
                                <tr bgcolor="#cceeff">
                                  <td align="left" valign="bottom" width="40%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="right" valign="bottom" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="right" valign="bottom" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                </tr>
                                <tr bgcolor="white">
                                  <td align="left" valign="bottom" width="40%">
                                    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 18pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Common
        unitholders (14,375,000 and 21,557,309 units issued and outstanding
        at</font></div>
                                  </td>
                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="right" valign="bottom" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="right" valign="bottom" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                </tr>
                                <tr bgcolor="#cceeff">
                                  <td align="left" valign="bottom" width="40%">
                                    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">December
        31, 2007 and September 30, 2008, respectively)</font></div>
                                  </td>
                                  <td align="right" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="right" valign="bottom" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">317,004</font></td>
                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="right" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="right" valign="bottom" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">482,086</font></td>
                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                </tr>
                                <tr bgcolor="white">
                                  <td align="left" valign="bottom" width="40%">
                                    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 18pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Subordinated
        unitholders (12,570,504 units issued and outstanding for both
        dates)</font></div>
                                  </td>
                                  <td align="right" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="right" valign="bottom" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(287,210</font></td>
                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">)</font></td>
                                  <td align="right" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="right" valign="bottom" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(283,717</font></td>
                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">)</font></td>
                                </tr>
                                <tr bgcolor="#cceeff">
                                  <td align="left" valign="bottom" width="40%">
                                    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 18pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">General
        partner interest (2.0% interest with 549,908 and 690,725 general partner
        units</font></div>
                                  </td>
                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="right" valign="bottom" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="right" valign="bottom" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                </tr>
                                <tr bgcolor="white">
                                  <td align="left" valign="bottom" width="40%" style="PADDING-BOTTOM: 2px">
                                    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">outstanding
        at December 31, 2007 and September 30, 2008, respectively)</font></div>
                                  </td>
                                  <td align="right" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="right" valign="bottom" width="8%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(12,565</font></td>
                                  <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">)</font></td>
                                  <td align="right" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="right" valign="bottom" width="8%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(323,364</font></td>
                                  <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">)</font></td>
                                </tr>
                                <tr bgcolor="#cceeff">
                                  <td align="left" valign="bottom" width="40%" style="PADDING-BOTTOM: 2px">
                                    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 18pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Total
        Partners' capital (deficit)</font></div>
                                  </td>
                                  <td align="right" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="right" valign="bottom" width="8%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">17,229</font></td>
                                  <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="right" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="right" valign="bottom" width="8%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(124,995</font></td>
                                  <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">)</font></td>
                                </tr>
                                <tr bgcolor="white">
                                  <td align="left" valign="bottom" width="40%" style="PADDING-BOTTOM: 4px">
                                    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Total
        liabilities and Partners' capital (deficit)</font></div>
                                  </td>
                                  <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 4px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 4px double"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></td>
                                  <td align="right" valign="bottom" width="8%" style="BORDER-BOTTOM: black 4px double"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">125,482</font></td>
                                  <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 4px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 4px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 4px double"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></td>
                                  <td align="right" valign="bottom" width="8%" style="BORDER-BOTTOM: black 4px double"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">349,113</font></td>
                                  <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 4px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                </tr>
                            </table>
                          </div>
                        </div>
                      </div>
                    </div>
                  </div>
                </div>
              </div>
            </div>
          </div>
        </div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">See
  accompanying notes to unaudited consolidated financial
  statements.</font></div><br>
      <div id="PGBRK" style="MARGIN-LEFT: 0pt; WIDTH: 100%; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
        <div id="FTR">
          <div style="WIDTH: 100%" align="left">
            <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
  </font></div>
          </div>
          <div id="GLFTR" style="WIDTH: 100%" align="center">
          </div>
        </div>
        <div id="PN" style="PAGE-BREAK-AFTER: always">
          <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">1</font></div>
          <div style="WIDTH: 100%; TEXT-ALIGN: center">
            <hr style="COLOR: black" noshade size="2">
          </div>
        </div>
        <div id="HDR">
          <div id="GLHDR" style="WIDTH: 100%" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 9pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><a href="#TOC">Table of Contents</a></font></div>
        </div>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><a name="IS">SEMGROUP</a> ENERGY PARTNERS, L.P.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">CONSOLIDATED
  STATEMENTS OF OPERATIONS</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(<font style="DISPLAY: inline; FONT-WEIGHT: bold">in thousands, except per unit
  data)</font></font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center">
        <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
        <div>
          <div align="left">
            <div align="center">
              <div align="center">
                <div align="center">
                  <div align="center">
                    <div align="center">
                      <div align="center">
                        <div align="center">
                          <table cellpadding="0" cellspacing="0" width="100%">
                              <tr>
                                <td align="left" valign="bottom" width="45%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                                <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td colspan="6" valign="bottom" width="14%">
                                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Three
        Months Ended</font></div>
                                </td>
                                <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td colspan="6" valign="bottom" width="14%">
                                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Nine
        Months Ended</font></div>
                                </td>
                                <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                              </tr>
                              <tr>
                                <td align="left" valign="bottom" width="45%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                                <td valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td colspan="6" valign="bottom" width="14%" style="BORDER-BOTTOM: black 2px solid">
                                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">September
        30,</font></div>
                                </td>
                                <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td colspan="6" valign="bottom" width="14%" style="BORDER-BOTTOM: black 2px solid">
                                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">September
        30,</font></div>
                                </td>
                                <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                              </tr>
                              <tr>
                                <td align="left" valign="bottom" width="45%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                                <td valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td colspan="2" valign="bottom" width="6%" style="BORDER-BOTTOM: black 2px solid">
                                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">2007</font></div>
                                </td>
                                <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td colspan="2" valign="bottom" width="6%" style="BORDER-BOTTOM: black 2px solid">
                                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">2008</font></div>
                                </td>
                                <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td colspan="2" valign="bottom" width="6%" style="BORDER-BOTTOM: black 2px solid">
                                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">2007</font></div>
                                </td>
                                <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td colspan="2" valign="bottom" width="6%" style="BORDER-BOTTOM: black 2px solid">
                                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">2008</font></div>
                                </td>
                                <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                              </tr>
                              <tr>
                                <td align="left" valign="bottom" width="45%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                                <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td colspan="14" valign="bottom" width="30%">
                                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(unaudited)</font></div>
                                </td>
                                <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                              </tr>
                              <tr>
                                <td align="left" valign="bottom" width="45%">
                                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"><a name="range_a8:b30">Service revenue:</a></font></div>
                                </td>
                                <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" colspan="2" valign="bottom" width="6%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" colspan="2" valign="bottom" width="6%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" colspan="2" valign="bottom" width="6%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" colspan="2" valign="bottom" width="6%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                              </tr>
                              <tr bgcolor="#cceeff">
                                <td align="left" valign="bottom" width="45%">
                                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 18pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Third
        party revenue</font></div>
                                </td>
                                <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></td>
                                <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">4,872</font></td>
                                <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></td>
                                <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">15,571</font></td>
                                <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></td>
                                <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">23,847</font></td>
                                <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></td>
                                <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">26,222</font></td>
                                <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                              </tr>
                              <tr bgcolor="white">
                                <td align="left" valign="bottom" width="45%" style="PADDING-BOTTOM: 2px">
                                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 18pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Related
        party revenue</font></div>
                                </td>
                                <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">20,408</font></td>
                                <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">38,223</font></td>
                                <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">20,531</font></td>
                                <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">123,062</font></td>
                                <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                              </tr>
                              <tr bgcolor="#cceeff">
                                <td align="left" valign="bottom" width="45%" style="PADDING-BOTTOM: 2px">
                                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 18pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Total
        revenue</font></div>
                                </td>
                                <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">25,280</font></td>
                                <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">53,794</font></td>
                                <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">44,378</font></td>
                                <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">149,284</font></td>
                                <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                              </tr>
                              <tr bgcolor="white">
                                <td align="left" valign="bottom" width="45%">
                                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Expenses:</font></div>
                                </td>
                                <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                              </tr>
                              <tr bgcolor="#cceeff">
                                <td align="left" valign="bottom" width="45%">
                                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 18pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Operating</font></div>
                                </td>
                                <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">15,952</font></td>
                                <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">28,187</font></td>
                                <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">50,110</font></td>
                                <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">79,958</font></td>
                                <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                              </tr>
                              <tr bgcolor="white">
                                <td align="left" valign="bottom" width="45%">
                                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 18pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Allowance
        for doubtful accounts</font></div>
                                </td>
                                <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">-</font></td>
                                <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(819</font></td>
                                <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">)</font></td>
                                <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">-</font></td>
                                <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">447</font></td>
                                <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                              </tr>
                              <tr bgcolor="#cceeff">
                                <td align="left" valign="bottom" width="45%" style="PADDING-BOTTOM: 2px">
                                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 18pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">General
        and administrative</font></div>
                                </td>
                                <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">2,525</font></td>
                                <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">27,177</font></td>
                                <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">11,015</font></td>
                                <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">33,244</font></td>
                                <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                              </tr>
                              <tr bgcolor="white">
                                <td align="left" valign="bottom" width="45%" style="PADDING-BOTTOM: 2px">
                                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 18pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Total
        expenses</font></div>
                                </td>
                                <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">18,477</font></td>
                                <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">54,545</font></td>
                                <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">61,125</font></td>
                                <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">113,649</font></td>
                                <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                              </tr>
                              <tr bgcolor="#cceeff">
                                <td align="left" valign="bottom" width="45%" style="PADDING-BOTTOM: 2px">
                                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Operating
        income (loss)</font></div>
                                </td>
                                <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">6,803</font></td>
                                <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(751</font></td>
                                <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">)</font></td>
                                <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(16,747</font></td>
                                <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">)</font></td>
                                <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">35,635</font></td>
                                <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                              </tr>
                              <tr bgcolor="white">
                                <td align="left" valign="bottom" width="45%">
                                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Other
        expenses:</font></div>
                                </td>
                                <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                              </tr>
                              <tr bgcolor="#cceeff">
                                <td align="left" valign="bottom" width="45%" style="PADDING-BOTTOM: 2px">
                                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 18pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Interest
        expense</font></div>
                                </td>
                                <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">2,424</font></td>
                                <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">11,041</font></td>
                                <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">3,369</font></td>
                                <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">15,905</font></td>
                                <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                              </tr>
                              <tr bgcolor="white">
                                <td align="left" valign="bottom" width="45%" style="PADDING-BOTTOM: 2px">
                                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Income
        (loss) before income taxes</font></div>
                                </td>
                                <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">4,379</font></td>
                                <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(11,792</font></td>
                                <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">)</font></td>
                                <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(20,116</font></td>
                                <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">)</font></td>
                                <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">19,730</font></td>
                                <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                              </tr>
                              <tr bgcolor="#cceeff">
                                <td align="left" valign="bottom" width="45%" style="PADDING-BOTTOM: 2px">
                                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Provision
        for income taxes</font></div>
                                </td>
                                <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">62</font></td>
                                <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">59</font></td>
                                <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">62</font></td>
                                <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">227</font></td>
                                <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                              </tr>
                              <tr bgcolor="white">
                                <td align="left" valign="bottom" width="45%" style="PADDING-BOTTOM: 4px">
                                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Net
        income (loss)</font></div>
                                </td>
                                <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 4px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 4px double"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></td>
                                <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: black 4px double"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">4,317</font></td>
                                <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 4px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 4px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 4px double"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></td>
                                <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: black 4px double"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(11,851</font></td>
                                <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 4px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">)</font></td>
                                <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 4px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 4px double"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></td>
                                <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: black 4px double"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(20,178</font></td>
                                <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 4px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">)</font></td>
                                <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 4px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 4px double"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></td>
                                <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: black 4px double"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">19,503</font></td>
                                <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 4px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                              </tr>
                              <tr bgcolor="#cceeff">
                                <td align="left" valign="bottom" width="45%">
                                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Allocation
        of net income (loss)&#160;to limited and subordinated
        partners:</font></div>
                                </td>
                                <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                              </tr>
                              <tr bgcolor="white">
                                <td align="left" valign="bottom" width="45%">
                                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Net
        loss attributable to SemGroup Energy Partners Predecessor</font></div>
                                </td>
                                <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></td>
                                <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(1,623</font></td>
                                <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">)</font></td>
                                <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></td>
                                <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">-</font></td>
                                <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></td>
                                <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(26,118</font></td>
                                <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">)</font></td>
                                <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></td>
                                <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">-</font></td>
                                <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                              </tr>
                              <tr bgcolor="#cceeff">
                                <td align="left" valign="bottom" width="45%">
                                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">General
        partner interest in net income (loss)</font></div>
                                </td>
                                <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></td>
                                <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">119</font></td>
                                <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></td>
                                <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(237</font></td>
                                <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">)</font></td>
                                <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></td>
                                <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">119</font></td>
                                <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></td>
                                <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">3,368</font></td>
                                <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                              </tr>
                              <tr bgcolor="white">
                                <td align="left" valign="bottom" width="45%">
                                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Net
        income (loss) allocable to limited and subordinated
      partners</font></div>
                                </td>
                                <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></td>
                                <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">5,821</font></td>
                                <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></td>
                                <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(11,614</font></td>
                                <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">)</font></td>
                                <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></td>
                                <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">5,821</font></td>
                                <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></td>
                                <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">16,135</font></td>
                                <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                              </tr>
                              <tr bgcolor="#cceeff">
                                <td align="left" valign="bottom" width="45%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                                <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                              </tr>
                              <tr bgcolor="white">
                                <td align="left" valign="bottom" width="45%">
                                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Basic
        and diluted net income (loss) per common unit</font></div>
                                </td>
                                <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></td>
                                <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">0.24</font></td>
                                <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></td>
                                <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(0.33</font></td>
                                <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">)</font></td>
                                <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></td>
                                <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">0.24</font></td>
                                <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></td>
                                <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">0.51</font></td>
                                <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                              </tr>
                              <tr bgcolor="#cceeff">
                                <td align="left" valign="bottom" width="45%">
                                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Basic
        and diluted net income (loss) per subordinated unit</font></div>
                                </td>
                                <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></td>
                                <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">0.19</font></td>
                                <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></td>
                                <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(0.33</font></td>
                                <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">)</font></td>
                                <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></td>
                                <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">0.19</font></td>
                                <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></td>
                                <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">0.51</font></td>
                                <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                              </tr>
                              <tr bgcolor="white">
                                <td align="left" valign="bottom" width="45%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                                <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                              </tr>
                              <tr bgcolor="#cceeff">
                                <td align="left" valign="bottom" width="45%">
                                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Weighted
        average common units outstanding - basic and diluted</font></div>
                                </td>
                                <td align="right" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">14,375</font></td>
                                <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">21,426</font></td>
                                <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="right" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">14,375</font></td>
                                <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">20,015</font></td>
                                <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                              </tr>
                              <tr bgcolor="white">
                                <td align="left" valign="bottom" width="45%">
                                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Weighted
        average subordinated partners' units outstanding - basic and
        diluted</font></div>
                                </td>
                                <td align="right" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">12,571</font></td>
                                <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">12,571</font></td>
                                <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="right" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">12,571</font></td>
                                <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">12,571</font></td>
                                <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                              </tr>
                          </table>
                        </div>
                      </div>
                    </div>
                  </div>
                </div>
              </div>
            </div>
          </div>
        </div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">See
  accompanying notes to unaudited consolidated financial
  statements.</font></div><br>
      <div id="PGBRK" style="MARGIN-LEFT: 0pt; WIDTH: 100%; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
        <div id="FTR">
          <div style="WIDTH: 100%" align="left">
            <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
  </font></div>
          </div>
          <div id="GLFTR" style="WIDTH: 100%" align="center">
          </div>
        </div>
        <div id="PN" style="PAGE-BREAK-AFTER: always">
          <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">2</font></div>
          <div style="WIDTH: 100%; TEXT-ALIGN: center">
            <hr style="COLOR: black" noshade size="2">
          </div>
        </div>
        <div id="HDR">
          <div id="GLHDR" style="WIDTH: 100%" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 9pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><a href="#TOC">Table of Contents</a></font></div>
        </div>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><a name="EQUITY">SEMGROUP</a> ENERGY PARTNERS, L.P.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">CONSOLIDATED
  STATEMENTS OF CHANGES IN PARTNERS&#8217; CAPITAL (DEFICIT)</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(in
  thousands)</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center">
        <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
        <div>
          <div align="left">
            <div align="center">
              <div align="center">
                <div align="center">
                  <table cellpadding="0" cellspacing="0" width="100%">
                      <tr>
                        <td align="left" valign="bottom" width="45%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                        <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td colspan="2" valign="bottom" width="6%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td colspan="2" valign="bottom" width="6%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td colspan="2" valign="bottom" width="6%">
                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">General</font></div>
                        </td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td colspan="2" valign="bottom" width="6%">
                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Total</font></div>
                        </td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                      </tr>
                      <tr>
                        <td align="left" valign="bottom" width="45%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                        <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td colspan="2" valign="bottom" width="6%">
                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Common</font></div>
                        </td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td colspan="2" valign="bottom" width="6%">
                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Subordinated</font></div>
                        </td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td colspan="2" valign="bottom" width="6%">
                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Partner</font></div>
                        </td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td colspan="2" valign="bottom" width="6%">
                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Partners'</font></div>
                        </td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                      </tr>
                      <tr>
                        <td align="left" valign="bottom" width="45%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                        <td valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td colspan="2" valign="bottom" width="6%" style="BORDER-BOTTOM: black 2px solid">
                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Unitholders</font></div>
                        </td>
                        <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td colspan="2" valign="bottom" width="6%" style="BORDER-BOTTOM: black 2px solid">
                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Unitholders</font></div>
                        </td>
                        <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td colspan="2" valign="bottom" width="6%" style="BORDER-BOTTOM: black 2px solid">
                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Interest</font></div>
                        </td>
                        <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td colspan="2" valign="bottom" width="6%" style="BORDER-BOTTOM: black 2px solid">
                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Capital
        (Deficit)</font></div>
                        </td>
                        <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                      </tr>
                      <tr>
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                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Balance,
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                        <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
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                      <tr bgcolor="white">
                        <td align="left" valign="bottom" width="45%">
                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Net
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                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
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                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
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                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
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                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">19,503</font></td>
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                        <td align="left" valign="bottom" width="45%">
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                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
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                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">6,526</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">357</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">17,964</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                      </tr>
                      <tr bgcolor="white">
                        <td align="left" valign="bottom" width="45%">
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                        </td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(13,719</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">)</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(9,271</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">)</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(727</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">)</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(23,717</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">)</font></td>
                      </tr>
                      <tr bgcolor="#cceeff">
                        <td align="left" valign="bottom" width="45%">
                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Proceeds
        from sale of 6,900,000 common units, net of underwriters' discount
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                        </td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">-</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                      </tr>
                      <tr bgcolor="white">
                        <td align="left" valign="bottom" width="45%">
                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;&#160;&#160;offering
        expenses of $7.1 million</font></div>
                        </td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">157,823</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">-</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">-</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">157,823</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
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                      <tr bgcolor="#cceeff">
                        <td align="left" valign="bottom" width="45%">
                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Proceeds
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                        </td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">-</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">-</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">3,365</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">3,365</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
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                      <tr bgcolor="white">
                        <td align="left" valign="bottom" width="45%" style="PADDING-BOTTOM: 2px">
                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Consideration
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                        </td>
                        <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">-</font></td>
                        <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">-</font></td>
                        <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(317,162</font></td>
                        <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">)</font></td>
                        <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(317,162</font></td>
                        <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">)</font></td>
                      </tr>
                      <tr bgcolor="#cceeff">
                        <td align="left" valign="bottom" width="45%" style="PADDING-BOTTOM: 4px">
                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Balance,
        September 30, 2008</font></div>
                        </td>
                        <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 4px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 4px double"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></td>
                        <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: black 4px double"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">482,086</font></td>
                        <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 4px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 4px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 4px double"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></td>
                        <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: black 4px double"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(283,717</font></td>
                        <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 4px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">)</font></td>
                        <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 4px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 4px double"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></td>
                        <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: black 4px double"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(323,364</font></td>
                        <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 4px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">)</font></td>
                        <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 4px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 4px double"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></td>
                        <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: black 4px double"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(124,995</font></td>
                        <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 4px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">)</font></td>
                      </tr>
                  </table>
                </div>
              </div>
            </div>
          </div>
        </div>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">See
  accompanying notes to unaudited consolidated financial statements.</font></div>
      <div id="PGBRK" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
        <div id="FTR">
          <div id="GLFTR" style="WIDTH: 100%" align="center">
          </div>
        </div>
        <div id="PN" style="PAGE-BREAK-AFTER: always">
          <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">3</font></div>
          <div style="WIDTH: 100%; TEXT-ALIGN: center">
            <hr style="COLOR: black" noshade size="2">
          </div>
        </div>
        <div id="HDR">
          <div id="GLHDR" style="WIDTH: 100%" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 9pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><a href="#TOC">Table of Contents</a></font></div>
        </div>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><a name="CF">SEMGROUP</a> ENERGY PARTNERS, L.P.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">CONSOLIDATED
  STATEMENTS OF CASH FLOWS</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(in
  thousands)</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center">
        <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
        <div>
          <div align="left">
            <div align="center">
              <div align="center">
                <div align="center">
                  <table cellpadding="0" cellspacing="0" width="100%">
                      <tr>
                        <td align="left" valign="bottom" width="60%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                        <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td colspan="6" valign="bottom" width="14%">
                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Nine
        Months Ended</font></div>
                        </td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                      </tr>
                      <tr>
                        <td valign="bottom" width="60%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                        <td valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td colspan="6" valign="bottom" width="14%" style="BORDER-BOTTOM: black 2px solid">
                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">September
        30,</font></div>
                        </td>
                        <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                      </tr>
                      <tr>
                        <td valign="bottom" width="60%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                        <td valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td colspan="2" valign="bottom" width="6%" style="BORDER-BOTTOM: black 2px solid">
                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">2007</font></div>
                        </td>
                        <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td colspan="2" valign="bottom" width="6%" style="BORDER-BOTTOM: black 2px solid">
                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">2008</font></div>
                        </td>
                        <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                      </tr>
                      <tr>
                        <td valign="bottom" width="60%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                        <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td colspan="6" valign="bottom" width="14%">
                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(unaudited)</font></div>
                        </td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                      </tr>
                      <tr>
                        <td align="left" valign="bottom" width="60%">
                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"><a name="range_a6:a49">Cash flows from operating
  activities:</a></font></div>
                        </td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" colspan="2" valign="bottom" width="6%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" colspan="2" valign="bottom" width="6%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                      </tr>
                      <tr bgcolor="#cceeff">
                        <td align="left" valign="bottom" width="60%">
                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 18pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Net
        income (loss)</font></div>
                        </td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></td>
                        <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(20,178</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">)</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></td>
                        <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">19,503</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                      </tr>
                      <tr bgcolor="white">
                        <td align="left" valign="bottom" width="60%">
                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 18pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Adjustments
        to reconcile net income (loss) to net cash provided by (used in) operating
        activities:</font></div>
                        </td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                      </tr>
                      <tr bgcolor="#cceeff">
                        <td align="left" valign="bottom" width="60%">
                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Provision
        for uncollectible receivables from third parties</font></div>
                        </td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(25</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">)</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">432</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                      </tr>
                      <tr bgcolor="white">
                        <td align="left" valign="bottom" width="60%">
                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Depreciation
        and amortization</font></div>
                        </td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">6,781</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">15,587</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                      </tr>
                      <tr bgcolor="#cceeff">
                        <td align="left" valign="bottom" width="60%">
                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Amortization
        and write off of debt issuance costs</font></div>
                        </td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">41</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">616</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                      </tr>
                      <tr bgcolor="white">
                        <td align="left" valign="bottom" width="60%">
                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Unrealized
        loss related to interest rate swaps</font></div>
                        </td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">627</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">-</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                      </tr>
                      <tr bgcolor="#cceeff">
                        <td align="left" valign="bottom" width="60%">
                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Loss
        on sale of assets</font></div>
                        </td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">68</font></td>
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                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">178</font></td>
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                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Equity-based
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                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
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                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
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                        <td valign="bottom" width="60%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
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                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
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                      <tr bgcolor="white">
                        <td align="left" valign="bottom" width="60%">
                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Changes
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                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
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                      <tr bgcolor="#cceeff">
                        <td align="left" valign="bottom" width="60%">
                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 45pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Decrease
        (increase) in accounts receivable</font></div>
                        </td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">701</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(5,720</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">)</font></td>
                      </tr>
                      <tr bgcolor="white">
                        <td align="left" valign="bottom" width="60%">
                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 45pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Increase
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                        </td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(1,428</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">)</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(9,626</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">)&#160;</font></td>
                      </tr>
                      <tr bgcolor="#cceeff">
                        <td align="left" valign="bottom" width="60%">
                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 45pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Increase
        in prepaid insurance</font></div>
                        </td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(28</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">)</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(2,506</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">)</font></td>
                      </tr>
                      <tr bgcolor="white">
                        <td align="left" valign="bottom" width="60%">
                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 45pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Increase
        in other current assets</font></div>
                        </td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(107</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">)</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(1,529</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">)</font></td>
                      </tr>
                      <tr bgcolor="#cceeff">
                        <td align="left" valign="bottom" width="60%">
                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 45pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Decrease
        (increase) in other assets</font></div>
                        </td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">72</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(113</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">)</font></td>
                      </tr>
                      <tr bgcolor="white">
                        <td align="left" valign="bottom" width="60%">
                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 45pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Decrease
        in accounts payable</font></div>
                        </td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(1,126</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">)</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(377</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">)</font></td>
                      </tr>
                      <tr bgcolor="#cceeff">
                        <td align="left" valign="bottom" width="60%">
                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 45pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Increase&#160;in
        payables to related parties</font></div>
                        </td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">3,325</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">5,677</font></td>
                        <td align="left" nowrap valign="bottom" width="1%">&#160;</td>
                      </tr>
                      <tr bgcolor="white">
                        <td align="left" valign="bottom" width="60%">
                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 45pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Increase
        (decrease) in accrued interest payable</font></div>
                        </td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">606</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(449</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">)</font></td>
                      </tr>
                      <tr bgcolor="#cceeff">
                        <td align="left" valign="bottom" width="60%">
                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 45pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Increase
        in accrued property taxes</font></div>
                        </td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">-</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">1,944</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                      </tr>
                      <tr bgcolor="white">
                        <td align="left" valign="bottom" width="60%">
                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 45pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Increase
        in interest rate swap settlements payable</font></div>
                        </td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">-</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">1,505</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                      </tr>
                      <tr bgcolor="#cceeff">
                        <td align="left" valign="bottom" width="60%">
                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 45pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Increase
        in unearned revenue</font></div>
                        </td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">-</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">453</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                      </tr>
                      <tr bgcolor="white">
                        <td align="left" valign="bottom" width="60%">
                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 45pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Increase
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                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(1,602</font></td>
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                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">1,616</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
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                      <tr bgcolor="#cceeff">
                        <td align="left" valign="bottom" width="60%" style="PADDING-BOTTOM: 2px">
                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 45pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Decrease
        in interest rate swap liability</font></div>
                        </td>
                        <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">-</font></td>
                        <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(2,233</font></td>
                        <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">)</font></td>
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                      <tr bgcolor="white">
                        <td align="left" valign="bottom" width="60%" style="PADDING-BOTTOM: 2px">
                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 18pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Net
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                        </td>
                        <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(11,741</font></td>
                        <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">)</font></td>
                        <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
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                        <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
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                      <tr bgcolor="#cceeff">
                        <td align="left" valign="bottom" width="60%">
                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Cash
        flows from investing activities:</font></div>
                        </td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
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                      <tr bgcolor="white">
                        <td align="left" valign="bottom" width="60%">
                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 18pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Acquisition
        of assets from Private Company</font></div>
                        </td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">-</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(514,669</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">)</font></td>
                      </tr>
                      <tr bgcolor="#cceeff">
                        <td align="left" valign="bottom" width="60%">
                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 18pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Capital
        expenditures</font></div>
                        </td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(18,951</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">)</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(5,485</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">)</font></td>
                      </tr>
                      <tr bgcolor="white">
                        <td align="left" valign="bottom" width="60%" style="PADDING-BOTTOM: 2px">
                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 18pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Proceeds
        from sale of assets</font></div>
                        </td>
                        <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">338</font></td>
                        <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">386</font></td>
                        <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                      </tr>
                      <tr bgcolor="#cceeff">
                        <td align="left" valign="bottom" width="60%" style="PADDING-BOTTOM: 2px">
                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 18pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Net
        cash used in investing activities</font></div>
                        </td>
                        <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(18,613</font></td>
                        <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">)</font></td>
                        <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(519,768</font></td>
                        <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">)</font></td>
                      </tr>
                      <tr bgcolor="white">
                        <td align="left" valign="bottom" width="60%">
                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Cash
        flows from financing activities:</font></div>
                        </td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                      </tr>
                      <tr bgcolor="#cceeff">
                        <td align="left" valign="bottom" width="60%">
                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 18pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Debt
        issuance costs</font></div>
                        </td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(1,037</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">)</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(2,094</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">)</font></td>
                      </tr>
                      <tr bgcolor="white">
                        <td align="left" valign="bottom" width="60%">
                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 18pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Payments
        on capital lease obligations</font></div>
                        </td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(1,294</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">)</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(939</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">)</font></td>
                      </tr>
                      <tr bgcolor="#cceeff">
                        <td align="left" valign="bottom" width="60%">
                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 18pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Borrowings
        under credit facility</font></div>
                        </td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">146,550</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">518,600</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                      </tr>
                      <tr bgcolor="white">
                        <td align="left" valign="bottom" width="60%">
                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 18pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Payments
        under credit facility</font></div>
                        </td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(54,050</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">)</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(160,100</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">)</font></td>
                      </tr>
                      <tr bgcolor="#cceeff">
                        <td align="left" valign="bottom" width="60%">
                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 18pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Proceeds
        from equity issuance, net of offering costs</font></div>
                        </td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">38,036</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">161,238</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                      </tr>
                      <tr bgcolor="white">
                        <td align="left" valign="bottom" width="60%">
                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 18pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Distributions
        paid</font></div>
                        </td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(136,463</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">)</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(23,717</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">)</font></td>
                      </tr>
                      <tr bgcolor="#cceeff">
                        <td align="left" valign="bottom" width="60%" style="PADDING-BOTTOM: 2px">
                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 18pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Contributions
        from Private Company</font></div>
                        </td>
                        <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">39,780</font></td>
                        <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">-</font></td>
                        <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                      </tr>
                      <tr bgcolor="white">
                        <td align="left" valign="bottom" width="60%" style="PADDING-BOTTOM: 2px">
                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 18pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Net
        cash provided by financing activities</font></div>
                        </td>
                        <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">31,522</font></td>
                        <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">492,988</font></td>
                        <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                      </tr>
                      <tr bgcolor="#cceeff">
                        <td align="left" valign="bottom" width="60%">
                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Net
        increase in cash and cash equivalents</font></div>
                        </td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">1,168</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">16,142</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                      </tr>
                      <tr bgcolor="white">
                        <td align="left" valign="bottom" width="60%" style="PADDING-BOTTOM: 2px">
                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Cash
        and cash equivalents at beginning of period</font></div>
                        </td>
                        <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">-</font></td>
                        <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">416</font></td>
                        <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                      </tr>
                      <tr bgcolor="#cceeff">
                        <td align="left" valign="bottom" width="60%" style="PADDING-BOTTOM: 4px">
                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Cash
        and cash equivalents at end of period</font></div>
                        </td>
                        <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 4px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 4px double"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></td>
                        <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: black 4px double"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">1,168</font></td>
                        <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 4px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 4px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 4px double"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></td>
                        <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: black 4px double"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">16,558</font></td>
                        <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 4px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                      </tr>
                      <tr bgcolor="white">
                        <td align="left" valign="bottom" width="60%">
                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Supplemental
        disclosure of cash flow information:</font></div>
                        </td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                      </tr>
                      <tr bgcolor="#cceeff">
                        <td align="left" valign="bottom" width="60%">
                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Increase
        (decrease) in accounts payable related to purchases of property, plant and
        equipment</font></div>
                        </td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></td>
                        <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(846</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">)</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></td>
                        <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">168</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                      </tr>
                  </table>
                </div>
              </div>
            </div>
          </div>
        </div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">See
  accompanying notes to unaudited consolidated financial
  statements.</font></div><br>
      <div id="PGBRK" style="MARGIN-LEFT: 0pt; WIDTH: 100%; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
        <div id="FTR">
          <div style="WIDTH: 100%" align="left">
            <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
  </font></div>
          </div>
          <div id="GLFTR" style="WIDTH: 100%" align="center">
          </div>
        </div>
        <div id="PN" style="PAGE-BREAK-AFTER: always">
          <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">4</font></div>
          <div style="WIDTH: 100%; TEXT-ALIGN: center">
            <hr style="COLOR: black" noshade size="2">
          </div>
        </div>
        <div id="HDR">
          <div id="GLHDR" style="WIDTH: 100%" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 9pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><a href="#TOC">Table of Contents</a></font></div>
          <div style="WIDTH: 100%" align="left">
            <div style="DISPLAY: block; TEXT-INDENT: 0pt; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">SEMGROUP
  ENERGY PARTNERS, L.P.</font></div>
            <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">NOTES
  TO UNAUDITED CONSOLIDATED FINANCIAL
  STATEMENTS</font></div>
          </div>
        </div>
      </div><br>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><a name="NOTES">1. ORGANIZATION </a>AND NATURE OF BUSINESS</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">SemGroup
  Energy Partners, L.P. and subsidiaries (the &#8220;Partnership&#8221;) is a publicly traded
  master limited partnership with operations in twenty-three states. The
  Partnership provides integrated terminalling, storage, gathering and
  transportation services for companies engaged in the production, distribution
  and marketing of crude oil and liquid asphalt cement. The Partnership manages
  its operations through two operating segments: (i)&#160;terminalling and storage
  services and (ii)&#160;gathering and transportation services. The Partnership
  was formed in February 2007 as a Delaware master limited partnership initially
  to own, operate and develop a diversified portfolio of complementary midstream
  energy assets.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">On
  July&#160;20, 2007, the Partnership issued 12,500,000 common units, representing
  limited partner interests in the Partnership, and 12,570,504 subordinated units,
  representing additional limited partner interests in the Partnership, to
  SemGroup Holdings, L.P. (&#8220;SemGroup Holdings&#8221;) and 549,908 general partner units
  representing a 2.0% general partner interest in the Partnership to SemGroup
  Energy Partners G.P., L.L.C. SemGroup Holdings subsequently offered 12,500,000
  common units pursuant to a public offering at a price of $22 per unit. In
  addition, the Partnership issued an additional 1,875,000 common units to the
  public pursuant to the underwriters&#8217; exercise of their over-allotment option.
  The initial public offering closed on July&#160;23, 2007.&#160;&#160;In
  connection with its initial public offering, the Partnership entered into a
  Throughput Agreement (the &#8220;Throughput Agreement&#8221;) with SemGroup, L.P.
  (collectively, with its subsidiaries other than the Partnership and the
  Partnership&#8217;s general partner, the &#8220;Private Company&#8221;) under which the
  Partnership provided crude oil gathering and transportation and terminalling and
  storage services to the Private Company.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">On
  February&#160;20, 2008, the Partnership purchased land, receiving
  infrastructure, machinery, pumps and piping and 46 liquid asphalt cement and
  residual fuel oil terminalling and storage facilities (the &#8220;Acquired Asphalt
  Assets&#8221;) from the Private Company for aggregate consideration of $379.5 million,
  including $0.7 million of acquisition-related costs. For accounting purposes,
  the acquisition has been reflected as a purchase of assets, with the Acquired
  Asphalt Assets recorded at the historical cost of the Private Company, which was
  approximately $145.5 million, with the additional purchase price of $234.0
  million reflected in the statement of changes in partners&#8217; capital as a
  distribution to the Private Company.&#160;&#160;In conjunction with the purchase
  of the Acquired Asphalt Assets, the Partnership amended its existing credit
  facility, increasing its borrowing capacity to $600 million. Concurrently, the
  Partnership issued 6,000,000 common units, receiving proceeds, net of
  underwriting discounts and offering-related costs, of $137.2 million. The
  Partnership&#8217;s general partner also made a capital contribution of $2.9 million
  to maintain its 2.0% general partner interest in the Partnership. On
  March&#160;5, 2008, the Partnership issued an additional 900,000 common units,
  receiving proceeds, net of underwriting discounts, of $20.6 million, in
  connection with the underwriters&#8217; exercise of their over-allotment option in
  full. The Partnership&#8217;s general partner made a corresponding capital
  contribution of $0.4 million to maintain its 2.0% general partner interest in
  the Partnership.&#160;&#160;In connection with the acquisition of the Acquired
  Asphalt Assets, the Partnership entered into a Terminalling and Storage
  Agreement (the &#8220;Terminalling Agreement&#8221;) with the Private Company and certain of
  its subsidiaries under which the Partnership provided liquid asphalt cement
  terminalling and storage and throughput services to the Private Company and the
  Private Company agreed to use the Partnership&#8217;s services at certain minimum
  levels.&#160;&#160;The board of directors of the Partnership&#8217;s general partner
  (the &#8220;Board&#8221;) approved the acquisition of the Acquired Asphalt Assets as well as
  the terms of the related agreements based on a recommendation from its conflicts
  committee, which consisted entirely of independent directors. The conflicts
  committee retained independent legal and financial advisors to assist it in
  evaluating the transaction and considered a number of factors in approving the
  acquisition, including an opinion from the committee&#8217;s independent financial
  advisor that the consideration paid for the Acquired Asphalt Assets was fair,
  from a financial point of view, to the Partnership.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">On May
  12, 2008, the Partnership purchased the Eagle North Pipeline System, a 130-mile,
  8-inch pipeline that originates in Ardmore, Oklahoma and terminates in
  Drumright, Oklahoma (the &#8220;Acquired Pipeline Assets&#8221;) from the Private Company
  for aggregate consideration of $45.1 million, including $0.1 million of
  acquisition-related costs.&#160;&#160;For accounting purposes, the acquisition
  has been reflected as a purchase of assets, with the Acquired Pipeline Assets
  recorded at the historical cost of the Private Company, which was approximately
  $35.1 million, with the additional purchase price of $10.0 million reflected in
  the statement of changes in partners&#8217; capital as a distribution to the Private
  Company.&#160;&#160;The acquisition was funded with borrowings under the
  Partnership&#8217;s existing revolving credit facility.&#160;&#160;The Board approved
  the acquisition of the Acquired Pipeline Assets based on a recommendation from
  its conflicts committee, which consisted entirely of independent directors. The
  conflicts committee retained independent legal and financial advisors to assist
  it in evaluating the transaction and considered a number of factors in approving
  the acquisition, including an opinion from the committee&#8217;s independent financial
  advisor that the consideration paid for the Acquired Pipeline Assets was fair,
  from a financial point of view, to the Partnership.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div><br>
      <div id="PGBRK" style="MARGIN-LEFT: 0pt; WIDTH: 100%; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
        <div id="FTR">
          <div style="WIDTH: 100%" align="left">
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        </div>
        <div id="HDR">
          <div id="GLHDR" style="WIDTH: 100%" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 9pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><a href="#TOC">Table of Contents</a></font></div>
          <div style="WIDTH: 100%" align="left">
            <div style="DISPLAY: block; TEXT-INDENT: 0pt; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">SEMGROUP
  ENERGY PARTNERS, L.P.</font></div>
            <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">NOTES
  TO UNAUDITED CONSOLIDATED FINANCIAL
  STATEMENTS</font></div>
          </div>
        </div>
      </div><br>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">On May
  30, 2008, the Partnership purchased eight recently constructed crude oil storage
  tanks located at the Cushing Interchange from the Private Company and&#160;the
  Private Company&#160;assigned a take-or-pay, fee-based agreement to the
  Partnership that commits substantially all of the 2.0 million barrels of new
  storage to a third-party customer through August 2010&#160;(the &#8220;Acquired
  Storage Assets&#8221;) for aggregate consideration of $90.3 million, including $0.3
  million of acquisition-related costs.&#160;&#160;For accounting purposes, the
  acquisition has been reflected as a purchase of assets, with the Acquired
  Storage Assets recorded at the historical cost of the Private Company, which was
  approximately $17.1 million, inclusive of $0.5 million of completion costs
  subsequent to the close of the acquisition, with the additional purchase price
  of $73.2 million reflected in the statement of changes in partners&#8217; capital as a
  distribution to the Private Company.&#160;&#160;The acquisition was funded with
  borrowings under the Partnership&#8217;s existing revolving credit
  facility.&#160;&#160;The Board approved the acquisition of the Acquired Storage
  Assets based on a recommendation from its conflicts committee, which consisted
  entirely of independent directors. The conflicts committee retained independent
  legal and financial advisors to assist it in evaluating the transaction and
  considered a number of factors in approving the acquisition, including an
  opinion from the committee&#8217;s independent financial advisor that the
  consideration paid for the Acquired Storage Assets was fair, from a financial
  point of view, to the Partnership.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">For the
  nine months ended September 30, 2008 and the year ended December 31, 2008, the
  Partnership derived approximately 81% and approximately 73%, respectively, of
  its revenues, excluding fuel surcharge revenues related to fuel and power
  consumed to operate its liquid asphalt cement storage tanks, from services it
  provided to the Private Company.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">On July
  22, 2008, the Private Company and certain of its subsidiaries filed voluntary
  petitions (the &#8220;Bankruptcy Filings&#8221;) for reorganization under Chapter 11 of the
  Bankruptcy Code in the United States Bankruptcy Court for the District of
  Delaware (the &#8220;Bankruptcy Court&#8221;), Case No. 08-11547-BLS.&#160;&#160; The
  Private Company and its subsidiaries continue to operate their businesses and
  own and manage their properties as debtors-in-possession under the jurisdiction
  of the Bankruptcy Court and in accordance with the applicable provisions of the
  Bankruptcy Code.&#160;None of the Partnership, its general partner, the
  subsidiaries of the Partnership nor the subsidiaries of the Partnership&#8217;s
  general partner were party to the Bankruptcy Filings.&#160;&#160;See Notes 4 and
  13 for a discussion of the impact of the Bankruptcy Filings and related events
  upon the Partnership.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">2.
  BASIS OF PRESENTATION</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
  accompanying financial statements have been prepared assuming that the
  Partnership will continue as a going concern.&#160;&#160;Prior to consummating
  the Settlement (as defined below), events of default existed under the
  Partnership&#8217;s credit facility, including during the quarter ended September 30,
  2008.&#160;&#160;As discussed in Notes 4 and 13 to the financial statements, the
  Partnership entered into the Credit Agreement Amendment (as defined below) under
  which, among other things, the lenders under the Partnership&#8217;s credit facility
  consented to the Settlement and waived all existing defaults and events of
  default described in the Forbearance Agreement (as defined below) and amendments
  thereto.&#160;&#160;However, the Partnership continues to face uncertainty
  relating to its future cash flows and operations, particularly with respect to
  its liquid asphalt cement terminalling and storage
  operations.&#160;&#160;Additionally, the Partnership earned 73% of its revenues,
  excluding fuel surcharge revenues related to fuel and power consumed to operate
  its liquid asphalt cement storage tanks, for the year ended December 31, 2008
  from the Private Company, which made the Bankruptcy Filings in July 2008, the
  effects of which are more fully disclosed in Note 13.&#160;&#160;These factors
  raise substantial doubt about the Partnership&#8217;s ability to continue as a going
  concern.&#160;&#160;Management&#8217;s plans in regard to these matters are also
  discussed in Note 13.&#160;&#160;The accompanying financial statements do not
  include any adjustments that might result from the outcome of this
  uncertainty.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
  accompanying consolidated financial statements and related notes include the
  accounts of the Partnership, and prior to July&#160;20, 2007, the operations
  contributed to the Partnership by the Private Company in connection with the
  Partnership&#8217;s initial public offering. The financial statements have been
  prepared in accordance with accounting principles and practices generally
  accepted in the United States of America (&#8220;GAAP&#8221;).</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
  accompanying financial statements include the results of operations of crude oil
  terminalling and storage and gathering and transportation operations that were
  contributed to the Partnership prior to the closing of the Partnership&#8217;s initial
  public offering on a carve-out basis and are referred to herein as the
  &#8220;Predecessor.&#8221;&#160;&#160;Both the Partnership and the Predecessor had common
  ownership and, in accordance with Emerging Issues Task Force Issue
  No.&#160;87-21, &#8220;Change of Accounting Basis in Master Limited Partnership
  Transactions,&#8221; the assets and liabilities transferred were carried forward to
  the Partnership at their historical amounts.&#160;&#160;Additionally, due to the
  previous common control of the Private Company and the Partnership, the
  subsequent acquisitions of fixed assets from the Private Company prior to July
  2008 were recorded at the historical cost of the Private Company.&#160;&#160;All
  significant intercompany accounts and transactions have been eliminated in the
  preparation of the accompanying financial statements.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div><br>
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  </font></div>
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          <div style="WIDTH: 100%; TEXT-ALIGN: center">
            <hr style="COLOR: black" noshade size="2">
          </div>
        </div>
        <div id="HDR">
          <div id="GLHDR" style="WIDTH: 100%" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 9pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><a href="#TOC">Table of Contents</a></font></div>
          <div style="WIDTH: 100%" align="left">
            <div style="DISPLAY: block; TEXT-INDENT: 0pt; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">SEMGROUP
  ENERGY PARTNERS, L.P.</font></div>
            <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">NOTES
  TO UNAUDITED CONSOLIDATED FINANCIAL
  STATEMENTS</font></div>
          </div>
        </div>
      </div><br>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Through
  the date of the initial public offering, the Private Company provided cash
  management services to the Predecessor through a centralized treasury system. As
  a result, all of the Predecessor&#8217;s charges and cost allocations covered by the
  centralized treasury system were deemed to have been paid to the Private Company
  in cash during the period in which the cost was recorded in the financial
  statements. In addition, cash advances by the Private Company in excess of cash
  earned by the Predecessor are reflected as contributions from the Private
  Company in the statements of cash flows.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Historically,
  the Predecessor was a part of the integrated operations of the Private Company,
  and neither the Private Company nor the Predecessor recorded revenue associated
  with the terminalling and storage and gathering and transportation services
  provided on an intercompany basis. The Private Company and the Predecessor
  recognized only the costs associated with providing such services. Accordingly,
  revenues reflected in these financial statements for all periods prior to the
  contribution of the assets, liabilities and operations to the Partnership by the
  Private Company on July&#160;20, 2007 relate to services provided to third
  parties. Prior to the close of its initial public offering in July 2007, the
  Partnership entered into a Throughput Agreement with the Private Company under
  which the Partnership provided crude oil gathering and transportation and
  terminalling and storage services to the Private Company.&#160;&#160;In
  connection with its February 2008 purchase of the Acquired Asphalt Assets, the
  Partnership entered into a Terminalling Agreement with the Private Company under
  which the Partnership provided liquid asphalt cement terminalling and storage
  and throughput services to the Private Company (see Note&#160;8).&#160;&#160;In
  connection with the Settlement, the Private Company rejected the Throughput
  Agreement and the Terminalling Agreement as part of its Bankruptcy Proceedings
  (as defined below) (see Note&#160;13).</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
  accompanying financial statements include allocated general and administrative
  charges from the Private Company for indirect corporate overhead to cover costs
  of functions such as legal, accounting, treasury, environmental safety,
  information technology and other corporate services. General and administrative
  charges allocated by the Private Company prior to the contribution of the
  assets, liabilities and operations to the Partnership by the Private Company
  were $3.2 million for the nine months ended September 30, 2007. Management
  believes that the allocated general and administrative expense is representative
  of the costs and expenses incurred by the Private Company for the Predecessor.
  Prior to the close of its initial public offering in July 2007, the Partnership
  entered into an Omnibus Agreement with the Private Company under which the
  Partnership reimbursed the Private Company for the provision of various general
  and administrative services for the Partnership&#8217;s benefit.&#160;&#160;The
  Omnibus Agreement was amended and restated in conjunction with the purchase of
  the Acquired Asphalt Assets in February 2008 (the "Amended Omnibus Agreement")
  (see Note&#160;8).&#160;&#160;The events related to the Bankruptcy Filings
  terminated the Private Company&#8217;s obligations to provide services to the
  Partnership under the Amended Omnibus Agreement.&#160;&#160;The Private Company
  continued to provide such services to the Partnership until the effective date
  of the Settlement at which time the Private Company rejected the Amended Omnibus
  Agreement and the Private Company and the Partnership entered into the Shared
  Services Agreement (as defined below) and the Transition Services Agreement (as
  defined below) relating to the provision of such services (see Note
  13).</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
  statements of operations for the three and nine months ended September 30, 2007
  and 2008 and the statements of cash flows for the nine months ended September
  30, 2007 and 2008 are unaudited. In the opinion of management, the unaudited
  interim financial statements have been prepared on the same bases as the audited
  financial statements and include all adjustments necessary to present fairly the
  financial position and results of operations for the respective interim periods.
  &#160;These consolidated financial statements and notes should be read in
  conjunction with the consolidated financial statements and notes thereto
  included in the Partnership&#8217;s annual report on Form 10-K for the year ended
  December&#160;31, 2007 filed with the Securities and Exchange Commission (the
  &#8220;SEC&#8221;) on March&#160;6, 2008.&#160; Interim financial results are not
  necessarily indicative of the results to be expected for an annual period. The
  year-end balance sheet data was derived from audited financial statements, but
  does not include all disclosures required by accounting principles generally
  accepted in the United States of America.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div><br>
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  </font></div>
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          <div style="WIDTH: 100%; TEXT-ALIGN: center">
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        </div>
        <div id="HDR">
          <div id="GLHDR" style="WIDTH: 100%" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 9pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><a href="#TOC">Table of Contents</a></font></div>
          <div style="WIDTH: 100%" align="left">
            <div style="DISPLAY: block; TEXT-INDENT: 0pt; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">SEMGROUP
  ENERGY PARTNERS, L.P.</font></div>
            <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">NOTES
  TO UNAUDITED CONSOLIDATED FINANCIAL
  STATEMENTS</font></div>
          </div>
        </div>
      </div><br>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">3.
  PROPERTY, PLANT AND EQUIPMENT</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Property,
  plant and equipment, net is stated at cost and consisted of the following (in
  thousands):</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left">
        <div>
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            <div align="center">
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                            <td valign="bottom" width="30%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                            <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                            <td colspan="2" valign="bottom" width="6%">
                              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Estimated</font></div>
                            </td>
                            <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                            <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                            <td colspan="2" valign="bottom" width="6%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                            <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                            <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                            <td colspan="2" valign="bottom" width="6%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                            <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                          </tr>
                          <tr>
                            <td valign="bottom" width="30%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                            <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                            <td colspan="2" valign="bottom" width="6%">
                              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Useful</font></div>
                            </td>
                            <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                            <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                            <td colspan="2" valign="bottom" width="6%">
                              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">December
        31,</font></div>
                            </td>
                            <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                            <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                            <td colspan="2" valign="bottom" width="6%">
                              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">September
        30,</font></div>
                            </td>
                            <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
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                            <td valign="bottom" width="30%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                            <td valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                            <td colspan="2" valign="bottom" width="6%" style="BORDER-BOTTOM: black 2px solid">
                              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Lives
        (Years)</font></div>
                            </td>
                            <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                            <td valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                            <td colspan="2" valign="bottom" width="6%" style="BORDER-BOTTOM: black 2px solid">
                              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">2007</font></div>
                            </td>
                            <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                            <td valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                            <td colspan="2" valign="bottom" width="6%" style="BORDER-BOTTOM: black 2px solid">
                              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">2008</font></div>
                            </td>
                            <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                          </tr>
                          <tr bgcolor="#cceeff">
                            <td align="left" valign="bottom" width="30%">
                              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Land</font></div>
                            </td>
                            <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                            <td colspan="2" valign="bottom" width="6%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                            <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></td>
                            <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">309</font></td>
                            <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                            <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></td>
                            <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">15,065</font></td>
                            <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                          </tr>
                          <tr bgcolor="white">
                            <td align="left" valign="bottom" width="30%">
                              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Land
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                            </td>
                            <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                            <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">10-20</font></td>
                            <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                            <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">-</font></td>
                            <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                            <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">5,297</font></td>
                            <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                          </tr>
                          <tr bgcolor="#cceeff">
                            <td align="left" valign="bottom" width="30%">
                              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Pipelines
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                            </td>
                            <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                            <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">5-31</font></td>
                            <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                            <td align="right" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                            <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">34,626</font></td>
                            <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                            <td align="right" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                            <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">94,600</font></td>
                            <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                          </tr>
                          <tr bgcolor="white">
                            <td align="left" valign="bottom" width="30%">
                              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Storage
        and terminal facilities</font></div>
                            </td>
                            <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                            <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">10-35</font></td>
                            <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                            <td align="right" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                            <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">71,873</font></td>
                            <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                            <td align="right" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                            <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">166,944</font></td>
                            <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                          </tr>
                          <tr bgcolor="#cceeff">
                            <td align="left" valign="bottom" width="30%">
                              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Transportation
        equipment</font></div>
                            </td>
                            <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                            <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">3-10</font></td>
                            <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                            <td align="right" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                            <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">25,133</font></td>
                            <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                            <td align="right" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                            <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">24,824</font></td>
                            <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                          </tr>
                          <tr bgcolor="white">
                            <td align="left" valign="bottom" width="30%">
                              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Office
        property and equipment and other</font></div>
                            </td>
                            <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                            <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">3-31</font></td>
                            <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                            <td align="right" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                            <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">8,505</font></td>
                            <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                            <td align="right" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                            <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">19,983</font></td>
                            <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                          </tr>
                          <tr bgcolor="#cceeff">
                            <td align="left" valign="bottom" width="30%" style="PADDING-BOTTOM: 2px">
                              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Construction-in-progress</font></div>
                            </td>
                            <td valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                            <td align="right" valign="bottom" width="5%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                            <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                            <td align="right" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                            <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                            <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">2,015</font></td>
                            <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                            <td align="right" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                            <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                            <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">37,734</font></td>
                            <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                          </tr>
                          <tr bgcolor="white">
                            <td align="left" valign="bottom" width="30%">
                              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Property,
        plant and equipment, gross</font></div>
                            </td>
                            <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                            <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                            <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                            <td align="right" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                            <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">142,461</font></td>
                            <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                            <td align="right" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                            <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">364,447</font></td>
                            <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                          </tr>
                          <tr bgcolor="#cceeff">
                            <td align="left" valign="bottom" width="30%" style="PADDING-BOTTOM: 2px">
                              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Accumulated
        depreciation</font></div>
                            </td>
                            <td valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                            <td align="right" valign="bottom" width="5%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                            <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                            <td align="right" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                            <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                            <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(40,222</font></td>
                            <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">)</font></td>
                            <td align="right" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                            <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                            <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(74,731</font></td>
                            <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">)</font></td>
                          </tr>
                          <tr bgcolor="white">
                            <td align="left" valign="bottom" width="30%" style="PADDING-BOTTOM: 4px">
                              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Property,
        plant and equipment, net</font></div>
                            </td>
                            <td valign="bottom" width="1%" style="PADDING-BOTTOM: 4px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                            <td align="right" valign="bottom" width="5%" style="PADDING-BOTTOM: 4px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                            <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 4px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                            <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 4px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                            <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 4px double"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></td>
                            <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: black 4px double"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">102,239</font></td>
                            <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 4px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                            <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 4px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                            <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 4px double"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></td>
                            <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: black 4px double"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">289,716</font></td>
                            <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 4px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                          </tr>
                      </table>
                    </div>
                  </div>
                </div>
              </div>
              <div style="DISPLAY: block; TEXT-INDENT: 0pt">&#160;</div>
            </div>
          </div>
        </div>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Property,
  plant and equipment includes assets under capital leases of $2.4 million and
  $1.4 million, net of accumulated depreciation of $4.2 million and
  $5.1&#160;million at December&#160;31, 2007 and September 30, 2008,
  respectively. All capital leases relate to the transportation equipment asset
  category.&#160;&#160;At September 30, 2008, $37.6 million of
  construction-in-progress consists of the Eagle North Pipeline System, a
  130-mile, 8-inch pipeline that was acquired by the Partnership from the Private
  Company on May 12, 2008.&#160; The Partnership has suspended capital
  expenditures on this pipeline due to the continuing impact of the Bankruptcy
  Filings (see Note 13).&#160; Management currently intends to put the asset into
  service by late 2009 or early 2010 and is exploring various alternatives to
  complete the project.&#160;</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Depreciation
  expense for the nine months ended September 30, 2007 and September 30, 2008 was
  $6.5 million and $15.4 million, respectively.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">4.
  LONG TERM DEBT</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">On
  July&#160;20, 2007, the Partnership entered into a $250.0 million five-year
  credit facility with a syndicate of financial institutions. The Partnership
  borrowed approximately $137.5&#160;million prior to the closing of the initial
  public offering. The Partnership distributed $136.5&#160;million, net of debt
  issuance costs of $1.0 million, advanced under the credit agreement to SemGroup
  Holdings. On July&#160;23, 2007, the Partnership repaid approximately $38.7
  million under the credit facility with the proceeds it received in connection
  with the exercise of the underwriters&#8217; over-allotment option in the
  Partnership&#8217;s initial public offering.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">In
  connection with its purchase of the Acquired Asphalt Assets, the Partnership
  amended this credit facility to increase the total borrowing capacity to $600.0
  million.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Due to
  events related to the Bankruptcy Filings, events of default occurred under the
  Partnership&#8217;s credit agreement (see Note 13).&#160;&#160;Effective on September
  18, 2008, the Partnership and the requisite lenders under its credit facility
  entered into a Forbearance Agreement and Amendment to Credit Agreement (the
  &#8220;Forbearance Agreement&#8221;) under which the lenders agreed, subject to specified
  limitations and conditions, to forbear from exercising their rights and remedies
  arising from the Partnership&#8217;s defaults and events of default described therein
  for the period commencing on September 18, 2008 and ending on the earliest of
  (i) December 11, 2008, (ii) the occurrence of any default or event of default
  under the credit agreement other than certain defaults and events of default
  indicated in the Forbearance Agreement, or (iii) the failure of the Partnership
  to comply with any of the terms of the Forbearance Agreement (the &#8220;Forbearance
  Period&#8221;).&#160;&#160;On December 11, 2008, the lenders agreed to extend the
  Forbearance Period until December 18, 2008 pursuant to a First Amendment to
  Forbearance Agreement and Amendment to Credit Agreement (the &#8220;First Forbearance
  Amendment&#8221;), on December 18, 2008, the lenders agreed to extend the Forbearance
  Period until March 18, 2009 pursuant to a Second Amendment to Forbearance
  Agreement and Amendment to Credit Agreement (the &#8220;Second Forbearance
  Amendment&#8221;), and on March 18, 2009, the lenders agreed to further extend the
  Forbearance Period until April 8, 2009 pursuant to a Third Amendment to
  Forbearance Agreement and Amendment to Credit Agreement (the &#8220;Third Forbearance
  Amendment&#8221;).</font></div><br>
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  </font></div>
          </div>
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        <div id="PN" style="PAGE-BREAK-AFTER: always">
          <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">8</font></div>
          <div style="WIDTH: 100%; TEXT-ALIGN: center">
            <hr style="COLOR: black" noshade size="2">
          </div>
        </div>
        <div id="HDR">
          <div id="GLHDR" style="WIDTH: 100%" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 9pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><a href="#TOC">Table of Contents</a></font></div>
          <div style="WIDTH: 100%" align="left">
            <div style="DISPLAY: block; TEXT-INDENT: 0pt; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">SEMGROUP
  ENERGY PARTNERS, L.P.</font></div>
            <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">NOTES
  TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS</font></div>
          </div>
        </div>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
  Partnership, its subsidiaries that are guarantors of the obligations under the
  credit facility, Wachovia Bank, National Association, as Administrative Agent,
  and the requisite lenders under the Partnership&#8217;s credit agreement entered into
  the Consent, Waiver and Amendment to Credit Agreement (the &#8220;Credit Agreement
  Amendment&#8221;), dated as of April 7, 2009, under which, among other
  things,&#160;the lenders consented to the Settlement (see Note 13)&#160;and
  waived all existing defaults and events of default described in the Forbearance
  Agreement and amendments thereto.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Prior to
  the execution of the Forbearance Agreement, the credit agreement was comprised
  of a $350 million revolving credit facility and a $250 million term loan
  facility.&#160;&#160;The Forbearance Agreement permanently reduced the
  Partnership&#8217;s revolving credit facility under the credit agreement from $350
  million to $300 million and prohibited the Partnership from borrowing additional
  funds under its revolving credit facility during the Forbearance
  Period.&#160;&#160;&#160;Under the Forbearance Agreement, the Partnership agreed
  to pay the lenders executing the Forbearance Agreement a fee equal to 0.25% of
  the aggregate commitments under the credit agreement after giving effect to the
  above described commitment reduction.&#160;&#160;The Second Forbearance
  Amendment further permanently reduced the Partnership&#8217;s revolving credit
  facility under the credit agreement from $300 million to $220
  million.&#160;&#160;In addition, under the Second Forbearance Amendment, the
  Partnership agreed to pay the lenders executing the Second Forbearance Amendment
  a fee equal to 0.375% of the aggregate commitments under the credit agreement
  after the above described commitment reduction.&#160;&#160;Under the Third
  Forbearance Amendment, the Partnership agreed to pay a fee equal to 0.25% of the
  aggregate commitments under the credit agreement after the above described
  commitment reduction.&#160; The amendments to the Forbearance Agreement
  prohibited the Partnership from borrowing additional funds under its revolving
  credit facility during the extended Forbearance Period.&#160;&#160;</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
  Credit Agreement Amendment subsequently further permanently reduced the
  Partnership&#8217;s revolving credit facility under the credit agreement from $220
  million to $50 million, and increased the term loan facility from $250 million
  to $400 million.&#160;&#160;Upon the execution of the Credit Agreement
  Amendment, $150 million of the Partnership&#8217;s outstanding revolving loans were
  converted to term loans and the Partnership became able to borrow additional
  funds under its revolving credit facility.&#160;&#160;Pursuant to the Credit
  Agreement Amendment, the credit facility&#160; and all obligations thereunder
  will mature on June 30, 2011.&#160;&#160;Under the Credit Agreement Amendment,
  the Partnership agreed to pay the lenders executing the Credit Agreement
  Amendment a fee equal to 2.00% of the aggregate commitments under the credit
  agreement after the above described commitment reduction, offset by the fee paid
  pursuant to the Third Forbearance Amendment.&#160;&#160;<font style="FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; BACKGROUND-COLOR: indianred"><font style="FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; BACKGROUND-COLOR: white"><font style="FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; BACKGROUND-COLOR: white"><font style="FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; BACKGROUND-COLOR: white">As
  of May 22, 2009, the Partnership had</font>&#160;$423.4 million in outstanding
  borrowings under its credit facility (including $23.4 million under its
  revolving credit facility and $400.0 million under its term loan facility) with
  an aggregate unused credit availability under its revolving credit facility and
  cash on hand of approximately $27.2 million. Pursuant to the Credit Agreement
  Amendment, the Partnership&#8217;s revolving credit facility&#160;is limited
  to&#160;$<font size="+0"><font style="FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">50.0</font>
  </font>million.&#160; <font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">If any of
  the financial institutions that support the Partnership&#8217;s revolving credit
  facility were to fail, it may not be able to find a replacement lender, which
  could negatively impact its ability to borrow under its revolving credit
  facility.&#160; For instance, Lehman Brothers Commercial Bank is one of the
  lenders under the Partnership&#8217;s $50.0 million revolving credit facility, and
  Lehman Brothers Commercial Bank has agreed to fund approximately $2.5 million
  (approximately 5%) of the revolving credit facility.&#160; On several occasions
  Lehman Brothers Commercial Bank has failed to fund revolving loan requests under
  the Partnership&#8217;s revolving credit facility, effectively limiting the aggregate
  amount of the Partnership&#8217;s revolving credit facility to $47.5
  million.&#160;</font></font></font></font></font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; BACKGROUND-COLOR: white">Prior
  to the events of default, indebtedness under the credit agreement bore interest
  at the Partnership&#8217;s option, at either (i)&#160;the higher of the administrative
  agent&#8217;s prime rate or the federal funds rate plus 0.5% (the "Base rate"), plus
  an applicable margin that ranges from 0.50% to 1.75%, depending on the
  Partnership&#8217;s total leverage ratio and senior secured leverage ratio, or
  (ii)&#160;LIBOR plus an applicable margin that ranges from 1.50% to 2.75%,
  depending upon the Partnership&#8217;s total leverage ratio and senior secured
  leverage ratio.&#160;&#160;During the Forbearance Period indebtedness under the
  credit agreement bore interest at the Partnership&#8217;s option, at either
  (i)&#160;the Base rate, plus an applicable margin that ranges from 2.75% to
  3.75%, depending upon the Partnership&#8217;s total leverage ratio, or (ii)&#160;LIBOR
  plus an applicable margin that ranges from 4.25% to 5.25%, depending upon the
  Partnership&#8217;s total leverage ratio.&#160;&#160;Pursuant to the Second
  Forbearance Amendment, commencing on December 12, 2008, indebtedness under the
  credit agreement bore interest at the Partnership&#8217;s option, at either
  (i)&#160;the&#160;Base rate&#160;plus 5.0% per annum, with a Base rate floor of
  4.0% per annum, or (ii)&#160;LIBOR plus 6.0% per annum, with a LIBOR floor of
  3.0% per annum.&#160;</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">After
  giving effect to the Credit Agreement Amendment, amounts outstanding under the
  Partnership&#8217;s credit facility bear interest at either the LIBOR rate plus 6.50%
  per annum, with a LIBOR floor of 3.00%, or the Base rate plus 5.50% per annum,
  with a Base rate floor of 4.00% per annum.&#160;&#160;The Partnership now pays a
  fee of 1.50% on unused commitments under its revolving credit
  facility.&#160;&#160;After giving effect to the Credit Agreement Amendment,
  interest on amounts outstanding under the Partnership&#8217;s credit facility must be
  paid monthly.&#160;&#160;The Partnership&#8217;s credit facility, as amended by the
  Credit Agreement Amendment, now requires the Partnership to pay additional
  interest on October 6, 2009, April 6, 2010, October 6, 2010 and April 6, 2011,
  equal to the product of (i) the sum of the total amount of term loans then
  outstanding plus the aggregate commitments under the revolving credit facility
  and (ii) 0.50%, 0.50%, 1.00% and 1.00%, respectively.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div><br>
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            <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
  </font></div>
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          <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">9</font></div>
          <div style="WIDTH: 100%; TEXT-ALIGN: center">
            <hr style="COLOR: black" noshade size="2">
          </div>
        </div>
        <div id="HDR">
          <div id="GLHDR" style="WIDTH: 100%" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 9pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><a href="#TOC">Table of Contents</a></font></div>
          <div style="WIDTH: 100%" align="left">
            <div style="DISPLAY: block; TEXT-INDENT: 0pt; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">SEMGROUP
  ENERGY PARTNERS, L.P.</font></div>
            <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">NOTES
  TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS</font></div>
          </div>
        </div>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">During
  the three months ended September 30, 2008, the weighted average interest rate
  incurred by the Partnership was 7.04% resulting in interest expense of
  approximately $8.2 million.&#160;&#160;During the three months ended December
  31, 2008, the weighted average interest rate incurred by the Partnership was
  7.72% resulting in interest expense of approximately $8.9 million.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Among
  other things, the Partnership&#8217;s credit facility, as amended by the Credit
  Agreement Amendment, now requires the Partnership to make (i) minimum quarterly
  amortization payments on March 31, 2010 in the amount of $2.0 million, June 30,
  2010 in the amount of $2.0 million, September 30, 2010 in the amount of $2.5
  million, December 31, 2010 in the amount of $2.5 million and March 31, 2011 in
  the amount of $2.5 million, (ii) mandatory prepayments of amounts outstanding
  under the revolving credit facility (with no commitment reduction) whenever cash
  on hand exceeds $15.0 million, (iii) mandatory prepayments with 100% of asset
  sale proceeds, (iv) mandatory prepayment with 50% of the proceeds raised through
  equity&#160;sales and (v) annual prepayments with 50% of excess cash flow (as
  defined in the Credit Agreement Amendment).&#160;&#160;The Partnership&#8217;s credit
  facility, as amended by the Credit Agreement Amendment, prohibits the
  Partnership from making draws under the revolving credit facility if it would
  have more than $15.0 million of cash on hand after making the draw and applying
  the proceeds thereof.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Under the
  credit agreement, the Partnership is subject to certain limitations, including
  limitations on its ability to grant liens, incur additional indebtedness, engage
  in a merger, consolidation or dissolution, enter into transactions with
  affiliates, sell or otherwise dispose of its assets (other than the sale or
  other disposition of the assets of the asphalt business, provided that such
  disposition is at arm&#8217;s length to a non-affiliate for fair market value in
  exchange for cash and the proceeds of the disposition are used to pay down
  outstanding loans), businesses and operations, materially alter the character of
  its business, and make acquisitions, investments and capital
  expenditures.&#160;&#160;The credit agreement prohibits the Partnership from
  making distributions of available cash to its unitholders if any default or
  event of default (as defined in the credit agreement) exists.&#160;&#160;The
  credit agreement, as amended by the Credit Agreement Amendment, requires the
  Partnership to maintain a leverage ratio (the ratio of its consolidated funded
  indebtedness to its consolidated adjusted EBITDA, in each case as defined in the
  credit agreement), determined as of the last day of each<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;</font>month
  for the&#160;twelve month&#160;period ending on the date of determination, that
  ranges on a monthly basis from not more than 5.50 to 1.00 to not more than 9.75
  to 1.00.&#160;&#160;In addition, pursuant to the Credit Agreement Amendment, the
  Partnership&#8217;s ability to make acquisitions and investments in unrestricted
  subsidiaries is limited and the Partnership may only make distributions if its
  leverage ratio is less than 3.50 to 1.00 and certain other conditions are
  met.&#160;&#160;As of September 30, 2008 and December 31, 2008, the
  Partnership&#8217;s leverage ratio was 4.34 to 1.00 and 4.83 to 1.00,
  respectively.&#160;If the Partnership&#8217;s leverage ratio does not improve, it may
  not make quarterly distributions to its unitholders in the future.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
  credit agreement, as amended by the Credit Agreement Amendment, also requires
  the Partnership to maintain an interest coverage ratio (the ratio of its
  consolidated EBITDA to its consolidated interest expense, in each case as
  defined in the credit agreement) that ranges on a monthly basis from not less
  than 2.50 to 1.00 to not less than 1.00 to 1.00. As of September 30, 2008 and
  December 31, 2008, the Partnership&#8217;s interest coverage ratio was 4.95 to 1.00
  and 3.60 to 1.00, respectively.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Further,
  the Partnership is required to maintain a monthly consolidated adjusted EBITDA
  for the prior twelve months ranging from $45.4 million to $82.9 million as
  determined at the end of each month.&#160;&#160;In addition, capital
  expenditures are limited to $12.5 million in 2009, $8.0 million in 2010 and $4.0
  million in the six months ending June 30, 2011.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
  credit agreement specifies a number of events of default (many of which are
  subject to applicable cure periods), including, among others, failure to pay any
  principal when due or any interest or fees within three business days of the due
  date, failure to perform or otherwise comply with the covenants in the credit
  agreement, failure of any representation or warranty to be true and correct in
  any material respect, failure to pay debt, a change of control of the
  Partnership or the Partnership&#8217;s general partner, and other customary
  defaults.&#160;&#160;<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">In
  addition, it is an event of default under the credit agreement if the
  Partnership does not file its delinquent quarterly and annual reports with the
  SEC by September 30, 2009, unless the Partnership retains new auditors, in which
  case such deadline is extended to December 31, 2009.&#160; </font>If an event of
  default exists under the credit agreement, the lenders will be able to
  accelerate the maturity of the credit agreement and exercise other rights and
  remedies, including taking available cash in the Partnership&#8217;s bank
  accounts.&#160;&#160;If an event of default exists and the Partnership is unable
  to obtain forbearance from its lenders or a waiver of the events of default
  under its credit agreement, it may be forced to sell assets, make a bankruptcy
  filing or take other action that could have a material adverse effect on its
  business, the price of its common units and its results of
  operations.&#160;&#160;The Partnership is also prohibited from making cash
  distributions to its unitholders while the events of default
  exist.&#160;&#160;</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
  Partnership is exposed to market risk for changes in interest rates related to
  its credit facility. Interest rate swap agreements were used to manage a portion
  of the exposure related to changing interest rates by converting floating-rate
  debt to fixed-rate debt. In August 2007 the Partnership entered into interest
  rate swap agreements with an aggregate notional value of $80.0 million that
  mature on August&#160;20, 2010. Under the terms of the interest rate swap
  agreements, the Partnership was to pay fixed rates of 4.9% and receive
  three-month LIBOR with quarterly settlement.&#160;&#160;In March 2008 the
  Partnership entered into interest rate swap agreements with an aggregate
  notional value of $100.0 million that mature on March 31, 2011.&#160;&#160;Under
  the terms of the interest rate swap agreements, the Partnership was to pay fixed
  rates of 2.6% to 2.7% and receive three-month LIBOR with quarterly
  settlement.&#160;&#160;The interest rate swaps do not receive hedge accounting
  treatment under Statement of Financial Accounting Standard (&#8220;SFAS&#8221;) SFAS No.
  133, &#8220;<font style="DISPLAY: inline; FONT-STYLE: italic">Accounting for
  Derivative Instruments and Hedging Activities</font>&#8221; (&#8220;SFAS 133&#8221;). Changes in
  the fair value of the interest rate swaps are recorded in interest expense in
  the statements of operations.&#160;&#160;In addition, the interest rate swap
  agreements contain cross-default provisions to events of default under the
  credit agreement.&#160;&#160;Due to events related to the Bankruptcy Filings,
  all of these interest rate swap positions were terminated in the third quarter
  of 2008, and the Partnership has recorded a $1.5 million liability as of
  September 30, 2008 with respect to these positions.</font></div><br>
      <div id="PGBRK" style="MARGIN-LEFT: 0pt; WIDTH: 100%; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
        <div id="FTR">
          <div style="WIDTH: 100%" align="left">
            <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
  </font></div>
          </div>
          <div id="GLFTR" style="WIDTH: 100%" align="center">
          </div>
        </div>
        <div id="PN" style="PAGE-BREAK-AFTER: always">
          <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">10</font></div>
          <div style="WIDTH: 100%; TEXT-ALIGN: center">
            <hr style="COLOR: black" noshade size="2">
          </div>
        </div>
        <div id="HDR">
          <div id="GLHDR" style="WIDTH: 100%" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 9pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><a href="#TOC">Table of Contents</a></font></div>
          <div style="WIDTH: 100%" align="left">
            <div style="DISPLAY: block; TEXT-INDENT: 0pt; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">SEMGROUP
  ENERGY PARTNERS, L.P.</font></div>
            <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">NOTES
  TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS</font></div>
          </div>
        </div>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">5.
  FAIR VALUE MEASUREMENTS</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
  Partnership adopted SFAS No.&#160;157, &#8220;<font style="DISPLAY: inline; FONT-STYLE: italic">Fair Value Measurements</font>,&#8221;
  effective January&#160;1, 2008 for financial assets and liabilities measured on
  a recurring basis. SFAS No.&#160;157 applies to all financial assets and
  financial liabilities that are being measured and reported on a fair value
  basis. In February 2008, the FASB issued FSP No. 157-2, which delayed the
  effective date of SFAS No. 157 by one year for nonfinancial assets and
  liabilities except those that are recognized and recorded in the financial
  statements at fair value on a recurring basis. As defined in SFAS No. 157, fair
  value is the price that would be received to sell an asset or paid to transfer a
  liability in an orderly transaction between market participants at the
  measurement date (exit price). SFAS No.&#160;157 requires disclosure that
  establishes a framework for measuring fair value and expands disclosure about
  fair value measurements. The statement requires fair value measurements be
  classified and disclosed in one of the following categories:</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div>
        <table cellpadding="0" cellspacing="0" width="100%">
            <tr>
              <td align="left" valign="top" width="7%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Level
        1:</font></div>
              </td>
              <td align="left" valign="bottom" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
              <td align="left" valign="top" width="68%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Unadjusted
        quoted prices in active markets that are accessible at the measurement
        date for identical, unrestricted assets or liabilities. The Partnership
        considers active markets as those in which transactions for the assets or
        liabilities occur in sufficient frequency and volume to provide pricing
        information on an ongoing basis.</font></div>
              </td>
            </tr>
            <tr>
              <td align="left" valign="top" width="7%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
              <td align="left" valign="bottom" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
              <td align="left" valign="top" width="68%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
            </tr>
            <tr>
              <td align="left" valign="top" width="7%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Level
        2:</font></div>
              </td>
              <td align="left" valign="bottom" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
              <td align="left" valign="top" width="68%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Quoted
        prices in markets that are not active, or inputs which are observable,
        either directly or indirectly, for substantially the full term of the
        asset or liability.</font></div>
              </td>
            </tr>
            <tr>
              <td align="left" valign="top" width="7%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
              <td align="left" valign="bottom" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
              <td align="left" valign="top" width="68%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
            </tr>
            <tr>
              <td align="left" valign="top" width="7%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Level
        3:</font></div>
              </td>
              <td align="left" valign="bottom" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
              <td align="left" valign="top" width="68%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Measured
        based on prices or valuation models that require inputs that are both
        significant to the fair value measurement and less observable from
        objective sources (i.e., supported by little or no market activity). The
        Partnership&#8217;s Level 3 instruments are comprised of interest rate
        swaps.&#160;&#160;Although the Partnership utilizes third party broker
        quotes to assess the reasonableness of its prices and valuation, the
        Partnership does not have sufficient corroborating market evidence to
        support classifying these assets and liabilities as Level
      2.</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">As
  required by SFAS No.&#160;157, financial assets and liabilities are classified
  based on the lowest level of input that is significant to the fair value
  measurement. The Partnership&#8217;s assessment of the significance of a particular
  input to the fair value measurement requires judgment, and may affect the
  valuation of the fair value of assets and liabilities and their placement within
  the fair value hierarchy levels. The following table summarizes the valuation of
  the Partnership&#8217;s investments and financial instruments by SFAS No.&#160;157
  pricing levels as of September 30, 2008 (in thousands):</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left">
        <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
        <div>
          <div align="left">
            <div align="center">
              <div align="center">
                <table cellpadding="0" cellspacing="0" width="100%">
                    <tr>
                      <td align="left" valign="bottom" width="15%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                      <td valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                      <td colspan="14" valign="bottom" width="39%" style="BORDER-BOTTOM: black 2px solid">
                        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Fair
        Value Measurements at Reporting Date Using</font></div>
                      </td>
                      <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                    </tr>
                    <tr>
                      <td align="left" valign="bottom" width="15%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                      <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                      <td align="left" colspan="2" valign="bottom" width="6%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                      <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                      <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                      <td colspan="2" valign="bottom" width="9%">
                        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Quoted
        Prices in Active</font></div>
                      </td>
                      <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                      <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                      <td colspan="2" valign="bottom" width="9%">
                        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Significant
        Other</font></div>
                      </td>
                      <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                      <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                      <td colspan="2" valign="bottom" width="9%">
                        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Significant</font></div>
                      </td>
                      <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                    </tr>
                    <tr>
                      <td align="left" valign="bottom" width="15%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                      <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                      <td align="left" colspan="2" valign="bottom" width="6%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                      <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                      <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                      <td colspan="2" valign="bottom" width="9%">
                        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Markets
        for Identical</font></div>
                      </td>
                      <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                      <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                      <td colspan="2" valign="bottom" width="9%">
                        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Observable</font></div>
                      </td>
                      <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                      <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                      <td colspan="2" valign="bottom" width="9%">
                        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Unobservable</font></div>
                      </td>
                      <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                    </tr>
                    <tr>
                      <td align="left" valign="bottom" width="15%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                      <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                      <td align="left" colspan="2" valign="bottom" width="6%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                      <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                      <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                      <td colspan="2" valign="bottom" width="9%">
                        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Assets</font></div>
                      </td>
                      <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                      <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                      <td colspan="2" valign="bottom" width="9%">
                        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Inputs</font></div>
                      </td>
                      <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                      <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                      <td colspan="2" valign="bottom" width="9%">
                        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Inputs</font></div>
                      </td>
                      <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                    </tr>
                    <tr>
                      <td align="left" valign="bottom" width="15%" style="BORDER-BOTTOM: black 2px solid">
                        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Description</font></div>
                      </td>
                      <td valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                      <td colspan="2" valign="bottom" width="6%" style="BORDER-BOTTOM: black 2px solid">
                        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">September
        30, 2008</font></div>
                      </td>
                      <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                      <td valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                      <td colspan="2" valign="bottom" width="9%" style="BORDER-BOTTOM: black 2px solid">
                        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(Level
        1)</font></div>
                      </td>
                      <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                      <td valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                      <td colspan="2" valign="bottom" width="9%" style="BORDER-BOTTOM: black 2px solid">
                        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(Level
        2)</font></div>
                      </td>
                      <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                      <td valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                      <td colspan="2" valign="bottom" width="9%" style="BORDER-BOTTOM: black 2px solid">
                        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(Level
        3)</font></div>
                      </td>
                      <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                    </tr>
                    <tr bgcolor="#cceeff">
                      <td align="left" valign="bottom" width="15%">
                        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Interest
        rate swap assets</font></div>
                      </td>
                      <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                      <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></td>
                      <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">-</font></td>
                      <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                      <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                      <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></td>
                      <td align="right" valign="bottom" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">-</font></td>
                      <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                      <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                      <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></td>
                      <td align="right" valign="bottom" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">-</font></td>
                      <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                      <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                      <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></td>
                      <td align="right" valign="bottom" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">-</font></td>
                      <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                    </tr>
                    <tr bgcolor="white">
                      <td align="left" valign="bottom" width="15%" style="PADDING-BOTTOM: 2px">
                        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Interest
        rate swap liabilities</font></div>
                      </td>
                      <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                      <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                      <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">-</font></td>
                      <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                      <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                      <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                      <td align="right" valign="bottom" width="8%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">-</font></td>
                      <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                      <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                      <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                      <td align="right" valign="bottom" width="8%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">-</font></td>
                      <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                      <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                      <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                      <td align="right" valign="bottom" width="8%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">-</font></td>
                      <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                    </tr>
                    <tr bgcolor="#cceeff">
                      <td align="left" valign="bottom" width="15%" style="PADDING-BOTTOM: 4px">
                        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;&#160;&#160;Total</font></div>
                      </td>
                      <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 4px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                      <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 4px double"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></td>
                      <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: black 4px double"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">-</font></td>
                      <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 4px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                      <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 4px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                      <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 4px double"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></td>
                      <td align="right" valign="bottom" width="8%" style="BORDER-BOTTOM: black 4px double"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">-</font></td>
                      <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 4px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                      <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 4px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                      <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 4px double"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></td>
                      <td align="right" valign="bottom" width="8%" style="BORDER-BOTTOM: black 4px double"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">-</font></td>
                      <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 4px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                      <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 4px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                      <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 4px double"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></td>
                      <td align="right" valign="bottom" width="8%" style="BORDER-BOTTOM: black 4px double"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">-</font></td>
                      <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 4px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                    </tr>
                </table>
              </div>
            </div>
          </div>
        </div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div><br>
        <div id="PGBRK" style="MARGIN-LEFT: 0pt; WIDTH: 100%; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
          <div id="FTR">
            <div style="WIDTH: 100%" align="left">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
  </font></div>
            </div>
            <div id="GLFTR" style="WIDTH: 100%" align="center">
            </div>
          </div>
          <div id="PN" style="PAGE-BREAK-AFTER: always">
            <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">11</font></div>
            <div style="WIDTH: 100%; TEXT-ALIGN: center">
              <hr style="COLOR: black" noshade size="2">
            </div>
          </div>
          <div id="HDR">
            <div id="GLHDR" style="WIDTH: 100%" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 9pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><a href="#TOC">Table of Contents</a></font></div>
            <div style="WIDTH: 100%" align="left">
              <div style="DISPLAY: block; TEXT-INDENT: 0pt; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">SEMGROUP
  ENERGY PARTNERS, L.P.</font></div>
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">NOTES
  TO UNAUDITED CONSOLIDATED FINANCIAL
  STATEMENTS</font></div>
            </div>
          </div>
        </div><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
  following table sets forth a reconciliation of changes in the fair value of the
  Partnership&#8217;s net financial liabilities classified as level 3 in the fair value
  hierarchy (in thousands):</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left">
        <div>
          <div align="left">
            <div align="center">
              <div align="center">
                <div align="center">
                  <div align="center">
                    <div align="center">
                      <div align="center">
                        <div align="center">
                          <table cellpadding="0" cellspacing="0" width="100%">
                              <tr>
                                <td valign="bottom" width="35%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                                <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td colspan="6" valign="bottom" width="20%">
                                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Fair
        Value Measurements Using</font></div>
                                </td>
                                <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                              </tr>
                              <tr>
                                <td valign="bottom" width="35%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                                <td valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td colspan="6" valign="bottom" width="20%" style="BORDER-BOTTOM: black 2px solid">
                                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Significant
        Unobservable Inputs</font></div>
                                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center">
                                    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(Level
        3)</font></div>
                                  </div>
                                </td>
                                <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                              </tr>
                              <tr>
                                <td valign="bottom" width="35%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                                <td valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td colspan="3" valign="bottom" width="10%" style="BORDER-BOTTOM: black 2px solid">
                                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Three
        Months Ended September 30, 2008</font></div>
                                </td>
                                <td valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td colspan="2" valign="bottom" width="9%" style="BORDER-BOTTOM: black 2px solid">
                                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Nine
        Months Ended September 30, 2008</font></div>
                                </td>
                                <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                              </tr>
                              <tr bgcolor="#cceeff">
                                <td align="left" valign="bottom" width="35%">
                                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Beginning
        balance</font></div>
                                </td>
                                <td align="right" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></td>
                                <td align="right" valign="bottom" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">496</font></td>
                                <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="right" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></td>
                                <td align="right" valign="bottom" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(2,233</font></td>
                                <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">)</font></td>
                              </tr>
                              <tr bgcolor="white">
                                <td align="left" colspan="4" valign="bottom" width="45%">
                                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Total
        gains or losses (realized/unrealized)</font></div>
                                </td>
                                <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="right" valign="bottom" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                              </tr>
                              <tr bgcolor="#cceeff">
                                <td align="left" valign="bottom" width="35%">
                                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Included
        in earnings (1)</font></div>
                                </td>
                                <td align="right" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="right" valign="bottom" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">216</font></td>
                                <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="right" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="right" valign="bottom" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">2,785</font></td>
                                <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                              </tr>
                              <tr bgcolor="white">
                                <td align="left" valign="bottom" width="35%">
                                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Included
        in other comprehensive income</font></div>
                                </td>
                                <td align="right" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="right" valign="bottom" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">-</font></td>
                                <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="right" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="right" valign="bottom" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">-</font></td>
                                <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                              </tr>
                              <tr bgcolor="#cceeff">
                                <td align="left" valign="bottom" width="35%">
                                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Purchases,
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                                </td>
                                <td align="right" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="right" valign="bottom" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(712</font></td>
                                <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">)</font></td>
                                <td align="right" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="right" valign="bottom" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(552</font></td>
                                <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">)</font></td>
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                              <tr bgcolor="white">
                                <td align="left" valign="bottom" width="35%" style="PADDING-BOTTOM: 2px">
                                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Transfers
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                                </td>
                                <td align="right" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="right" valign="bottom" width="8%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">-</font></td>
                                <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="right" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="right" valign="bottom" width="8%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">-</font></td>
                                <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                              </tr>
                              <tr bgcolor="#cceeff">
                                <td align="left" valign="bottom" width="35%" style="PADDING-BOTTOM: 4px">
                                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Ending
        balance, September 30, 2008</font></div>
                                </td>
                                <td align="right" valign="bottom" width="1%" style="PADDING-BOTTOM: 4px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 4px double"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></td>
                                <td align="right" valign="bottom" width="8%" style="BORDER-BOTTOM: black 4px double"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">-</font></td>
                                <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 4px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="right" valign="bottom" width="1%" style="PADDING-BOTTOM: 4px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 4px double"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></td>
                                <td align="right" valign="bottom" width="8%" style="BORDER-BOTTOM: black 4px double"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">-</font></td>
                                <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 4px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                              </tr>
                              <tr bgcolor="white">
                                <td valign="bottom" width="35%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                                <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="right" valign="bottom" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="right" valign="bottom" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                              </tr>
                              <tr bgcolor="#cceeff">
                                <td align="left" colspan="4" valign="bottom" width="45%">
                                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">The
        amount of total losses for the period included</font></div>
                                </td>
                                <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="right" valign="bottom" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                              </tr>
                              <tr bgcolor="white">
                                <td align="left" colspan="5" valign="bottom" width="46%">
                                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">in
        earnings attributable to the change in the unrealized</font></div>
                                </td>
                                <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="right" valign="bottom" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                              </tr>
                              <tr bgcolor="#cceeff">
                                <td align="left" colspan="4" valign="bottom" width="45%">
                                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">gains
        or losses relating to liabilities still held at</font></div>
                                </td>
                                <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="right" valign="bottom" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                              </tr>
                              <tr bgcolor="white">
                                <td align="left" valign="bottom" width="35%" style="PADDING-BOTTOM: 4px">
                                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">the
        reporting date</font></div>
                                </td>
                                <td align="right" valign="bottom" width="1%" style="PADDING-BOTTOM: 4px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 4px double"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></td>
                                <td align="right" valign="bottom" width="8%" style="BORDER-BOTTOM: black 4px double"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">-</font></td>
                                <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 4px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="right" valign="bottom" width="1%" style="PADDING-BOTTOM: 4px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 4px double"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></td>
                                <td align="right" valign="bottom" width="8%" style="BORDER-BOTTOM: black 4px double"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">-</font></td>
                                <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 4px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                              </tr>
                              <tr bgcolor="#cceeff">
                                <td valign="bottom" width="35%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                                <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="right" valign="bottom" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="right" valign="bottom" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                              </tr>
                              <tr bgcolor="white">
                                <td align="left" colspan="8" valign="bottom" width="56%">
                                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(1)
        Amounts reported as included in earnings are reported as interest expense
        on the statements of operations.</font></div>
                                </td>
                                <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                              </tr>
                          </table>
                        </div>
                      </div>
                    </div>
                  </div>
                </div>
              </div>
            </div>
          </div>
        </div>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">6.
  NET INCOME PER LIMITED PARTNER UNIT</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Subject
  to applicability of Emerging Issues Task Force Issue No.&#160;03-06 (&#8220;EITF
  03-06&#8221;), &#8220;Participating Securities and the Two-Class Method under Financial
  Accounting Standards Board (&#8220;FASB&#8221;) Statement No.&#160;128,&#8221; as discussed below,
  Partnership income is allocated to the limited partners, including the holders
  of subordinated units, and to the general partner after consideration of its
  incentive distribution rights.&#160;&#160;Income allocable to the limited
  partners is first allocated to the common unitholders up to the quarterly
  minimum distribution of $0.3125 per unit, with remaining income allocated to the
  subordinated unitholders up to the minimum distribution amount. Basic and
  diluted net income per common and subordinated partner unit is determined by
  dividing net income attributable to common and subordinated partners by the
  weighted average number of outstanding common and subordinated partner units
  during the period.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">EITF
  03-06 addresses the computation of earnings per share by entities that have
  issued securities other than common stock that contractually entitle the holder
  to participate in dividends and earnings of the entity when, and if, it declares
  dividends on its common stock (or partnership distributions to unitholders).
  Under EITF 03-06, in accounting periods where the Partnership&#8217;s aggregate net
  income exceeds aggregate dividends declared in the period, the Partnership is
  required to present earnings per unit as if all of the earnings for the periods
  were distributed.&#160;&#160;The nine months ended September 30, 2008 earnings
  per share calculation reflects the summation of the quarterly calculations, as
  earnings per share for master limited partnerships is calculated based on the
  distribution&#160;provisions set forth in the partnership
  agreement.&#160;&#160;The following sets forth the computation of basic and
  diluted net income per common and subordinated unit (in thousands, except per
  unit data):</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left">
        <div>
          <div align="left">
            <div align="center">
              <div align="center">
                <div>
                  <div align="left">
                    <div align="center">
                      <div align="center">
                        <div align="center">
                          <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
                          <div>
                            <div align="left">
                              <div align="center">
                                <div align="center">
                                  <div align="center">
                                    <div align="center">
                                      <div align="center">
                                        <div align="center">
                                          <div align="center">
                                            <table cellpadding="0" cellspacing="0" width="100%">
                                                <tr>
                                                  <td valign="bottom" width="22%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                                                  <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td colspan="2" valign="bottom" width="6%">
                                                    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">July
        1, 2007 to</font></div>
                                                  </td>
                                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td colspan="2" valign="bottom" width="6%">
                                                    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">July
        20, 2007 to</font></div>
                                                  </td>
                                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td colspan="2" valign="bottom" width="8%">
                                                    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Three
        Months Ended</font></div>
                                                  </td>
                                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td colspan="2" valign="bottom" width="6%">
                                                    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">January
        1, 2007 to</font></div>
                                                  </td>
                                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td colspan="2" valign="bottom" width="6%">
                                                    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">July
        20, 2007 to</font></div>
                                                  </td>
                                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td colspan="2" valign="bottom" width="8%">
                                                    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Nine
        Months Ended</font></div>
                                                  </td>
                                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                </tr>
                                                <tr>
                                                  <td valign="bottom" width="22%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                                                  <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td colspan="2" valign="bottom" width="6%">
                                                    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">July
        19,</font></div>
                                                  </td>
                                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td colspan="2" valign="bottom" width="6%">
                                                    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">September
        30,</font></div>
                                                  </td>
                                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td colspan="2" valign="bottom" width="8%">
                                                    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">September
        30,</font></div>
                                                  </td>
                                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td colspan="2" valign="bottom" width="6%">
                                                    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">July
        19,</font></div>
                                                  </td>
                                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td colspan="2" valign="bottom" width="6%">
                                                    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">September
        30,</font></div>
                                                  </td>
                                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td colspan="2" valign="bottom" width="8%">
                                                    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">September
        30,</font></div>
                                                  </td>
                                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                </tr>
                                                <tr>
                                                  <td align="left" valign="bottom" width="22%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                                                  <td valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td colspan="2" valign="bottom" width="6%" style="BORDER-BOTTOM: black 2px solid">
                                                    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">2007</font></div>
                                                  </td>
                                                  <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td colspan="2" valign="bottom" width="6%" style="BORDER-BOTTOM: black 2px solid">
                                                    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">2007</font></div>
                                                  </td>
                                                  <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td colspan="2" valign="bottom" width="8%" style="BORDER-BOTTOM: black 2px solid">
                                                    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">2008</font></div>
                                                  </td>
                                                  <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td colspan="2" valign="bottom" width="6%" style="BORDER-BOTTOM: black 2px solid">
                                                    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">2007</font></div>
                                                  </td>
                                                  <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td colspan="2" valign="bottom" width="6%" style="BORDER-BOTTOM: black 2px solid">
                                                    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">2007</font></div>
                                                  </td>
                                                  <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td colspan="2" valign="bottom" width="8%" style="BORDER-BOTTOM: black 2px solid">
                                                    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">2008</font></div>
                                                  </td>
                                                  <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                </tr>
                                                <tr bgcolor="#cceeff">
                                                  <td align="left" valign="bottom" width="22%">
                                                    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Net
        income (loss)</font></div>
                                                  </td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></td>
                                                  <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(1,623</font></td>
                                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">)</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></td>
                                                  <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">5,940</font></td>
                                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></td>
                                                  <td align="right" valign="bottom" width="7%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(11,851</font></td>
                                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">)</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></td>
                                                  <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(26,118</font></td>
                                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">)</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></td>
                                                  <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">5,940</font></td>
                                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></td>
                                                  <td align="right" valign="bottom" width="7%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">19,503</font></td>
                                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                </tr>
                                                <tr bgcolor="white">
                                                  <td align="left" valign="bottom" width="22%" style="PADDING-BOTTOM: 2px">
                                                    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 18pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Less:
        General partner interest in net income (loss)</font></div>
                                                  </td>
                                                  <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(1,623</font></td>
                                                  <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">)</font></td>
                                                  <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">119</font></td>
                                                  <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="right" valign="bottom" width="7%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(237</font></td>
                                                  <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">)</font></td>
                                                  <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(26,118</font></td>
                                                  <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">)</font></td>
                                                  <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">119</font></td>
                                                  <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="right" valign="bottom" width="7%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">3,368</font></td>
                                                  <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                </tr>
                                                <tr bgcolor="#cceeff">
                                                  <td align="left" valign="bottom" width="22%" style="PADDING-BOTTOM: 4px">
                                                    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 18pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Net
        income (loss) available to limited and subordinated
      partners</font></div>
                                                  </td>
                                                  <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 4px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 4px double"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></td>
                                                  <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: black 4px double"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">-</font></td>
                                                  <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 4px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 4px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 4px double"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></td>
                                                  <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: black 4px double"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">5,821</font></td>
                                                  <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 4px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 4px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 4px double"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></td>
                                                  <td align="right" valign="bottom" width="7%" style="BORDER-BOTTOM: black 4px double"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(11,614</font></td>
                                                  <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 4px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">)</font></td>
                                                  <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 4px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 4px double"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></td>
                                                  <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: black 4px double"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">-</font></td>
                                                  <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 4px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 4px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 4px double"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></td>
                                                  <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: black 4px double"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">5,821</font></td>
                                                  <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 4px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 4px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 4px double"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></td>
                                                  <td align="right" valign="bottom" width="7%" style="BORDER-BOTTOM: black 4px double"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">16,135</font></td>
                                                  <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 4px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                </tr>
                                                <tr bgcolor="white">
                                                  <td align="left" valign="bottom" width="22%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="right" valign="bottom" width="7%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="right" valign="bottom" width="7%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                </tr>
                                                <tr bgcolor="#cceeff">
                                                  <td align="left" valign="bottom" width="22%">
                                                    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Basic
        weighted average number of units:</font></div>
                                                  </td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="right" valign="bottom" width="7%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="right" valign="bottom" width="7%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                </tr>
                                                <tr bgcolor="white">
                                                  <td align="left" valign="bottom" width="22%">
                                                    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 18pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Common
        units</font></div>
                                                  </td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">14,375</font></td>
                                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="right" valign="bottom" width="7%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">21,426</font></td>
                                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">14,375</font></td>
                                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="right" valign="bottom" width="7%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">20,015</font></td>
                                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                </tr>
                                                <tr bgcolor="#cceeff">
                                                  <td align="left" valign="bottom" width="22%">
                                                    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 18pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Subordinated
        units</font></div>
                                                  </td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">12,571</font></td>
                                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="right" valign="bottom" width="7%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">12,571</font></td>
                                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">12,571</font></td>
                                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="right" valign="bottom" width="7%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">12,571</font></td>
                                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                </tr>
                                                <tr bgcolor="white">
                                                  <td align="left" valign="bottom" width="22%">
                                                    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 18pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Restricted
        and phantom units</font></div>
                                                  </td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">-</font></td>
                                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="right" valign="bottom" width="7%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">641</font></td>
                                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">-</font></td>
                                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="right" valign="bottom" width="7%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">552</font></td>
                                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                </tr>
                                                <tr bgcolor="#cceeff">
                                                  <td align="left" valign="bottom" width="22%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="right" valign="bottom" width="7%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="right" valign="bottom" width="7%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                </tr>
                                                <tr bgcolor="white">
                                                  <td align="left" valign="bottom" width="22%">
                                                    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Diluted
        weighted average number of units:</font></div>
                                                  </td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="right" valign="bottom" width="7%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="right" valign="bottom" width="7%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                </tr>
                                                <tr bgcolor="#cceeff">
                                                  <td align="left" valign="bottom" width="22%">
                                                    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 18pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Common
        units</font></div>
                                                  </td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">14,508</font></td>
                                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="right" valign="bottom" width="7%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">21,426</font></td>
                                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">14,508</font></td>
                                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="right" valign="bottom" width="7%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">20,015</font></td>
                                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                </tr>
                                                <tr bgcolor="white">
                                                  <td align="left" valign="bottom" width="22%">
                                                    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 18pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Subordinated
        units</font></div>
                                                  </td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">12,571</font></td>
                                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="right" valign="bottom" width="7%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">12,571</font></td>
                                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">12,571</font></td>
                                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="right" valign="bottom" width="7%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">12,571</font></td>
                                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                </tr>
                                                <tr bgcolor="#cceeff">
                                                  <td align="left" valign="bottom" width="22%">
                                                    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 18pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Restricted
        and phantom units</font></div>
                                                  </td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">-</font></td>
                                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="right" valign="bottom" width="7%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">641</font></td>
                                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">-</font></td>
                                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="right" valign="bottom" width="7%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">552</font></td>
                                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                </tr>
                                                <tr bgcolor="white">
                                                  <td align="left" valign="bottom" width="22%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="right" valign="bottom" width="7%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="right" valign="bottom" width="7%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                </tr>
                                                <tr bgcolor="#cceeff">
                                                  <td align="left" valign="bottom" width="22%">
                                                    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Basic
        and diluted net income (loss) per common unit</font></div>
                                                  </td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></td>
                                                  <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">0.24</font></td>
                                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></td>
                                                  <td align="right" valign="bottom" width="7%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(0.33</font></td>
                                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">)</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></td>
                                                  <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">0.24</font></td>
                                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></td>
                                                  <td align="right" valign="bottom" width="7%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">0.51</font></td>
                                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                </tr>
                                                <tr bgcolor="white">
                                                  <td align="left" valign="bottom" width="22%">
                                                    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Basic
        and diluted net income (loss) per subordinated unit</font></div>
                                                  </td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></td>
                                                  <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">0.19</font></td>
                                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></td>
                                                  <td align="right" valign="bottom" width="7%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(0.33</font></td>
                                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">)</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></td>
                                                  <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">0.19</font></td>
                                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></td>
                                                  <td align="right" valign="bottom" width="7%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">0.51</font></td>
                                                  <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                </tr>
                                            </table>
                                          </div>
                                        </div>
                                      </div>
                                    </div>
                                  </div>
                                </div>
                              </div>
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                          </div>
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                        </div>
                      </div>
                    </div>
                  </div>
                </div>
                <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
              </div>
            </div>
          </div>
        </div>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div><br>
      <div id="PGBRK" style="MARGIN-LEFT: 0pt; WIDTH: 100%; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
        <div id="FTR">
          <div style="WIDTH: 100%" align="left">
            <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
  </font></div>
          </div>
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        <div id="PN" style="PAGE-BREAK-AFTER: always">
          <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">12</font></div>
          <div style="WIDTH: 100%; TEXT-ALIGN: center">
            <hr style="COLOR: black" noshade size="2">
          </div>
        </div>
        <div id="HDR">
          <div id="GLHDR" style="WIDTH: 100%" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 9pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><a href="#TOC">Table of Contents</a></font></div>
          <div style="WIDTH: 100%" align="left">
            <div style="DISPLAY: block; TEXT-INDENT: 0pt; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">SEMGROUP
  ENERGY PARTNERS, L.P.</font></div>
            <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">NOTES
  TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS</font></div>
          </div>
        </div>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">7.
  PARTNERS&#8217; CAPITAL AND DISTRIBUTIONS</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
  Partnership has not made a distribution to its common unitholders, subordinated
  unitholders or general partner since May 15, 2008 due to the events of default
  that existed under its credit agreement and the uncertainty of its future cash
  flows relating to the Bankruptcy Filings.&#160;&#160;The Partnership&#8217;s
  unitholders will be required to pay taxes on their share of the Partnership&#8217;s
  taxable income even though they did not receive a distribution for the quarters
  ended June 30, 2008, September 30, 2008, December 31, 2008 or March 31,
  2009.&#160;&#160;In addition, the Partnership does not currently expect to make
  a distribution relating to operations during the second quarter of
  2009.&#160;&#160;Pursuant to the Credit Agreement Amendment, the Partnership is
  prohibited from making distributions to its unitholders if its leverage ratio
  (as defined in the credit agreement) exceeds 3.50 to 1.00.&#160;&#160;As of
  September 30, 2008 and December 31, 2008, the Partnership&#8217;s leverage ratio was
  4.34 to 1.00 and 4.83 to 1.00, respectively.&#160;If the Partnership&#8217;s leverage
  ratio does not improve, it may not make quarterly distributions to its
  unitholders in the future.&#160;&#160;The Partnership&#8217;s partnership agreement
  provides that, during the subordination period, which the Partnership is
  currently in, the Partnership&#8217;s common units will have the right to receive
  distributions of available cash from operating surplus in an amount equal to the
  minimum quarterly distribution of $0.3125 per common unit per quarter, plus any
  arrearages in the payment of the minimum quarterly distribution on the common
  units from prior quarters, before any distributions of available cash from
  operating surplus may be made on the subordinated units.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">On April
  24, 2008, the Partnership declared a cash distribution of $0.40 per unit on its
  outstanding units for the three month period ended March 31,
  2008.&#160;&#160;The distribution was paid on May 15, 2008 to unitholders of
  record on May 5, 2008. The total distribution paid was approximately $14.3
  million, with approximately $8.5 million, $5.0 million, and $0.6 million paid to
  the Partnership&#8217;s common unitholders, subordinated unitholders and general
  partner, respectively, and $0.2 million paid to phantom and restricted
  unitholders pursuant to awards granted under the Partnership&#8217;s long-term
  incentive plan.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">On
  February&#160;20, 2008, the Partnership purchased the Acquired Asphalt Assets
  from the Private Company for aggregate consideration of $379.5 million,
  including $0.7 million of acquisition-related costs. For accounting purposes,
  the acquisition has been reflected as a purchase of assets, with the Acquired
  Asphalt Assets recorded at the historical cost of the Private Company, which was
  approximately $145.5 million, and with the additional purchase price of $234.0
  million reflected in the statement of changes in partners&#8217; capital as a
  distribution to the Private Company.&#160;&#160;The Board approved the
  acquisition of the Acquired Asphalt Assets as well as the terms of the related
  agreements based on a recommendation from its conflicts committee, which
  consisted entirely of independent directors. The conflicts committee retained
  independent legal and financial advisors to assist it in evaluating the
  transaction and considered a number of factors in approving the acquisition,
  including an opinion from the committee&#8217;s independent financial advisor that the
  consideration paid for the Acquired Asphalt Assets was fair, from a financial
  point of view, to the Partnership.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">On May
  12, 2008, the Partnership purchased the Acquired Pipeline Assets from the
  Private Company for aggregate consideration of $45.1 million, including $0.1
  million of acquisition-related costs. For accounting purposes, the acquisition
  has been reflected as a purchase of assets, with the Acquired Pipeline Assets
  recorded at the historical cost of the Private Company, which was approximately
  $35.1 million, and with the additional purchase price of $10.0 million reflected
  in the statement of changes in partners&#8217; capital as a distribution to the
  Private Company.&#160;&#160;The Board approved the acquisition of the Acquired
  Pipeline Assets based on a recommendation from its conflicts committee, which
  consisted entirely of independent directors. The conflicts committee retained
  independent legal and financial advisors to assist it in evaluating the
  transaction and considered a number of factors in approving the acquisition,
  including an opinion from the committee&#8217;s independent financial advisor that the
  consideration paid for the Acquired Pipeline Assets was fair, from a financial
  point of view, to the Partnership.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">On May
  30, 2008, the Partnership purchased the Acquired Storage Assets from the Private
  Company for aggregate consideration of $90.3 million, including $0.3 million of
  acquisition-related costs. For accounting purposes, the acquisition has been
  reflected as a purchase of assets, with the Acquired Storage Assets recorded at
  the historical cost of the Private Company, which was approximately $17.1
  million, inclusive of $0.5 million of completion costs subsequent to the close
  of the acquisition, and with the additional purchase price of $73.2 million
  reflected in the statement of changes in partners&#8217; capital as a distribution to
  the Private Company.&#160;&#160;The Board approved the acquisition of the
  Acquired Storage Assets based on a recommendation from its conflicts committee,
  which consisted entirely of independent directors. The conflicts committee
  retained independent legal and financial advisors to assist it in evaluating the
  transaction and considered a number of factors in approving the acquisition,
  including an opinion from the committee&#8217;s independent financial advisor that the
  consideration paid for the Acquired Storage Assets was fair, from a financial
  point of view, to the Partnership.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div><br>
      <div id="PGBRK" style="MARGIN-LEFT: 0pt; WIDTH: 100%; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
        <div id="FTR">
          <div style="WIDTH: 100%" align="left">
            <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
  </font></div>
          </div>
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        <div id="PN" style="PAGE-BREAK-AFTER: always">
          <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">13</font></div>
          <div style="WIDTH: 100%; TEXT-ALIGN: center">
            <hr style="COLOR: black" noshade size="2">
          </div>
        </div>
        <div id="HDR">
          <div id="GLHDR" style="WIDTH: 100%" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 9pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><a href="#TOC">Table of Contents</a></font></div>
          <div style="WIDTH: 100%" align="left">
            <div style="DISPLAY: block; TEXT-INDENT: 0pt; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">SEMGROUP
  ENERGY PARTNERS, L.P.</font></div>
            <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">NOTES
  TO UNAUDITED CONSOLIDATED FINANCIAL
  STATEMENTS</font></div>
          </div>
        </div>
      </div><br>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">As a
  result of the Private Company&#8217;s control of the Partnership&#8217;s general partner,
  consideration paid in excess of the historical cost of the Acquired Asphalt
  Assets, Acquired Pipeline Assets, and Acquired Storage Assets were treated as
  distributions to the Private Company.&#160;&#160;This resulted in an aggregate
  reduction in Partners&#8217; Capital of $317.2 million and negative Partners&#8217; Capital
  of $125.0 million as of September 30, 2008.&#160;&#160;As discussed in the
  Partnership&#8217;s Annual Report on Form 10-K for the year ended December 31, 2007,
  as a result of the Private Company&#8217;s control of the Partnership&#8217;s general
  partner, the Partnership was subject to the risk that the Private Company may
  favor its own interest in proposing the terms of any acquisition (or drop downs)
  the Partnership makes from the Private Company and such terms may not be as
  favorable as those received from an unrelated third party.&#160;&#160;The Board
  approved the acquisition of the Acquired Asphalt Assets, the Acquired Pipeline
  Assets, and Acquired Storage Assets, as well as the terms of the related
  agreements based on a recommendation from its conflicts committee, which
  consisted entirely of independent directors. The conflicts committee retained
  independent legal and financial advisors to assist it in evaluating these
  transactions and considered a number of factors in approving the acquisitions,
  including opinions from the committee&#8217;s independent financial advisor that the
  consideration paid for the Acquired Asphalt Assets, the Acquired Pipeline
  Assets, and the Acquired Storage Assets was fair, from a financial point of
  view, to the Partnership.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">8.
  RELATED PARTY TRANSACTIONS</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Prior to
  the close of its initial public offering in July 2007, the Partnership entered
  into the Throughput Agreement with the Private Company. For the nine months
  ended September 30, 2008, the Partnership recognized revenue of $73.4 million
  under the Throughput Agreement.<font style="DISPLAY: inline; FONT-SIZE: 10pt">&#160;</font></font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">In
  conjunction with the purchase of the Acquired Asphalt Assets in February 2008,
  the Partnership entered into the Terminalling Agreement with the Private
  Company. For the nine months ended September 30, 2008, the Partnership
  recognized revenue of $49.1 million under the Terminalling Agreement, including
  fuel surcharge revenues related to fuel and power consumed to operate its liquid
  asphalt cement storage tanks.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Based on
  the minimum requirements under the Throughput Agreement and the Terminalling
  Agreement, the Private Company was obligated to pay the Partnership an aggregate
  minimum monthly fee totaling $135 million annually for the Partnership&#8217;s
  gathering and transportation services and the Partnership&#8217;s terminalling and
  storage services.&#160;&#160;Pursuant to an order of the Bankruptcy Court
  entered on September 9, 2008, the Private Company began making payments under
  the Throughput Agreement at a market rate based upon the Private Company&#8217;s
  actual usage rather than the contractual minimums.&#160;&#160;In connection with
  the Settlement, the Private Company rejected the Throughput Agreement and the
  Terminalling Agreement as part of its Bankruptcy Proceedings (see
  Note&#160;13).</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">In
  connection with the Settlement, the Partnership and the Private Company entered
  into various agreements including the New Throughput Agreement pursuant to which
  the Partnership provides certain crude oil gathering, transportation,
  terminalling and storage services to the Private Company and the New
  Terminalling Agreement&#160;pursuant to which the Partnership provides certain
  liquid asphalt cement terminalling and storage services for the Private
  Company&#8217;s remaining asphalt inventory.&#160;&#160;For a further discussion of
  these agreements, and the other agreements entered into in connection with the
  Settlement, please see Note 13.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">As of
  December&#160;31, 2007 and September 30, 2008, the Partnership had
  $9.7&#160;million and $19.3 million, respectively, in receivables from the
  Private Company and its subsidiaries,&#160;including the pre-petition
  receivables that will be netted and waived due to the Settlement of $0 and $10.5
  million, respectively.&#160;&#160;The $10.5 million relates to amounts that were
  due from the Private Company as of September 30, 2008 and are considered
  prepetition debt in the Bankruptcy Cases.&#160;&#160;In connection with the
  Settlement, these pre-petition claims by the Partnership will be netted against
  pre-petition claims by the Private Company and waived (see Note
  13).</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Prior to
  the Bankruptcy Filings, the Partnership paid the Private Company a fixed
  administrative fee for providing general and administrative services to the
  Partnership.&#160;&#160;This fixed administrative fee was initially fixed at
  $5.0 million per year through July&#160;2010.&#160;&#160;Concurrently with the
  closing of the purchase of the Acquired Asphalt Assets, the Partnership amended
  and restated the Omnibus Agreement, increasing the fixed administrative fee the
  Partnership paid the Private Company for providing general and administrative
  services to the Partnership from $5.0 million per year to $7.0 million per
  year.&#160;&#160;For the nine months ended September 30, 2008, the Partnership
  paid the Private Company $5.0<font style="DISPLAY: inline; FONT-WEIGHT: bold">&#160;</font>million for the services
  provided under the Omnibus Agreement.&#160;&#160;The obligation for the Private
  Company to provide services under the Amended Omnibus Agreement and the
  corresponding administrative fee payable by the Partnership were terminated in
  connection with the events related to the change of control of the Partnership&#8217;s
  general partner.&#160;&#160;The Private Company continued to provide such
  services to the Partnership until the effective date of the Settlement at which
  time the Private Company rejected the Amended Omnibus Agreement and the Private
  Company and the Partnership entered into the Shared Services Agreement&#160;and
  the Transition Services Agreement&#160;relating to the provision of such
  services (see Note 13).&#160; <font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">In
  addition, in connection with the Settlement, the Private Company
  waived&#160;the&#160;fixed administrative fee payable by the Partnership under
  the Amended Omnibus Agreement for the month of March 2009 (see Note
  13).</font></font></div><br>
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          <div style="WIDTH: 100%" align="left">
            <div style="DISPLAY: block; TEXT-INDENT: 0pt; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">SEMGROUP
  ENERGY PARTNERS, L.P.</font></div>
            <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">NOTES
  TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS</font></div>
          </div>
        </div>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
  Partnership also reimburses the Private Company for direct operating payroll and
  payroll-related costs and other operating costs associated with services the
  Private Company&#8217;s employees provide to the Partnership. For the three months and
  nine months ended September 30, 2008, the Partnership recorded $7.3 million and
  $21.6 million, respectively, in compensation costs and $0.7 and $2.3 million,
  respectively, in other operating costs related to services provided by the
  Private Company&#8217;s employees which are reflected as operating expenses in the
  accompanying statement of operations. As of December&#160;31, 2007 and September
  30, 2008, the Partnership had $10.2&#160;million and $15.9&#160;million&#160;in
  payables to the Private Company and its subsidiaries, including the pre-petition
  payables that will be netted and waived due to the Settlement of $0 and $10.6
  million, respectively.&#160;&#160;Pursuant to the Settlement, these pre-petition
  claims by the Private Company will be netted against pre-petition claims by the
  Partnership and waived (see Note 13).&#160;&#160;After the effective date of the
  Settlement, these costs will be reimbursed pursuant to the Shared Services
  Agreement and the Transition Services Agreement (see Note 13).&#160; <font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">In
  addition, in connection with the Settlement, the Private Company waived the
  direct operational costs attributable to the Partnership&#8217;s asphalt operations
  and payable by the Partnership under the Amended Omnibus Agreement for the month
  of March 2009 (see Note 13).</font></font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
  Partnership has acquired various assets, including the Acquired Asphalt Assets,
  the Acquired Pipeline Assets and the Acquired Storage Assets, from the Private
  Company.&#160;&#160;See Notes 1 and 7 for a description of these
  acquisitions.&#160;&#160;In addition, the Partnership acquired certain liquid
  asphalt cement assets and crude oil assets from the Private Company in
  connection with the Settlement (see Note 13).</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">During
  the three months and nine months ended September 30, 2008, the Partnership made
  payments of $0.8 million and $1.8&#160;million, respectively, to a third party
  entity on whose board of directors a former member of the Board served in
  connection with leased transport trucks and trailers utilized in the
  Partnership&#8217;s gathering and transportation services segment.&#160;At September
  30, 2008 the Partnership had future commitments to this entity totaling $8.3
  million.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">As of
  September 30, 2008, the Partnership had a banking relationship with a third
  party banking entity on whose board of directors a former member of the Board
  served.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">9.
  LONG-TERM INCENTIVE PLAN</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">In July
  2007, the Partnership&#8217;s general partner adopted the SemGroup Energy Partners
  G.P., L.L.C. Long-Term Incentive Plan (the &#8220;Plan&#8221;). The compensation committee
  of the Board administers the Plan. The Plan authorizes the grant of an aggregate
  of 1.25&#160;million common units deliverable upon vesting. Although other types
  of awards are contemplated under the Plan, currently outstanding awards include
  &#8220;phantom&#8221; units, which convey the right to receive common units upon vesting,
  and &#8220;restricted&#8221; units, which are grants of common units restricted until the
  time of vesting. The phantom unit awards also include distribution equivalent
  rights (&#8220;DERs&#8221;).</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Subject
  to applicable earning criteria, a DER entitles the grantee to a cash payment
  equal to the cash distribution paid on an outstanding common unit prior to the
  vesting date of the underlying award. Recipients of restricted units are
  entitled to receive cash distributions paid on common units during the vesting
  period which distributions are reflected initially as a reduction of partners&#8217;
  capital. Distributions paid on units which ultimately do not vest are
  reclassified as compensation expense.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">In July
  2007, 475,000 phantom common units and 5,000 restricted common units were
  granted which vest ratably over periods of four and three years, respectively.
  In October 2007, 5,000 restricted common units were granted which vest ratably
  over three years. In June 2008, 375,000 phantom common units were granted which
  vest ratably over three years.&#160;&#160;In July 2008, 5,000 restricted common
  units were granted which vest ratably over three years.&#160;&#160;These grants
  are equity awards under SFAS 123(R), &#8220;<font style="DISPLAY: inline; FONT-STYLE: italic">Share-Based Payment</font>&#8221; and,
  accordingly, the fair value of the awards as of the grant date is expensed over
  the vesting period. The weighted average grant date fair-value of the awards is
  $23.86 per unit. The value of these award grants was approximately
  $10.5&#160;million, $0.1 million, $0.1&#160;million, $9.8 million and $0.1
  million on their grant dates, respectively.&#160;&#160;Due to the change of
  control of the Partnership&#8217;s general partner related to the Private Company&#8217;s
  liquidity issues, all outstanding awards as of July 18, 2008
  vested.&#160;&#160;The Partnership&#8217;s equity-based incentive compensation expense
  for the three months and nine months ended September 30, 2007 and 2008 was $0.5
  million, $0.5 million, $18.0 and $19.4 million, respectively.&#160;&#160;On
  August 14, 2008, 282,309 common units were issued in connection with the vesting
  of certain of the outstanding awards.&#160;&#160;In addition, in December 2008
  the Plan was amended to provide for the delivery of subordinated units in
  addition to common units upon vesting and 3,333 restricted common units and
  1,667 restricted subordinated units were awarded under the Plan (see Note
  13).&#160;&#160;In April 2009, the 1,667 restricted subordinated units were
  cancelled and were replaced by a grant of 1,667 restricted common units (see
  Note 13).</font></div><br>
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        </div>
        <div id="HDR">
          <div id="GLHDR" style="WIDTH: 100%" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 9pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><a href="#TOC">Table of Contents</a></font></div>
          <div style="WIDTH: 100%" align="left">
            <div style="DISPLAY: block; TEXT-INDENT: 0pt; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">SEMGROUP
  ENERGY PARTNERS, L.P.</font></div>
            <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">NOTES
  TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS</font></div>
          </div>
        </div>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">10.
  COMMITMENTS AND CONTINGENCIES</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
  Partnership is from time to time subject to various legal actions and claims
  incidental to its business, including those arising out of environmental-related
  matters. Management believes that these routine legal proceedings will not have
  a material adverse effect on the financial position, results of operations or
  cash flows of the Partnership. Once management determines that information
  pertaining to a legal proceeding indicates that it is probable that a liability
  has been incurred and the amount of such liability can be reasonably estimated,
  an accrual is established equal to its estimate of the likely exposure. The
  Partnership did not have an accrual for legal settlements as of
  December&#160;31, 2007 or September 30, 2008.&#160;&#160;The Partnership is
  subject to a securities class action and other lawsuits, an SEC investigation
  and a Grand Jury investigation due to events related to the Bankruptcy Filings
  (see Note 13).&#160;&#160;An unfavorable outcome in any of these matters may
  have a material adverse effect on the Partnership&#8217;s business, financial
  condition, results of operations, cash flows, ability to make distributions to
  its unitholders and the trading price of the Partnership&#8217;s common
  units.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
  Partnership has contractual obligations to perform dismantlement and removal
  activities in the event that some of its liquid asphalt cement and residual fuel
  oil terminalling and storage assets are abandoned. These obligations include
  varying levels of activity including completely removing the assets and
  returning the land to its original state. The Partnership has determined that
  the settlement dates related to the retirement obligations are indeterminate.
  The assets with indeterminate settlement dates have been in existence for many
  years and with regular maintenance will continue to be in service for many years
  to come. Also, it is not possible to predict when demands for the Partnership&#8217;s
  terminalling and storage services will cease, and the Partnership does not
  believe that such demand will cease for the foreseeable
  future.&#160;&#160;Accordingly, the Partnership believes the date when these
  assets will be abandoned is indeterminate. With no reasonably determinable
  abandonment date, the Partnership cannot reasonably estimate the fair value of
  the associated asset retirement obligations.&#160;&#160;Management believes that
  if the Partnership&#8217;s asset retirement obligations were settled in the
  foreseeable future the potential cash flows that would be required to settle the
  obligations based on current costs are not material.&#160;&#160;The Partnership
  will record asset retirement obligations for these assets in the period in which
  sufficient information becomes available for it to reasonably determine the
  settlement dates.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">In the
  Amended Omnibus Agreement and other agreements with the Private Company, the
  Private Company agreed to indemnify the Partnership for certain environmental
  and other claims relating to the crude oil and liquid asphalt cement assets that
  have been contributed to the Partnership.&#160;&#160;In connection with the
  Settlement, the Partnership waived these claims and the Amended Omnibus
  Agreement and other relevant agreements, including the indemnification
  provisions therein, were rejected as part of the Bankruptcy
  Proceedings.&#160;&#160;If the Partnership experiences an environmental or other
  loss, it would experience increased losses which may have a material adverse
  effect on its business, financial condition, results of operations, cash flows,
  ability to make distributions to its unitholders, the trading price of its
  common units and the ability to conduct its business.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">11.
  OPERATING SEGMENTS</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
  Partnership&#8217;s operations consist of two operating segments:
  (i)&#160;terminalling and storage services and (ii)&#160;gathering and
  transportation services.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold">TERMINALLING AND STORAGE
  SERVICES</font> &#8212;The Partnership provides crude oil and liquid asphalt cement
  terminalling and storage services at its terminalling and storage facilities
  located in twenty-three states.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold">GATHERING AND TRANSPORTATION
  SERVICES</font> &#8212;The Partnership owns and operates two pipeline systems, the
  Mid-Continent system and the Longview system, that gather crude oil purchased by
  the Private Company and its other customers and transports it to refiners, to
  common carrier pipelines for ultimate delivery to refiners or to terminalling
  and storage facilities owned by the Partnership and others. The Partnership
  refers to its gathering and transportation system located in Oklahoma and the
  Texas Panhandle as the Mid-Continent system. It refers to its second gathering
  and transportation system, which is located in Texas, as the Longview system. In
  addition to its pipelines, the Partnership uses its owned and leased tanker
  trucks to gather crude oil for the Private Company and its other customers at
  remote wellhead locations generally not covered by pipeline and gathering
  systems and to transport the crude oil to aggregation points and storage
  facilities located along pipeline gathering and transportation systems. In
  connection with its gathering services, the Partnership also provides a number
  of producer field services, ranging from gathering condensates from natural gas
  companies to hauling produced water to disposal wells.</font></div>
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          <div style="WIDTH: 100%" align="left">
            <div style="DISPLAY: block; TEXT-INDENT: 0pt; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">SEMGROUP
  ENERGY PARTNERS, L.P.</font></div>
            <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">NOTES
  TO UNAUDITED CONSOLIDATED FINANCIAL
  STATEMENTS</font></div>
          </div>
        </div>
      </div><br>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
  Partnership&#8217;s management evaluates performance based upon segment operating
  margin, which includes revenues from related parties and external customers and
  operating expenses excluding depreciation and amortization. The non-GAAP measure
  of operating margin (in the aggregate and by segment) is presented in the
  following table. The Partnership computes the components of operating margin by
  using amounts that are determined in accordance with GAAP. A reconciliation of
  operating margin to income (loss) before income tax, which is its nearest
  comparable GAAP financial measure, is included in the following table. The
  Partnership believes that investors benefit from having access to the same
  financial measures being utilized by management. Operating margin is an
  important measure of the economic performance of the Partnership&#8217;s core
  operations. This measure forms the basis of the Partnership&#8217;s internal financial
  reporting and is used by its management in deciding how to allocate capital
  resources between segments.&#160;&#160;Income (loss) before income tax,
  alternatively, includes expense items, such as depreciation and amortization,
  general and administrative expenses and interest expense, which management does
  not consider when evaluating the core profitability of an
  operation.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
  following table reflects certain financial data for each segment for the periods
  indicated:</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left">
        <div>
          <div align="left">
            <div align="center">
              <div align="center">
                <div>
                  <div align="left">
                    <div align="center">
                      <div align="center">
                        <div align="center">
                          <div align="center">
                            <div>
                              <div align="center">
                                <div align="left">
                                  <div align="center">
                                    <div align="center">
                                      <div align="center">
                                        <div align="center">
                                          <div align="center">
                                            <div align="center">
                                              <div align="center">
                                                <div align="center">
                                                  <div align="center">
                                                    <div align="center">
                                                      <div align="center">
                                                        <div align="center">
                                                          <div align="center">
                                                            <div align="center">
                                                              <div align="center">
                                                                <div align="center">
                                                                  <div align="center">
                                                                    <div align="center">
                                                                      <div align="center">
                                                                        <div align="center">
                                                                          <div align="center">
                                                                            <div align="center">
                                                                              <div align="center">
                                                                                <div align="center">
                                                                                  <table cellpadding="0" cellspacing="0" width="100%">
                                                                                      <tr>
                                                                                        <td valign="bottom" width="45%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                                                                                        <td valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td colspan="2" valign="bottom" width="6%" style="BORDER-BOTTOM: black 2px solid">
                                                                                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Terminalling
        and Storage</font></div>
                                                                                        </td>
                                                                                        <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td colspan="2" valign="bottom" width="6%" style="BORDER-BOTTOM: black 2px solid">
                                                                                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Gathering
        and Transportation</font></div>
                                                                                        </td>
                                                                                        <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td colspan="2" valign="bottom" width="6%" style="BORDER-BOTTOM: black 2px solid">
                                                                                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Total</font></div>
                                                                                        </td>
                                                                                        <td valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                      </tr>
                                                                                      <tr>
                                                                                        <td valign="bottom" width="45%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                                                                                        <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td colspan="10" valign="bottom" width="22%">
                                                                                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(in&#160;thousands)</font></div>
                                                                                        </td>
                                                                                        <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                      </tr>
                                                                                      <tr>
                                                                                        <td align="left" valign="bottom" width="45%">
                                                                                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Three
        Months Ended September 30, 2007</font></div>
                                                                                        </td>
                                                                                        <td align="right" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="right" colspan="2" valign="bottom" width="6%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="right" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="right" colspan="2" valign="bottom" width="6%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="right" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="right" colspan="2" valign="bottom" width="6%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                      </tr>
                                                                                      <tr>
                                                                                        <td align="left" valign="bottom" width="45%">
                                                                                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Service
        revenue</font></div>
                                                                                        </td>
                                                                                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" colspan="2" valign="bottom" width="6%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" colspan="2" valign="bottom" width="6%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" colspan="2" valign="bottom" width="6%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="right" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                      </tr>
                                                                                      <tr bgcolor="#cceeff">
                                                                                        <td align="left" valign="bottom" width="45%">
                                                                                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 18pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Third
        party revenue</font></div>
                                                                                        </td>
                                                                                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></td>
                                                                                        <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">691</font></td>
                                                                                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></td>
                                                                                        <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">4,181</font></td>
                                                                                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></td>
                                                                                        <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">4,872</font></td>
                                                                                        <td align="right" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                      </tr>
                                                                                      <tr bgcolor="white">
                                                                                        <td align="left" valign="bottom" width="45%" style="PADDING-BOTTOM: 2px">
                                                                                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 18pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Related
        party revenue</font></div>
                                                                                        </td>
                                                                                        <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">7,245</font></td>
                                                                                        <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">13,163</font></td>
                                                                                        <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">20,408</font></td>
                                                                                        <td align="right" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                      </tr>
                                                                                      <tr bgcolor="#cceeff">
                                                                                        <td align="left" valign="bottom" width="45%">
                                                                                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Total
        revenue for reportable segments</font></div>
                                                                                        </td>
                                                                                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">7,936</font></td>
                                                                                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">17,344</font></td>
                                                                                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">25,280</font></td>
                                                                                        <td align="right" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(1</font></td>
                                                                                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">)</font></td>
                                                                                      </tr>
                                                                                      <tr bgcolor="white">
                                                                                        <td align="left" valign="bottom" width="45%" style="PADDING-BOTTOM: 2px">
                                                                                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Operating
        expenses (excluding depreciation and amortization)</font></div>
                                                                                        </td>
                                                                                        <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">293</font></td>
                                                                                        <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">13,265</font></td>
                                                                                        <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">13,558</font></td>
                                                                                        <td align="right" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                      </tr>
                                                                                      <tr bgcolor="#cceeff">
                                                                                        <td align="left" valign="bottom" width="45%" style="PADDING-BOTTOM: 2px">
                                                                                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Operating
        margin (excluding depreciation and amortization)</font></div>
                                                                                        </td>
                                                                                        <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">7,643</font></td>
                                                                                        <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">4,079</font></td>
                                                                                        <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">11,722</font></td>
                                                                                        <td align="right" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(2</font></td>
                                                                                        <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">)</font></td>
                                                                                      </tr>
                                                                                      <tr bgcolor="white">
                                                                                        <td align="left" valign="bottom" width="45%" style="PADDING-BOTTOM: 2px">
                                                                                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Total
        assets (end of period)</font></div>
                                                                                        </td>
                                                                                        <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">63,134</font></td>
                                                                                        <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">54,182</font></td>
                                                                                        <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">117,316</font></td>
                                                                                        <td align="right" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                      </tr>
                                                                                      <tr bgcolor="#cceeff">
                                                                                        <td align="left" valign="bottom" width="45%">
                                                                                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Three
        Months Ended September 30, 2008</font></div>
                                                                                        </td>
                                                                                        <td align="right" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="right" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="right" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="right" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                      </tr>
                                                                                      <tr bgcolor="white">
                                                                                        <td align="left" valign="bottom" width="45%">
                                                                                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Service
        revenue</font></div>
                                                                                        </td>
                                                                                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="right" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                      </tr>
                                                                                      <tr bgcolor="#cceeff">
                                                                                        <td align="left" valign="bottom" width="45%">
                                                                                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 18pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Third
        party revenue</font></div>
                                                                                        </td>
                                                                                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></td>
                                                                                        <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">4,661</font></td>
                                                                                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></td>
                                                                                        <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">10,910</font></td>
                                                                                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></td>
                                                                                        <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">15,571</font></td>
                                                                                        <td align="right" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                      </tr>
                                                                                      <tr bgcolor="white">
                                                                                        <td align="left" valign="bottom" width="45%" style="PADDING-BOTTOM: 2px">
                                                                                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 18pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Related
        party revenue</font></div>
                                                                                        </td>
                                                                                        <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">27,555</font></td>
                                                                                        <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">10,668</font></td>
                                                                                        <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">38,223</font></td>
                                                                                        <td align="right" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                      </tr>
                                                                                      <tr bgcolor="#cceeff">
                                                                                        <td align="left" valign="bottom" width="45%">
                                                                                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Total
        revenue for reportable segments</font></div>
                                                                                        </td>
                                                                                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">32,216</font></td>
                                                                                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">21,578</font></td>
                                                                                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">53,794</font></td>
                                                                                        <td align="right" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                      </tr>
                                                                                      <tr bgcolor="white">
                                                                                        <td align="left" valign="bottom" width="45%">
                                                                                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Operating
        expenses (excluding depreciation and amortization)</font></div>
                                                                                        </td>
                                                                                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">7,958</font></td>
                                                                                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">14,415</font></td>
                                                                                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">22,373</font></td>
                                                                                        <td align="right" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                      </tr>
                                                                                      <tr bgcolor="#cceeff">
                                                                                        <td align="left" valign="bottom" width="45%" style="PADDING-BOTTOM: 2px">
                                                                                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Allowance
        for doubtful accounts</font></div>
                                                                                        </td>
                                                                                        <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(817</font></td>
                                                                                        <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">)</font></td>
                                                                                        <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(2</font></td>
                                                                                        <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">)</font></td>
                                                                                        <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(819)</font></td>
                                                                                        <td align="right" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px">
                                                                                          <div>&#160;</div>
                                                                                        </td>
                                                                                        <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                      </tr>
                                                                                      <tr bgcolor="white">
                                                                                        <td align="left" valign="bottom" width="45%" style="PADDING-BOTTOM: 2px">
                                                                                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Operating
        margin (excluding depreciation and amortization)</font></div>
                                                                                        </td>
                                                                                        <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">25,075</font></td>
                                                                                        <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">7,165</font></td>
                                                                                        <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">32,240</font></td>
                                                                                        <td align="right" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(2</font></td>
                                                                                        <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">)</font></td>
                                                                                      </tr>
                                                                                      <tr bgcolor="#cceeff">
                                                                                        <td align="left" valign="bottom" width="45%" style="PADDING-BOTTOM: 2px">
                                                                                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Total
        assets (end of period)</font></div>
                                                                                        </td>
                                                                                        <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">246,651</font></td>
                                                                                        <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">102,462</font></td>
                                                                                        <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">349,113</font></td>
                                                                                        <td align="right" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                      </tr>
                                                                                      <tr bgcolor="white">
                                                                                        <td align="left" valign="bottom" width="45%">
                                                                                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Nine
        Months Ended September 30, 2007</font></div>
                                                                                        </td>
                                                                                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="right" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                      </tr>
                                                                                      <tr bgcolor="#cceeff">
                                                                                        <td align="left" valign="bottom" width="45%">
                                                                                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Service
        revenue</font></div>
                                                                                        </td>
                                                                                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="right" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                      </tr>
                                                                                      <tr bgcolor="white">
                                                                                        <td align="left" valign="bottom" width="45%">
                                                                                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 18pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Third
        party revenue</font></div>
                                                                                        </td>
                                                                                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></td>
                                                                                        <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">7,836</font></td>
                                                                                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></td>
                                                                                        <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">16,011</font></td>
                                                                                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></td>
                                                                                        <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">23,847</font></td>
                                                                                        <td align="right" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                      </tr>
                                                                                      <tr bgcolor="#cceeff">
                                                                                        <td align="left" valign="bottom" width="45%" style="PADDING-BOTTOM: 2px">
                                                                                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 18pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Related
        party revenue</font></div>
                                                                                        </td>
                                                                                        <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">7,245</font></td>
                                                                                        <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">13,286</font></td>
                                                                                        <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">20,531</font></td>
                                                                                        <td align="right" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                      </tr>
                                                                                      <tr bgcolor="white">
                                                                                        <td align="left" valign="bottom" width="45%">
                                                                                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Total
        revenue for reportable segments</font></div>
                                                                                        </td>
                                                                                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">15,081</font></td>
                                                                                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">29,297</font></td>
                                                                                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">44,378</font></td>
                                                                                        <td align="right" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(1</font></td>
                                                                                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">)</font></td>
                                                                                      </tr>
                                                                                      <tr bgcolor="#cceeff">
                                                                                        <td align="left" valign="bottom" width="45%" style="PADDING-BOTTOM: 2px">
                                                                                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Operating
        expenses (excluding depreciation and amortization)</font></div>
                                                                                        </td>
                                                                                        <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">1,449</font></td>
                                                                                        <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">41,880</font></td>
                                                                                        <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">43,329</font></td>
                                                                                        <td align="right" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                      </tr>
                                                                                      <tr bgcolor="white">
                                                                                        <td align="left" valign="bottom" width="45%" style="PADDING-BOTTOM: 2px">
                                                                                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Operating
        margin (excluding depreciation and amortization)</font></div>
                                                                                        </td>
                                                                                        <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">13,632</font></td>
                                                                                        <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(12,583</font></td>
                                                                                        <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">)</font></td>
                                                                                        <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">1,049</font></td>
                                                                                        <td align="right" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(2</font></td>
                                                                                        <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">)</font></td>
                                                                                      </tr>
                                                                                      <tr bgcolor="#cceeff">
                                                                                        <td align="left" valign="bottom" width="45%" style="PADDING-BOTTOM: 2px">
                                                                                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Total
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                                                                                        </td>
                                                                                        <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">63,134</font></td>
                                                                                        <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">54,182</font></td>
                                                                                        <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">117,316</font></td>
                                                                                        <td align="right" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                      </tr>
                                                                                      <tr bgcolor="white">
                                                                                        <td align="left" valign="bottom" width="45%">
                                                                                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Nine
        Months Ended September 30, 2008</font></div>
                                                                                        </td>
                                                                                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="right" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                      </tr>
                                                                                      <tr bgcolor="#cceeff">
                                                                                        <td align="left" valign="bottom" width="45%">
                                                                                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Service
        revenue</font></div>
                                                                                        </td>
                                                                                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="right" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                      </tr>
                                                                                      <tr bgcolor="white">
                                                                                        <td align="left" valign="bottom" width="45%">
                                                                                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 18pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Third
        party revenue</font></div>
                                                                                        </td>
                                                                                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></td>
                                                                                        <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">5,674</font></td>
                                                                                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></td>
                                                                                        <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">20,548</font></td>
                                                                                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></td>
                                                                                        <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">26,222</font></td>
                                                                                        <td align="right" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                      </tr>
                                                                                      <tr bgcolor="#cceeff">
                                                                                        <td align="left" valign="bottom" width="45%" style="PADDING-BOTTOM: 2px">
                                                                                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 18pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Related
        party revenue</font></div>
                                                                                        </td>
                                                                                        <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">75,434</font></td>
                                                                                        <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">47,628</font></td>
                                                                                        <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">123,062</font></td>
                                                                                        <td align="right" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                      </tr>
                                                                                      <tr bgcolor="white">
                                                                                        <td align="left" valign="bottom" width="45%">
                                                                                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Total
        revenue for reportable segments</font></div>
                                                                                        </td>
                                                                                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">81,108</font></td>
                                                                                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">68,176</font></td>
                                                                                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">149,284</font></td>
                                                                                        <td align="right" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                      </tr>
                                                                                      <tr bgcolor="#cceeff">
                                                                                        <td align="left" valign="bottom" width="45%">
                                                                                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Operating
        expenses (excluding depreciation and amortization)</font></div>
                                                                                        </td>
                                                                                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">18,928</font></td>
                                                                                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">45,444</font></td>
                                                                                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="right" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">64,372</font></td>
                                                                                        <td align="right" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                      </tr>
                                                                                      <tr bgcolor="white">
                                                                                        <td align="left" valign="bottom" width="45%" style="PADDING-BOTTOM: 2px">
                                                                                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Allowance
        for doubtful accounts</font></div>
                                                                                        </td>
                                                                                        <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">-</font></td>
                                                                                        <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">447</font></td>
                                                                                        <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">447</font></td>
                                                                                        <td align="right" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                      </tr>
                                                                                      <tr bgcolor="#cceeff">
                                                                                        <td align="left" valign="bottom" width="45%" style="PADDING-BOTTOM: 2px">
                                                                                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Operating
        margin (excluding depreciation and amortization)</font></div>
                                                                                        </td>
                                                                                        <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">62,180</font></td>
                                                                                        <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">22,285</font></td>
                                                                                        <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">84,465</font></td>
                                                                                        <td align="right" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(2</font></td>
                                                                                        <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">)</font></td>
                                                                                      </tr>
                                                                                      <tr bgcolor="white">
                                                                                        <td align="left" valign="bottom" width="45%" style="PADDING-BOTTOM: 2px">
                                                                                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Total
        assets (end of period)</font></div>
                                                                                        </td>
                                                                                        <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">246,651</font></td>
                                                                                        <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">102,462</font></td>
                                                                                        <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">349,113</font></td>
                                                                                        <td align="right" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                        <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                                                      </tr>
                                                                                  </table>
                                                                                </div>
                                                                              </div>
                                                                            </div>
                                                                          </div>
                                                                        </div>
                                                                      </div>
                                                                    </div>
                                                                  </div>
                                                                </div>
                                                              </div>
                                                            </div>
                                                          </div>
                                                        </div>
                                                      </div>
                                                    </div>
                                                  </div>
                                                </div>
                                              </div>
                                            </div>
                                          </div>
                                        </div>
                                      </div>
                                    </div>
                                  </div>
                                </div>
                              </div>
                            </div>
                          </div>
                        </div>
                      </div>
                    </div>
                  </div>
                </div>
                <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br>
                  <div>
                    <div align="left">
                      <div align="left">
                        <div align="left">
                          <div align="left">
                            <div align="left">
                              <table cellpadding="0" cellspacing="0" width="100%">
                                  <tr>
                                    <td align="left" colspan="5" valign="top" width="67%">
                                      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(1)
        Historically, the Predecessor was a part of the integrated operations of
        the Private Company, and neither the Private Company nor the Predecessor
        recorded revenue associated with the terminalling and storage and
        gathering and transportation services provided on an intercompany basis.
        Accordingly, revenues reflected for all periods prior to the contribution
        of the assets, liabilities and operations to the Partnership by the
        Private Company on July&#160;20, 2007 are substantially services provided
        to third parties.</font></div>
                                    </td>
                                  </tr>
                                  <tr>
                                    <td valign="top" width="37%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                                    <td valign="top" width="9%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                                    <td valign="top" width="11%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                                    <td valign="top" width="6%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                                    <td valign="top" width="3%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                                  </tr>
                                  <tr>
                                    <td align="left" colspan="5" valign="top" width="67%">
                                      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(2)
        The following table reconciles segment operating margin (excluding
        depreciation and amortization) to income (loss) before income
        taxes:</font></div>
                                    </td>
                                  </tr>
                              </table>
                            </div>
                          </div>
                        </div>
                      </div>
                    </div>
                  </div>
                </div>
              </div>
            </div>
          </div>
        </div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt">&#160;</div>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left">
        <div>
          <div align="left">
            <div align="center">
              <div align="center">
                <div align="center">
                  <div align="center">
                    <table cellpadding="0" cellspacing="0" width="100%">
                        <tr>
                          <td align="left" valign="bottom" width="20%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                          <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                          <td colspan="6" valign="bottom" width="16%">
                            <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Three
        Months Ended September 30,</font></div>
                          </td>
                          <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                          <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                          <td colspan="6" valign="bottom" width="16%">
                            <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Nine
        Months Ended September 30,</font></div>
                          </td>
                          <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        </tr>
                        <tr>
                          <td align="left" valign="bottom" width="20%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                          <td valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                          <td colspan="2" valign="bottom" width="7%" style="BORDER-BOTTOM: black 2px solid">
                            <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">2007</font></div>
                          </td>
                          <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                          <td valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                          <td colspan="2" valign="bottom" width="7%" style="BORDER-BOTTOM: black 2px solid">
                            <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">2008</font></div>
                          </td>
                          <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                          <td valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                          <td colspan="2" valign="bottom" width="7%" style="BORDER-BOTTOM: black 2px solid">
                            <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">2007</font></div>
                          </td>
                          <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                          <td valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                          <td colspan="2" valign="bottom" width="7%" style="BORDER-BOTTOM: black 2px solid">
                            <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">2008</font></div>
                          </td>
                          <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        </tr>
                        <tr>
                          <td align="left" valign="bottom" width="20%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                          <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                          <td colspan="14" valign="bottom" width="34%">
                            <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(in
        thousands)</font></div>
                          </td>
                          <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        </tr>
                        <tr bgcolor="#cceeff">
                          <td align="left" valign="bottom" width="20%">
                            <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Operating
        margin (excluding depreciation and amortization)</font></div>
                          </td>
                          <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                          <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></td>
                          <td align="right" valign="bottom" width="6%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">11,722</font></td>
                          <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                          <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                          <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></td>
                          <td align="right" valign="bottom" width="6%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">32,240</font></td>
                          <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                          <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                          <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></td>
                          <td align="right" valign="bottom" width="6%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">1,049</font></td>
                          <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                          <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                          <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></td>
                          <td align="right" valign="bottom" width="6%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">84,465</font></td>
                          <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        </tr>
                        <tr bgcolor="white">
                          <td align="left" valign="bottom" width="20%">
                            <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Depreciation
        and amortization</font></div>
                          </td>
                          <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                          <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                          <td align="right" valign="bottom" width="6%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">2,394</font></td>
                          <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                          <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                          <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                          <td align="right" valign="bottom" width="6%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">5,814</font></td>
                          <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                          <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                          <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                          <td align="right" valign="bottom" width="6%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">6,781</font></td>
                          <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                          <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                          <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                          <td align="right" valign="bottom" width="6%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">15,586</font></td>
                          <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        </tr>
                        <tr bgcolor="#cceeff">
                          <td align="left" valign="bottom" width="20%">
                            <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">General
        and administrative expenses</font></div>
                          </td>
                          <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                          <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                          <td align="right" valign="bottom" width="6%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">2,525</font></td>
                          <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                          <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                          <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                          <td align="right" valign="bottom" width="6%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">27,177</font></td>
                          <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                          <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                          <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                          <td align="right" valign="bottom" width="6%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">11,015</font></td>
                          <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                          <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                          <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                          <td align="right" valign="bottom" width="6%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">33,244</font></td>
                          <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        </tr>
                        <tr bgcolor="white">
                          <td align="left" valign="bottom" width="20%" style="PADDING-BOTTOM: 2px">
                            <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Interest&#160;expense</font></div>
                          </td>
                          <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                          <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                          <td align="right" valign="bottom" width="6%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">2,424</font></td>
                          <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                          <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                          <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                          <td align="right" valign="bottom" width="6%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">11,041</font></td>
                          <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                          <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                          <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                          <td align="right" valign="bottom" width="6%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">3,369</font></td>
                          <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                          <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                          <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                          <td align="right" valign="bottom" width="6%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">15,905</font></td>
                          <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        </tr>
                        <tr bgcolor="#cceeff">
                          <td align="left" valign="bottom" width="20%" style="PADDING-BOTTOM: 4px">
                            <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Income
        (loss) before income taxes</font></div>
                          </td>
                          <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 4px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                          <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 4px double"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></td>
                          <td align="right" valign="bottom" width="6%" style="BORDER-BOTTOM: black 4px double"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">4,379</font></td>
                          <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 4px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                          <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 4px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                          <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 4px double"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></td>
                          <td align="right" valign="bottom" width="6%" style="BORDER-BOTTOM: black 4px double"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(11,792</font></td>
                          <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 4px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">)</font></td>
                          <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 4px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                          <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 4px double"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></td>
                          <td align="right" valign="bottom" width="6%" style="BORDER-BOTTOM: black 4px double"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(20,116</font></td>
                          <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 4px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">)</font></td>
                          <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 4px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                          <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 4px double"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></td>
                          <td align="right" valign="bottom" width="6%" style="BORDER-BOTTOM: black 4px double"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">19,730</font></td>
                          <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 4px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        </tr>
                    </table>
                  </div>
                </div>
              </div>
            </div>
          </div>
        </div>
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        <div id="FTR">
          <div style="WIDTH: 100%" align="left">
            <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
  </font></div>
          </div>
          <div id="GLFTR" style="WIDTH: 100%" align="center">
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        <div id="PN" style="PAGE-BREAK-AFTER: always">
          <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">17</font></div>
          <div style="WIDTH: 100%; TEXT-ALIGN: center">
            <hr style="COLOR: black" noshade size="2">
          </div>
        </div>
        <div id="HDR">
          <div id="GLHDR" style="WIDTH: 100%" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 9pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><a href="#TOC">Table of Contents</a></font></div>
          <div style="WIDTH: 100%" align="left">
            <div style="DISPLAY: block; TEXT-INDENT: 0pt; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">SEMGROUP
  ENERGY PARTNERS, L.P.</font></div>
            <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">NOTES
  TO UNAUDITED CONSOLIDATED FINANCIAL
  STATEMENTS</font></div>
          </div>
        </div>
      </div><br>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">12.
  RECENTLY ISSUED ACCOUNTING STANDARDS</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left">
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font id="TAB2" style="LETTER-SPACING: 9pt">&#160;&#160;&#160;</font>&#160;In April
  2009, the Financial and Accounting Standards Board (FASB) issued FASB Staff
  Position (FSP)&#160;Statement No. 107-1 and Accounting Principles Board (APB)
  28-1 (collectively, FSP FAS 107-1), &#8220;Interim Disclosures about Fair Value of
  Financial Instruments.&#8221; &#160;FSP FAS 107-1 amends FAS 107, &#8220;Disclosures about
  Fair Value of Financial Instruments,&#8221; to require an entity to provide
  disclosures about fair value of financial instruments in interim financial
  information. &#160;The FSP FAS 107-1 also amends APB Opinion 28, &#8220;Interim
  Financial Reporting,&#8221; to require those disclosures in summarized financial
  information at interim reporting periods. Under FSP FAS 107-1, the Partnership
  will be required to include disclosures about the fair value of its financial
  instruments whenever it issues financial&#160;information for interim reporting
  periods. &#160;In addition, the Partnership will be required to disclose in the
  body or in the accompanying notes of its summarized financial information for
  interim reporting periods and in its financial statements for annual reporting
  periods the fair value of all financial instruments for which it is practicable
  to estimate that value, whether recognized or not recognized in the statement of
  financial position. &#160;FSP FAS 107-1 is effective for periods ending after
  June 15, 2009.&#160;The Partnership is currently evaluating the impact FSP FAS
  107-1 may have on our consolidated financial statements.</font></div>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">In
  June&#160;2008, the Emerging Issues Task Force (&#8220;EITF&#8221;) issued Issue
  No.&#160;03-6-1, &#8220;<font style="DISPLAY: inline; FONT-STYLE: italic">Determining
  Whether Instruments Granted in Share-Based Payment Transactions Are
  Participating Securities </font>&#8220; (&#8220;EITF 03-6-1&#8221;).&#160; EITF 03-6-1 addresses
  whether instruments granted in share-based payment transactions are
  participating securities prior to vesting and, therefore, need to be included in
  the earnings allocation in computing earnings per share (&#8220;EPS&#8221;) under the
  two-class method.&#160; EITF 03-6-1 will be effective for financial statements
  issued for fiscal years beginning after December&#160;15, 2008, and interim
  periods within those years.&#160; All prior-period EPS data presented will be
  adjusted retrospectively to conform with the provisions of EITF 03-6-1. The
  Partnership is evaluating the expected impact of adoption of EITF
  03-6-1.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">In
  April&#160;2008, the Financial Accounting Standards Board (&#8220;FASB&#8221;) issued FASB
  Staff Position (&#8220;FSP&#8221;) No.&#160;FAS 142-3 &#8220;<font style="DISPLAY: inline; FONT-STYLE: italic">Determination of the Useful Life of
  Intangible Assets </font>&#8220; (&#8220;FSP No.&#160;FAS 142-3&#8221;).&#160; FSP No.&#160;FAS
  142-3 amends the factors that should be considered in developing renewal or
  extension assumptions used to determine the useful life of a recognized
  intangible asset under SFAS No.&#160;142, &#8220;<font style="DISPLAY: inline; FONT-STYLE: italic">Goodwill and Other Intangible Assets
  </font>&#8220; (&#8220;SFAS&#160;142&#8221;).&#160; The intent of this FSP is to improve the
  consistency between the useful life of a recognized intangible asset under
  SFAS&#160;142 and the period of expected cash flows used to measure the fair
  value of the asset under SFAS No.&#160;141 (revised 2007), &#8220;<font style="DISPLAY: inline; FONT-STYLE: italic">Business Combinations</font>,&#8221; and
  other GAAP.&#160; This FSP will be effective for financial statements issued for
  fiscal years beginning after December&#160;15, 2008, and interim periods within
  those fiscal years.&#160; The Partnership is evaluating the expected impact;
  however, it believes adoption will not impact the Partnership&#8217;s financial
  position, results of operations or cash flows.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">In
  March&#160;2008, the FASB issued SFAS&#160;No.&#160;161, &#8220;Disclosures about
  Derivative Instruments and Hedging Activities-an amendment of FASB Statement No.
  133&#8221; (&#8220;SFAS No. 161&#8221;). This Statement requires enhanced disclosures about the
  Partnership&#8217;s derivative and hedging activities. This statement is effective for
  financial statements issued for fiscal years and interim periods beginning after
  November&#160;15, 2008. The Partnership will adopt SFAS No.&#160;161 beginning
  January&#160;1, 2009. With the adoption of this statement, the Partnership does
  not expect any significant impact on its financial position, results of
  operations or cash flows.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">In March
  2008, the Emerging Issues Task Force (&#8220;EITF&#8221;) of the FASB reached a final
  consensus on Issue No.&#160;07-4, &#8220;Application of the Two-Class Method under
  FASB Statement No.&#160;128, Earnings per Share, to Master Limited Partnerships&#8221;
  (&#8220;Issue No.&#160;07-4&#8221;). This conclusion reached by the EITF affects how a
  master limited partnership (&#8220;MLP&#8221;) allocates income between its general partner,
  which typically holds incentive distribution rights (&#8220;IDRs&#8221;) along with the
  general partner interest, and the limited partners. It is not uncommon for MLPs
  to experience timing differences between the recognition of income and
  partnership distributions. The amount of incentive distribution is typically
  calculated based on the amount of distributions paid to the MLP&#8217;s partners. The
  issue is whether current period earnings of an MLP should be allocated to the
  holders of IDRs as well as the holders of the general and limited partnership
  interests when applying the two-class method under SFAS No. 128, &#8220;Earnings Per
  Share.&#8221;</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
  conclusion reached by the EITF in Issue No.&#160;07-4 is that when current
  period earnings are in excess of cash distributions, the undistributed earnings
  should be allocated to the holders of the general partner interest, the holders
  of the limited partner interest and incentive distribution rights holders based
  upon the terms of the partnership agreement. Under this model, contractual
  limitations on distributions to incentive distribution rights holders would be
  considered when determining the amount of earnings to allocate to them. That is,
  undistributed earnings would not be considered available cash for purposes of
  allocating earnings to incentive distribution rights holders. Conversely, when
  cash distributions are in excess of earnings, net income (or loss) should be
  reduced (increased) by the distributions made to the holders of the general
  partner interest, the holders of the limited partner interest and incentive
  distribution rights holders. The resulting net loss would then be allocated to
  the holders of the general partner interest and the holders of the limited
  partner interest based on their respective sharing of the losses based upon the
  terms of the partnership agreement.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Issue
  No.&#160;07-4 is effective for fiscal years beginning after December&#160;15,
  2008 and interim periods within those fiscal years. The accounting treatment is
  effective for all financial statements presented. The Partnership is currently
  considering the impact of the adoption of Issue&#160;07-4 on its presentation of
  earnings per unit.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">In
  December 2007, the FASB issued SFAS No.&#160;141(R), &#8220;Business
  Combinations.&#8221;&#160;&#160;This statement requires assets acquired and
  liabilities assumed to be measured at fair value as of the acquisition date,
  acquisition related costs incurred prior to the acquisition to be expensed and
  contractual contingencies to be recognized at fair value as of the acquisition
  date. This statement is effective for financial statements issued for fiscal
  years beginning after December&#160;15, 2008. The Partnership is currently
  assessing the impact, if any, the adoption of this statement will have on its
  financial position, results of operations or cash flows.</font></div><br>
      <div id="PGBRK" style="MARGIN-LEFT: 0pt; WIDTH: 100%; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
        <div id="FTR">
          <div style="WIDTH: 100%" align="left">
            <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
  </font></div>
          </div>
          <div id="GLFTR" style="WIDTH: 100%" align="center">
          </div>
        </div>
        <div id="PN" style="PAGE-BREAK-AFTER: always">
          <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">18</font></div>
          <div style="WIDTH: 100%; TEXT-ALIGN: center">
            <hr style="COLOR: black" noshade size="2">
          </div>
        </div>
        <div id="HDR">
          <div id="GLHDR" style="WIDTH: 100%" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 9pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><a href="#TOC">Table of Contents</a></font></div>
          <div style="WIDTH: 100%" align="left">
            <div style="DISPLAY: block; TEXT-INDENT: 0pt; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">SEMGROUP
  ENERGY PARTNERS, L.P.</font></div>
            <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">NOTES
  TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS</font></div>
          </div>
        </div>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">13.
  EVENTS RELATED TO THE BANKRUPTCY FILINGS AND SUBSEQUENT EVENTS</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Due to
  the events related to the Bankruptcy Filings described herein, including the
  uncertainty relating to future cash flows, the Partnership faces substantial
  doubt as to its ability to continue as a going concern.&#160;&#160;While it is
  not feasible to predict the ultimate outcome of the events surrounding the
  Bankruptcy Cases, the Partnership has been and could continue to be materially
  and adversely affected by such events and it may be forced to make a bankruptcy
  filing or take other action that could have a material adverse effect on its
  business, the price of its common units and its results of
  operations.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 18pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">Bankruptcy
  Filings</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">On July
  17, 2008, the Partnership issued a press release announcing that the Private
  Company was experiencing liquidity issues and was exploring various
  alternatives, including raising additional equity, debt capital or the filing of
  a voluntary petition for reorganization under Chapter 11 of the Bankruptcy Code
  to address these issues.&#160;&#160;The Partnership filed this press release in
  a Current Report on Form 8-K filed with the SEC on July 18, 2008.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">On July
  22, 2008 and thereafter, the Private Company and certain of its subsidiaries
  made the Bankruptcy Filings.&#160; The Private Company and its subsidiaries
  continue to operate their businesses and own and manage their properties as
  debtors-in-possession under the jurisdiction of the Bankruptcy Court and in
  accordance with the applicable provisions of the Bankruptcy Code (the
  &#8220;Bankruptcy Cases&#8221;).&#160;None of the Partnership, its general partner, the
  subsidiaries of the Partnership nor the subsidiaries of the general partner are
  debtors in the Bankruptcy Cases.&#160;&#160;However, because of the contractual
  relationships with the Private Company and certain of its subsidiaries, the
  Bankruptcy Filings have adversely impacted the Partnership and may in the future
  impact the Partnership in various ways, including the items discussed
  below.&#160;&#160;The Partnership&#8217;s financial results as of September 30, 2008
  also reflect a $0.4 million allowance for doubtful accounts related to amounts
  due from third parties as of September 30, 2008.&#160;&#160;The allowance
  related to amounts due from third parties was established as a result of certain
  third party customers netting amounts due them from the Private Company with
  amounts due to the Partnership.&#160;&#160;Also, due to the change of control of
  the Partnership&#8217;s general partner related to the Private Company&#8217;s liquidity
  issues, all outstanding awards under the Plan vested on July 18, 2008, resulting
  in an incremental $18.0 million in non-cash compensation expense for the three
  months ended September 30, 2008 (see Note 9).&#160;&#160;In addition to the
  allowance for doubtful accounts and non-cash compensation expense described
  above, the results of operations for the three and nine months ended September
  30, 2008 included in this quarterly report were affected by the Bankruptcy
  Filings and related events, which resulted in decreased revenues and increased
  general and administrative expenses as described below under &#8220;&#8212;Partnership
  Revenues,&#8221; and &#8220;&#8212;Other Effects,&#8221; respectively.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 18pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">Board
  and Management Composition</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">On July
  9, 2008, Edward F. Kosnik was appointed as an independent member of the
  Board.&#160;&#160;Mr.&#160;Kosnik is the chairman of the compensation committee
  and also serves on the audit committee and the conflicts committee of the Board.
  Under the provisions of the Plan, Mr.&#160;Kosnik was granted an award of 5,000
  restricted common units on July 9, 2008.&#160;These restricted common units
  vested on July 18, 2008 in connection with the change of control of the
  Partnership&#8217;s general partner described below.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">On July
  18, 2008, Manchester Securities Corp. (&#8220;Manchester&#8221;) and Alerian Finance
  Partners, LP (&#8220;Alerian&#8221;), as lenders to SemGroup Holdings, the sole member of
  the Partnership&#8217;s general partner, exercised certain rights described below
  under a Loan Agreement and a Pledge Agreement, each dated June 25, 2008 (the
  &#8220;Holdings Credit Agreements&#8221;), that were triggered by certain events of default
  under the Holdings Credit Agreements.&#160;&#160;On March 20, 2009, Alerian
  transferred its interest in the Holdings Credit Agreements to
  Manchester.&#160;&#160;The Holdings Credit Agreements are secured by the
  subordinated units and incentive distribution rights of the Partnership and the
  membership interests in the Partnership&#8217;s general partner owned by SemGroup
  Holdings.&#160;&#160;Manchester has not foreclosed on the subordinated units of
  the Partnership owned by SemGroup Holdings or the membership interests in the
  Partnership&#8217;s general partner.&#160;&#160;Manchester may in the future exercise
  other remedies available to them under the Holdings Credit Agreement and related
  loan documents, including taking action to foreclose on the collateral securing
  the loan.&#160;&#160;Neither the Partnership nor the Partnership&#8217;s general
  partner is a party to the Holdings Credit Agreements or the related loan
  documents.</font></div><br>
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  </font></div>
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          <div style="WIDTH: 100%; TEXT-ALIGN: center">
            <hr style="COLOR: black" noshade size="2">
          </div>
        </div>
        <div id="HDR">
          <div id="GLHDR" style="WIDTH: 100%" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 9pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><a href="#TOC">Table of Contents</a></font></div>
          <div style="WIDTH: 100%" align="left">
            <div style="DISPLAY: block; TEXT-INDENT: 0pt; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">SEMGROUP
  ENERGY PARTNERS, L.P.</font></div>
            <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">NOTES
  TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS</font></div>
          </div>
        </div>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">On July
  18, 2008, Manchester and Alerian exercised their right under the Holdings Credit
  Agreements to vote the membership interests of the Partnership&#8217;s general partner
  in order to reconstitute the Board (the &#8220;Change of Control&#8221;).&#160;&#160;Messrs.
  Thomas L. Kivisto, Gregory C. Wallace, Kevin L. Foxx, Michael J. Brochetti and
  W. Anderson Bishop were removed from the Board.&#160;&#160;Mr. Bishop had served
  as the chairman of the audit committee and as a member of the conflicts
  committee and compensation committee of the Board.&#160;&#160;Messrs. Sundar S.
  Srinivasan, David N. Bernfeld and Gabriel Hammond (each of whom is affiliated
  with Manchester or Alerian) were appointed to the Board.&#160;&#160;Mr.
  Srinivasan was elected as Chairman of the Board.&#160;&#160;Messrs. Brian F.
  Billings and Edward F. Kosnik remain as independent directors of the Board and
  continue to serve as members of the conflicts committee, audit committee and
  compensation committee of the Board.&#160;&#160;In addition, Messrs. Foxx and
  Alex Stallings resigned the positions each officer held with SemGroup, L.P. in
  July 2008.&#160;&#160;Mr. Brochetti had previously resigned from his position
  with SemGroup, L.P. in March 2008.&#160;&#160;Messrs. Foxx, Brochetti and
  Stallings remain as officers of the Partnership&#8217;s general partner.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">On
  October 1, 2008, Dave Miller (who is an affiliate of Manchester) and Duke R.
  Ligon were appointed members of the Board. Mr. Ligon is an independent member of
  the Board and is the chairman of the audit committee and also serves on the
  compensation committee and the conflicts committee of the Board. Under the
  provisions of the Plan, Mr. Ligon was granted an award of 3,333 restricted
  common units and 1,667 restricted subordinated units on December 23, 2008 (see
  Note 9). In April 2009, the 1,667 restricted subordinated units granted to Mr.
  Ligon were cancelled and replaced with 1,667 restricted common units (see Note
  9).&#160;&#160;The restricted common units granted to Mr. Ligon vest in
  one-third increments over a three-year period.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">On
  January 9, 2009, Mr. Srinivasan resigned his positions as Chairman of the Board
  and as a director.&#160;&#160;Mr. Ligon was subsequently elected as Chairman of
  the Board.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">On March
  18, 2009, the Board realigned the officers of the Partnership&#8217;s general partner
  appointing Michael J. Brochetti as Executive Vice President&#8212;Corporate
  Development and Treasurer, Alex G. Stallings as Chief Financial Officer and
  Secretary, and James R. Griffin as Chief Accounting Officer.&#160;&#160;Mr.
  Brochetti had previously served as Chief Financial Officer, Mr. Stallings had
  previously served as Chief Accounting Officer and Secretary and Mr. Griffin had
  previously served as Controller.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 18pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">Bankruptcy
  Court Order</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">On
  September 9, 2008, the Bankruptcy Court entered an order relating to the
  settlement of certain matters between the Partnership and the Private Company
  (the &#8220;Order&#8221;) in the Bankruptcy Cases.&#160;&#160;Among other things, the Order
  provided that (i) the Private Company was to directly pay any utility costs
  attributable to the operations of the Private Company at certain shared
  facilities, and the Private Company was to pay the Partnership for past utility
  cost reimbursements that&#160;were due from the Private Company; (ii) commencing
  on September 15, 2008, payments under the Terminalling Agreement were netted
  against amounts due under the Amended Omnibus Agreement and were made on the
  15th day of each month for the prior month (with a three business-day grace
  period); (iii) the Private Company provided the Partnership with a letter of
  credit in the amount of approximately $4.9 million to secure the Private
  Company&#8217;s postpetition obligations under the Terminalling Agreement; (iv) the
  Private Company was to make payments under the Throughput Agreement for the
  month of August on September 15, 2008 (with a three business-day grace period)
  based upon the monthly contract minimums in the Throughput Agreement and netted
  against amounts due under the Amended Omnibus Agreement; (v) the Private Company
  was to make payments under the Throughput Agreement for the months of September
  and October on October 15, 2008 (with a three business-day grace period) and
  November 15, 2008 (with a three business-day grace period), respectively, or
  three business days after amounts due are determined and documentation therefore
  was provided and exchanged based upon actual volumes for each such month and at
  a rate equal to the average rate charged by the Partnership to third-party
  shippers in the same geographical area, with any such amounts netted against
  amounts due under the Amended Omnibus Agreement; (vi) the parties were to
  reevaluate the Throughput Agreement and the payment terms with respect to
  services provided after October 2008; (vii) representatives of the Private
  Company and the Partnership were to meet to discuss the transition to the
  Partnership of certain of the Private Company&#8217;s employees necessary to maintain
  the Partnership&#8217;s business, and pending agreement between the parties, the
  Private Company was to continue to provide services in accordance with the
  Amended Omnibus Agreement through at least November 30, 2008; (viii) the Private
  Company was to consent to an order relating a third-party storage contract which
  provided that the Partnership was the rightful owner of the rights in and to a
  certain third-party storage agreement and the corresponding amounts due
  thereunder; and (ix) the Partnership was to enter into a specified lease with
  the Private Company to permit the Private Company to construct a
  pipeline.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div><br>
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  </font></div>
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          <div style="WIDTH: 100%; TEXT-ALIGN: center">
            <hr style="COLOR: black" noshade size="2">
          </div>
        </div>
        <div id="HDR">
          <div id="GLHDR" style="WIDTH: 100%" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 9pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><a href="#TOC">Table of Contents</a></font></div>
          <div style="WIDTH: 100%" align="left">
            <div style="DISPLAY: block; TEXT-INDENT: 0pt; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">SEMGROUP
  ENERGY PARTNERS, L.P.</font></div>
            <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">NOTES
  TO UNAUDITED CONSOLIDATED FINANCIAL
  STATEMENTS</font></div>
          </div>
        </div>
      </div><br>
      <div style="DISPLAY: block; MARGIN-LEFT: 18pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">Settlement
  with the Private Company</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">On March
  12, 2009, the Bankruptcy Court held a hearing and approved the transactions
  contemplated by a term sheet (the &#8220;Settlement Term Sheet&#8221;) relating to the
  settlement of certain matters between the Private Company and the Partnership
  (the &#8220;Settlement&#8221;).&#160;&#160;The Bankruptcy Court entered an order approving
  the Settlement upon the terms contained in the Settlement Term Sheet on March
  20, 2009.&#160;&#160;The Partnership and the Private Company executed definitive
  documentation, in the form of a master agreement (the &#8220;Master Agreement&#8221;), dated
  April 7, 2009 to be effective as of 11:59 PM CDT March 31, 2009, and certain
  other transaction documents to effectuate the Settlement and that superseded the
  Settlement Term Sheet.&#160;&#160;The Bankruptcy Court entered an order
  approving the Master Agreement and the Settlement on April 7,
  2009.&#160;&#160;In addition, in connection with the Settlement, the Partnership
  and the requisite lenders under the Partnership&#8217;s secured credit facility
  entered into the Credit Agreement Amendment under which, among other things, the
  lenders consented to the Settlement and waived all existing defaults and events
  of default described in the Forbearance Agreement and amendments
  thereto.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
  Settlement provided for the following:</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 36pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">the
        Partnership transferred certain crude oil storage assets located in Kansas
        and northern Oklahoma to the Private
  Company;</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 36pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">the
        Private Company transferred ownership of 355,000 barrels of crude oil tank
        bottoms and line fill to the
  Partnership;</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 36pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">the
        Private Company rejected the Throughput
    Agreement;</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 36pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">the
        Partnership and one of its subsidiaries have a $20 million unsecured claim
        against the Private Company and certain of its subsidiaries relating to
        rejection of the Throughput
  Agreement;</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 36pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">the
        Partnership and the Private Company entered into the New Throughput
        Agreement (as defined below) pursuant to which the Partnership provides
        certain crude oil gathering, transportation, terminalling and storage
        services to the Private Company;</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 36pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">the
        Partnership offered employment to certain crude oil
      employees;</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 36pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">the
        Private Company transferred its asphalt assets that are connected to the
        Partnership&#8217;s asphalt assets to the
  Partnership;</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 36pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">the
        Private Company rejected the Terminalling
    Agreement;</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 36pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">a
        subsidiary of the Partnership has a $35 million unsecured claim against
        the Private Company and certain of its subsidiaries relating to rejection
        of the Terminalling Agreement;</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 36pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">the
        Partnership and the Private Company entered into the New Terminalling
        Agreement (as defined below) pursuant to which the Partnership provides
        liquid asphalt cement terminalling and storage services for the Private
        Company&#8217;s remaining asphalt
  inventory;</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 36pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">the
        Private Company agreed to remove all of its remaining asphalt inventory
        from the Partnership&#8217;s asphalt storage facilities no later than October
        31, 2009;</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 36pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">the
        Private Company will be entitled to receive 20% of the proceeds of any
        sale by the Partnership of any of the asphalt assets transferred to the
        Partnership in connection with the Settlement that occurs prior to
        December 31, 2009;</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 36pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">the
        Private Company rejected the Amended Omnibus
    Agreement;</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 36pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">the
        Partnership and the Private Company entered into the Shared Services
        Agreement (as defined below) pursuant to which the Private Company
        provides certain operational services for the
    Partnership;</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 36pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">other
        than as provided above, the Partnership and the Private Company entered
        into mutual releases of claims relating to the rejection of the
        Terminalling Agreement, the Throughput Agreement and the Amended Omnibus
        Agreement;</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 36pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">certain
        pre-petition claims by the Private Company and the Partnership were netted
        and waived;</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 36pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">the
        Private Company and the Partnership resolved certain remaining issues
        related to the contribution of crude oil assets to the Partnership in
        connection with the Partnership&#8217;s initial public offering, the
        Partnership&#8217;s acquisition of the Acquired Asphalt Assets, the
        Partnership&#8217;s acquisition of the Acquired Pipeline Assets and the
        Partnership&#8217;s acquisition of the Acquired Storage Assets, including the
        release of claims relating to such acquisitions;
    and</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 36pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">the
        Partnership and the Private Company entered into the Trademark Agreement
        (as defined below) which provides the Partnership with a non-exclusive,
        worldwide license to use certain trade names, including the name
        &#8220;SemGroup&#8221;, and the corresponding mark until December 31, 2009, and the
        Private Company waived claims for infringement relating to such trade
        names and mark prior to the date of such license
    agreement.</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Management
  is currently evaluating the accounting for the Settlement, and is obtaining
  independent valuations of the assets transferred.&#160; Certain terms of
  transaction documents relating to the Settlement are discussed in more detail
  below.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div><br>
      <div id="PGBRK" style="MARGIN-LEFT: 0pt; WIDTH: 100%; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
        <div id="FTR">
          <div style="WIDTH: 100%" align="left">
            <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
  </font></div>
          </div>
          <div id="GLFTR" style="WIDTH: 100%" align="center">
          </div>
        </div>
        <div id="PN" style="PAGE-BREAK-AFTER: always">
          <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">21</font></div>
          <div style="WIDTH: 100%; TEXT-ALIGN: center">
            <hr style="COLOR: black" noshade size="2">
          </div>
        </div>
        <div id="HDR">
          <div id="GLHDR" style="WIDTH: 100%" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 9pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><a href="#TOC">Table of Contents</a></font></div>
          <div style="WIDTH: 100%" align="left">
            <div style="DISPLAY: block; TEXT-INDENT: 0pt; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">SEMGROUP
  ENERGY PARTNERS, L.P.</font></div>
            <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">NOTES
  TO UNAUDITED CONSOLIDATED FINANCIAL
  STATEMENTS</font></div>
          </div>
        </div>
      </div><br>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">Shared
  Services Agreement</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">In
  connection with the Settlement, the Partnership entered into a Shared Services
  Agreement, dated April 7, 2009 to be effective as of 11:59 PM CDT March 31, 2009
  (the &#8220;Shared Services Agreement&#8221;), with the Private Company.&#160;&#160;Pursuant
  to the Shared Services Agreement, the Private Company will provide certain
  general shared services, Cushing shared services (as described below), and SCADA
  services (as described below) to the Partnership.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
  general shared services include crude oil movement services, Department of
  Transportation services, right-of-way services, environmental services, pipeline
  and civil structural maintenance services, safety services, pipeline truck
  station maintenance services, project support services and truck dispatch
  services.&#160;&#160;The fees for such general shared services&#160;are fixed at
  $125,000 for the month of April 2009 and such fixed fee may be extended by
  mutual agreement of the parties for one additional month.&#160;&#160;Thereafter
  the fees will be calculated in accordance with the formulas contained
  therein.&#160;&#160;The Private Company has agreed to provide the general shared
  services for three years (subject to earlier termination as provided therein)
  and the term may be extended an additional year by mutual agreement of the
  parties.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
  Cushing shared services include operational and maintenance services related to
  terminals at Cushing, Oklahoma.&#160;&#160;The fees for such Cushing shared
  services&#160;are fixed at $20,000 for the month of April 2009 and such fixed
  fee may be extended by mutual agreement of the parties for one additional
  month.&#160;&#160;Thereafter the fees will be calculated in accordance with the
  formulas contained therein.&#160;&#160;The Private Company has agreed to provide
  the Cushing shared services for three years (subject to earlier termination as
  provided therein) and the term may be extended an additional year by mutual
  agreement of the parties.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The SCADA
  services include services related to the operation of the SCADA system which is
  used in connection with the Partnership&#8217;s crude oil operations.&#160;&#160;The
  fees for such SCADA services&#160;are fixed at $15,000 for the month of April
  2009 and such fixed fee may be extended by mutual agreement of the parties for
  one additional month.&#160;&#160;Thereafter the fees will be calculated in
  accordance with the formulas contained therein.&#160;&#160;The Private Company
  has agreed to provide the SCADA services for five years (subject to earlier
  termination as provided therein) and the Partnership may elect to extend the
  term for two subsequent five year periods.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">Transition
  Services Agreement</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">In
  connection with the Settlement, the Partnership entered into a Transition
  Services Agreement, dated April 7, 2009 to be effective as of 11:59 PM CDT March
  31, 2009 (the &#8220;Transition Services Agreement&#8221;), with the Private
  Company.&#160;&#160;Pursuant to the Transition Services Agreement, the Private
  Company will provide certain corporate, crude oil and asphalt transition
  services, in each case for a limited amount of time, to the
  Partnership.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">Transfer
  of Crude Oil Assets</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">In
  connection with the Settlement, the Partnership transferred certain crude oil
  assets located in Kansas and northern Oklahoma to the Private
  Company.&#160;&#160;These transfers included real property and associated
  personal property at locations where the Private Company owned the
  pipeline.&#160;&#160;The Partnership retained certain access and connection
  rights to enable it to continue to operate its crude oil trucking business in
  such areas.&#160;&#160;In addition, the Partnership transferred its interests in
  the SCADA System, a crude oil inventory tracking system, to the Private
  Company.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">In
  addition, the Private Company transferred to the Partnership (i) 355,000 barrels
  of crude oil line fill and tank bottoms, which are necessary for the Partnership
  to operate its crude oil tank storage operations and its Oklahoma and Texas
  crude oil pipeline systems, (ii) certain personal property located in Oklahoma,
  Texas and Kansas used in connection with the Partnership&#8217;s crude oil trucking
  business and (iii) certain real property located in Oklahoma, Kansas, Texas and
  New Mexico that was intended to be transferred in connection with the
  Partnership&#8217;s initial public offering.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">Transfer
  of Asphalt Assets</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">In
  connection with the Settlement, the Private Company transferred certain asphalt
  processing assets that&#160;were connected to, adjacent to, or otherwise
  contiguous with the Partnership&#8217;s existing asphalt facilities and associated
  real property interests to the Partnership.&#160;&#160;The transfer of the
  Private Company&#8217;s asphalt assets in connection with the Settlement provides the
  Partnership with outbound logistics for its existing asphalt assets and,
  therefore, allows it to provide asphalt terminalling and storage services to
  third parties.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div><br>
      <div id="PGBRK" style="MARGIN-LEFT: 0pt; WIDTH: 100%; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
        <div id="FTR">
          <div style="WIDTH: 100%" align="left">
            <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
  </font></div>
          </div>
          <div id="GLFTR" style="WIDTH: 100%" align="center">
          </div>
        </div>
        <div id="PN" style="PAGE-BREAK-AFTER: always">
          <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">22</font></div>
          <div style="WIDTH: 100%; TEXT-ALIGN: center">
            <hr style="COLOR: black" noshade size="2">
          </div>
        </div>
        <div id="HDR">
          <div id="GLHDR" style="WIDTH: 100%" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 9pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><a href="#TOC">Table of Contents</a></font></div>
          <div style="WIDTH: 100%" align="left">
            <div style="DISPLAY: block; TEXT-INDENT: 0pt; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">SEMGROUP
  ENERGY PARTNERS, L.P.</font></div>
            <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">NOTES
  TO UNAUDITED CONSOLIDATED FINANCIAL
  STATEMENTS</font></div>
          </div>
        </div>
      </div><br>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">New
  Throughput Agreement</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">In
  connection with the Settlement, the Partnership and the Private Company entered
  into a Throughput Agreement, dated as of April 7, 2009 to be effective as of
  11:59 PM CDT March 31, 2009 (the &#8220;New Throughput Agreement&#8221;), pursuant to which
  the Partnership provides certain crude oil gathering, transportation,
  terminalling and storage services to the Private Company.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Under the
  New Throughput Agreement, the Partnership charges the following fees: (i)
  barrels gathered via gathering lines will be charged a gathering rate of $0.75
  per barrel, (ii) barrels transported within Oklahoma will be charged $1.00 per
  barrel while barrels transported on the Masterson Mainline will be charged $0.55
  per barrel, (iii) barrels transported by truck will be charged in accordance
  with the schedule contained therein, including a fuel surcharge, (iv) storage
  fees shall equal $0.50 per barrel per month for product located in storage tanks
  located in Cushing, Oklahoma and $0.44 per barrel per month for product not
  located in dedicated Cushing storage tanks, and (v) a delivery charge of $0.08
  per barrel will be charged for deliveries out of the Cushing Interchange
  Terminal.&#160;The New Throughput Agreement has an initial term of one year with
  additional automatic one-month renewals unless either party terminates the
  agreement upon thirty-days prior notice.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">New
  Terminalling and Storage Agreement</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">In
  connection with the Settlement, the Partnership and the Private Company entered
  into a Terminalling and Storage Agreement, dated as of April 7, 2009 to be
  effective as of 11:59 PM CDT March 31, 2009 (the &#8220;New Terminalling Agreement&#8221;),
  pursuant to which the Partnership provides certain asphalt terminalling and
  storage services for the remaining asphalt inventory of the Private
  Company.&#160;&#160;Storage services under the New Terminalling Agreement are
  equal to $0.565 per barrel per month multiplied by the total shell capacity in
  barrels for each storage tank where the Private Company and its affiliates have
  product; provided that if the Private Company removes all product from a storage
  tank prior to the end of the month, then the storage service fees shall be
  pro-rated for such month based on the number of calendar days storage was
  actually used.&#160;&#160;Throughput fees under the New Terminalling Agreement
  are equal to $9.25 per ton; provided that no fees are payable for transfers of
  product between storage tanks located at the same or different
  terminals.&#160;&#160;The New Terminalling Agreement has an initial term that
  expires on October 31, 2009, which may be extended for one month by mutual
  agreement of the parties.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">New
  Access and Use Agreement</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">In
  connection with the Settlement, the Partnership and the Private Company entered
  into an Access and Use Agreement, dated as of April 7, 2009 to be effective as
  of 11:59 PM CDT March 31, 2009 (the &#8220;New Access and Use Agreement&#8221;), pursuant to
  which the Partnership will allow the Private Company access rights to the
  Partnership&#8217;s asphalt facilities relating to its existing asphalt
  inventory.&#160;&#160;The term of the Access and Use Agreement will end
  separately for each terminal upon the earlier of October 31, 2009 or until all
  of the existing asphalt inventory of the Private Company is removed from such
  terminal.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">Trademark
  Agreement</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">In
  connection with the Settlement, the Private Company and the Partnership entered
  into a Trademark License Agreement, dated as of April 7, 2009 to be effective as
  of 11:59 PM CDT March 31, 2009 (the &#8220;Trademark Agreement&#8221;), pursuant to which
  the Private Company granted the Partnership a non-exclusive, worldwide license
  to use certain trade names, including the name &#8220;SemGroup&#8221;, and the corresponding
  mark until December 31, 2009, and the Private Company waived claims for
  infringement relating to such trade names and mark prior to the effective date
  of the Trademark Agreement.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">Building
  and Office Leases</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">In
  connection with the Settlement, the Partnership leased office space in Oklahoma
  City, Oklahoma and certain facilities in Cushing, Oklahoma to the Private
  Company.&#160;&#160;The terms for the leases expire on March 31,
  2014.&#160;&#160;The rents for such leases are as described in the exhibits
  thereto.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div><br>
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        </div>
        <div id="HDR">
          <div id="GLHDR" style="WIDTH: 100%" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 9pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><a href="#TOC">Table of Contents</a></font></div>
          <div style="WIDTH: 100%" align="left">
            <div style="DISPLAY: block; TEXT-INDENT: 0pt; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">SEMGROUP
  ENERGY PARTNERS, L.P.</font></div>
            <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">NOTES
  TO UNAUDITED CONSOLIDATED FINANCIAL
  STATEMENTS</font></div>
          </div>
        </div>
      </div><br>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">Easements</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">In
  connection with the Settlement, the Partnership and the Private Company granted
  mutual easements relating to access, facility improvements, existing and future
  pipeline rights and corresponding rights of ingress and egress for properties
  owned by the parties at Cushing, Oklahoma.&#160;&#160;In addition, the
  Partnership granted the Private Company certain pipeline easements at Cushing,
  Oklahoma, together with the corresponding rights of ingress and
  egress.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 9pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">Partnership
  Revenues</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">For the
  nine months ended September 30, 2008 and the year ended December 31, 2008, the
  Partnership derived approximately 81% and approximately 73%, respectively, of
  its revenues, excluding fuel surcharge revenues related to fuel and power
  consumed to operate its liquid asphalt cement storage tanks, from services it
  provided to the Private Company and its subsidiaries.&#160;&#160;Prior to the
  Order and the Settlement, the Private Company was obligated to pay the
  Partnership minimum monthly fees totaling $76.1 million annually and $58.9
  million annually in respect of the minimum commitments under the Throughput
  Agreement and the Terminalling Agreement, respectively, regardless of whether
  such services were actually utilized by the Private Company.&#160;&#160;As
  described above, the Order required the Private Company to make certain payments
  under the Throughput Agreement and Terminalling Agreement during a portion of
  the third quarter of 2008, including the contractual minimum payments under the
  Terminalling Agreement.&#160;&#160;In connection with the Settlement, the
  Partnership waived the fees due under the Terminalling Agreement during March
  2009.&#160;&#160;In addition, the Private Company rejected the Throughput
  Agreement and the Terminalling Agreement and the Partnership and the Private
  Company entered into the New Throughput Agreement and the New Terminalling
  Agreement.&#160;&#160;The Partnership expects revenues from services provided to
  the Private Company under the New Throughput Agreement and New Terminalling
  Agreement to be substantially less than prior revenues from services provided to
  the Private Company as the new agreements are based upon actual volumes
  gathered, transported, terminalled and stored instead of certain minimum volumes
  and are at reduced rates when compared to the Throughput Agreement and
  Terminalling Agreement.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
  Partnership has been pursuing opportunities to provide crude oil terminalling
  and storage services and crude oil gathering and transportation services to
  third parties.&#160;&#160;As a result of new crude oil third-party storage
  contracts, the Partnership increased its third-party terminalling and storage
  revenue (excluding fuel surcharge revenues related to fuel and power consumed to
  operate its liquid asphalt cement storage tanks)&#160;from approximately $1.0
  million, or approximately 4% of total terminalling and storage
  revenue&#160;during the second quarter of 2008, to approximately $4.6 million
  and $8.4 million, or approximately 17% and 34% of total terminalling and storage
  revenue&#160;for the third quarter of 2008 and the&#160;fourth quarter of 2008,
  respectively.&#160;</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;In
  addition, as a result of new third-party crude oil transportation contracts and
  reduced commitments of usage by the Private Company under the Throughput
  Agreement, the Partnership increased its third-party gathering and
  transportation revenue from approximately $5.0 million, or approximately 21% of
  total gathering and transportation revenue during the second quarter of 2008, to
  approximately $10.9 million and $13.6 million, or approximately 51% and 85% of
  total gathering and transportation revenue for the&#160;third quarter of 2008
  and the fourth quarter of 2008, respectively.&#160;</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
  significant majority of the increase in third party revenues results from an
  increase in third-party crude oil services provided and a corresponding decrease
  in the Private Company&#8217;s crude oil services provided due to the termination of
  the monthly contract minimum revenues under the Throughput Agreement in
  September 2008.&#160;&#160;Average rates for the new third-party crude oil
  terminalling and storage and transportation and gathering contracts are
  comparable with those previously received from the Private
  Company.&#160;&#160;However, the volumes being terminalled, stored, transported
  and gathered have decreased as compared to periods prior to the Bankruptcy
  Filings, which has negatively impacted total revenues.&#160;&#160;As an example,
  fourth quarter 2008 total revenues are approximately $8.2 million less than
  third quarter 2008 total revenues, in each case excluding fuel surcharge
  revenues related to fuel and power consumed <font style="FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">to operate its liquid
  asphalt cement storage tanks.</font></font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left">
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font id="TAB2" style="LETTER-SPACING: 9pt">&#160;&#160;&#160;</font>&#160;In addition,
  the Partnership has recently entered into leases and storage agreements with
  third parties relating to&#160;39 of its 46&#160;asphalt
  facilities.&#160;&#160;</font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
  Partnership has entered into various crude oil transportation and storage
  contracts with third parties and is continuing to pursue additional contracts
  with third parties; however, there can be no assurance that any of these
  additional efforts will be successful.&#160;&#160;In addition, certain third
  parties may be less likely to enter into business transactions with the
  Partnership due to the Bankruptcy Filings.&#160;&#160;The Private Company may
  also choose to curtail its operations or liquidate its assets as part of the
  Bankruptcy Cases.&#160;&#160;As a result, unless the Partnership is able to
  generate additional third party revenues, the Partnership will continue to
  experience lower volumes in its system which could have a material adverse
  effect on its results of operations and cash flows.</font></div>
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  </font></div>
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          <div style="WIDTH: 100%; TEXT-ALIGN: center">
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        </div>
        <div id="HDR">
          <div id="GLHDR" style="WIDTH: 100%" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 9pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><a href="#TOC">Table of Contents</a></font></div>
          <div style="WIDTH: 100%" align="left">
            <div style="DISPLAY: block; TEXT-INDENT: 0pt; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">SEMGROUP
  ENERGY PARTNERS, L.P.</font></div>
            <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">NOTES
  TO UNAUDITED CONSOLIDATED FINANCIAL
  STATEMENTS</font></div>
          </div>
        </div>
      </div><br>
      <div style="DISPLAY: block; MARGIN-LEFT: 18pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">Asphalt
  Operations</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Historically,
  the Partnership provided liquid asphalt cement terminalling and storage services
  to the Private Company pursuant to the Terminalling Agreement.&#160;&#160;In
  connection with the Settlement, the Private Company rejected the Terminalling
  Agreement and the Partnership and the Private Company entered into the New
  Terminalling Agreement whereby the Partnership provides liquid asphalt cement
  terminalling and storage services to the Private Company in connection with its
  remaining asphalt inventory.&#160;&#160;The New Terminalling Agreement has an
  initial term that ends on October 31, 2009 and the Private Company has agreed to
  remove all of its existing asphalt inventory no later than such date, and the
  Partnership expects that the Private Company may remove it much earlier than
  such date.&#160;&#160;Also in connection with the Settlement, the Private
  Company transferred certain asphalt assets to the Partnership that were
  connected to the Partnership&#8217;s existing asphalt assets.&#160;&#160;The transfer
  of the Private Company&#8217;s asphalt assets in connection with the Settlement
  provides the Partnership with outbound logistics for its existing asphalt assets
  and, therefore, allows it to provide asphalt terminalling and storage services
  to third parties.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
  asphalt industry in the United States is characterized by a high degree of
  seasonality. Much of this seasonality is due to the impact that weather
  conditions have on road construction schedules, particularly in cold weather
  states. Refineries produce liquid asphalt cement year round, but the peak
  asphalt demand season is during the warm weather months when most of the road
  construction activity in the United States takes place. As a result, liquid
  asphalt cement is typically purchased from refineries at low prices in the low
  demand winter months and then processed and sold at higher prices in the peak
  summer demand season.&#160;&#160;Any significant decrease in the amount of
  revenues that the Partnership receives from its liquid asphalt cement
  terminalling and storage operations could have a material adverse effect on the
  Partnership&#8217;s cash flows, financial condition and results of
  operations.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left">
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font size="+0"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font size="+0" style="FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font id="TAB2" style="FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; LETTER-SPACING: 9pt">&#160;&#160;&#160;</font>&#160;<font style="FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The Partnership has
  recently entered into leases and storage agreements with third parties relating
  to&#160;39 of its 46 asphalt
  facilities.&#160;&#160;</font></font></font></font></font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">
          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font id="TAB2" style="FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; LETTER-SPACING: 9pt">&#160;&#160;&#160;</font>&#160;The
  revenues that the Partnership will receive pursuant to these leases and storage
  agreements will be less than the revenues received under the Terminalling
  Agreement with the Private Company.&#160; Without sufficient revenues from its
  asphalt assets, the Partnership may be unable to meet the covenants, including
  the minimum liquidity, minimum EBITDA and minimum receipt requirements, under
  its credit agreement.</font></font></font></div>
        </div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 18pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">Operation
  and General Administration of the Partnership</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">As is the
  case with many publicly traded partnerships, the Partnership has not
  historically directly employed any persons responsible for managing or operating
  the Partnership or for providing services relating to day-to-day business
  affairs.&#160;&#160;Pursuant to the Amended Omnibus Agreement, the Private
  Company operated the Partnership&#8217;s assets and performed other administrative
  services for the Partnership such as accounting, legal, regulatory, development,
  finance, land and engineering.&#160;&#160;The events related to the Bankruptcy
  Filings terminated the Private Company&#8217;s obligations to provide services to the
  Partnership under the Amended Omnibus Agreement.&#160;&#160;The Private Company
  continued to provide such services to the Partnership until the effective date
  of the Settlement at which time the Private Company rejected the Amended Omnibus
  Agreement and the Private Company and the Partnership entered into the Shared
  Services Agreement and the Transition Services Agreement relating to the
  provision of such services.&#160;&#160;In addition, in connection with the
  Settlement, the Partnership made offers of employment to certain individuals
  associated with its crude oil operations and expects to make additional offers
  of employment to certain individuals associated with its asphalt
  operations.&#160;&#160;The costs to directly employ these individuals as well as
  the costs under the Shared Services Agreement and the Transition Services
  Agreement may be higher than those previously paid by the Partnership under the
  Amended Omnibus Agreement, which could have a material adverse effect on the
  Partnership&#8217;s business, financial condition, results of operations, cash flows,
  ability to make distributions to its unitholders, the trading price of its
  common units and its ability to conduct its business.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">In
  addition, in connection with the Settlement, the Partnership agreed to not
  solicit the Private Company&#8217;s employees for a year from the time of the
  Settlement.&#160;&#160;In connection with the Bankruptcy Cases, the Private
  Company may reduce a substantial number of its employees or some of the Private
  Company&#8217;s employees may choose to terminate their employment with the Private
  Company, some of whom may currently be providing general and administrative and
  operating services to the Partnership under the Shared Services Agreement or the
  Transition Services Agreement.&#160;&#160;Any reductions in critical personnel
  who provide services to the Partnership and any increased costs to replace such
  personnel could have a material adverse effect on the Partnership&#8217;s ability to
  conduct its business and its results of operations.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div><br>
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          <div style="WIDTH: 100%; TEXT-ALIGN: center">
            <hr style="COLOR: black" noshade size="2">
          </div>
        </div>
        <div id="HDR">
          <div id="GLHDR" style="WIDTH: 100%" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 9pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><a href="#TOC">Table of Contents</a></font></div>
          <div style="WIDTH: 100%" align="left">
            <div style="DISPLAY: block; TEXT-INDENT: 0pt; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">SEMGROUP
  ENERGY PARTNERS, L.P.</font></div>
            <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">NOTES
  TO UNAUDITED CONSOLIDATED FINANCIAL
  STATEMENTS</font></div>
          </div>
        </div>
      </div><br>
      <div style="DISPLAY: block; MARGIN-LEFT: 18pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">Intellectual
  Property Rights</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Pursuant
  to the Amended Omnibus Agreement, the Partnership licensed the use of certain
  trade names and marks, including the name &#8220;SemGroup.&#8221;&#160;&#160;This license
  terminated automatically upon the Change of Control.&#160;&#160;In connection
  with the Settlement, the Private Company and the Partnership entered into the
  Trademark Agreement, pursuant to which the Private Company granted the
  Partnership a non-exclusive, worldwide license to use certain trade names,
  including the name &#8220;SemGroup&#8221; and the corresponding mark, until December 31,
  2009, and the Private Company waived claims for infringement relating to such
  trade names and mark prior to the effective date of such&#160;Trademark
  Agreement (see &#8220;&#8212;Settlement with the Private Company&#8221;).&#160;&#160;As such, the
  Partnership will be required to change its name and trademark upon or prior to
  the expiration of the Trademark Agreement.&#160;&#160;The expenses associated
  with such a change may be significant, which could have a material adverse
  effect on the Partnership&#8217;s business, financial condition, results of
  operations, cash flows, ability to make distributions to its unitholders, the
  trading price of its common units and its ability to conduct its
  business.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 18pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">Credit
  Facility</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">As
  described in Note 4, in connection with the events related to the Bankruptcy
  Filings, events of default occurred under the Partnership&#8217;s credit
  agreement.&#160;&#160;On September 18, 2008, the Partnership and the requisite
  lenders under its credit facility entered into the Forbearance Agreement
  relating to such events of default.&#160;&#160;&#160;On April 7, 2009, the
  Partnership and the requisite lenders entered into the Credit Agreement
  Amendment, under which the lenders consented to the Settlement and waived all
  existing defaults and events of default described in the Forbearance Agreement
  and amendments thereto.&#160;&#160;See Note 4 for more information regarding the
  Partnership&#8217;s credit facility, the Forbearance Agreement and the Credit
  Agreement Amendment.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 18pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">Distributions
  to Unitholders</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
  Partnership did not make a distribution to its common unitholders, subordinated
  unitholders or general partner attributable to the results of operations for the
  quarters ended June 30, 2008, September 30, 2008, December 31, 2008 or March 31,
  2009 due to the events of default under its credit agreement and the uncertainty
  of its future cash flows relating to the Bankruptcy Filings.&#160;&#160;The
  Partnership&#8217;s unitholders will be required to pay taxes on their share of the
  Partnership&#8217;s taxable income even though they did not receive a cash
  distribution for such periods.&#160;&#160;In addition, the Partnership does not
  currently expect to make a distribution relating to the second quarter of
  2009.&#160;&#160;The Partnership distributed approximately $14.3 million to its
  unitholders for the three months ended March 31, 2008.&#160;&#160;Pursuant to
  the Credit Agreement Amendment, the Partnership is prohibited from making
  distributions to its unitholders if its leverage ratio (as defined in the credit
  agreement) exceeds 3.50 to 1.00.&#160;&#160;As of September 30, 2008 and
  December 31, 2008, the Partnership&#8217;s leverage ratio was 4.34 to 1.00 and 4.83 to
  1.00, respectively.&#160;If the Partnership&#8217;s leverage ratio does not improve,
  it may not make quarterly distributions to its unitholders in the
  future.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
  Partnership&#8217;s partnership agreement provides that, during the subordination
  period, which the Partnership is currently in, the Partnership&#8217;s common units
  will have the right to receive distributions of available cash from operating
  surplus in an amount equal to the minimum quarterly distribution of $0.3125 per
  common unit per quarter, plus any arrearages in the payment of the minimum
  quarterly distribution on the common units from prior quarters, before any
  distributions of available cash from operating surplus may be made on the
  subordinated units.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 18pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">Nasdaq
  Delisting</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Effective
  at the opening of business on February 20, 2009, the Partnership&#8217;s common units
  were delisted from the Nasdaq Global Market (&#8220;Nasdaq&#8221;) due to the Partnership&#8217;s
  failure to timely file this Quarterly Report as well as its Quarterly Report on
  Form 10-Q for the quarter ended June 30, 2008.&#160;&#160;The Partnership filed
  its Quarterly Report on Form 10-Q for the quarter ended June 30, 2008 on March
  23, 2009.&#160;&#160;The Partnership&#8217;s common units are currently traded on the
  Pink Sheets, which is an over-the-counter securities market, under the symbol
  SGLP.PK.&#160;&#160;The fact that the Partnership&#8217;s common units are not listed
  on a national securities exchange is likely to make trading such common units
  more difficult for broker-dealers, unitholders and investors, potentially
  leading to further declines in the price of the common units.&#160;&#160;In
  addition, it may limit the number of institutional and other investors that will
  consider investing in the Partnership&#8217;s common units, which may have an adverse
  effect on the price of its common units.&#160;&#160;It may also make it more
  difficult for the Partnership to raise capital in the future.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
  Partnership continues to work to become compliant with its SEC reporting
  obligations and intends to promptly seek the relisting of its common units on
  Nasdaq as soon as practicable after it has become compliant with such reporting
  obligations.&#160;&#160;However, there can be no assurances that the Partnership
  will be able to relist its common units on Nasdaq or any other national
  securities exchange and the Partnership may face a lengthy process to relist its
  common units if it is able to relist them at all.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div><br>
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            <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
  </font></div>
          </div>
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          <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">26</font></div>
          <div style="WIDTH: 100%; TEXT-ALIGN: center">
            <hr style="COLOR: black" noshade size="2">
          </div>
        </div>
        <div id="HDR">
          <div id="GLHDR" style="WIDTH: 100%" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 9pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><a href="#TOC">Table of Contents</a></font></div>
          <div style="WIDTH: 100%" align="left">
            <div style="DISPLAY: block; TEXT-INDENT: 0pt; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">SEMGROUP
  ENERGY PARTNERS, L.P.</font></div>
            <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">NOTES
  TO UNAUDITED CONSOLIDATED FINANCIAL
  STATEMENTS</font></div>
          </div>
        </div>
      </div><br>
      <div style="DISPLAY: block; MARGIN-LEFT: 18pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">Claims
  Against and By the Private Company&#8217;s Bankruptcy Estate</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">In
  connection with the Settlement, the Partnership and the Private Company entered
  into mutual releases regarding certain claims.&#160;&#160;In addition, the
  Settlement provided that the Partnership has a $35 million unsecured claim
  against the Private Company relating to the rejection of the Terminalling
  Agreement and a $20 million unsecured claim against the Private Company relating
  to rejection of the Throughput Agreement.&#160; <font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">On May
  15, 2009, the Private Company filed a joint plan of
  reorganization.&#160;&#160;If such plan is confirmed without material amendment,
  the Partnership&#8217;s claims will be impaired.</font>&#160;&#160;The Partnership may
  also have additional claims against the Private Company that were not released
  in connection with the Settlement, and the Private Company may also have
  additional claims against the Partnership that were not released in connection
  with the Settlement.&#160;&#160;Any claims asserted by the Partnership against
  the Private Company in the Bankruptcy Cases will be subject to the claim
  allowance procedure provided in the Bankruptcy Code and Bankruptcy
  Rules.&#160;&#160;If an objection is filed, the Bankruptcy Court will determine
  the extent to which any such claim that has been objected to is allowed and the
  priority of such claims.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 18pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">Governmental
  Investigations</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">On July
  21, 2008, the Partnership received a letter from the staff of the SEC giving
  notice that the SEC is conducting an inquiry relating to the Partnership and
  requesting, among other things, that the Partnership voluntarily preserve,
  retain and produce to the SEC certain documents and information relating
  primarily to the Partnership&#8217;s disclosures respecting the Private Company&#8217;s
  liquidity issues, which were the subject of the Partnership&#8217;s July 17, 2008
  press release.&#160;&#160;On October 22, 2008, the Partnership received a
  subpoena from the SEC pursuant to a formal order of investigation requesting
  certain documents relating to, among other things, the Private Company&#8217;s
  liquidity issues.&#160;&#160;The Partnership has been cooperating, and intends
  to continue cooperating, with the SEC in its investigation.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">On July
  23, 2008, the Partnership and its general partner each received a Grand Jury
  subpoena from the United States Attorney&#8217;s Office in Oklahoma City, Oklahoma,
  requiring, among other things, that the Partnership and its general partner
  produce financial and other records related to the Partnership&#8217;s July 17, 2008
  press release.&#160;&#160;The Partnership has been informed that the U.S.
  Attorneys&#8217; Offices for the Western District of Oklahoma and the Northern
  District of Oklahoma are in discussions regarding the subpoenas, and no date has
  been set for a response to the subpoenas.&#160;&#160;The Partnership and its
  general partner intend to cooperate fully with this investigation if and when it
  proceeds.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 18pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">Securities
  and Other Litigation</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Between
  July 21, 2008 and September 4, 2008, the following class action complaints were
  filed:</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;&#160;&#160;&#160;&#160;&#160;&#160;
  1.&#160;&#160;&#160;&#160;&#160;<font style="DISPLAY: inline; FONT-STYLE: italic"> Poelman v. SemGroup Energy
  Partners, L.P., et al</font>., Civil Action No. 08-CV-6477, in the United States
  District Court for the Southern District of New York (filed July 21,
  2008).&#160; The plaintiff voluntarily dismissed this case on August 26,
  2008;</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;&#160;&#160;&#160;&#160;&#160;&#160;
  2.&#160;&#160;&#160;&#160;&#160;<font style="DISPLAY: inline; FONT-STYLE: italic"> Carson v. SemGroup Energy Partners,
  L.P. et al</font><font style="DISPLAY: inline; FONT-WEIGHT: bold">.</font>,
  Civil Action No. 08-cv-425, in the Northern District of Oklahoma (filed July 22,
  2008);</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;&#160;&#160;&#160;&#160;&#160;&#160;
  3.&#160;&#160;&#160;&#160;&#160;&#160;<font style="DISPLAY: inline; FONT-STYLE: italic"> Charles D. Maurer SIMP Profit
  Sharing Plan f/b/o Charles D. Maurer v. SemGroup Energy Partners, L.P. et
  al.</font>, Civil Action No. 08-cv-6598, in the United States District Court for
  the Southern District of New York (filed July 25, 2008);</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;&#160;&#160;&#160;&#160;&#160;&#160;
  4.&#160;&#160;&#160;&#160;&#160;<font style="DISPLAY: inline; FONT-STYLE: italic"> Michael Rubin v. SemGroup Energy
  Partners, L.P. et al.</font>, Civil Action No. 08-cv-7063, in the United States
  District Court for the Southern District of New York (filed August 8,
  2008);</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;&#160;&#160;&#160;&#160;&#160;&#160;
  5.&#160;&#160;&#160;&#160;&#160;<font style="DISPLAY: inline; FONT-STYLE: italic"> Dharam V. Jain v. SemGroup Energy
  Partners, L.P. et al.</font>, Civil Action No. 08-cv-7510, in the United States
  District Court for the Southern District of New York&#160; (filed August 25,
  2008); and</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;&#160;&#160;&#160;&#160;&#160;&#160;
  6.&#160;&#160;&#160;&#160;&#160;<font style="DISPLAY: inline; FONT-STYLE: italic"> William L. Hickman v. SemGroup
  Energy Partners, L.P. et al.</font>, Civil Action No. 08-cv-7749, in the United
  States District Court for the Southern District of New York (filed September 4,
  2008).</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;&#160;&#160;&#160;&#160;&#160;&#160;
  </font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;&#160;&#160;&#160;&#160;&#160;&#160;</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div><br>
      <div id="PGBRK" style="MARGIN-LEFT: 0pt; WIDTH: 100%; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
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            <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
  </font></div>
          </div>
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            <hr style="COLOR: black" noshade size="2">
          </div>
        </div>
        <div id="HDR">
          <div id="GLHDR" style="WIDTH: 100%" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 9pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><a href="#TOC">Table of Contents</a></font></div>
          <div style="WIDTH: 100%" align="left">
            <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
            <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
            <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">SEMGROUP
  ENERGY PARTNERS, L.P.</font></div>
            <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">NOTES
  TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS</font></div>
          </div>
        </div>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Pursuant
  to a motion filed with the United States Judicial Panel on Multidistrict
  Litigation (&#8220;MDL Panel&#8221;), the<font style="DISPLAY: inline; FONT-STYLE: italic">
  Maurer</font> case has been transferred to the Northern District of Oklahoma and
  consolidated with the<font style="DISPLAY: inline; FONT-STYLE: italic">
  Carson</font> case.&#160; The<font style="DISPLAY: inline; FONT-STYLE: italic">
  Rubin, Jain,</font> and<font style="DISPLAY: inline; FONT-STYLE: italic">
  Hickman</font> cases have also been transferred to the Northern District of
  Oklahoma.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">A hearing
  on motions for appointment as lead plaintiff was held in the<font style="DISPLAY: inline; FONT-STYLE: italic"> Carson</font> case on October 17,
  2008.&#160; At that hearing, the court granted a motion to consolidate the <font style="DISPLAY: inline; FONT-STYLE: italic">Carson</font> and <font style="DISPLAY: inline; FONT-STYLE: italic">Maurer</font> cases for pretrial
  proceedings, and the consolidated litigation is now pending as<font style="DISPLAY: inline; FONT-STYLE: italic"> In Re: SemGroup Energy Partners,
  L.P. Securities Litigation</font>, Case No. 08-CV-425-GKF-PJC. The court entered
  an order on October 27, 2008, granting the motion of Harvest Fund Advisors LLC
  to be appointed lead plaintiff in the consolidated litigation.&#160;&#160;On
  January 23, 2009, the court entered a Scheduling Order providing, among other
  things, that the lead plaintiff may file a consolidated amended complaint within
  70 days of the date of the order, and that defendants may answer or otherwise
  respond within 60 days of the date of the filing of a consolidated amended
  complaint.&#160; <font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">On
  January 30, 2009 the lead plaintiff filed a motion to modify the stay of
  discovery provided for under the Private Securities Litigation Reform Act. The
  court granted Plaintiff's motion, and the Partnership and certain other
  defendants filed a Petition for Writ of Mandamus in the Tenth Circuit Court of
  Appeals that was denied after oral argument on April 24,
  2009.</font></font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font id="TAB2" style="LETTER-SPACING: 9pt">&#160;&#160;&#160;</font>&#160;The lead
  plaintiff obtained an extension to file its consolidated amended complaint until
  May 4, 2009; defendants have 60 days from that date to answer or otherwise
  respond to the complaint.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left">
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font id="TAB2" style="LETTER-SPACING: 9pt">&#160;&#160;&#160;</font>&#160;The lead
  plaintiff filed a consolidated amended complaint on May 4, 2009.&#160;&#160;In
  that complaint, filed as a putative class action on behalf of all purchasers of
  the Partnership&#8217;s units from July 17, 2007 to July 17, 2008 (the &#8220;class
  period&#8221;), lead plaintiff asserts claims under the federal securities laws
  against the Partnership, its general partner, certain of the Partnership&#8217;s
  current and former officers and directors, certain underwriters in the
  Partnership&#8217;s initial and secondary public offerings, and certain entities who
  were investors in the Private Company and their individual representatives who
  served on the Private Company&#8217;s management committee. Among other allegations,
  the amended complaint alleges that the Partnership&#8217;s financial condition
  throughout the class period was dependent upon speculative commodities trading
  by the Private Company and its Chief Executive Officer, Thomas L. Kivisto, and
  that Defendants negligently and intentionally failed to disclose this
  speculative trading in the Partnership&#8217;s public filings during the class period.
  Specifically, the amended complaint alleges claims for violations of sections
  11, 12(a)(2), and 15 of the Securities Act of 1933 for damages and rescission
  with respect to all persons who purchased the Partnership&#8217;s units in the initial
  and secondary offerings, and also asserts claims under section 10b, Rule 10b-5,
  and section 20(a) of the Securities and Exchange Act of 1934. The amended
  complaint seeks certification as a class action under the Federal Rules of Civil
  Procedure, compensatory and rescissory damages for class members, pre-judgment
  interest, costs of court, and attorneys&#8217; fees.</font></div>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB2" style="LETTER-SPACING: 9pt">&#160;&#160;&#160;</font>&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font id="TAB2" style="LETTER-SPACING: 9pt">&#160;&#160;&#160;</font>&#160;The
  Partnership intends to vigorously defend these actions.&#160;&#160;There can be
  no assurance regarding the outcome of the litigation.&#160;&#160;An estimate of
  possible loss, if any, or the range of loss cannot be made and therefore the
  Partnership has not accrued a loss contingency related to these actions.
  However, the ultimate resolution of these actions could have a material adverse
  effect on the Partnership&#8217;s business, financial condition, results of
  operations, cash flows, ability to make distributions to its unitholders, the
  trading price of the Partnership&#8217;s common units and its ability to conduct its
  business.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">In March
  and April 2009, nine current or former executives of the Private Company and
  certain of its affiliates filed wage claims with the Oklahoma Department of
  Labor against the Partnership&#8217;s general partner.&#160;&#160;Their claims arise
  from the Partnership&#8217;s general partner&#8217;s Long-Term Incentive Plan, Employee
  Phantom Unit Agreement (&#8220;Phantom Unit
  Agreement&#8221;).&#160;&#160;Most&#160;claimants allege that phantom units previously
  awarded to them vested upon the&#160;Change of Control that occurred in July
  2008.&#160;&#160;One claimant alleges that his phantom units vested upon his
  termination.&#160;&#160;The claimants contend the Partnership&#8217;s general
  partner&#8217;s failure to deliver certificates for the phantom units within 60 days
  after vesting has caused them to be damaged, and they seek recovery of
  approximately $2 million in damages and penalties.&#160;&#160;<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">On April
  30, 2009, all of the wage claims were dismissed on jurisdictional grounds by the
  Department of Labor.&#160; </font>The Partnership&#8217;s general partner intends to
  vigorously defend these claims.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
  Partnership may become the subject of additional private or government actions
  regarding these matters in the future.&#160;&#160;Litigation may be
  time-consuming, expensive and disruptive to normal business operations, and the
  outcome of litigation is difficult to predict.&#160;&#160;The defense of these
  lawsuits may result in the incurrence of significant legal expense, both
  directly and as the result of the Partnership&#8217;s indemnification
  obligations.&#160;&#160;The litigation may also divert management&#8217;s attention
  from the Partnership&#8217;s operations which may cause its business to
  suffer.&#160;&#160;An unfavorable outcome in any of these matters may have a
  material adverse effect on the Partnership&#8217;s business, financial condition,
  results of operations, cash flows, ability to make distributions to its
  unitholders, the trading price of the Partnership&#8217;s common units and its ability
  to conduct its business. All or a portion of the defense costs and any amount
  the Partnership may be required to pay to satisfy a judgment or settlement of
  these claims may not be covered by insurance.</font></div>
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            <div style="DISPLAY: block; TEXT-INDENT: 0pt; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">SEMGROUP
  ENERGY PARTNERS, L.P.</font></div>
            <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">NOTES
  TO UNAUDITED CONSOLIDATED FINANCIAL
  STATEMENTS</font></div>
          </div>
        </div>
      </div><br>
      <div style="DISPLAY: block; MARGIN-LEFT: 18pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">Examiner</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">On August
  12, 2008, a motion was filed by the United States Trustee asking the Bankruptcy
  Court to appoint an examiner to investigate the Private Company&#8217;s trading
  strategies as well as certain &#8220;insider transactions,&#8221; including the contribution
  of the crude oil assets to the Partnership in connection with its initial public
  offering, the sale of the Acquired Asphalt Assets to the Partnership, the sale
  of the Acquired Pipeline Assets to the Partnership, the sale of the Acquired
  Storage Assets to the Partnership, and the entering into the Holdings Credit
  Agreements by SemGroup Holdings.&#160;&#160;On September 10, 2008, the
  Bankruptcy Court approved the appointment of an examiner, and on October 14,
  2008, the United States Trustee appointed Louis J. Freeh, former director of the
  Federal Bureau of Investigation, as the examiner.&#160;&#160;<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">On April
  15, 2009, the examiner filed a report summarizing the findings of his
  investigation with the Bankruptcy Court (the &#8220;Examiner&#8217;s Report&#8221;).</font></font>
  
        <div style="DISPLAY: block; TEXT-INDENT: 0pt">&#160;</div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font id="TAB2" style="LETTER-SPACING: 9pt">&#160;&#160;&#160;</font>&#160;The examiner
  was directed by the Bankruptcy Court to (i) investigate the circumstances
  surrounding the Private Company&#8217;s trading strategy, the transfer of the New York
  Mercantile Exchange account, certain insider transactions, the formation of the
  Partnership, the potential improper use of borrowed funds and funds generated
  from the Private Company&#8217;s operations and the liquidation of their assets to
  satisfy margin calls related to the trading strategy for the Private Company and
  certain entities owned or controlled by the Private Company&#8217;s officers and
  directors and (ii) determine whether any directors, officers or employees of the
  Private Company participated in fraud, dishonesty, incompetence, misconduct,
  mismanagement, or irregularity in the management of the affairs of the Private
  Company and whether the Private Company&#8217;s estates have causes of action against
  such persons arising from any such participation.</font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt">&#160;</div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font id="TAB2" style="LETTER-SPACING: 9pt">&#160;&#160;&#160;</font>&#160;The
  Examiner&#8217;s Report identified potential claims or causes of action against
  current officers of the Partnership&#8217;s general partner who were former officers
  of the Private Company, including, without limitation, (i)<font style="DISPLAY: inline; FONT-WEIGHT: bold">&#160;</font>against Kevin L. Foxx
  for his failure to develop a suitable risk management policy or integrate a
  suitable risk management policy into the Private Company&#8217;s business controls,
  and for his failure to comply with the risk management policy that did exist,
  thereby subjecting the Private Company to increased risk and (ii) against Alex
  Stallings for his failure to stop Thomas L. Kivisto from engaging in trading
  activity on his own behalf through Westback Purchasing Company, L.L.C., a
  limited liability trading partnership which Mr. Kivisto owned and controlled,
  thereby subjecting the Private Company to increased risk and
  losses.&#160;&#160;<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">In
  addition, the Examiner&#8217;s Report criticized Mr. Foxx for certain conflicts of
  interest with entities that he or his family invested in and which had a
  business relationship with the Private Company.</font>&#160; Additionally, the
  Examiner&#8217;s Report identified a number of potential claims or causes of action
  against Mr. Kivisto and Gregory C. Wallace, who are former directors of the
  Partnership&#8217;s general partner and former officers of the Private Company,
  including, without limitation, for negligence and mismanagement, fraud and false
  statements, conversion and corporate waste, unjust enrichment, breach of
  fiduciary duties and breach of contract.</font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt">&#160;</div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font id="TAB2" style="LETTER-SPACING: 9pt">&#160;&#160;&#160;</font>&#160;The
  Examiner&#8217;s Report and related exhibits are publicly available at
  www.kccllc.net/SemGroup.</font></div>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 18pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">Internal
  Review</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">As
  previously announced, in July 2008 the Board created an internal review
  subcommittee of the Board comprised of directors who are independent of
  management and the Private Company to determine whether the Partnership
  participates in businesses other than as described in its filings with the SEC
  and to conduct investigations into other such specific items as are deemed to be
  appropriate by the subcommittee.&#160;&#160;The subcommittee retained
  independent legal counsel to assist it in its investigations.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
  subcommittee has investigated a short-term financing transaction involving two
  subsidiaries of the Private Company.&#160;&#160;This transaction was identified
  as a potential source of concern in a whistleblower report made after the
  Private Company filed for bankruptcy.&#160;&#160;Although the transaction did
  not involve the Partnership or its subsidiaries, it was investigated because it
  did involve certain senior executive officers of the Partnership&#8217;s general
  partner who were also senior executive officers of the Private Company at the
  time of the transaction.&#160;&#160;Based upon its investigation, counsel for
  the subcommittee found that, subject to the subcommittee&#8217;s lack of access to
  Private Company documents and electronic records and witnesses, although certain
  irregularities occurred in the transactions, the transaction did not appear to
  cause the relevant officers to understand or believe that the Private Company
  had a lack of liquidity that imperiled the Private Company&#8217;s ability to meet its
  obligations to the Partnership and that certain aspects of the documentation of
  the transaction that were out of the ordinary did not call into question the
  integrity of any of the relevant officers.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
  subcommittee also investigated whether certain senior executive officers of the
  Partnership&#8217;s general partner who were also senior executive officers of the
  Private Company knew and understood, beginning as early as July 2007 and at
  various times thereafter, about a lack of liquidity at the Private Company that
  imperiled the Private Company&#8217;s ability to meet its obligations to the
  Partnership.&#160;&#160;Based upon this investigation, and subject to the
  subcommittee&#8217;s lack of access to Private Company documents and electronic
  records and witnesses, counsel for the subcommittee found that each of the
  officers had access to and reviewed Private Company financial information,
  including information regarding the Private Company&#8217;s commodity trading
  activities, from which they could have developed an understanding of the nature
  and significance of the trading activities that led to liquidity problems at the
  Private Company well before they say they did.&#160;&#160;While the officers
  each stated sincerely that they did not understand the nature or extent of the
  Private Company&#8217;s trading-related problems until the first week of July 2008 or
  later, objective evidence suggests that they showed at least some indifference
  to known or easily discoverable facts and that they failed to adhere to
  procedures under the Private Company&#8217;s Risk Management Policy created expressly
  to ensure that the Private Company&#8217;s trading activities were properly
  monitored.&#160;&#160;Nonetheless, counsel for the subcommittee was not
  persuaded by the documents and other evidence it was able to access that the
  officers in fact knew and understood that the Private Company&#8217;s liquidity or
  capital needs were a significant cause for alarm until, at the earliest, the
  second quarter of 2008.&#160;&#160;Moreover, while it appeared to counsel that
  the officers developed a growing awareness of the nature and severity of the
  Private Company&#8217;s liquidity issues over the second quarter of 2008, counsel was
  unable to identify with any more precision the specific level of concern or
  understanding these individuals had prior to July 2008.&#160;&#160;While not
  within the scope of such counsel&#8217;s investigation, counsel was requested by the
  subcommittee to note any information that came to counsel&#8217;s attention during its
  investigation that suggested that the officers intended to deceive or mislead
  any third party.&#160;&#160;Subject to limitations described in its report, no
  information came to counsel&#8217;s attention during its investigation that suggested
  to counsel that the officers intended to deceive or to mislead any third
  parties.&#160;&#160;In addition, in connection with the investigation, counsel
  for the subcommittee did not express any findings of intentional misconduct or
  fraud on the part of any officer or employee of the Partnership.</font></div>
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            <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
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        </div>
        <div id="HDR">
          <div id="GLHDR" style="WIDTH: 100%" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 9pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><a href="#TOC">Table of Contents</a></font></div>
          <div style="WIDTH: 100%" align="left">
            <div style="DISPLAY: block; TEXT-INDENT: 0pt; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">SEMGROUP
  ENERGY PARTNERS, L.P.</font></div>
            <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">NOTES
  TO UNAUDITED CONSOLIDATED FINANCIAL
  STATEMENTS</font></div>
          </div>
        </div>
      </div><br>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">After
  completion of the internal review, a plan was developed with the advice of the
  Audit Committee of the Board to further strengthen the processes and procedures
  at the Partnership.&#160;&#160;This plan includes, among other things,
  reevaluating executive officers and accounting and finance personnel (including
  a realignment of officers as described elsewhere in this report) and hiring, as
  deemed necessary, additional accounting and finance personnel or consultants;
  reevaluating the Partnership&#8217;s internal audit function and determining whether
  to expand the duties and responsibilities of such group; evaluating the
  comprehensive training programs for all management personnel covering, among
  other things, compliance with controls and procedures, revising the reporting
  structure so that the Chief Financial Officer reports directly to the Audit
  Committee, and increasing the business and operational oversight role of the
  Audit Committee.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 18pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">Equity
  Awards and Employment Agreements</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
  Change of Control constituted a change of control under the Plan, which resulted
  in the early vesting of all awards under the Plan.&#160;&#160;As such, the
  phantom units awarded to Messrs. Kevin L. Foxx, Michael J. Brochetti, Alex G.
  Stallings, Peter L. Schwiering and Jerry A. Parsons in the amounts of 150,000
  units, 90,000 units, 75,000 units, 45,000 units and 20,000 units, respectively,
  are fully vested.&#160;&#160;The common units underlying such awards were issued
  to such individuals in August 2008.&#160;&#160;In addition, the 5,000 restricted
  units awarded to each of Messrs. Billings, Kosnik and Bishop for their service
  as independent members of the Board fully vested.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
  Change of Control also resulted in a change of control under the employment
  agreements of Messrs. Foxx, Brochetti, Stallings, Schwiering and
  Parsons.&#160;&#160;If within one year after the Change of Control any such
  officer is terminated by the Partnership&#8217;s general partner without Cause (as
  defined below) or such officer terminates the agreement for Good Reason (as
  defined below), he will be entitled to payment of any unpaid base salary and
  vested benefits under any incentive plans, a lump sum payment equal to 24 months
  of base salary and continued participation in the Partnership&#8217;s general
  partner&#8217;s welfare benefit programs for one year after termination. Upon such an
  event, Messrs&#160;Foxx, Brochetti, Stallings, Schwiering and Parsons would be
  entitled to lump sum payments of $900,000, $600,000, $550,000, $500,000 and
  $500,000, respectively, in addition to continued participation in the
  Partnership&#8217;s general partner&#8217;s welfare benefit programs.&#160;&#160;As of the
  date of the filing of this report, none of these officers is entitled to these
  benefits as none of them has been terminated by the Partnership&#8217;s general
  partner without Cause or has terminated his agreement for Good
  Reason.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">For
  purposes of the employment agreements:</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#8220;Cause&#8221;
  means (i)&#160;conviction of the executive officer by a court of competent
  jurisdiction of any felony or a crime involving moral turpitude; (ii)&#160;the
  executive officer&#8217;s willful and intentional failure or willful intentional
  refusal to follow reasonable and lawful instructions of the Board;
  (iii)&#160;the executive officer&#8217;s material breach or default in the performance
  of his obligations under the employment agreement; or (iv)&#160;the executive
  officer&#8217;s act of misappropriation, embezzlement, intentional fraud or similar
  conduct involving the Partnership&#8217;s general partner.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#8220;Good
  Reason&#8221; means (i)&#160;a material reduction in the executive officer&#8217;s base
  salary; (ii)&#160;a material diminution of the executive officer&#8217;s duties,
  authority or responsibilities as in effect immediately prior to such diminution;
  or (iii)&#160;the relocation of the named executive officer&#8217;s principal work
  location to a location more than 50 miles from its current
  location.</font></div>
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          <div style="WIDTH: 100%" align="left">
            <div style="DISPLAY: block; TEXT-INDENT: 0pt; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">SEMGROUP
  ENERGY PARTNERS, L.P.</font></div>
            <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">NOTES
  TO UNAUDITED CONSOLIDATED FINANCIAL
  STATEMENTS</font></div>
          </div>
        </div>
      </div><br>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 18pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">Taxation
  as a Corporation</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
  anticipated after-tax economic benefit of an investment in the Partnership&#8217;s
  common units depends largely on the Partnership being treated as a partnership
  for federal income tax purposes.&#160;&#160;If less than 90% of the gross income
  of a publicly traded partnership, such as the Partnership, for any taxable year
  is &#8220;qualifying income&#8221; from sources such as the transportation, marketing (other
  than to end users), or processing of crude oil, natural gas or products thereof,
  interest, dividends or similar sources, that partnership will be taxable as a
  corporation under Section 7704 of the Internal Revenue Code for federal income
  tax purposes for that taxable year and all subsequent years.&#160;&#160;In this
  regard, because the income the Partnership earns from the Throughput Agreement
  and the Terminalling Agreement with the Private Company is &#8220;qualifying income&#8221;
  any material reduction or elimination of that income or any amendment to the
  Throughput Agreement or the Terminalling Agreement which changes the nature of
  the services provided or the income generated thereunder, may cause the
  Partnership&#8217;s remaining &#8220;qualifying income&#8221; to constitute less than 90% of its
  gross income.&#160;&#160;As a result, the Partnership could become taxable as a
  corporation for federal income tax purposes, unless it were to transfer the
  businesses that generate non-qualifying income to one or more subsidiaries taxed
  as corporations and pay entity level income taxes on such non-qualifying
  income.&#160;&#160;The IRS has not provided any ruling to the Partnership on
  this matter.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">If the
  Partnership were treated as a corporation for federal income tax purposes, then
  it would pay federal income tax on its income at the corporate tax rate, which
  is currently a maximum of 35%, and would likely pay state income tax at varying
  rates.&#160;&#160;Distributions would generally be taxed again to unitholders as
  corporate distributions and none of the Partnership&#8217;s income, gains, losses,
  deductions or credits would flow through to its unitholders.&#160;&#160;Because
  a tax would be imposed upon the Partnership as an entity, cash available for
  distribution to its unitholders would be substantially
  reduced.&#160;&#160;Treatment of the Partnership as a corporation would result
  in a material reduction in the anticipated cash flow and after-tax return to
  unitholders and thus would likely result in a substantial reduction in the value
  of the Partnership&#8217;s common units.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 18pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">Other
  Effects</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
  Bankruptcy Filings have had and may in the future continue to have a number of
  other impacts on the Partnership&#8217;s business and management.&#160;&#160;In the
  Amended Omnibus Agreement and other agreements with the Private Company, the
  Private Company agreed to indemnify the Partnership for certain environmental
  and other claims relating to the crude oil and liquid asphalt cement assets that
  have been contributed to the Partnership.&#160;&#160;In connection with the
  Settlement, the Partnership waived these claims and the Amended Omnibus
  Agreement and other relevant agreements, including the indemnification
  provisions therein, were rejected as part of the Bankruptcy
  Proceedings.&#160;&#160;If the Partnership experiences an environmental or other
  loss, it would experience increased losses which may have a material adverse
  effect on its business, financial condition, results of operations, cash flows,
  ability to make distributions to its unitholders, the trading price of its
  common units and the ability to conduct its business.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
  Partnership is currently pursuing various strategic alternatives for its
  business and assets including the possibility of entering into storage contracts
  with third party customers and the sale of all or a portion of its
  assets.&#160;&#160;The uncertainty relating to the Bankruptcy Filings and the
  recent global market and economic conditions may make it more difficult to
  pursue merger opportunities or enter into storage contracts with third party
  customers.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">In
  addition, general and administrative expenses (exclusive of non-cash
  compensation expense related to the vesting of the units under the Plan - see
  Note 9) increased by approximately $6.9 million and $7.5 million, or
  approximately 300% and 326%, to approximately $9.2 million for the third quarter
  of 2008 and $9.8 million for the fourth quarter of 2008, respectively, compared
  to $2.3 million in the second quarter of 2008.&#160;&#160;This increase is due
  to increased costs related to legal and financial advisors as well as other
  related costs in connection with events related to the Bankruptcy Filings, the
  securities litigation and governmental investigations, and the Partnership&#8217;s
  efforts to enter into storage contracts with third party customers and pursue
  merger opportunities.&#160;&#160;The Partnership expects this increased level of
  general and administrative expenses to continue into 2009.</font></div>
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        </div>
      </div><br>
      <div>
        <table cellpadding="0" cellspacing="0" width="100%">
            <tr>
              <td align="left" valign="top" width="9%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0.8pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;<a name="mda">Item&#160;2.</a></font></div>
              </td>
              <td align="left" valign="top" width="70%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0.8pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Management&#8217;s
        Discussion and Analysis of Financial Condition and Results of
        Operations</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">As
  used in this quarterly report, unless we indicate otherwise: (1)&#160;"SemGroup
  Energy Partners,&#8221; &#8220;our,&#8221; &#8220;we,&#8221; &#8220;us&#8221; and similar terms refer to SemGroup Energy
  Partners, L.P., together with our subsidiaries, (2) the &#8220;Private Company&#8221; refers
  to SemGroup, L.P. and its subsidiaries and affiliates (other than our general
  partner and us), and (3)&#160;"Crude Oil Business&#8221; refers to the crude oil
  gathering, transportation, terminalling and storage assets that were contributed
  to us by the Private Company. The historical financial statements for periods
  prior to the contribution of the operations to us by the Private Company on
  July&#160;20, 2007 reflect the operations of our predecessor. The following
  discussion analyzes the historical financial condition and results of operations
  of the Partnership and should be read in conjunction with our predecessor&#8217;s
  financial statements and notes thereto, and Management&#8217;s Discussion and Analysis
  of Financial Condition and Results of Operations presented in our Annual Report
  on Form 10-K for the year ended December 31, 2007.&#160;&#160;The Partnership as
  used herein refers to the financial results and operations of our predecessor
  until its contribution to us, and to our financial results and operations
  thereafter.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Forward-Looking
  Statements</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">This
  report contains &#8220;forward-looking statements&#8221; intended to qualify for the safe
  harbors from liability established by the federal securities laws. Statements
  included in this quarterly report that are not historical facts (including any
  statements concerning the benefits of the Settlement (as defined below) or the
  Credit Agreement Amendment (as defined below), the impact of the Bankruptcy
  Filings (as defined below) and any statements regarding plans and objectives of
  management for future operations or economic performance, or assumptions or
  forecasts related thereto), including, without limitation, the information set
  forth in Management&#8217;s Discussion and Analysis of Financial Condition and Results
  of Operations, are forward-looking statements. These statements can be
  identified by the use of forward-looking terminology including &#8220;may,&#8221; &#8220;will,&#8221;
  &#8220;should,&#8221; &#8220;believe,&#8221; &#8220;expect,&#8221; &#8220;intend,&#8221; &#8220;anticipate,&#8221; &#8220;estimate,&#8221; &#8220;continue,&#8221;
  or other similar words. These statements discuss future expectations, contain
  projections of results of operations or of financial condition, or state other
  &#8220;forward-looking&#8221; information. We and our representatives may from time to time
  make other oral or written statements that are also forward-looking
  statements.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Such
  forward-looking statements are subject to various risks and uncertainties that
  could cause actual results to differ materially from those anticipated as of the
  date of the filing of this report. Although we believe that the expectations
  reflected in these forward-looking statements are based on reasonable
  assumptions, no assurance can be given that these expectations will prove to be
  correct. Important factors that could cause our actual results to differ
  materially from the expectations reflected in these forward-looking statements
  include, among other things, those set forth in Part I, &#8220;Item 1A. Risk Factors&#8221;
  in our Annual Report on Form 10-K for the year ended December 31, 2007, which
  was filed with the Securities and Exchange Commission (the &#8220;SEC&#8221;) on March 6,
  2008 (the &#8220;2007 Form 10-K&#8221;), and those set forth in &#8220;Item 1A. Risk Factors&#8221; of
  this report.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">All
  forward-looking statements included in this report are based on information
  available to us on the date of this report. We undertake no obligation to
  publicly update or revise any forward-looking statement, whether as a result of
  new information, future events or otherwise. All subsequent written and oral
  forward-looking statements attributable to us or persons acting on our behalf
  are expressly qualified in their entirety by the cautionary statements contained
  throughout this report.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Overview</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">We are a
  publicly traded master limited partnership with operations in twenty-three
  states. We provide integrated terminalling, storage, gathering and
  transportation services for companies engaged in the production, distribution
  and marketing of crude oil and liquid asphalt cement. We manage our operations
  through two operating segments: (i)&#160;terminalling and storage services and
  (ii)&#160;gathering and transportation services. We were formed in February 2007
  as a Delaware master limited partnership initially to own, operate and develop a
  diversified portfolio of complementary midstream energy assets.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">In July
  2007, we issued 12,500,000 common units, representing limited partner interests,
  and 12,570,504 subordinated units, representing additional limited partner
  interests, to SemGroup Holdings, L.P., or SemGroup Holdings, and 549,908 general
  partner units representing a 2% general partner interest to SemGroup Energy
  Partners G.P., L.L.C., our general partner. SemGroup Holdings then completed a
  public offering of 12,500,000 common units at a price of $22 per unit. In
  addition, we issued an additional 1,875,000 common units to the public pursuant
  to the underwriters&#8217; exercise of their over-allotment option. We did not receive
  any proceeds from the common units sold by SemGroup Holdings. We received net
  proceeds of approximately $38.7 million after deducting underwriting discounts
  from the sale of common units in connection with the exercise of the
  underwriters&#8217; over-allotment option. We used these net proceeds to reduce
  outstanding borrowings under our credit facility.&#160;&#160;In connection with
  our initial public offering, we entered into a Throughput Agreement (the
  &#8220;Throughput Agreement&#8221;) with the Private Company under which we provided crude
  oil gathering and transportation and terminalling and storage services to the
  Private Company.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div><br>
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  </font></div>
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          <div id="GLHDR" style="WIDTH: 100%" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 9pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><a href="#TOC">Table of Contents</a></font></div>
        </div>
      </div><br>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">On
  February&#160;20, 2008, we purchased land, receiving infrastructure, machinery,
  pumps and piping and 46 liquid asphalt cement and residual fuel oil terminalling
  and storage facilities (the &#8220;Acquired Asphalt Assets&#8221;) from the Private Company
  for aggregate consideration of $379.5 million, including $0.7 million of
  acquisition-related costs. For accounting purposes, the acquisition has been
  reflected as a purchase of assets, with the Acquired Asphalt Assets recorded at
  the historical cost of the Private Company, which was approximately $145.5
  million, with the additional purchase price of $234.0 million reflected in the
  statement of changes in partners&#8217; capital as a distribution to the Private
  Company.&#160;&#160;In conjunction with the purchase of the Acquired Asphalt
  Assets, we amended&#160;our existing credit facility, increasing&#160;our
  borrowing capacity to $600 million. Concurrently,&#160;we issued 6,000,000
  common units, receiving proceeds, net of underwriting discounts and
  offering-related costs, of $137.2 million.&#160;Our general partner also made a
  capital contribution of $2.9 million to maintain its 2.0% general partner
  interest in us. On March&#160;5, 2008,&#160;we issued an additional 900,000
  common units, receiving proceeds, net of underwriting discounts, of $20.6
  million, in connection with the underwriters&#8217; exercise of their over-allotment
  option in full.&#160;Our general partner made a corresponding capital
  contribution of $0.4 million to maintain its 2.0% general partner interest in
  us.&#160;&#160;In connection with the acquisition of the Acquired Asphalt
  Assets,&#160;we entered into a Terminalling and Storage Agreement (the
  &#8220;Terminalling Agreement&#8221;) with the Private Company and certain of its
  subsidiaries under which we provided liquid asphalt cement terminalling and
  storage and throughput services to the Private Company and the Private Company
  has agreed to use the&#160;our services at certain minimum
  levels.&#160;&#160;Our general partner&#8217;s Board of Directors (the &#8220;Board&#8221;)
  approved the acquisition of the Acquired Asphalt Assets as well as the terms of
  the related agreements based on a recommendation from its conflicts committee,
  which consisted entirely of independent directors. The conflicts committee
  retained independent legal and financial advisors to assist it in evaluating the
  transaction and considered a number of factors in approving the acquisition,
  including an opinion from the committee&#8217;s independent financial advisor that the
  consideration paid for the Acquired Asphalt Assets was fair, from a financial
  point of view, to us.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">On May
  12, 2008, we purchased the Eagle North Pipeline System, a 130-mile, 8-inch
  pipeline that originates in Ardmore, Oklahoma and terminates in Drumright,
  Oklahoma as well as other real and personal property related to the pipeline
  (the &#8220;Acquired Pipeline Assets&#8221;) from the Private Company for aggregate
  consideration of $45.1 million, including $0.1 million of acquisition-related
  costs.&#160;&#160;The acquisition was funded with borrowings under our revolving
  credit facility.&#160;&#160;We have suspended capital expenditures on this
  pipeline due to the continuing impact of the Bankruptcy Filings.&#160;
  Management currently intends to put the asset into service by late 2009 or early
  2010 and is exploring various alternatives to complete the
  project.&#160;&#160;The Board approved the acquisition of the Acquired Pipeline
  Assets based on a recommendation from its conflicts committee, which consisted
  entirely of independent directors. The conflicts committee retained independent
  legal and financial advisors to assist it in evaluating the transaction and
  considered a number of factors in approving the acquisition, including an
  opinion from the committee&#8217;s independent financial advisor that the
  consideration paid for the Acquired Pipeline Assets was fair, from a financial
  point of view, to us.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">On May
  30, 2008, we purchased certain land, crude oil storage and terminalling
  facilities with an aggregate of approximately 2.0 million barrels of storage
  capacity and related assets located at the Cushing Interchange from the Private
  Company and we assumed a take-or-pay, fee-based, third party contract through
  August 2010 relating to the additional 2.0 million barrels of storage capacity
  (the &#8220;Acquired Storage Assets&#8221;) for aggregate consideration of $90.3 million,
  including $0.3 million of acquisition-related costs.&#160;&#160;The acquisition
  was funded with borrowings under our revolving credit facility.&#160;&#160;The
  Board approved the acquisition of the Acquired Storage Assets based on a
  recommendation from its conflicts committee, which consisted entirely of
  independent directors. The conflicts committee retained independent legal and
  financial advisors to assist it in evaluating the transaction and considered a
  number of factors in approving the acquisition, including an opinion from the
  committee&#8217;s independent financial advisor that the consideration paid for the
  Acquired Storage Assets was fair, from a financial point of view, to
  us.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Impact
  of the Bankruptcy of the Private Company and Certain of its Subsidiaries and
  Related Events</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0.8pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Due to
  the events related to the Bankruptcy Filings (as defined below) described
  herein, including the uncertainty relating to future cash flows, we face
  substantial doubt as to our ability to continue as a going
  concern.&#160;&#160;While it is not feasible to predict the ultimate outcome of
  the events surrounding the Bankruptcy Cases (as defined below), we have been and
  could continue to be materially and adversely affected by such events and we may
  be forced to make a bankruptcy filing or take other action that could have a
  material adverse effect on our business, the price of our common units and our
  results of operations.</font></div>
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        <div id="HDR">
          <div id="GLHDR" style="WIDTH: 100%" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 9pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><a href="#TOC">Table of Contents</a></font></div>
        </div>
      </div><br>
      <div style="DISPLAY: block; MARGIN-LEFT: 18pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">Bankruptcy
  Filings</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">On July
  17, 2008, we issued a press release announcing that the Private Company was
  experiencing liquidity issues and was exploring various alternatives, including
  raising additional equity, debt capital or the filing of a voluntary petition
  for reorganization under Chapter 11 of the Bankruptcy Code to address these
  issues.&#160;&#160;We filed this press release in a Current Report on Form 8-K
  filed with the SEC on July 18, 2008.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">On July
  22, 2008, the Private Company and certain of its subsidiaries filed voluntary
  petitions (the &#8220;Bankruptcy Filings&#8221;) for reorganization under Chapter 11 of the
  Bankruptcy Code in the United States Bankruptcy Court for the District of
  Delaware (the &#8220;Bankruptcy Court&#8221;), Case No. 08-11547-BLS.&#160;&#160; The
  Private Company and its subsidiaries continue to operate their businesses and
  own and manage their properties as debtors-in-possession under the jurisdiction
  of the Bankruptcy Court and in accordance with the applicable provisions of the
  Bankruptcy Code (the &#8220;Bankruptcy Cases&#8221;).&#160;None of us, our general partner,
  our subsidiaries nor the subsidiaries of our general partner are debtors in the
  Bankruptcy Cases.&#160;&#160;However, because of the contractual relationships
  with the Private Company and certain of its subsidiaries, the Bankruptcy Filings
  have adversely impacted us and may in the future impact us in various ways,
  including the items discussed below.&#160;&#160;Our financial results as of
  September 30, 2008 reflect a $0.4 million allowance for doubtful accounts
  related to amounts due from third parties as of September 30,
  2008.&#160;&#160;The allowance related to amounts due from third parties was
  established as a result of certain third party customers netting amounts due
  them from the Private Company with amounts due to us.&#160;&#160;Also, due to
  the change of control of our general partner related to the Private Company&#8217;s
  liquidity issues, all outstanding awards under our general partner&#8217;s long-term
  incentive plan (the&#160;"Plan")&#160;vested on July 18, 2008, resulting in an
  incremental $18.0 million in non-cash compensation expense for the three months
  ended September 30, 2008.&#160;&#160;In addition to the allowance for doubtful
  accounts and non-cash compensation expense described above, the results of
  operations for the three and nine months ended September 30, 2008 included in
  this quarterly report were affected by the Bankruptcy Filings and related
  events, which resulted in decreased revenues and increased general and
  administrative expenses as described below under &#8220;&#8212;Our Revenues,&#8221; and &#8220;&#8212;Other
  Effects,&#8221; respectively.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 18pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">Board
  and Management Composition</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">On July
  9, 2008, Edward F. Kosnik was appointed as an independent member of the
  Board.&#160;&#160;Mr.&#160;Kosnik is the chairman of the compensation committee
  and also serves on the audit committee and the conflicts committee of the Board.
  Under the provisions of the Plan, Mr.&#160;Kosnik was granted an award of 5,000
  restricted common units on July 9, 2008.&#160;These restricted common units
  vested on July 18, 2008 in connection with the change of control of our general
  partner described below.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">On July
  18, 2008, Manchester Securities Corp. (&#8220;Manchester&#8221;) and Alerian Finance
  Partners, LP (&#8220;Alerian&#8221;), as lenders to SemGroup Holdings, the sole member of
  our general partner, exercised certain rights described below under a Loan
  Agreement and a Pledge Agreement, each dated June 25, 2008 (the &#8220;Holdings Credit
  Agreements&#8221;), that were triggered by certain events of default under the
  Holdings Credit Agreements.&#160;&#160;On March 20, 2009, Alerian transferred
  its interest in the Holdings Credit Agreements to Manchester.&#160;&#160;The
  Holdings Credit Agreements are secured by our subordinated units and incentive
  distribution rights and the membership interests in our general partner owned by
  SemGroup Holdings.&#160;&#160;Manchester has not foreclosed on our subordinated
  units owned by SemGroup Holdings or the membership interests in our general
  partner.&#160;&#160;Manchester may in the future exercise other remedies
  available to them under the Holdings Credit Agreement and related loan
  documents, including taking action to foreclose on the collateral securing the
  loan.&#160;&#160;Neither us nor our general partner is a party to the Holdings
  Credit Agreements or the related loan documents.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">On July
  18, 2008, Manchester and Alerian exercised their right under the Holdings Credit
  Agreements to vote the membership interests of our general partner in order to
  reconstitute the Board (the &#8220;Change of Control&#8221;).&#160;&#160;Messrs. Thomas L.
  Kivisto, Gregory C. Wallace, Kevin L. Foxx, Michael J. Brochetti and W. Anderson
  Bishop were removed from the Board.&#160;&#160;Mr. Bishop had served as the
  chairman of the audit committee and as a member of the conflicts committee and
  compensation committee of the Board.&#160;&#160;Messrs. Sundar S. Srinivasan,
  David N. Bernfeld and Gabriel Hammond (each of whom is affiliated with
  Manchester or Alerian) were appointed to the Board.&#160;&#160;Mr. Srinivasan
  was elected as Chairman of the Board.&#160;&#160;Messrs. Brian F. Billings and
  Edward F. Kosnik remain as independent directors of the Board and continue to
  serve as members of the conflicts committee, audit committee and compensation
  committee of the Board.&#160;&#160;In addition, Messrs. Foxx and Alex Stallings
  resigned the positions each officer held with SemGroup, L.P. in July
  2008.&#160;&#160;Mr. Brochetti had previously resigned from his position with
  SemGroup, L.P. in March 2008.&#160;&#160;Messrs. Foxx, Brochetti and Stallings
  remain as officers of our general partner.</font></div><br>
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        </div>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">On
  October 1, 2008, Dave Miller (who is an affiliate of Manchester) and Duke R.
  Ligon were appointed members of the Board. Mr. Ligon is an independent member of
  the Board and is the chairman of the audit committee and also serves on the
  compensation committee and the conflicts committee of the Board. In connection
  with his appointment to the Board, Mr. Ligon was granted an award of 5,000
  restricted common units.&#160;&#160;The restricted common units granted to Mr.
  Ligon vest in one-third increments over a three-year period.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">On
  January 9, 2009, Mr. Srinivasan resigned his positions as Chairman of the Board
  and as a director.&#160;&#160;Mr. Ligon was subsequently elected as Chairman of
  the Board.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">On March
  18, 2009, the Board realigned the officers of our general partner appointing
  Michael J. Brochetti as Executive Vice President&#8212;Corporate Development and
  Treasurer, Alex G. Stallings as Chief Financial Officer and Secretary, and James
  R. Griffin as Chief Accounting Officer.&#160;&#160;Mr. Brochetti had previously
  served as Chief Financial Officer, Mr. Stallings had previously served as Chief
  Accounting Officer and Secretary and Mr. Griffin had previously served as
  Controller.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 18pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">Bankruptcy
  Court Order</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">On
  September 9, 2008, the Bankruptcy Court entered an order relating to the
  settlement of certain matters between us and the Private Company (the &#8220;Order&#8221;)
  in the Bankruptcy Cases.&#160;&#160;Among other things, the Order provided that
  (i) the Private Company was to directly pay any utility costs attributable to
  the operations of the Private Company at certain shared facilities, and the
  Private Company was to pay us for past utility cost reimbursements that were due
  from the Private Company; (ii) commencing on September 15, 2008, payments under
  the Terminalling Agreement were netted against amounts due under the Amended
  Omnibus Agreement and were made on the 15th day of each month for the prior
  month (with a three business-day grace period); (iii) the Private Company
  provided us with a letter of credit in the amount of approximately $4.9 million
  to secure the Private Company&#8217;s postpetition obligations under the Terminalling
  Agreement; (iv) the Private Company was to make payments under the Throughput
  Agreement for the month of August on September 15, 2008 (with a three
  business-day grace period) based upon the monthly contract minimums in the
  Throughput Agreement and netted against amounts due under the Amended Omnibus
  Agreement; (v) the Private Company was to make payments under the Throughput
  Agreement for the months of September and October on October 15, 2008 (with a
  three business-day grace period) and November 15, 2008 (with a three
  business-day grace period), respectively, or three business days after amounts
  due are determined and documentation therefore was provided and exchanged based
  upon actual volumes for each such month and at a rate equal to the average rate
  charged by us to third-party shippers in the same geographical area, with any
  such amounts netted against amounts due under the Amended Omnibus Agreement (as
  defined below); (vi) the parties were to reevaluate the Throughput Agreement and
  the payment terms with respect to services provided after October 2008; (vii)
  representatives of us and the Private Company were to meet to discuss the
  transition to us of certain of the Private Company&#8217;s employees necessary to
  maintain our business, and pending agreement between the parties, the Private
  Company was to continue to provide services in accordance with the Amended
  Omnibus Agreement through at least November 30, 2008; (viii) the Private Company
  was to consent to an order relating a third-party storage contract which
  provided that we were the rightful owner of the rights in and to a certain
  third-party storage agreement and the corresponding amounts due thereunder; and
  (ix) we were to enter into a specified lease with the Private Company to permit
  the Private Company to construct a pipeline.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 18pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">Settlement
  with the Private Company</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">On March
  12, 2009, the Bankruptcy Court held a hearing and approved the transactions
  contemplated by a term sheet (the &#8220;Settlement Term Sheet&#8221;) relating to the
  settlement of certain matters between the Private Company and us (the
  &#8220;Settlement&#8221;).&#160;&#160;The Bankruptcy Court entered an order approving the
  Settlement upon the terms contained in the Settlement Term Sheet on March 20,
  2009.&#160;&#160;We and the Private Company executed definitive documentation,
  in the form of a master agreement (the &#8220;Master Agreement&#8221;), dated April 7, 2009
  to be effective as of 11:59 PM CDT March 31, 2009, and certain other transaction
  documents to effectuate the Settlement and that superseded the Settlement Term
  Sheet.&#160;&#160;The Bankruptcy Court entered an order approving the Master
  Agreement and the Settlement on April 7, 2009.&#160;&#160;In addition, in
  connection with the Settlement, we and the requisite lenders under our secured
  credit facility entered into the Credit Agreement Amendment (as defined below)
  under which, among other things, the lenders consented to the Settlement and
  waived all existing defaults and events of default described in the Forbearance
  Agreement (as defined below) and amendments thereto.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div><br>
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        </div>
      </div><br>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
  Settlement&#160;provided for&#160;the following:</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 36pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">we
        transferred certain crude oil storage assets located in Kansas and
        northern Oklahoma to the Private
  Company;</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 36pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">the
        Private Company transferred ownership of 355,000 barrels of crude oil tank
        bottoms and line fill to us;</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 36pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">the
        Private Company rejected the Throughput
    Agreement;</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 36pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">we
        and one of our subsidiaries have a $20 million unsecured claim against the
        Private Company and certain of its subsidiaries relating to rejection of
        the Throughput Agreement;</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 36pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">we
        and the Private Company entered into the New Throughput Agreement (as
        defined below) pursuant to which we provide certain crude oil gathering,
        transportation, terminalling and storage services to the Private
        Company;</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 36pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">we
        offered employment to certain crude oil
    employees;</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 36pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">the
        Private Company transferred its asphalt assets that are connected to our
        asphalt assets to us;</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 36pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">the
        Private Company rejected the Terminalling
    Agreement;</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 36pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">one
        of our subsidiaries has a $35 million unsecured claim against the Private
        Company and certain of its subsidiaries relating to rejection of the
        Terminalling Agreement;</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 36pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">we
        and the Private Company entered into the New Terminalling Agreement (as
        defined below) pursuant to which we provide liquid asphalt cement
        terminalling and storage services for the Private Company&#8217;s remaining
        asphalt inventory;</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 36pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">the
        Private Company agreed to remove all of its remaining asphalt inventory
        from our asphalt storage facilities no later than October 31,
        2009;</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 36pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">the
        Private Company will be entitled to receive 20% of the proceeds of any
        sale by us of any of the asphalt assets transferred to us in connection
        with the Settlement that occurs prior to December 31,
    2009;</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 36pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">the
        Private Company rejected the Amended Omnibus
    Agreement;</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 36pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">we
        and the Private Company entered into the Shared Services Agreement (as
        defined below) pursuant to which the Private Company provides certain
        operational services for us;</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 36pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">other
        than as provided above, we and the Private Company entered into mutual
        releases of claims relating to the rejection of the Terminalling
        Agreement, the Throughput Agreement and the Amended Omnibus
        Agreement;</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 36pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">certain
        pre-petition claims by the Private Company and us were netted and
        waived;</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 36pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">we
        and the Private Company resolved certain remaining issues related to the
        contribution of crude oil assets to us in connection with our initial
        public offering, our acquisition of the Acquired Asphalt Assets, our
        acquisition of the Acquired Pipeline Assets and our acquisition of the
        Acquired Storage Assets, including the release of claims relating to such
        acquisitions; and</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 36pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">we
        and the Private Company entered into the Trademark Agreement (as defined
        below) which provides us with a non-exclusive, worldwide license to use
        certain trade names, including the name &#8220;SemGroup&#8221;, and the corresponding
        mark until December 31, 2009, and the Private Company waived claims for
        infringement relating to such trade names and mark prior to the date of
        such license agreement.</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Management
  is currently evaluating the accounting for the Settlement, and is obtaining
  independent valuations of the assets transferred.&#160; Certain terms of the
  transaction documents relating to the Settlement are discussed in more detail
  below.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div><br>
      <div id="PGBRK" style="MARGIN-LEFT: 0pt; WIDTH: 100%; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
        <div id="FTR">
          <div style="WIDTH: 100%" align="left">
            <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
  </font></div>
          </div>
          <div id="GLFTR" style="WIDTH: 100%" align="center">
          </div>
        </div>
        <div id="PN" style="PAGE-BREAK-AFTER: always">
          <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">36</font></div>
          <div style="WIDTH: 100%; TEXT-ALIGN: center">
            <hr style="COLOR: black" noshade size="2">
          </div>
        </div>
        <div id="HDR">
          <div id="GLHDR" style="WIDTH: 100%" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 9pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><a href="#TOC">Table of Contents</a></font></div>
        </div>
      </div><br>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">Shared
  Services Agreement</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">In
  connection with the Settlement, we entered into a Shared Services Agreement,
  dated April 7, 2009 to be effective as of 11:59 PM CDT March 31, 2009 (the
  &#8220;Shared Services Agreement&#8221;), with the Private Company.&#160;&#160;Pursuant to
  the Shared Services Agreement, the Private Company will provide certain general
  shared services, Cushing shared services (as described below), and SCADA
  services (as described below) to us.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
  general shared services include crude oil movement services, Department of
  Transportation services, right-of-way services, environmental services, pipeline
  and civil structural maintenance services, safety services, pipeline truck
  station maintenance services, project support services and truck dispatch
  services.&#160;&#160;The fees for such general shared services are fixed at
  $125,000 for the month of April 2009 and such fixed fee may be extended by
  mutual agreement of the parties for one additional month.&#160;&#160;Thereafter
  the fees will be calculated in accordance with the formulas contained
  therein.&#160;&#160;The Private Company has agreed to provide the general shared
  services for three years (subject to earlier termination as provided therein)
  and the term may be extended an additional year by mutual agreement of the
  parties.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
  Cushing shared services include operational and maintenance services related to
  terminals at Cushing, Oklahoma.&#160;&#160;The fees for such Cushing shared
  services&#160;are fixed at $20,000 for the month of April 2009 and such fixed
  fee may be extended by mutual agreement of the parties for one additional
  month.&#160;&#160;Thereafter the fees will be calculated in accordance with the
  formulas contained therein.&#160;&#160;The Private Company has agreed to provide
  the Cushing shared services for three years (subject to earlier termination as
  provided therein) and the term may be extended an additional year by mutual
  agreement of the parties.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The SCADA
  services include services related to the operation of the SCADA system which is
  used in connection with our crude oil operations.&#160;&#160;The fees for such
  SCADA services&#160;are fixed at $15,000 for the month of April 2009 and such
  fixed fee may be extended by mutual agreement of the parties for one additional
  month.&#160;&#160;Thereafter the fees will be calculated in accordance with the
  formulas contained therein.&#160;&#160;The Private Company has agreed to provide
  the SCADA services for five years (subject to earlier termination as provided
  therein) and we may elect to extend the term for two subsequent five year
  periods.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">Transition
  Services Agreement</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">In
  connection with the Settlement, we entered into a Transition Services Agreement,
  dated April 7, 2009 to be effective as of 11:59 PM CDT March 31, 2009 (the
  &#8220;Transition Services Agreement&#8221;), with the Private Company.&#160;&#160;Pursuant
  to the Transition Services Agreement, the Private Company will provide certain
  corporate, crude oil and asphalt transition services, in each case for a limited
  amount of time, to us.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">Transfer
  of Crude Oil Assets</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">In
  connection with the Settlement, we transferred certain crude oil assets located
  in Kansas and northern Oklahoma to the Private Company.&#160;&#160;These
  transfers included real property and associated personal property at locations
  where the Private Company owned the pipeline.&#160;&#160;We retained certain
  access and connection rights to enable us to continue to operate our crude oil
  trucking business in such areas.&#160;&#160;In addition, we transferred our
  interests in the SCADA System, a crude oil inventory tracking system, to the
  Private Company.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">In
  addition, the Private Company transferred to us (i) 355,000 barrels of crude oil
  line fill and tank bottoms, which are necessary for us to operate our crude oil
  tank storage operations and our Oklahoma and Texas crude oil pipeline systems,
  (ii) certain personal property located in Oklahoma, Texas and Kansas used in
  connection with our crude oil trucking business and (iii) certain real property
  located in Oklahoma, Kansas, Texas and New Mexico that was intended to be
  transferred in connection with our initial public offering.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">Transfer
  of Asphalt Assets</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">In
  connection with the Settlement, the Private Company transferred certain asphalt
  processing assets that&#160;were connected to, adjacent to, or otherwise
  contiguous with our existing asphalt facilities and associated real property
  interests to us.&#160;&#160;The transfer of the Private Company&#8217;s asphalt assets
  in connection with the Settlement provides us with outbound logistics for our
  existing asphalt assets and, therefore, allows us to provide asphalt
  terminalling and storage services to third parties.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div><br>
      <div id="PGBRK" style="MARGIN-LEFT: 0pt; WIDTH: 100%; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
        <div id="FTR">
          <div style="WIDTH: 100%" align="left">
            <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
  </font></div>
          </div>
          <div id="GLFTR" style="WIDTH: 100%" align="center">
          </div>
        </div>
        <div id="PN" style="PAGE-BREAK-AFTER: always">
          <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">37</font></div>
          <div style="WIDTH: 100%; TEXT-ALIGN: center">
            <hr style="COLOR: black" noshade size="2">
          </div>
        </div>
        <div id="HDR">
          <div id="GLHDR" style="WIDTH: 100%" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 9pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><a href="#TOC">Table of Contents</a></font></div>
        </div>
      </div><br>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">New
  Throughput Agreement</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">In
  connection with the Settlement, we and the Private Company entered into a
  Throughput Agreement, dated as of April 7, 2009 to be effective as of 11:59 PM
  CDT March 31, 2009 (the &#8220;New Throughput Agreement&#8221;), pursuant to which we
  provide certain crude oil gathering, transportation, terminalling and storage
  services to the Private Company.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Under the
  New Throughput Agreement, we charge the following fees: (i) barrels gathered via
  gathering lines will be charged a gathering rate of $0.75 per barrel, (ii)
  barrels transported within Oklahoma will be charged $1.00 per barrel while
  barrels transported on the Masterson Mainline will be charged $0.55 per barrel,
  (iii) barrels transported by truck will be charged in accordance with the
  schedule contained therein, including a fuel surcharge, (iv) storage fees shall
  equal $0.50 per barrel per month for product located in storage tanks located in
  Cushing, Oklahoma and $0.44 per barrel per month for product not located in
  dedicated Cushing storage tanks, and (v) a delivery charge of $0.08 per barrel
  will be charged for deliveries out of the Cushing Interchange Terminal.&#160;The
  New Throughput Agreement has an initial term of one year with additional
  automatic one-month renewals unless either party terminates the agreement upon
  thirty-days prior notice.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">New
  Terminalling and Storage Agreement</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">In
  connection with the Settlement, we and the Private Company entered into a
  Terminalling and Storage Agreement, dated as of April 7, 2009 to be effective as
  of 11:59 PM CDT March 31, 2009 (the &#8220;New Terminalling Agreement&#8221;), pursuant to
  which we provide certain asphalt terminalling and storage services for the
  remaining asphalt inventory of the Private Company.&#160;&#160;Storage services
  under the New Terminalling Agreement are equal to $0.565 per barrel per month
  multiplied by the total shell capacity in barrels for each storage tank where
  the Private Company and its affiliates have product; provided that if the
  Private Company removes all product from a storage tank prior to the end of the
  month, then the storage service fees shall be pro-rated for such month based on
  the number of calendar days storage was actually used.&#160;&#160;Throughput
  fees under the New Terminalling Agreement are equal to $9.25 per ton; provided
  that no fees are payable for transfers of product between storage tanks located
  at the same or different terminals.&#160;&#160;The New Terminalling Agreement
  has an initial term that expires on October 31, 2009, which may be extended for
  one month by mutual agreement of the parties.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">New
  Access and Use Agreement</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">In
  connection with the Settlement, we and the Private Company entered into an
  Access and Use Agreement, dated as of April 7, 2009 to be effective as of 11:59
  PM CDT March 31, 2009 (the &#8220;New Access and Use Agreement&#8221;), pursuant to which we
  will allow the Private Company access rights to our asphalt facilities relating
  to its existing asphalt inventory.&#160;&#160;The term of the Access and Use
  Agreement will end separately for each terminal upon the earlier of October 31,
  2009 or until all of the existing asphalt inventory of the Private Company is
  removed from such terminal.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">Trademark
  Agreement</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">In
  connection with the Settlement, we and the Private Company entered into a
  Trademark License Agreement, dated as of April 7, 2009 to be effective as of
  11:59 PM CDT March 31, 2009 (the &#8220;Trademark Agreement&#8221;), pursuant to which the
  Private Company granted us a non-exclusive, worldwide license to use certain
  trade names, including the name &#8220;SemGroup&#8221;, and the corresponding mark until
  December 31, 2009, and the Private Company waived claims for infringement
  relating to such trade names and mark prior to the effective date of the
  Trademark Agreement.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">Building
  and Office Leases</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">In
  connection with the Settlement, we leased office space in Oklahoma City,
  Oklahoma and certain facilities in Cushing, Oklahoma to the Private
  Company.&#160;&#160;The term for the leases expires on March 31,
  2014.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div><br>
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            <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
  </font></div>
          </div>
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          <div style="WIDTH: 100%; TEXT-ALIGN: center">
            <hr style="COLOR: black" noshade size="2">
          </div>
        </div>
        <div id="HDR">
          <div id="GLHDR" style="WIDTH: 100%" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 9pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><a href="#TOC">Table of Contents</a></font></div>
        </div>
      </div><br>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">Easements</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">In
  connection with the Settlement, we and the Private Company granted mutual
  easements relating to access, facility improvements, existing and future
  pipeline rights and corresponding rights of ingress and egress for properties
  owned by the parties at Cushing, Oklahoma.&#160;&#160;In addition, we granted
  the Private Company certain pipeline easements at Cushing, Oklahoma, together
  with the corresponding rights of ingress and egress.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 9pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">Partnership
  Revenues</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">For the
  nine months ended September 30, 2008 and the year ended December 31, 2008, we
  derived approximately 81% and approximately 73%, respectively, of our revenues,
  excluding fuel surcharge revenues related to fuel and power consumed to operate
  our liquid asphalt cement storage tanks, from services we provided to the
  Private Company and its subsidiaries.&#160;&#160;Prior to the Order and the
  Settlement, the Private Company was obligated to pay us minimum monthly fees
  totaling $76.1 million annually and $58.9 million annually in respect of the
  minimum commitments under the Throughput Agreement and the Terminalling
  Agreement, respectively, regardless of whether such services were actually
  utilized by the Private Company.&#160;&#160;As described above, the Order
  required the Private Company to make certain payments under the Throughput
  Agreement and Terminalling Agreement during a portion of the third quarter of
  2008, including the contractual minimum payments under the Terminalling
  Agreement.&#160;&#160;In connection with the Settlement, we waived the fees due
  under the Terminalling Agreement during March 2009.&#160;&#160;In addition, the
  Private Company rejected the Throughput Agreement and the Terminalling Agreement
  and we and the Private Company entered into the New Throughput Agreement and the
  New Terminalling Agreement.&#160;&#160;We expect revenues from services provided
  to the Private Company under the New Throughput Agreement and New Terminalling
  Agreement to be substantially less than prior revenues from services provided to
  the Private Company as the new agreements are based upon actual volumes
  gathered, transported, terminalled and stored instead of certain minimum volumes
  and are at reduced rates when compared to the Throughput Agreement and
  Terminalling Agreement.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">We have
  been pursuing opportunities to provide crude oil terminalling and storage
  services and crude oil gathering and transportation services to third
  parties.&#160;&#160;As a result of new crude oil third-party storage contracts,
  we increased our third-party terminalling and storage revenue (excluding fuel
  surcharge revenues related to fuel and power consumed to operate our liquid
  asphalt cement storage tanks)&#160;from approximately $1.0 million, or
  approximately 4% of total terminalling and storage revenue&#160;during the
  second quarter of 2008, to approximately $4.6 million and $8.4 million, or
  approximately 17% and 34% of total terminalling and storage revenue&#160;for the
  third quarter of 2008 and the&#160;fourth quarter of 2008,
  respectively.&#160;</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;In
  addition, as a result of new third-party crude oil transportation contracts and
  reduced commitments of usage by the Private Company under the Throughput
  Agreement, we increased our third-party gathering and transportation revenue
  from approximately $5.0 million, or approximately 21% of total gathering and
  transportation revenue during the second quarter of 2008, to approximately $10.9
  million and $13.6 million, or approximately 51% and 85% of total gathering and
  transportation revenue for the&#160;third quarter of 2008 and the fourth quarter
  of 2008, respectively.&#160;</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
  significant majority of the increase in third party revenues results from an
  increase in third-party crude oil services provided and a corresponding decrease
  in the Private Company&#8217;s crude oil services provided due to the termination of
  the monthly contract minimum revenues under the Throughput Agreement in
  September 2008.&#160;&#160;Average rates for the new third-party crude oil
  terminalling and storage and transportation and gathering contracts are
  comparable with those previously received from the Private
  Company.&#160;&#160;However, the volumes being terminalled, stored, transported
  and gathered have decreased as compared to periods prior to the Bankruptcy
  Filings, which has negatively impacted total revenues.&#160;&#160;As an example,
  fourth quarter 2008 total revenues are approximately $8.2 million less than
  third quarter 2008 total revenues, in each case excluding fuel surcharge
  revenues related to fuel and power consumed to operate our liquid asphalt cement
  storage tanks.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left">
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font id="TAB2" style="LETTER-SPACING: 9pt">&#160;&#160;&#160;</font>&#160;In addition,
  we have recently entered into leases and storage agreements with third parties
  relating to&#160;39 of&#160;our 46 asphalt facilities.&#160;&#160;</font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">We have
  entered into various crude oil transportation and storage contracts with third
  parties and are continuing to pursue additional contracts with third parties;
  however, there can be no assurance that any of these additional efforts will be
  successful.&#160;&#160;In addition, certain third parties may be less likely to
  enter into business transactions with us due to the Bankruptcy
  Filings.&#160;&#160;The Private Company may also choose to curtail its
  operations or liquidate its assets as part of the Bankruptcy
  Cases.&#160;&#160;As a result, unless we are able to generate additional third
  party revenues, we will continue to experience lower volumes in our system which
  could have a material adverse effect on our results of operations and cash
  flows.</font></div>
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            <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
  </font></div>
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        </div>
        <div id="HDR">
          <div id="GLHDR" style="WIDTH: 100%" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 9pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><a href="#TOC">Table of Contents</a></font></div>
        </div>
      </div><br>
      <div style="DISPLAY: block; MARGIN-LEFT: 18pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">Asphalt
  Operations</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Historically,
  we provided liquid asphalt cement terminalling and storage services to the
  Private Company pursuant to the Terminalling Agreement.&#160;&#160;In connection
  with the Settlement, the Private Company rejected the Terminalling Agreement and
  we and the Private Company entered into the New Terminalling Agreement whereby
  we provide liquid asphalt cement terminalling and storage services to the
  Private Company in connection with its remaining asphalt
  inventory.&#160;&#160;The New Terminalling Agreement has an initial term that
  ends on October 31, 2009 and the Private Company has agreed to remove all of its
  existing asphalt inventory no later than such date, and we expect that the
  Private Company may remove it much earlier than such date.&#160;&#160;Also in
  connection with the Settlement, the Private Company transferred certain asphalt
  assets to us that were connected to our existing asphalt assets.&#160;&#160;The
  transfer of the Private Company&#8217;s asphalt assets in connection with the
  Settlement provides us with outbound logistics for our existing asphalt assets
  and, therefore, allows us to provide asphalt terminalling and storage services
  for third parties.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
  asphalt industry in the United States is characterized by a high degree of
  seasonality. Much of this seasonality is due to the impact that weather
  conditions have on road construction schedules, particularly in cold weather
  states. Refineries produce liquid asphalt cement year round, but the peak
  asphalt demand season is during the warm weather months when most of the road
  construction activity in the United States takes place. As a result, liquid
  asphalt cement is typically purchased from refineries at low prices in the low
  demand winter months and then processed and sold at higher prices in the peak
  summer demand season.&#160;&#160;Any significant decrease in the amount of
  revenues that we receive from our liquid asphalt cement terminalling and storage
  operations could have a material adverse effect on our cash flows, financial
  condition and results of operations.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left">
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font size="+0"><font style="FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font id="TAB2" style="FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; LETTER-SPACING: 9pt">&#160;&#160;&#160;</font>&#160;<font style="FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">We have recently entered
  into leases and storage agreements with third parties relating to 39 of
  our&#160;46 asphalt facilities.&#160;&#160;The revenues that we will receive
  pursuant to these leases and storage agreements will be less than the revenues
  received under the Terminalling Agreement with the Private Company.&#160;
  </font></font><font style="FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Without sufficient
  revenues from our asphalt assets, we may be unable to meet the covenants,
  including the minimum liquidity, minimum EBITDA and minimum receipt
  requirements, under our credit agreement.</font></font><font style="FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;&#160;</font></font></div>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 18pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">Operation
  and General Administration of the Partnership</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">As is the
  case with many publicly traded partnerships, we have not historically directly
  employed any persons responsible for managing or operating us or for providing
  services relating to day-to-day business affairs.&#160;&#160;Pursuant to the
  Amended Omnibus Agreement, the Private Company operated our assets and performed
  other administrative services for us such as accounting, legal, regulatory,
  development, finance, land and engineering.&#160;&#160;The events related to the
  Bankruptcy Filings terminated the Private Company&#8217;s obligations to provide
  services to us under the Amended Omnibus Agreement.&#160;&#160;The Private
  Company continued to provide such services to us until the effective date of the
  Settlement at which time the Private Company rejected the Amended Omnibus
  Agreement and we and the Private Company entered into the Shared Services
  Agreement and the Transition Services Agreement relating to the provision of
  such services.&#160;&#160;In addition, in connection with the Settlement, we
  made offers of employment to certain individuals associated with our crude oil
  operations and expect to make additional offers of employment to certain
  individuals associated with our asphalt operations.&#160;&#160;The costs to
  directly employ these individuals as well as the costs under the Shared Services
  Agreement and the Transition Services Agreement may be higher than those
  previously paid by us under the Amended Omnibus Agreement, which could have a
  material adverse effect on our business, financial condition, results of
  operations, cash flows, ability to make distributions to our unitholders, the
  trading price of our common units and our ability to conduct our
  business.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">In
  addition, in connection with the Settlement, we agreed to not solicit the
  Private Company&#8217;s employees for a year from the time of the
  Settlement.&#160;&#160;In connection with the Bankruptcy Cases, the Private
  Company may reduce a substantial number of its employees or some of the Private
  Company&#8217;s employees may choose to terminate their employment with the Private
  Company, some of whom may currently be providing general and administrative and
  operating services to us under the Shared Services Agreement or the Transition
  Services Agreement.&#160;&#160;Any reductions in critical personnel who provide
  services to us and any increased costs to replace such personnel could have a
  material adverse effect on our ability to conduct our business and our results
  of operations.</font></div>
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  </font></div>
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        </div>
      </div><br>
      <div style="DISPLAY: block; MARGIN-LEFT: 18pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">Intellectual
  Property Rights</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Pursuant
  to the Amended Omnibus Agreement, we licensed the use of certain trade names and
  marks, including the name &#8220;SemGroup.&#8221;&#160;&#160;This license terminated
  automatically upon the Change of Control.&#160;&#160;In connection with the
  Settlement, we and the Private Company entered into the Trademark Agreement,
  pursuant to which the Private Company granted us a non-exclusive, worldwide
  license to use certain trade names, including the name &#8220;SemGroup&#8221; and the
  corresponding mark, until December 31, 2009, and the Private Company waived
  claims for infringement relating to such trade names and mark prior to the
  effective date of such Trademark Agreement (see &#8220;&#8212;Settlement with the Private
  Company&#8221;).&#160;&#160;As such, we will be required to change our name and
  trademark upon or prior to the expiration of the Trademark
  Agreement.&#160;&#160;The expenses associated with such a change may be
  significant, which could have a material adverse effect on our business,
  financial condition, results of operations, cash flows, ability to make
  distributions to our unitholders, the trading price of our common units and our
  ability to conduct our business.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 18pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">Credit
  Facility</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">As
  described below under &#8220;&#8212;Liquidity and Capital Resources&#8221;, in connection with the
  events related to the Bankruptcy Filings, certain events of default occurred
  under our credit agreement.&#160;&#160;On September 18, 2008, we and the
  requisite lenders under our credit facility entered into the Forbearance
  Agreement relating to such events of default.&#160;&#160;On April 7, 2009, we
  and the requisite lenders entered into the Credit Agreement Amendment, under
  which the lenders consented to the Settlement and waived all existing defaults
  and events of default described in the Forbearance Agreement and amendments
  thereto.&#160;&#160;See &#8220;&#8212;Liquidity and Capital Resources&#8221; for more information
  regarding our credit facility, the Forbearance Agreement and the Credit
  Agreement Amendment.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 18pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">Distributions
  to Our Unitholders</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">We did
  not make a distribution to our common unitholders, subordinated unitholders or
  general partner attributable to the results of operations for the quarters ended
  June 30, 2008, September 30, 2008, December 31, 2008 or March 31, 2009 due to
  the events of default under our credit agreement and the uncertainty of our
  future cash flows relating to the Bankruptcy Filings.&#160;&#160;Our unitholders
  will be required to pay taxes on their share of our taxable income even though
  they did not receive a cash distribution for such periods.&#160;&#160;In
  addition, we do not currently expect to make a distribution relating to the
  second quarter of 2009.&#160;&#160;We distributed approximately $14.3 million to
  our unitholders for the three months ended March 31, 2008.&#160;&#160;Pursuant
  to the Credit Agreement Amendment, we are prohibited from making distributions
  to our unitholders if our leverage ratio (as defined in the credit agreement)
  exceeds 3.50 to 1.00.&#160;&#160;As of September 30, 2008 and December 31, 2008,
  our leverage ratio was 4.34 to 1.00 and 4.83 to 1.00, respectively.&#160;If our
  leverage ratio does not improve, we may not make quarterly distributions to our
  unitholders in the future.&#160;&#160;</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Our
  partnership agreement provides that, during the subordination period, which we
  are currently in, our common units have the right to receive distributions of
  available cash from operating surplus in an amount equal to the minimum
  quarterly distribution of $0.3125 per common unit per quarter, plus any
  arrearages in the payment of the minimum quarterly distribution on the common
  units from prior quarters, before any distributions of available cash from
  operating surplus may be made on the subordinated units.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 18pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">Nasdaq
  Delisting</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Effective
  at the opening of business on February 20, 2009, our common units were delisted
  from the Nasdaq Global Market (&#8220;Nasdaq&#8221;) due to our failure to timely file this
  Quarterly Report as well as our Quarterly Report on Form 10-Q for the quarter
  ended June 30, 2008.&#160;&#160;We filed our Quarterly Report on Form 10-Q for
  the quarter ended June 30, 2008 on March 23, 2009.&#160;&#160;Our common units
  are currently traded on the Pink Sheets, which is an over-the-counter securities
  market, under the symbol SGLP.PK.&#160;&#160;The fact that our common units are
  not listed on a national securities exchange is likely to make trading such
  common units more difficult for broker-dealers, unitholders and investors,
  potentially leading to further declines in the price of our common
  units.&#160;&#160;In addition, it may limit the number of institutional and
  other investors that will consider investing in our common units, which may have
  an adverse effect on the price of our common units.&#160;&#160;It may also make
  it more difficult for us to raise capital in the future.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">We
  continue to work to become compliant with our SEC reporting obligations and
  intend to promptly seek the relisting of our common units on Nasdaq as soon as
  practicable after we have become compliant with such reporting
  obligations.&#160;&#160;However, there can be no assurances that we will be able
  to relist our common units on Nasdaq or any other national securities exchange
  and we may face a lengthy process to relist our common units if we are able to
  relist them at all.</font></div>
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        </div>
      </div><br>
      <div style="DISPLAY: block; MARGIN-LEFT: 18pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">Claims
  Against and By The Private Company&#8217;s Bankruptcy Estate</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">In
  connection with the Settlement, we and the Private Company entered into mutual
  releases regarding certain claims.&#160;&#160;In addition, the Settlement
  provided that we have a $35 million unsecured claim against the Private Company
  relating to rejection of the Terminalling Agreement and a $20 million unsecured
  claim against the Private Company relating to rejection of the Throughput
  Agreement.&#160;&#160;<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">On May
  15, 2009, the Private Company filed a joint plan of
  reorganization.&#160;&#160;If such plan is confirmed without material amendment,
  our claims will be impaired.</font>&#160; We may also have additional claims
  against the Private Company that were not released in connection with the
  Settlement, and the Private Company may also have additional claims against us
  that were not released in connection with the Settlement.&#160;&#160;Any claims
  asserted by us against the Private Company in the Bankruptcy Cases will be
  subject to the claim allowance procedure provided in the Bankruptcy Code and
  Bankruptcy Rules.&#160;&#160;If an objection is filed, the Bankruptcy Court will
  determine the extent to which any such claim that has been objected to is
  allowed and the priority of such claims.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 18pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">Governmental
  Investigations</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">On July
  21, 2008, we received a letter from the staff of the SEC giving notice that the
  SEC is conducting an inquiry relating to us and requesting, among other things,
  that we voluntarily preserve, retain and produce to the SEC certain documents
  and information relating primarily to our disclosures respecting the Private
  Company&#8217;s liquidity issues, which were the subject of our July 17, 2008 press
  release.&#160;&#160;On October 22, 2008, we received a subpoena from the SEC
  pursuant to a formal order of investigation requesting certain documents
  relating to, among other things, the Private Company&#8217;s liquidity
  issues.&#160;&#160;We have been cooperating, and intend to continue cooperating,
  with the SEC in its investigation.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">On July
  23, 2008, we and our general partner each received a Grand Jury subpoena from
  the United States Attorney&#8217;s Office in Oklahoma City, Oklahoma, requiring, among
  other things, that we and our general partner produce financial and other
  records related to our July 17, 2008 press release.&#160;&#160;We have been
  informed that the U.S. Attorneys&#8217; Offices for the Western District of Oklahoma
  and the Northern District of Oklahoma are in discussions regarding the
  subpoenas, and no date has been set for a response to the
  subpoenas.&#160;&#160;We and our general partner intend to cooperate fully with
  this investigation if and when it proceeds.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 18pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">Securities
  and Other Litigation</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Please
  see &#8220;Part II&#8212;Item I. Legal Proceedings&#8221; for a discussion of certain securities
  and other litigation to which we are a party.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 18pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">Examiner</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">On August
  12, 2008, a motion was filed by the United States Trustee asking the Bankruptcy
  Court to appoint an examiner to investigate the Private Company&#8217;s trading
  strategies as well as certain &#8220;insider transactions,&#8221; including the contribution
  of the crude oil assets to us in connection with our initial public offering,
  the sale of the asphalt assets to us in February 2008, the sale of the Eagle
  North Pipeline System to us in May 2008, the sale of certain crude oil storage
  assets to us in May 2008, and the entering into the Holdings Credit Agreements
  by SemGroup Holdings.&#160;&#160;On September 10, 2008, the Bankruptcy Court
  approved the appointment of an examiner, and on October 14, 2008, the United
  States Trustee appointed Louis J. Freeh, former director of the Federal Bureau
  of Investigation, as the examiner.&#160;&#160;<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">On April
  15, 2009, the examiner filed a report summarizing the findings of his
  investigation with the Bankruptcy Court (the &#8220;Examiner&#8217;s Report&#8221;).</font></font>
  
        <div style="DISPLAY: block; TEXT-INDENT: 0pt">&#160;</div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font id="TAB2" style="LETTER-SPACING: 9pt">&#160;&#160;&#160;</font>&#160;The examiner
  was directed by the Bankruptcy Court to (i) investigate the circumstances
  surrounding the Private Company&#8217;s trading strategy, the transfer of the New York
  Mercantile Exchange account, certain insider transactions, the formation of us,
  the potential improper use of borrowed funds and funds generated from the
  Private Company&#8217;s operations and the liquidation of their assets to satisfy
  margin calls related to the trading strategy for the Private Company and certain
  entities owned or controlled by the Private Company&#8217;s officers and directors and
  (ii) determine whether any directors, officers or employees of the Private
  Company participated in fraud, dishonesty, incompetence, misconduct,
  mismanagement, or irregularity in the management of the affairs of the Private
  Company and whether the Private Company&#8217;s estates have causes of action against
  such persons arising from any such participation.</font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt">&#160;</div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font id="TAB2" style="LETTER-SPACING: 9pt">&#160;&#160;&#160;</font>&#160;The
  Examiner&#8217;s Report identified potential claims or causes of action against
  current officers of our general partner who were former officers of the Private
  Company, including, without limitation, (i) against Kevin L. Foxx for his
  failure to develop a suitable risk management policy or integrate a suitable
  risk management policy into the Private Company&#8217;s business controls, and for his
  failure to comply with the risk management policy that did exist, thereby
  subjecting the Private Company to increased risk and (ii) against Alex Stallings
  for his failure to stop Thomas L. Kivisto from engaging in trading activity on
  his own behalf through Westback Purchasing Company, L.L.C., a limited liability
  trading partnership which Mr. Kivisto owned and controlled, thereby subjecting
  the Private Company to increased risk and losses.&#160;&#160;<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">In
  addition, the Examiner&#8217;s Report criticized Mr. Foxx for certain conflicts of
  interest with entities that he or his family invested in and which had a
  business relationship with the Private Company.</font>&#160; Additionally, the
  Examiner&#8217;s Report identified a number of potential claims or causes of action
  against Mr. Kivisto and Gregory C. Wallace, who are former directors of our
  general partner and former officers of the Private Company, including, without
  limitation, for negligence and mismanagement, fraud and false statements,
  conversion and corporate waste, unjust enrichment, breach of fiduciary duties
  and breach of contract.</font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt">&#160;</div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font id="TAB2" style="LETTER-SPACING: 9pt">&#160;&#160;&#160;</font>&#160;The
  Examiner&#8217;s Report and related exhibits are publicly available at
  www.kccllc.net/SemGroup.</font></div>
      </div>
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          <div id="GLHDR" style="WIDTH: 100%" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 9pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><a href="#TOC">Table of Contents</a></font></div>
        </div>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 18pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">Internal
  Review</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">As
  previously announced, in July 2008 the Board created an internal review
  subcommittee of the Board comprised of directors who are independent of
  management and the Private Company to determine whether we participate in
  businesses other than as described in our filings with the SEC and to conduct
  investigations into other such specific items as are deemed to be appropriate by
  the subcommittee.&#160;&#160;The subcommittee retained independent legal counsel
  to assist it in its investigations.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
  subcommittee has investigated a short-term financing transaction involving two
  subsidiaries of the Private Company.&#160;&#160;This transaction was identified
  as a potential source of concern in a whistleblower report made after the
  Private Company filed for bankruptcy.&#160;&#160;Although the transaction did
  not involve us or our subsidiaries, it was investigated because it did involve
  certain senior executive officers of our general partner who were also senior
  executive officers of the Private Company at the time of the
  transaction.&#160;&#160;Based upon its investigation, counsel for the
  subcommittee found that, subject to the subcommittee&#8217;s lack of access to Private
  Company documents and electronic records and witnesses, although certain
  irregularities occurred in the transactions, the transaction did not appear to
  cause the relevant officers to understand or believe that the Private Company
  had a lack of liquidity that imperiled the Private Company&#8217;s ability to meet its
  obligations to us and that certain aspects of the documentation of the
  transaction that were out of the ordinary did not call into question the
  integrity of any of the relevant officers.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
  subcommittee also investigated whether certain senior executive officers of our
  general partner who were also senior executive officers of the Private Company
  knew and understood, beginning as early as July 2007 and at various times
  thereafter, about a lack of liquidity at the Private Company that imperiled the
  Private Company&#8217;s ability to meet its obligations to us.&#160;&#160;Based upon
  this investigation, and subject to the subcommittee&#8217;s lack of access to Private
  Company documents and electronic records and witnesses, counsel for the
  subcommittee found that each of the officers had access to and reviewed Private
  Company financial information, including information regarding the Private
  Company&#8217;s commodity trading activities, from which they could have developed an
  understanding of the nature and significance of the trading activities that led
  to liquidity problems at the Private Company well before they say they
  did.&#160;&#160;While the officers each stated sincerely that they did not
  understand the nature or extent of the Private Company&#8217;s trading-related
  problems until the first week of July 2008 or later, objective evidence suggests
  that they showed at least some indifference to known or easily discoverable
  facts and that they failed to adhere to procedures under the Private Company&#8217;s
  Risk Management Policy created expressly to ensure that the Private Company&#8217;s
  trading activities were properly monitored.&#160;&#160;Nonetheless, counsel for
  the subcommittee was not persuaded by the documents and other evidence it was
  able to access that the officers in fact knew and understood that the Private
  Company&#8217;s liquidity or capital needs were a significant cause for alarm until,
  at the earliest, the second quarter of 2008.&#160;&#160;Moreover, while it
  appeared to counsel that the officers developed a growing awareness of the
  nature and severity of the Private Company&#8217;s liquidity issues over the second
  quarter of 2008, counsel was unable to identify with any more precision the
  specific level of concern or understanding these individuals had prior to July
  2008.&#160;&#160;While not within the scope of such counsel&#8217;s investigation,
  counsel was requested by the subcommittee to note any information that came to
  counsel&#8217;s attention during its investigation that suggested that the officers
  intended to deceive or mislead any third party.&#160;&#160;Subject to
  limitations described in its report, no information came to counsel&#8217;s attention
  during its investigation that suggested to counsel that the officers intended to
  deceive or to mislead any third parties.&#160;&#160;In addition, in connection
  with the investigation, counsel for the subcommittee did not express any
  findings of intentional misconduct or fraud on the part of any officer or
  employee of us.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">After
  completion of the internal review, a plan was developed with the advice of the
  Audit Committee of the Board to further strengthen our processes and
  procedures.&#160;&#160;This plan includes, among other things, reevaluating
  executive officers and accounting and finance personnel (including a realignment
  of officers as described elsewhere in this report) and hiring, as deemed
  necessary, additional accounting and finance personnel or consultants;
  reevaluating our internal audit function and determining whether to expand the
  duties and responsibilities of such group; evaluating the comprehensive training
  programs for all management personnel covering, among other things, compliance
  with controls and procedures, revising the reporting structure so that the Chief
  Financial Officer reports directly to the Audit Committee, and increasing the
  business and operational oversight role of the Audit Committee.</font></div>
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        </div>
        <div id="HDR">
          <div id="GLHDR" style="WIDTH: 100%" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 9pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><a href="#TOC">Table of Contents</a></font></div>
        </div>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 18pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">Equity
  Awards and Employment Agreements</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
  Change of Control constituted a change of control under the Plan, which resulted
  in the early vesting of all awards under the Plan.&#160;&#160;As such, the
  phantom units awarded to Messrs. Kevin L. Foxx, Michael J. Brochetti, Alex G.
  Stallings, Peter L. Schwiering and Jerry A. Parsons in the amounts of 150,000
  units, 90,000 units, 75,000 units, 45,000 units and 20,000 units, respectively,
  are fully vested.&#160;&#160;&#160;The common units underlying such awards were
  issued to such individuals in August 2008.&#160;&#160;In addition, the 5,000
  restricted units awarded to each of Messrs. Billings, Kosnik and Bishop for
  their service as independent members of the Board are fully vested.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
  Change of Control also resulted in a change of control under the employment
  agreements of Messrs. Foxx, Brochetti, Stallings, Schwiering and
  Parsons.&#160;&#160;If within one year after the Change of Control any such
  officer is terminated by our general partner without Cause (as defined below) or
  such officer terminates the agreement for Good Reason (as defined below), he
  will be entitled to payment of any unpaid base salary and vested benefits under
  any incentive plans, a lump sum payment equal to 24 months of base salary and
  continued participation in the our general partner&#8217;s welfare benefit programs
  for one year after termination. Upon such an event, Messrs&#160;Foxx, Brochetti,
  Stallings, Schwiering and Parsons would be entitled to lump sum payments of
  $900,000, $600,000, $550,000, $500,000 and $500,000, respectively, in addition
  to continued participation in our general partner&#8217;s welfare benefit
  programs.&#160;&#160;As of the date of the filing of this report, none of these
  officers is entitled to these benefits as none of them has been terminated by
  our general partner without Cause or has terminated his agreement for Good
  Reason.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">For
  purposes of the employment agreements:</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#8220;Cause&#8221;
  means (i)&#160;conviction of the executive officer by a court of competent
  jurisdiction of any felony or a crime involving moral turpitude; (ii)&#160;the
  executive officer&#8217;s willful and intentional failure or willful intentional
  refusal to follow reasonable and lawful instructions of the Board;
  (iii)&#160;the executive officer&#8217;s material breach or default in the performance
  of his obligations under the employment agreement; or (iv)&#160;the executive
  officer&#8217;s act of misappropriation, embezzlement, intentional fraud or similar
  conduct involving our general partner.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#8220;Good
  Reason&#8221; means (i)&#160;a material reduction in the executive officer&#8217;s base
  salary; (ii)&#160;a material diminution of the executive officer&#8217;s duties,
  authority or responsibilities as in effect immediately prior to such diminution;
  or (iii)&#160;the relocation of the named executive officer&#8217;s principal work
  location to a location more than 50 miles from its current
  location.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 18pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">Internal
  Controls</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">SemGroup
  Energy Partners G.P., L.L.C., our general partner, has sole responsibility for
  conducting our business and for managing our operations. Effective internal
  controls are necessary for our general partner, on our behalf, to provide
  reliable financial reports, prevent fraud and operate us successfully as a
  public company. If our general partner&#8217;s efforts to develop and maintain its
  internal controls are not successful, it is unable to maintain adequate controls
  over our financial processes and reporting in the future or it is unable to
  assist us in complying with our obligations under Section 404 of the
  Sarbanes-Oxley Act of 2002, our operating results could be harmed or we may fail
  to meet our reporting obligations.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">We and
  our general partner rely upon the Private Company for their personnel, including
  those related to the implementation of internal controls and disclosure controls
  and procedures.&#160;&#160;Staff reductions by the Private Company or other
  departures by the Private Company&#8217;s employees that provide services to us could
  have a material adverse effect on internal controls and the effectiveness of
  disclosure controls and procedures.&#160;&#160;Ineffective internal controls
  could cause us to report inaccurate financial information or cause investors to
  lose confidence in our reported financial information, which would likely have a
  negative effect on the trading price of our common units.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 18pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left">&#160;</div><br>
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  </font></div>
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        </div>
      </div><br>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 18pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">Taxation
  as a Corporation</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
  anticipated after-tax economic benefit of an investment in our common units
  depends largely on us being treated as a partnership for federal income tax
  purposes.&#160;&#160;If less than 90% of the gross income of a publicly traded
  partnership, such as us, for any taxable year is &#8220;qualifying income&#8221; from
  sources such as the transportation, marketing (other than to end users), or
  processing of crude oil, natural gas or products thereof, interest, dividends or
  similar sources, that partnership will be taxable as a corporation under Section
  7704 of the Internal Revenue Code for federal income tax purposes for that
  taxable year and all subsequent years.&#160;&#160;In this regard, because the
  income we earn from the Throughput Agreement and the Terminalling Agreement with
  the Private Company is &#8220;qualifying income&#8221; any material reduction or elimination
  of that income, or any amendment to the Throughput Agreement or the Terminalling
  Agreement which changes the nature of the services provided or the income
  generated thereunder, may cause our remaining &#8220;qualifying income&#8221; to constitute
  less than 90% of our gross income.&#160;&#160;As a result, we could become
  taxable as a corporation for federal income tax purposes, unless we were to
  transfer the businesses that generate non-qualifying income to one or more
  subsidiaries taxed as corporations and pay entity level income taxes on such
  non-qualifying income.&#160;&#160;The IRS has not provided any ruling to us on
  this matter.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">If we
  were treated as a corporation for federal income tax purposes, then we would pay
  federal income tax on our income at the corporate tax rate, which is currently a
  maximum of 35%, and would likely pay state income tax at varying
  rates.&#160;&#160;Distributions would generally be taxed again to unitholders as
  corporate distributions and none of our income, gains, losses, deductions or
  credits would flow through to our unitholders.&#160;&#160;Because a tax would be
  imposed upon us as an entity, cash available for distribution to our unitholders
  would be substantially reduced.&#160;&#160;Treatment of us as a corporation
  would result in a material reduction in the anticipated cash flow and after-tax
  return to unitholders and thus would likely result in a substantial reduction in
  the value of our common units.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 18pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">Other
  Effects</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
  Bankruptcy Filings have had and may in the future continue to have a number of
  other impacts on our business and management.&#160;&#160;In the Amended Omnibus
  Agreement and other agreements with the Private Company, the Private Company
  agreed to indemnify us for certain environmental and other claims relating to
  the crude oil and liquid asphalt cement assets that have been contributed to
  us.&#160;&#160;In connection with the Settlement, we waived these claims and the
  Amended Omnibus Agreement and other relevant agreements, including the
  indemnification provisions therein, were rejected as part of the Bankruptcy
  Proceedings.&#160;&#160;If we experience an environmental or other loss, we
  would experience increased losses which may have a material adverse effect on
  our business, financial condition, results of operations, cash flows, ability to
  make distributions to our unitholders, the trading price of our common units and
  the ability to conduct our business.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">We are
  currently pursuing various strategic alternatives for our business and assets
  including the possibility of entering into additional storage contracts with
  third party customers and the sale of all or a portion of our
  assets.&#160;&#160;The uncertainty relating to the Bankruptcy Filings and the
  recent global market and economic conditions may make it more difficult to
  pursue merger opportunities or enter into storage contracts with third party
  customers.&#160;&#160;</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">In
  addition, events related to the Bankruptcy Filings, the securities litigation
  and governmental investigations, and our efforts to enter into storage contracts
  with third party customers and pursue merger opportunities has resulted in
  increased expense beginning in the third quarter of 2008 due to the costs
  related to legal and financial advisors as well as other related
  costs.&#160;&#160;General and administrative expenses (exclusive of non-cash
  compensation expense related to the vesting of the units under the Plan)
  increased by approximately $6.9 million and $7.5 million, or approximately 300%
  and 326%, to approximately $9.2 million for the third quarter of 2008 and $9.8
  million for the fourth quarter of 2008, respectively, compared to $2.3 million
  in the second quarter of 2008.&#160;&#160;We expect this increased level of
  general and administrative expenses to continue into 2009.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Items
  Impacting the Comparability of Our Financial Results</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 36pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">There
        are differences in the way our predecessor recorded revenues and the way
        we record revenues.</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 72pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">o&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Historically,
        a substantial portion of our revenues were derived from services provided
        to the crude oil purchasing, marketing and distribution operations of the
        Private Company pursuant to the Throughput Agreement. Under the Throughput
        Agreement, the Private Company paid us a fee for gathering,
        transportation, terminalling and storage services based on volume and
        throughput. In rendering these services, we did not take title to, or
        marketing responsibility for, the crude oil that we gathered, transported,
        terminalled or stored and, therefore, we had minimal direct exposure to
        changes in crude oil prices.</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 72pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">o&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
        Crude Oil Business had historically been a part of the integrated
        operations of the Private Company, and neither the Private Company nor our
        predecessor recorded revenue associated with the gathering,
        transportation, terminalling and storage services provided on an
        intercompany basis. The Private Company and our predecessor recognized
        only the costs associated with providing such services. As such, the
        revenues we received under the Throughput Agreement are not reflected in
        the historical financial statements of our
    predecessor.</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 72pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">o&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Our
        predecessor recognized revenues from third parties for (1)&#160;crude oil
        storage services, (2)&#160;crude oil transportation services and
        (3)&#160;crude oil producer field services. Although a substantial
        majority of our revenues are derived from services provided to the Private
        Company, we also recognize revenue for gathering, transportation,
        terminalling and storage services provided to third
      parties.</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 36pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">There
        are differences in the way general and administrative expenses were
        allocated to our predecessor and the way we recognize general and
        administrative expenses.</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 72pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">o&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">General
        and administrative expenses include office personnel and benefit expenses,
        costs related to our administration facilities, and insurance, accounting
        and legal expenses, including costs allocated by the Private Company for
        centralized general and administrative services performed by the Private
        Company. Such costs were allocated to our predecessor based on the nature
        of the respective expenses and its proportionate share of the Private
        Company&#8217;s head count, compensation expense, net revenues or square footage
        as appropriate.</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 72pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">o&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">We
        were party to an Omnibus Agreement with the Private
        Company.&#160;&#160;The Omnibus Agreement was amended (the "Amended
        Omnibus Agreement")&#160;in connection with the purchase of the Acquired
        Asphalt Assets to, among other things, increase the fixed administrative
        fee payable under such agreement from $5.0 million per year to $7.0
        million per year. Pursuant to the Amended Omnibus Agreement, we were
        required to pay our general partner and the Private Company this fixed
        administrative fee for the provision by our general partner and the
        Private Company of various general and administrative services to us for
        three years following the acquisition of our asphalt
        assets.&#160;&#160;The events related to the Bankruptcy Filings terminated
        the Private Company&#8217;s obligations to provide services to us under the
        Amended Omnibus Agreement.&#160;&#160;The Private Company continued to
        provide such services to us until the effective date of the Settlement at
        which time the Private Company rejected the Amended Omnibus Agreement and
        we and the Private Company entered into the Shared Services Agreement and
        the Transition Services Agreement relating to the provision of such
        services (see &#8220;Item 2. Management&#8217;s Discussion and Analysis of Financial
        Condition and Results of Operations<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#8212;Impact
        of the Bankruptcy of the Private Company and Certain of its Subsidiaries
        and Related Events</font>&#8212;Settlement with the Private
        Company&#8221;).&#160;&#160;In addition, in connection with the Settlement, we
        made offers of employment to certain individuals associated with our crude
        oil operations and expect to make additional offers of employment to
        certain individuals associated with our asphalt operations.&#160;&#160;The
        costs to directly employ these individuals as well as the costs under the
        Shared Services Agreement and&#160;the Transition Services Agreement may
        be higher than those previously paid by us under the Amended Omnibus
        Agreement, which could have a material adverse effect on our business,
        financial condition, results of operations, cash flows, ability to make
        distributions to our unitholders, the trading price of our common units
        and our ability to conduct our business.&#160;&#160;For a more complete
        description of the Omnibus Agreement, see &#8220;Item 13&#8212;Certain Relationships
        and Related Party Transactions, and Director Independence&#8212;Agreements
        Related to Our Acquisition of the Asphalt Assets &#8212;Amended Omnibus
        Agreement&#8221; in our 2007 Form 10-K.</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 72pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">o&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">We
        incur incremental general and administrative expenses as a result of being
        a publicly traded limited partnership, including costs associated with
        annual and quarterly reports to unitholders, financial statement audit,
        tax return and Schedule K-1 preparation and distribution, investor
        relations activities, registrar and transfer agent fees, incremental
        director and officer liability insurance costs and independent director
        compensation. These incremental general and administrative expenditures
        are not reflected in the historical financial statements of our
        predecessor.</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 36pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">With
        the exception of capital lease obligations and prepaid insurance, no
        working capital was contributed to us in connection with our initial
        public offering.</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 36pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Our
        predecessor had $31.2 million in debt payable to the Private Company which
        was not assumed by us in our initial public offering. We entered into a
        $250.0 million five-year credit facility and borrowed $137.5 million under
        that facility and used net proceeds of approximately $38.7 million from
        the issuance of 1,875,000 common units pursuant to the underwriters&#8217;
        exercise of their over-allotment option in our initial public offering to
        reduce outstanding borrowings under our credit facility.&#160;&#160;In
        connection with the purchase of our Acquired Asphalt Assets, we amended
        our credit facility to increase our borrowing capacity to $600.0
        million.&#160;&#160;This borrowing capacity has subsequently been reduced
        as described in &#8220;&#8212;Liquidity and Capital Resources.&#8221;&#160;&#160;Our credit
        facility matures in June 2011.&#160;&#160;<font style="FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">As of&#160;May
        22,&#160;2009, we had&#160;$423.4 million in outstanding borrowings under
        our credit facility (including $23.4 million under our revolving credit
        facility and $400.0 million under our term loan facility) with an
        aggregate unused credit availability under our revolving credit facility
        and cash on hand of approximately $27.2 million. Pursuant to the Credit
        Agreement Amendment, our revolving credit facility&#160;is limited
        to&#160;$50.0 million.&#160;&#160;</font>Please see &#8220;&#8212;Liquidity and
        Capital Resources.&#8221;</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div><br>
      <div id="PGBRK" style="MARGIN-LEFT: 0pt; WIDTH: 100%; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
        <div id="FTR">
          <div style="WIDTH: 100%" align="left">
            <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
  </font></div>
          </div>
          <div id="GLFTR" style="WIDTH: 100%" align="center">
          </div>
        </div>
        <div id="PN" style="PAGE-BREAK-AFTER: always">
          <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">45</font></div>
          <div style="WIDTH: 100%; TEXT-ALIGN: center">
            <hr style="COLOR: black" noshade size="2">
          </div>
        </div>
        <div id="HDR">
          <div id="GLHDR" style="WIDTH: 100%" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 9pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><a href="#TOC">Table of Contents</a></font></div>
        </div>
      </div><br>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Results
  of Operations</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The table
  below summarizes the financial results of the Partnership for the three and nine
  months ended September 30, 2007 and 2008.&#160;&#160;These financial results
  reflect a $0.4 million allowance for doubtful accounts related to amounts
  collectible from third parties as of September 30, 2008.&#160;&#160;The
  allowance related to amounts collectible from third parties was established as a
  result of certain third party customers netting amounts due them from the
  Private Company with amounts due to us.&#160;&#160;Also, due to the change of
  control of our general partner related to the Private Company&#8217;s liquidity
  issues, all outstanding awards under our general partner&#8217;s long-term incentive
  plan vested on July 18, 2008, resulting in an incremental $18.0 million in
  non-cash compensation expense for the three months ended September 30,
  2008.&#160;&#160;In addition to the allowance for doubtful accounts and non-cash
  compensation expense described above, the results of operations for the three
  and nine months ended September 30, 2008 included in this quarterly report were
  affected by the Bankruptcy Filings and related events, which resulted in
  decreased revenues and increased general and administrative expenses (see &#8220;Item
  2. Management&#8217;s Discussion and Analysis of Financial Condition and results of
  Operations<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#8212;Impact
  of the Bankruptcy of the Private Company and Certain of its Subsidiaries and
  Related Events</font>&#8212;Our Revenues,&#8221; and &#8220;Item 2. Management&#8217;s Discussion and
  Analysis of Financial Condition and results of Operations<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#8212;Impact
  of the Bankruptcy of the Private Company and Certain of its Subsidiaries and
  Related Events</font>&#8212;Other Effects,&#8221; respectively).<font style="DISPLAY: inline; FONT-WEIGHT: bold">&#160;</font>Due to the events
  related to the Bankruptcy Filings, including uncertainties related to future
  revenues and cash flows, we do not expect our financial results for the three
  and nine months ended September 30, 2008 to be indicative of our future
  financial results.&#160;&#160;For example, since the Bankruptcy Filings we have
  experienced increased general and administrative expenses related to the costs
  of legal and financial advisors and increased interest expense related to the
  events of default under our credit facility and the associated Forbearance
  Agreement (as defined below) and amendments thereto.&#160;&#160;In addition, the
  volumes being terminalled, stored, transported and gathered have decreased as
  compared to periods prior to the Bankruptcy Filings, which has negatively
  impacted total revenues.&#160;&#160;As an example, fourth quarter 2008 total
  revenues are approximately $8.2 million less than third quarter 2008 total
  revenues, in each case excluding fuel surcharge revenues related to fuel and
  power consumed to operate our liquid asphalt cement storage
  tanks.&#160;&#160;Our future total revenues will be further impacted because,
  pursuant to the Settlement, the Private Company rejected the Terminalling
  Agreement and the Throughput Agreement.&#160;&#160;We entered into the New
  Terminalling Agreement and the New Throughput Agreement on the terms described
  elsewhere herein (see &#8220;Item 2. Management&#8217;s Discussion and Analysis of Financial
  Condition and Results of Operations<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#8212;Impact
  of the Bankruptcy of the Private Company and Certain of its Subsidiaries and
  Related Events</font>&#8212;Settlement with the Private Company&#8221;).</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left">
        <div>
          <div align="left">
            <div align="center">
              <div align="center">
                <div align="center">
                  <table cellpadding="0" cellspacing="0" width="100%">
                      <tr>
                        <td align="left" valign="bottom" width="30%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                        <td valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td colspan="6" valign="bottom" width="20%" style="BORDER-BOTTOM: black 2px solid">
                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Three
        Months ended September 30,</font></div>
                        </td>
                        <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td colspan="6" valign="bottom" width="20%" style="BORDER-BOTTOM: black 2px solid">
                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Nine
        Months ended September 30,</font></div>
                        </td>
                        <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                      </tr>
                      <tr>
                        <td align="left" valign="bottom" width="30%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                        <td valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td colspan="2" valign="bottom" width="9%" style="BORDER-BOTTOM: black 2px solid">
                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">2007</font></div>
                        </td>
                        <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td colspan="2" valign="bottom" width="9%" style="BORDER-BOTTOM: black 2px solid">
                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">2008</font></div>
                        </td>
                        <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td colspan="2" valign="bottom" width="9%" style="BORDER-BOTTOM: black 2px solid">
                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">2007</font></div>
                        </td>
                        <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td colspan="2" valign="bottom" width="9%" style="BORDER-BOTTOM: black 2px solid">
                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">2008</font></div>
                        </td>
                        <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                      </tr>
                      <tr>
                        <td align="left" valign="bottom" width="30%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                        <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td colspan="14" valign="bottom" width="42%">
                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(in
        thousands)</font></div>
                        </td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                      </tr>
                      <tr>
                        <td align="left" valign="bottom" width="30%">
                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Service
        revenues:</font></div>
                        </td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" colspan="2" valign="bottom" width="9%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" colspan="2" valign="bottom" width="9%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" colspan="2" valign="bottom" width="9%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" colspan="2" valign="bottom" width="9%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                      </tr>
                      <tr>
                        <td align="left" valign="bottom" width="30%">
                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 18pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Terminalling
        and storage revenues:</font></div>
                        </td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" colspan="2" valign="bottom" width="9%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" colspan="2" valign="bottom" width="9%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" colspan="2" valign="bottom" width="9%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" colspan="2" valign="bottom" width="9%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                      </tr>
                      <tr bgcolor="#cceeff">
                        <td align="left" valign="bottom" width="30%">
                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Third
        party</font></div>
                        </td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></td>
                        <td align="right" valign="bottom" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">691</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></td>
                        <td align="right" valign="bottom" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">4,661</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></td>
                        <td align="right" valign="bottom" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">7,836</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></td>
                        <td align="right" valign="bottom" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">5,674</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
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                      <tr bgcolor="white">
                        <td align="left" valign="bottom" width="30%" style="PADDING-BOTTOM: 2px">
                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Related
        party</font></div>
                        </td>
                        <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="8%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">7,245</font></td>
                        <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="8%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">27,555</font></td>
                        <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="8%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">7,245</font></td>
                        <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="8%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">75,434</font></td>
                        <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
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                      <tr bgcolor="#cceeff">
                        <td align="left" valign="bottom" width="30%">
                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 45pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Total
        terminalling and storage</font></div>
                        </td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">7,936</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">32,216</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">15,081</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">81,108</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                      </tr>
                      <tr bgcolor="white">
                        <td align="left" valign="bottom" width="30%">
                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 18pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Gathering
        and transportation revenues:</font></div>
                        </td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                      </tr>
                      <tr bgcolor="#cceeff">
                        <td align="left" valign="bottom" width="30%">
                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Third
        party</font></div>
                        </td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">4,181</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">10,910</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">16,011</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">20,548</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                      </tr>
                      <tr bgcolor="white">
                        <td align="left" valign="bottom" width="30%" style="PADDING-BOTTOM: 2px">
                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Related
        party</font></div>
                        </td>
                        <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="8%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">13,163</font></td>
                        <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="8%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">10,668</font></td>
                        <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="8%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">13,286</font></td>
                        <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="8%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">47,628</font></td>
                        <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                      </tr>
                      <tr bgcolor="#cceeff">
                        <td align="left" valign="bottom" width="30%" style="PADDING-BOTTOM: 2px">
                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 45pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Total
        gathering and transportation</font></div>
                        </td>
                        <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="8%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">17,344</font></td>
                        <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="8%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">21,578</font></td>
                        <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="8%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">29,297</font></td>
                        <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="8%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">68,176</font></td>
                        <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                      </tr>
                      <tr bgcolor="white">
                        <td align="left" valign="bottom" width="30%">
                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Total
        revenues</font></div>
                        </td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">25,280</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">53,794</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">44,378</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">149,284</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                      </tr>
                      <tr bgcolor="#cceeff">
                        <td align="left" valign="bottom" width="30%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
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                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Operating
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                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
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                        <td align="left" valign="bottom" width="30%">
                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 18pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Terminalling
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                        </td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">1,078</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">11,975</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">3,408</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">29,071</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
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                      <tr bgcolor="white">
                        <td align="left" valign="bottom" width="30%">
                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 18pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Gathering
        and transportation</font></div>
                        </td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">14,874</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">16,212</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">46,702</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">50,887</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                      </tr>
                      <tr bgcolor="#cceeff">
                        <td align="left" valign="bottom" width="30%" style="PADDING-BOTTOM: 2px">
                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 18pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Allowance
        for doubtful accounts</font></div>
                        </td>
                        <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="8%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">-</font></td>
                        <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="8%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(819</font></td>
                        <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">)</font></td>
                        <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="8%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">-</font></td>
                        <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="8%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">447</font></td>
                        <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                      </tr>
                      <tr bgcolor="white">
                        <td align="left" valign="bottom" width="30%">
                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Total
        operating expenses</font></div>
                        </td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">15,952</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">27,368</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">50,110</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">80,405</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                      </tr>
                      <tr bgcolor="#cceeff">
                        <td align="left" valign="bottom" width="30%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                      </tr>
                      <tr bgcolor="white">
                        <td align="left" valign="bottom" width="30%" style="PADDING-BOTTOM: 2px">
                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">General
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                        </td>
                        <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="8%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">2,525</font></td>
                        <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="8%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">27,177</font></td>
                        <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="8%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">11,015</font></td>
                        <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="8%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">33,244</font></td>
                        <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                      </tr>
                      <tr bgcolor="#cceeff">
                        <td align="left" valign="bottom" width="30%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
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                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
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                        <td align="left" valign="bottom" width="30%">
                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Operating
        income (loss)</font></div>
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                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">6,803</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(751</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">)</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(16,747</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">)</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">35,635</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
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                        <td align="left" valign="bottom" width="30%">
                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Interest
        expense</font></div>
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                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">2,424</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">11,041</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">3,369</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">15,905</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                      </tr>
                      <tr bgcolor="#cceeff">
                        <td align="left" valign="bottom" width="30%" style="PADDING-BOTTOM: 2px">
                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Income
        tax expense</font></div>
                        </td>
                        <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="8%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">62</font></td>
                        <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="8%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">59</font></td>
                        <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="8%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">62</font></td>
                        <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="8%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">227</font></td>
                        <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                      </tr>
                      <tr bgcolor="white">
                        <td align="left" valign="bottom" width="30%" style="PADDING-BOTTOM: 4px">
                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Net
        income (loss)</font></div>
                        </td>
                        <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 4px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 4px double"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></td>
                        <td align="right" valign="bottom" width="8%" style="BORDER-BOTTOM: black 4px double"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">4,317</font></td>
                        <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 4px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 4px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 4px double"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></td>
                        <td align="right" valign="bottom" width="8%" style="BORDER-BOTTOM: black 4px double"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(11,851</font></td>
                        <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 4px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">)</font></td>
                        <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 4px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 4px double"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></td>
                        <td align="right" valign="bottom" width="8%" style="BORDER-BOTTOM: black 4px double"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(20,178</font></td>
                        <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 4px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">)</font></td>
                        <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 4px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 4px double"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></td>
                        <td align="right" valign="bottom" width="8%" style="BORDER-BOTTOM: black 4px double"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">19,503</font></td>
                        <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 4px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                      </tr>
                  </table>
                </div>
              </div>
            </div>
          </div>
        </div>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div><br>
      <div id="PGBRK" style="MARGIN-LEFT: 0pt; WIDTH: 100%; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
        <div id="FTR">
          <div style="WIDTH: 100%" align="left">
            <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
  </font></div>
          </div>
          <div id="GLFTR" style="WIDTH: 100%" align="center">
          </div>
        </div>
        <div id="PN" style="PAGE-BREAK-AFTER: always">
          <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">46</font></div>
          <div style="WIDTH: 100%; TEXT-ALIGN: center">
            <hr style="COLOR: black" noshade size="2">
          </div>
        </div>
        <div id="HDR">
          <div id="GLHDR" style="WIDTH: 100%" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 9pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><a href="#TOC">Table of Contents</a></font></div>
        </div>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">Three
  Months Ended September 30, 2008 Compared to the Three Months Ended September 30,
  2007</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-STYLE: italic">Service revenues.</font> Service
  revenues were $53.8 million for the three months ended September 30, 2008
  compared to $25.3 million for the three months ended September 30, 2007, an
  increase of $28.5 million, or 113%. Service revenues include revenues from
  terminalling and storage services and gathering and transportation services.
  Terminalling and storage revenues increased by $24.3 million to $32.2 million
  for the three months ended September 30, 2008 compared to $7.9 million for the
  three months ended September 30, 2007, primarily due to revenues generated under
  the Terminalling Agreement (revenues of $20.9 million for the three months ended
  September 30, 2008).&#160;&#160;The Terminalling Agreement was entered into in
  February 2008 in conjunction with the purchase of the Acquired Asphalt Assets
  therefore it was not present in the three months ended September 30,
  2007.&#160;&#160;In addition, our third party terminalling and storage revenue
  increased by $4.0 million due to additional volume&#160;from third party crude
  oil storage agreements during the three months ended September 30,
  2008.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Our
  gathering and transportation services revenue increased by $4.3 million to $21.6
  million for the three months ended September 30, 2008 compared to $17.3 million
  for the three months ended September 30, 2007.&#160;&#160;The increase is
  primarily due to third party customer revenues increasing for the three months
  ended September 30, 2008 compared to the three months ended September 30,
  2007.&#160;&#160;The increase in third party revenues is primarily due to the
  replacement of services previously provided to the Private Company with third
  party gathering and transportation customers due to an order of the Bankruptcy
  Court entered on September 9, 2008, that stated the Private Company would no
  longer make minimum payments under the Throughput Agreement but instead pay a
  market rate based upon the Private Company&#8217;s actual
  usage.&#160;&#160;Historically, our Predecessor was a part of the integrated
  operations of the Private Company, and neither the Private Company nor the
  Predecessor recorded revenue associated with the terminalling and storage and
  gathering and transportation services provided on an intercompany basis.
  Accordingly, revenues reflected for all periods prior to the contribution of the
  assets, liabilities and operations to the Partnership by the Private Company on
  July&#160;20, 2007 are substantially services provided to third
  parties.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-STYLE: italic">Operating expenses</font>.&#160;
  Operating expenses increased by $11.4 million, or 71%, to $27.4 million for the
  three months ended September 30, 2008 compared to $16.0 million for the three
  months ended September 30, 2007. Our fuel expenses increased by $5.5 million to
  $8.0 million for the three months ended September 30, 2008 compared to $2.5
  million for the three months ended September 30, 2007. The increase in our fuel
  costs is attributable to the increase in number of transport trucks we operated
  for the respective periods and the rising price of diesel fuel during the
  comparative periods.&#160;&#160;&#160;The Throughput Agreement provides for a
  fuel surcharge, recorded in revenue, which offsets increases in fuel expenses
  related to either rising diesel prices or force majeure events.&#160;&#160;Also
  included in fuel expense for the three months ended September 30, 2008 is $4.7
  million of fuel and power expense associated with the boiler systems utilized to
  heat our liquid asphalt cement storage tanks that were acquired in February
  2008.&#160;&#160;Under the Terminalling Agreement, this component of fuel
  expense is passed through to the Private Company.&#160;&#160;As a result of this
  agreement, we have recorded $4.7 million in fuel surcharge revenues in relation
  to fuel and power consumed to operate our liquid asphalt cement storage tanks
  for the three months ended September 30, 2008.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Compensation
  expense increased by $1.8 million to $7.3 million for the three months ended
  September 30, 2008 primarily as a result of the purchase of our Acquired Asphalt
  Assets in February 2008.&#160;&#160;Our repair and maintenance expenses
  decreased by $0.8 million to $1.2 million for the three months ended September
  30, 2008 compared to $2.0 million for the three months ended September 30, 2007,
  primarily due to the timing of routine maintenance in our gathering and
  transportation segment. Lease expense related to crude oil tanker trucks
  increased by $0.3 million to $0.8 million for the three months ended September
  30, 2008. This increase is attributable to the replacement of crude oil
  transport vehicles that were historically financed through capital
  leases.&#160;&#160;As a result of the growth in our property and equipment, our
  property taxes increased by $0.7 million to $0.9 million for the three months
  ended September 30, 2008 compared to $0.2 million for the three months ended
  September 30, 2007.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Outside
  services expenses increased by $0.2 million to $0.8 million for the three months
  ended September 30, 2008 compared to $0.6 million for the three months ended
  September 30, 2007, primarily due to an increase in third party transportation
  costs resulting from increased volumes gathered in our gathering and
  transportation segment.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Depreciation
  expense increased by $3.4 million to $5.7 million for the three months ended
  September 30, 2008 compared to $2.3 million for the three months ended September
  30, 2007, primarily as a result of capital expenditures in our terminalling and
  storage segment and as a result of the purchase of our Acquired Asphalt Assets
  in February 2008.</font></div><br>
      <div id="PGBRK" style="MARGIN-LEFT: 0pt; WIDTH: 100%; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
        <div id="FTR">
          <div style="WIDTH: 100%" align="left">
            <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
  </font></div>
          </div>
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        </div>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The three
  months ended September 30, 2008 includes a decrease of $0.9 million in our
  allowance for doubtful accounts for amounts due from the Private Company that
  had been reserved as of June 30, 2008.&#160;&#160;Pursuant to the
  Settlement,&#160;our pre-petition claims have been netted against pre-petition
  claims by the Private Company and waived.&#160;&#160;The three months ended
  September 30, 2008 also includes an allowance for doubtful accounts increase of
  $0.1 million for services provided to certain third parties as of September 30,
  2008.&#160;&#160;The allowance related to amounts due from third parties
  increased as a result of certain third party customers netting amounts due them
  from the Private Company with amounts due to us.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-STYLE: italic">General and administrative
  expenses</font>.&#160;General and administrative expenses increased by $24.7
  million, or 988%, to $27.2 million for the three months ended September 30, 2008
  compared to $2.5 million for the three months ended September 30, 2007. Due to
  the change of control of our general partner related to the Private Company&#8217;s
  liquidity issues, all awards outstanding under our long-term incentive plan as
  of June 30, 2008 vested on July 18, 2008.&#160;&#160;As a result, general and
  administrative expenses for the three months ended September 30, 2008 included
  $18.0 million in non-cash, equity-based compensation recognized under our
  long-term incentive plan.&#160;&#160;General and administrative expenses
  (exclusive of non-cash compensation expense related to the vesting of the units
  under the Plan) increased by approximately $6.9 million and $7.5 million, or
  approximately 300% and 326%, to approximately $9.2 million for the third quarter
  of 2008 and $9.8 million for the fourth quarter of 2008, respectively, compared
  to $2.3 million in the second quarter of 2008.&#160;&#160;We expect this
  increased level of general and administrative expenses to continue into
  2009.&#160; This increase is due to increased costs related to legal and
  financial advisors as well as other related costs in connection with events
  related to the Bankruptcy Filings, the securities litigation and governmental
  investigations, and our efforts to enter into storage contracts with third party
  customers and pursue other strategic&#160;opportunities.&#160;&#160;We expect
  this increased level of general and administrative expenses to continue into
  2009.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-STYLE: italic">Interest expense</font>.&#160;
  Interest expense represents interest on capital lease obligations and long-term
  borrowings under our credit facility and the impact of our interest rate swap
  agreements. Interest expense increased by $8.6 million to $11.0 million interest
  expense for the three months ended September 30, 2008 compared to $2.4 million
  interest expense for the three months ended September 30, 2007.&#160;&#160;The
  increase was primarily due to an increase in the average long-term borrowings
  outstanding during the three months ended September 30, 2008 compared to the
  three months ended September 30, 2007, which accounted for approximately $7.8
  million of an increase in interest expense, net of capitalized
  interest.&#160;&#160;In addition, the two interest rate swap agreements entered
  into during the third quarter of 2007 and the three additional interest rate
  swap agreements entered into in February 2008 resulted in $0.6 million in
  interest expense for the three months ended September 30, 2008.&#160;&#160;Due
  to events related to the Bankruptcy Filings, all of these interest rate swap
  positions were terminated in the third quarter of 2008, and we have recorded a
  $1.5 million liability as of September 30, 2008 with respect to these
  positions.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">Nine
  months Ended September 30, 2008 Compared to the Nine months Ended September 30,
  2007</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-STYLE: italic">Service revenues.
  </font>&#160;Service revenues were $149.3 million for the nine months ended
  September 30, 2008 compared to $44.4 million for the nine months ended September
  30, 2007, an increase of $104.9 million, or 236%. Service revenues include
  revenues from terminalling and storage services and gathering and transportation
  services. Terminalling and storage revenues increased by $66.0 million to $81.1
  million for the nine months ended September 30, 2008 compared to $15.1 million
  for the nine months ended September 30, 2007, primarily due to revenues
  generated under both the Throughput Agreement (revenues of $26.3 million for the
  nine months ended September 30, 2008 compared to revenues of $7.2 million for
  the nine months ended September 30, 2007) and the Terminalling Agreement
  (revenues of $49.1 million for the nine months ended September 30,
  2008).&#160;&#160;The Terminalling Agreement was entered into in February 2008
  in conjunction with the purchase of the Acquired Asphalt Assets therefore it was
  not present in the nine months ended September 30,
  2007.&#160;&#160;Historically, our Predecessor was a part of the integrated
  operations of the Private Company, and neither the Private Company nor the
  Predecessor recorded revenue associated with the terminalling and storage and
  gathering and transportation services provided on an intercompany basis.
  Accordingly, revenues reflected for all periods prior to the contribution of the
  crude oil assets, liabilities and operations to the Partnership by the Private
  Company on July&#160;20, 2007 are substantially services provided to third
  parties.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Our
  gathering and transportation services revenue increased by $38.9 million to
  $68.2 million for the nine months ended September 30, 2008 compared to $29.3
  million for the nine months ended September 30, 2007. This increase is primarily
  due to revenues generated under the Throughput Agreement subsequent to the
  closing of our initial public offering.&#160;&#160;Historically, our Predecessor
  was a part of the integrated operations of the Private Company, and neither the
  Private Company nor the Predecessor recorded revenue associated with the
  terminalling and storage and gathering and transportation services provided on
  an intercompany basis. Accordingly, revenues reflected for all periods prior to
  the contribution of the crude oil assets, liabilities and operations to the
  Partnership by the Private Company on July&#160;20, 2007 are substantially
  services provided to third parties.</font></div><br>
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        </div>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-STYLE: italic">Operating expenses</font>.&#160;
  Operating expenses increased by $30.3 million, or 60%, to $80.4 million for the
  nine months ended September 30, 2008 compared to $50.1 million for the nine
  months ended September 30, 2007. Our fuel expenses increased by $13.1 million to
  $20.5 million for the nine months ended September 30, 2008 compared to $7.4
  million for the nine months ended September 30, 2007. The increase in our fuel
  costs is attributable to the increase in number of transport trucks we operated
  for the respective periods and the rising price of diesel fuel during the
  comparative periods.&#160;&#160;&#160;The Throughput Agreement provides for a
  fuel surcharge, recorded in revenue, which offsets increases in fuel expenses
  related to either rising diesel prices or force majeure events.&#160;&#160;Also
  included in fuel expense for the nine months ended September 30, 2008 is $10.8
  million of fuel and power expense associated with the boiler systems utilized to
  heat our liquid asphalt cement storage tanks that were acquired in February
  2008.&#160;&#160;Under the Terminalling Agreement, this component of fuel
  expense is passed through to the Private Company.&#160;&#160;As a result of this
  agreement, we have recorded $10.8 million in fuel surcharge revenues in relation
  to fuel and power consumed to operate our liquid asphalt cement storage tanks
  for the nine months ended September 30, 2008.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Compensation
  expense increased by $4.7 million to $21.6 million for the nine months ended
  September 30, 2008 primarily as a result of the purchase of our Acquired Asphalt
  Assets in February 2008.&#160;&#160;Our repair and maintenance expenses
  decreased by $1.5 million to $5.0 million for the nine months ended September
  30, 2008 compared to $6.5 million for the nine months ended September 30, 2007,
  primarily due to the timing of routine maintenance in our gathering and
  transportation segment. Lease expense related to crude oil tanker trucks
  increased by $0.9 million to $2.0 million for the nine months ended September
  30, 2008. This increase is attributable to the replacement of crude oil
  transport vehicles that were historically financed through capital
  leases.&#160;&#160;As a result of the growth in our property and equipment, our
  property taxes increased by $1.7 million to $2.3 million for the nine months
  ended September 30, 2008 compared to $0.6 million for the nine months ended
  September 30, 2007.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Outside
  services expenses increased by $1.6 million to $3.2 million for the nine months
  ended September 30, 2008 compared to $1.6 million for the nine months ended
  September 30, 2007, primarily due to an increase in third party transportation
  costs resulting from increased volumes gathered in our gathering and
  transportation segment.&#160;&#160;In addition, our utilities expenses increased
  by $0.4 million to $1.7 million for the nine months ended September 30, 2008
  compared to $1.3 million for the nine months ended September 30, 2007, primarily
  due to growth in our gathering and transportation segment.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Depreciation
  expense increased by $8.8 million to $15.3 million for the nine months ended
  September 30, 2008 compared to $6.5 million for the nine months ended September
  30, 2007, primarily as a result of capital expenditures in our terminalling and
  storage segment and as a result of the purchase of our Acquired Asphalt Assets
  in February 2008.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The nine
  months ended September 30, 2008 reflects a $0.4 million allowance for doubtful
  accounts related to amounts due from third parties as of September 30,
  2008.&#160;&#160;The allowance related to amounts due from third parties was
  established as a result of certain third party customers netting amounts due
  them from the Private Company with amounts due to us.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-STYLE: italic">General and administrative
  expenses</font>.&#160;General and administrative expenses increased by $22.2
  million, or 202%, to $33.2 million for the nine months ended September 30, 2008
  compared to $11.0 million for the nine months ended September 30,
  2007.&#160;&#160;Due to the change of control of our general partner related to
  the Private Company&#8217;s liquidity issues, all awards outstanding under our
  long-term incentive plan as of June 30, 2008 vested on July 18,
  2008.&#160;&#160;As a result, general and administrative expenses for the nine
  months ended September 30, 2008 included $19.4 million in non-cash, equity-based
  incentive compensation recognized under our long-term incentive
  plan.&#160;&#160;General and administrative expenses (exclusive of non-cash
  compensation expense related to the vesting of the units under the Plan)
  increased by approximately $6.9 million and $7.5 million, or approximately 300%
  and 326%, to approximately $9.2 million for the third quarter of 2008 and $9.8
  million for the fourth quarter of 2008, respectively, compared to $2.3 million
  in the second quarter of 2008.&#160;&#160;This increase is due to increased
  costs related to legal and financial advisors as well as other related costs in
  connection with events related to the Bankruptcy Filings, the securities
  litigation and governmental investigations, and our efforts to enter into
  storage contracts with third party customers and pursue&#160;other
  strategic&#160;opportunities.&#160;&#160;We expect this increased level of
  general and administrative expenses to continue into 2009.</font></div><br>
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        </div>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-STYLE: italic">Interest expense</font>.&#160;
  Interest expense represents interest on capital lease obligations and long-term
  borrowings under our credit facility and the impact of our interest rate swap
  agreements.&#160;&#160;Interest expense increased by $12.5 million to $15.9
  million for the nine months ended September 30, 2008 compared to $3.4 million
  for the nine months ended September 30, 2007. The increase was primarily due to
  an increase in the average long-term borrowings outstanding during the nine
  months ended September 30, 2008 compared to the nine months ended September 30,
  2007, which accounted for approximately $14.1 million of an increase in interest
  expense, net of capitalized interest.&#160;&#160;This increase was partially
  offset by the two interest rate swap agreements entered into during the third
  quarter of 2007 and three additional interest rate swap agreements entered into
  in February 2008, the fair value accounting of which resulted in $2.1 million in
  interest income for the nine months ended September 30, 2008.&#160;&#160;Due to
  events related to the Bankruptcy Filings, all of these interest rate swap
  positions were terminated in the third quarter of 2008, and we have recorded a
  $1.5 million liability as of September 30, 2008 with respect to these
  positions.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Effects
  of Inflation</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">In recent
  years, inflation has been modest and has not had a material impact upon the
  results of the Partnership&#8217;s operations.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Off
  Balance Sheet Arrangements</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">We do not
  have any off-balance sheet arrangements.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Liquidity
  and Capital Resources</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 18pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">Cash
  Flows and Capital Expenditures</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Cash
  generated from operations and borrowings under our credit facility have
  historically been the primary sources of our liquidity. Due to the events
  related to the Bankruptcy Filings, including uncertainties related to future
  revenues and cash flows, we do not expect our historical cash flows to be
  indicative of our future financial cash flows.<font style="FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;&#160;<font style="FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">As of May 22, 2009, we
  had&#160;$423.4 million in outstanding borrowings under our credit facility
  (including $23.4 million under our revolving credit facility and $400.0 million
  under our term loan facility) with an aggregate unused credit availability under
  our revolving credit facility and cash on hand of approximately $27.2 million.
  Pursuant to the Credit Agreement Amendment (as defined below), our revolving
  credit facility&#160;is limited to&#160;$50.0 million.</font>&#160;&#160;If we
  are unable</font> to sustain our sources of revenue generation and reestablish
  our relationships within the credit markets, this cash position may not be
  sufficient to operate our business over the long-term.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Historically,
  our predecessor&#8217;s sources of liquidity included cash generated from operations
  and funding from the Private Company.&#160;&#160;The following table summarizes
  our sources and uses of cash for the nine months ended September 30, 2007 and
  2008:</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
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                                        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Nine
        Months Ended</font></div>
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        </font></td>
                                      <td valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                      <td colspan="6" valign="bottom" width="20%" style="BORDER-BOTTOM: black 2px solid">
                                        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">September
        30,</font></div>
                                      </td>
                                      <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                    </tr>
                                    <tr>
                                      <td valign="bottom" width="35%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                                      <td valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                      <td colspan="2" valign="bottom" width="9%" style="BORDER-BOTTOM: black 2px solid">
                                        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">2007</font></div>
                                      </td>
                                      <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                      <td valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                      <td colspan="2" valign="bottom" width="9%" style="BORDER-BOTTOM: black 2px solid">
                                        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">2008</font></div>
                                      </td>
                                      <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                    </tr>
                                    <tr>
                                      <td valign="bottom" width="35%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                                      <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                      <td colspan="6" valign="bottom" width="20%">
                                        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(in
        millions)</font></div>
                                      </td>
                                      <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                    </tr>
                                    <tr bgcolor="#cceeff">
                                      <td align="left" valign="bottom" width="35%">
                                        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Net
        cash provided by (used in) operating activities</font></div>
                                      </td>
                                      <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                      <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                      <td align="right" valign="bottom" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(11.7</font></td>
                                      <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">)</font></td>
                                      <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                      <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                      <td align="right" valign="bottom" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">42.9</font></td>
                                      <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                    </tr>
                                    <tr bgcolor="white">
                                      <td align="left" valign="bottom" width="35%">
                                        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Net
        cash used in investing activities</font></div>
                                      </td>
                                      <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                      <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                      <td align="right" valign="bottom" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(18.6</font></td>
                                      <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">)</font></td>
                                      <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                      <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                      <td align="right" valign="bottom" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(519.8</font></td>
                                      <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">)</font></td>
                                    </tr>
                                    <tr bgcolor="#cceeff">
                                      <td align="left" valign="bottom" width="35%">
                                        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Net
        cash provided by financing activities</font></div>
                                      </td>
                                      <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                      <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                      <td align="right" valign="bottom" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">31.5</font></td>
                                      <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                      <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                      <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                      <td align="right" valign="bottom" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">493.0</font></td>
                                      <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                    </tr>
                                </table>
                              </div>
                            </div>
                          </div>
                        </div>
                      </div>
                    </div>
                  </div>
                </div>
              </div>
            </div>
          </div>
        </div>
        <div>&#160;</div>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-STYLE: italic">Operating
  Activities</font>.&#160;Net cash provided by operating activities was $42.9
  million for the nine months ended September 30, 2008 as compared to the $11.7
  million used in operating activities for the nine months ended September 30,
  2007.&#160;&#160;The increase in net cash provided by operating activities is
  primarily due to a $39.7 million increase in our net income for the nine months
  ended September 30, 2008 compared to the nine months ended September 30,
  2007.&#160;&#160;In addition, cash provided by our operating activities
  increased due to a $8.8 million increase in depreciation and amortization, a
  $17.4 million increase in equity based incentive compensation and a $0.5 million
  increase in allowance for doubtful accounts.&#160;&#160;The increase was offset
  by a decrease in our cash provided by changes in working capital of $9.4
  million, a decrease in our interest rate swap liability of $2.2 million and a
  decrease in our unrealized loss related to interest rate swap agreements of $0.6
  million.</font></div><br>
      <div id="PGBRK" style="MARGIN-LEFT: 0pt; WIDTH: 100%; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
        <div id="FTR">
          <div style="WIDTH: 100%" align="left">
            <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
  </font></div>
          </div>
          <div id="GLFTR" style="WIDTH: 100%" align="center">
          </div>
        </div>
        <div id="PN" style="PAGE-BREAK-AFTER: always">
          <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">50</font></div>
          <div style="WIDTH: 100%; TEXT-ALIGN: center">
            <hr style="COLOR: black" noshade size="2">
          </div>
        </div>
        <div id="HDR">
          <div id="GLHDR" style="WIDTH: 100%" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 9pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><a href="#TOC">Table of Contents</a></font></div>
        </div>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-STYLE: italic">Investing
  Activities</font>.&#160;Net cash used in investing activities was $519.8 million
  for the nine months ended September 30, 2008 compared to $18.6 million for the
  nine months ended September 30, 2007. This increase is primarily attributable to
  the purchase of our Acquired Asphalt Assets in February 2008 for approximately
  $380 million, our purchase of our Acquired Storage Assets in May 2008 for
  approximately $90 million, and our purchase of our Acquired Pipeline Assets in
  May 2008 for approximately $45 million.&#160;&#160;The increase due to the above
  mentioned purchases were offset by a reduction in capital expenditures primarily
  resulting from the timing of construction projects in our terminalling and
  storage segment and gathering and transportation segment.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-STYLE: italic">Financing
  Activities</font>.&#160;Net cash provided by financing activities was $493.0
  million for the nine months ended September 30, 2008 as compared to $31.5
  million for the nine months ended September 30, 2007.&#160;&#160;Net cash
  provided by financing activities for the nine months ended September 30, 2008 is
  primarily comprised of the change in our net borrowings under our credit
  facility of $266.0 million and proceeds from the February 2008 public offering,
  net of offering fees, of $161.2 million, and is offset by distributions paid of
  $23.7 million for the nine months ended September 30, 2008.&#160;&#160;Prior to
  our initial public offering our net cash provided by financing activities
  primarily comprised of capital contributions received from the Private
  Company.&#160;&#160;The capital contributions served to fund our working capital
  needs and both maintenance and expansion capital expenditure projects that are
  reflected in net cash used in investing activities for the nine months ended
  September 30, 2007.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 18pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">Our
  Liquidity and Capital Resources</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Cash flow
  from operations and our credit facility are our primary sources of liquidity. At
  September 30, 2008, we had approximately $101.9 million of availability under
  our revolving credit facility.&#160;&#160;<font style="FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">As of May 22, 2009, we had
  an aggregate unused credit availability under our revolving credit facility and
  cash on hand of approximately $27.2 million.</font>&#160;&#160;</font>Usage of
  our revolving credit facility is subject to ongoing compliance with covenants.
  If we are unable to sustain our sources of revenue generation and reestablish
  our relationships within the credit markets, this cash position may not be
  sufficient to operate our business over the long-term. Historically, we have
  derived a substantial majority of our revenues from services provided to the
  Private Company, and as such, our liquidity was affected by the liquidity and
  credit risk of the Private Company.&#160;&#160;Due to the events related to the
  Bankruptcy Filings described herein, including the uncertainty relating to
  future cash flows, we face substantial doubt as to&#160;our ability to continue
  as a going concern.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-STYLE: italic">Capital Requirements</font>. Our
  operations are capital intensive, requiring significant investment to maintain
  and upgrade existing operations. Our capital requirements consist of the
  following:</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 36pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">maintenance
        capital expenditures, which are capital expenditures made to maintain the
        existing integrity and operating capacity of our assets and related cash
        flows further extending the useful lives of the assets;
    and</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 36pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">expansion
        capital expenditures, which are capital expenditures made to expand or to
        replace partially or fully depreciated assets or to expand the operating
        capacity or revenue of existing or new assets, whether through
        construction, acquisition or
  modification.</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;No
  assurance can be given that we will not be required to restrict our operations
  because of possible limitations on our ability to obtain financing for our
  maintenance capital expenditures and our expansion capital expenditures due to
  restrictions under our credit agreement and the uncertainty related to the
  Bankruptcy Filings.&#160;&#160;For example, due to the continuing impact of the
  Bankruptcy Filing discussed below, we have suspended capital expenditures
  related to Acquired Pipeline Assets and are evaluating future use of such
  pipeline.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-STYLE: italic">Our Ability to Grow Depends on Our
  Ability to Access External Expansion Capital</font>. Our partnership agreement
  provides that we distribute all of our available cash to our unitholders.
  Available cash is reduced by cash reserves established by our general partner to
  provide for the proper conduct of our business (including for future capital
  expenditures) and to comply with the provisions of our credit facility. However,
  we expect that we will continue to rely primarily upon external financing
  sources, including commercial bank borrowings and the issuance of debt and
  equity securities, rather than cash reserves established by our general partner,
  to fund our acquisitions and expansion capital expenditures that we may make in
  the future.&#160;&#160;We do not expect to make acquisitions or expansion
  capital expenditures in the near term.&#160;&#160;Capital expenditures are
  limited under our credit agreement to $12.5 million in 2009, $8.0 million in
  2010 and $4.0 million in 2011.&#160;&#160;To the extent we are unable to finance
  growth externally and we are unwilling to establish cash reserves to fund future
  acquisitions, our cash distribution policy will significantly impair our ability
  to grow. In addition, because we distribute all of our available cash, we may
  not grow as quickly as businesses that reinvest their available cash to expand
  ongoing operations.&#160;&#160;Pursuant to the Credit Agreement Amendment, we
  are prohibited from making distributions to our unitholders if our leverage
  ratio (as defined in the credit agreement) exceeds 3.50 to 1.00.&#160;&#160;As
  of September 30, 2008 and December 31, 2008, our leverage ratio was 4.34 to 1.00
  and 4.83 to 1.00, respectively.&#160;If our leverage ratio does not improve, we
  may not make quarterly distributions to our unitholders in the
  future.&#160;&#160;To the extent we issue additional units in connection with
  any acquisitions or expansion capital expenditures, the payment of distributions
  on those additional units may increase the risk that we will be unable to
  maintain or increase our per unit distribution level, which in turn may impact
  the available cash that we have to distribute on each unit. There are no
  limitations in our partnership agreement on our ability to issue additional
  units, including units ranking senior to the common units.</font></div><br>
      <div id="PGBRK" style="MARGIN-LEFT: 0pt; WIDTH: 100%; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
        <div id="FTR">
          <div style="WIDTH: 100%" align="left">
            <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
  </font></div>
          </div>
          <div id="GLFTR" style="WIDTH: 100%" align="center">
          </div>
        </div>
        <div id="PN" style="PAGE-BREAK-AFTER: always">
          <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">51</font></div>
          <div style="WIDTH: 100%; TEXT-ALIGN: center">
            <hr style="COLOR: black" noshade size="2">
          </div>
        </div>
        <div id="HDR">
          <div id="GLHDR" style="WIDTH: 100%" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 9pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><a href="#TOC">Table of Contents</a></font></div>
        </div>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-STYLE: italic">Description of Credit
  Facility</font>.&#160;In July 2007 we entered into a $250.0 million five-year
  credit facility with a syndicate of financial institutions. In connection with
  our acquisition of our asphalt assets, we amended this credit facility to
  increase the total amount we may borrow to $600.0 million.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
  credit facility is available for general partnership purposes, including working
  capital, capital expenditures, distributions and repayment of indebtedness that
  is assumed in connection with acquisitions. Due to events related to the
  Bankruptcy Filings, events of default occurred under our credit
  agreement.&#160;&#160;Effective on September 18, 2008, we and the requisite
  lenders under our credit facility entered into a Forbearance Agreement and
  Amendment to Credit Agreement (the &#8220;Forbearance Agreement&#8221;) under which the
  lenders agreed, subject to specified limitations and conditions, to forbear from
  exercising their rights and remedies arising from the defaults and events of
  default described therein for the period commencing on September 18, 2008 and
  ending on the earliest of (i) December 11, 2008, (ii) the occurrence of any
  default or event of default under the credit agreement other than certain
  defaults and events of default indicated in the Forbearance Agreement, or (iii)
  the failure of us to comply with any of the terms of the Forbearance Agreement
  (the &#8220;Forbearance Period&#8221;).&#160;&#160;On December 11, 2008, the lenders agreed
  to extend the Forbearance Period until December 18, 2008 pursuant to a First
  Amendment to Forbearance Agreement and Amendment to Credit Agreement (the &#8220;First
  Forbearance Amendment&#8221;), on December 18, 2008, the lenders agreed to extend the
  Forbearance Period until March 18, 2009 pursuant to a Second Amendment to
  Forbearance Agreement and Amendment to Credit Agreement (the &#8220;Second Forbearance
  Amendment&#8221;), and on March 18, 2009, the lenders agreed to further extend the
  Forbearance Period until April 8, 2009 pursuant to a Third Amendment to
  Forbearance Agreement and Amendment to Credit Agreement (the &#8220;Third Forbearance
  Amendment&#8221;).</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">We, our
  subsidiaries that are guarantors of the obligations under the credit facility,
  Wachovia Bank, National Association, as Administrative Agent, and the requisite
  lenders under our credit agreement entered into the Consent, Waiver and
  Amendment to Credit Agreement (the &#8220;Credit Agreement Amendment&#8221;), dated as of
  April 7, 2009, under which, among other things,&#160;the lenders consented to
  the Settlement and waived all existing defaults and events of default described
  in the Forbearance Agreement and amendments thereto.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Prior to
  the execution of the Forbearance Agreement, the credit agreement was comprised
  of a $350 million revolving credit facility and a $250 million term loan
  facility.&#160;&#160;The Forbearance Agreement permanently reduced our revolving
  credit facility under the credit agreement from $350 million to $300 million and
  prohibited us from borrowing additional funds under our revolving credit
  facility during the Forbearance Period.&#160;&#160;&#160;Under the Forbearance
  Agreement, we agreed to pay the lenders executing the Forbearance Agreement a
  fee equal to 0.25% of the aggregate commitments under the credit agreement after
  giving effect to the above described commitment reduction.&#160;&#160;The Second
  Forbearance Amendment further permanently reduced our revolving credit facility
  under the credit agreement from $300 million to $220 million.&#160;&#160;In
  addition, under the Second Forbearance Amendment, we agreed to pay the lenders
  executing the Second Forbearance Amendment a fee equal to 0.375% of the
  aggregate commitments under the credit agreement after the above described
  commitment reduction.&#160;&#160;Under the Third Forbearance Amendment, we
  agreed to pay a fee equal to 0.25% of the aggregate commitments under the credit
  agreement after the above described commitment reduction.&#160; The amendments
  to the Forbearance Agreement prohibited us from borrowing additional funds under
  our revolving credit facility during the extended Forbearance
  Period.&#160;&#160;</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
  Credit Agreement Amendment subsequently further permanently reduced our
  revolving credit facility under the credit agreement from $220 million to $50
  million, and increased the term loan facility from $250 million to $400
  million.&#160;&#160;Upon the execution of the Credit Agreement Amendment, $150
  million of our outstanding revolving loans were converted to term loans and we
  became able to borrow additional funds under our revolving credit
  facility.&#160;&#160;Pursuant to the Credit Agreement Amendment, the credit
  facility and all obligatinos thereunder will mature on June 30,
  2011.&#160;&#160;Under the Credit Agreement Amendment, we agreed to pay the
  lenders executing the Credit Agreement Amendment a fee equal to 2.00% of the
  aggregate commitments under the credit agreement after the above described
  commitment reduction, offset by the fee paid pursuant to the Third Forbearance
  Amendment.&#160;<font size="+0">&#160;<font style="FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">As of May 22, 2009, we
  had&#160;$423.4 million in outstanding borrowings under our credit facility
  (including $23.4 million under our revolving credit facility and $400.0 million
  under our term loan facility) with an aggregate unused credit availability under
  our revolving credit facility and cash on hand of approximately $27.2 million.
  Pursuant to the Credit Agreement Amendment,&#160;our revolving credit facility
  is limited to $50.0 million.&#160; <font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">If any of
  the financial institutions that support our revolving credit facility were to
  fail, we may not be able to find a replacement lender, which could negatively
  impact our ability to borrow under our revolving credit facility.&#160; For
  instance, Lehman Brothers Commercial Bank is one of the lenders under our $50.0
  million revolving credit facility, and Lehman Brothers Commercial Bank has
  agreed to fund approximately $2.5 million (approximately 5%) of the revolving
  credit facility.&#160; On several occasions Lehman Brothers Commercial Bank has
  failed to fund revolving loan requests under our revolving credit facility,
  effectively limiting the aggregate amount of our revolving credit facility to
  $47.5 million.&#160;</font></font></font></font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div><br>
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  </font></div>
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          <div style="WIDTH: 100%; TEXT-ALIGN: center">
            <hr style="COLOR: black" noshade size="2">
          </div>
        </div>
        <div id="HDR">
          <div id="GLHDR" style="WIDTH: 100%" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 9pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><a href="#TOC">Table of Contents</a></font></div>
        </div>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Prior to
  the events of default, indebtedness under the credit agreement bore interest at
  our option, at either (i)&#160;the higher of the administrative agent&#8217;s prime
  rate or the federal funds rate plus 0.5% (the "Base rate"), plus an applicable
  margin that ranges from 0.50% to 1.75%, depending on our total leverage ratio
  and senior secured leverage ratio, or (ii)&#160;LIBOR plus an applicable margin
  that ranges from 1.50% to 2.75%, depending upon our total leverage ratio and
  senior secured leverage ratio.&#160;&#160;During the Forbearance Period
  indebtedness under the credit agreement bore interest at our option, at either
  (i)&#160;the Base rate, plus an applicable margin that ranges from 2.75% to
  3.75%, depending upon our total leverage ratio, or (ii)&#160;LIBOR plus an
  applicable margin that ranges from 4.25% to 5.25%, depending upon our total
  leverage ratio.&#160;&#160;Pursuant to the Second Forbearance Amendment,
  commencing on December 12, 2008, indebtedness under the credit agreement bore
  interest at our option, at either (i)&#160;the Base rate plus 5.0% per annum,
  with a Base rate floor of 4.0% per annum, or (ii)&#160;LIBOR plus 6.0% per
  annum, with a LIBOR floor of 3.0% per annum.&#160;</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">After
  giving effect to the Credit Agreement Amendment, amounts outstanding under our
  credit facility bear interest at either the LIBOR rate plus 6.50% per annum,
  with a LIBOR floor of 3.00%, or the Base rate plus 5.50% per annum, with a Base
  rate floor of 4.00% per annum.&#160;&#160;We now pay a fee of 1.50% on unused
  commitments under our revolving credit facility.&#160;&#160;After giving effect
  to the Credit Agreement Amendment, interest on amounts outstanding under our
  credit facility must be paid monthly.&#160;&#160;Our credit facility, as amended
  by the Credit Agreement Amendment, now requires us to pay additional interest on
  October 6, 2009, April 6, 2010, October 6, 2010 and April 6, 2011, equal to the
  product of (i) the sum of the total amount of term loans then outstanding plus
  the aggregate commitments under the revolving credit facility and (ii) 0.50%,
  0.50%, 1.00% and 1.00%, respectively.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">During
  the three months ended September 30, 2008, the weighted average interest rate
  incurred by us was 7.04% resulting in interest expense of approximately $8.2
  million.&#160;&#160;During the three months ended December 31, 2008, the
  weighted average interest rate incurred by us was 7.72% resulting in interest
  expense of approximately $8.9 million.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Among
  other things, our credit facility, as amended by the Credit Agreement Amendment,
  now requires us to make (i) minimum quarterly amortization payments on March 31,
  2010 in the amount of $2.0 million, June 30, 2010 in the amount of $2.0 million,
  September 30, 2010 in the amount of $2.5 million, December 31, 2010 in the
  amount of $2.5 million and March 31, 2011 in the amount of $2.5 million, (ii)
  mandatory prepayments of amounts outstanding under the revolving credit facility
  (with no commitment reduction) whenever cash on hand exceeds $15.0 million,
  (iii) mandatory prepayments with 100% of asset sale proceeds, (iv) mandatory
  prepayment with 50% of the proceeds raised through equity&#160;sales and (v)
  annual prepayments with 50% of excess cash flow (as defined in the Credit
  Agreement Amendment).&#160;&#160;Our credit facility, as amended by the Credit
  Agreement Amendment, prohibits us from making draws under the revolving credit
  facility if we would have more than $15.0 million of cash on hand after making
  the draw and applying the proceeds thereof.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Under the
  credit agreement, we are subject to certain limitations, including limitations
  on our ability to grant liens, incur additional indebtedness, engage in a
  merger, consolidation or dissolution, enter into transactions with affiliates,
  sell or otherwise dispose of our assets (other than the sale or other
  disposition of the assets of the asphalt business, provided that such
  disposition is at arm&#8217;s length to a non-affiliate for fair market value in
  exchange for cash and the proceeds of the disposition are used to pay down
  outstanding loans), businesses and operations, materially alter the character of
  our business, and make acquisitions, investments and capital
  expenditures.&#160;&#160;The credit agreement prohibits us from making
  distributions of available cash to our unitholders if any default or event of
  default (as defined in the credit agreement) exists.&#160;&#160;The credit
  agreement, as amended by the Credit Agreement Amendment, requires us to maintain
  a leverage ratio (the ratio of our consolidated funded indebtedness to our
  consolidated adjusted EBITDA, in each case as defined in the credit agreement),
  determined as of the last day of each<font style="DISPLAY: inline; FONT-SIZE: 10pt">&#160;</font>month for the&#160;twelve
  month&#160;period ending on the date of determination, that ranges on a monthly
  basis from not more than 5.50 to 1.00 to not more than 9.75 to
  1.00.&#160;&#160;In addition, pursuant to the Credit Agreement Amendment, our
  ability to make acquisitions and investments in unrestricted subsidiaries is
  limited and we may only make distributions if our leverage ratio is less than
  3.50 to 1.00 and certain other conditions are met.&#160;&#160;As of September
  30, 2008 and December 31, 2008, our leverage ratio was 4.34 to 1.00 and 4.83 to
  1.00, respectively.&#160;If our leverage ratio does not improve, we may not make
  quarterly distributions to our unitholders in the future.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
  credit agreement, as amended by the Credit Agreement Amendment, also requires us
  to maintain an interest coverage ratio (the ratio of our consolidated EBITDA to
  our consolidated interest expense, in each case as defined in the credit
  agreement) that ranges on a monthly basis from not less than 2.50 to 1.00 to not
  less than 1.00 to 1.00. As of September 30, 2008 and December 31, 2008, our
  interest coverage ratio was 4.95 to 1.00 and 3.60 to 1.00,
  respectively.</font></div><br>
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  </font></div>
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        </div>
        <div id="HDR">
          <div id="GLHDR" style="WIDTH: 100%" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 9pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><a href="#TOC">Table of Contents</a></font></div>
        </div>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Further,
  we are required to maintain a minimum monthly consolidated adjusted EBITDA for
  the prior twelve months ranging from $45.4 million to $82.9 million as
  determined at the end of each month.&#160;&#160;In addition, capital
  expenditures are limited to $12.5 million in 2009, $8.0 million in 2010 and $4.0
  million in the six months ending June 30, 2011.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
  credit agreement specifies a number of events of default (many of which are
  subject to applicable cure periods), including, among others, failure to pay any
  principal when due or any interest or fees within three business days of the due
  date, failure to perform or otherwise comply with the covenants in the credit
  agreement, failure of any representation or warranty to be true and correct in
  any material respect, failure to pay debt, a change of control of us or our
  general partner, and other customary defaults.&#160;&#160;<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">In
  addition, it is an event of default under the credit agreement if we do not file
  our delinquent quarterly and annual reports with the SEC by September 30, 2009,
  unless we retain new auditors, in which case such deadline is extended to
  December 31, 2009.&#160; </font>If an event of default exists under the credit
  agreement, the lenders will be able to accelerate the maturity of the credit
  agreement and exercise other rights and remedies, including taking available
  cash in our bank accounts.&#160;&#160;If an event of default exists and we are
  unable to obtain forbearance from our lenders or a waiver of the events of
  default under our credit agreement, we may be forced to sell assets, make a
  bankruptcy filing or take other action that could have a material adverse effect
  on our business, the price of our common units and our results of
  operations.&#160;&#160;We are also prohibited from making cash distributions to
  our unitholders while the events of default exist.&#160;&#160;</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-STYLE: italic">Contractual
  Obligations</font>.&#160;In addition to the credit facility described above, we
  entered into the Amended Omnibus Agreement with the Private Company pursuant to
  which the Private Company provided all employees and support services necessary
  to run our business prior to the Settlement. The services included, without
  limitation, operations, marketing, maintenance and repair, legal, accounting,
  treasury, insurance administration and claims processing, risk management,
  health, safety and environmental, information technology, human resources,
  credit, payroll, internal audit, taxes and engineering.&#160;&#160;The events
  related to the Bankruptcy Filings terminated the Private Company&#8217;s obligations
  to provide services to us under the Amended Omnibus Agreement.&#160;&#160;The
  Private Company continued to provide such services to us until the effective
  date of the Settlement at which time the Private Company rejected the Amended
  Omnibus Agreement and we and the Private Company entered into the Shared
  Services Agreement and the Transition Services Agreement relating to the
  provision of such services (see &#8220;Item 2. Management&#8217;s Discussion and Analysis of
  Financial Condition and Results of Operations<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#8212;Impact
  of the Bankruptcy of the Private Company and Certain of its Subsidiaries and
  Related Events</font>&#8212;Settlement with the Private Company&#8221;).&#160;&#160;In
  addition, in connection with the Settlement, we made offers of employment to
  certain individuals associated with our crude oil operations and expect to make
  additional offers of employment to certain individuals associated with our
  asphalt operations.&#160;&#160;The costs to directly employ these individuals as
  well as the costs under the Shared Services Agreement, the Transition Services
  Agreement may be higher than those previously paid by us under the Amended
  Omnibus Agreement, which could have a material adverse effect on our business,
  financial condition, results of operations, cash flows, ability to make
  distributions to our unitholders, the trading price of our common units and our
  ability to conduct our business.&#160;</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">A summary
  of our contractual cash obligations over the next several fiscal years, as of
  September 30, 2008, was as follows:</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left">
        <div>
          <div align="center">
            <div>
              <div align="left">
                <div align="center">
                  <div align="center">
                    <table cellpadding="0" cellspacing="0" width="100%">
                        <tr>
                          <td align="left" valign="bottom" width="30%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                          <td valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                          <td colspan="18" valign="bottom" width="43%" style="BORDER-BOTTOM: black 2px solid">
                            <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Payments
        Due by Period</font></div>
                          </td>
                          <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        </tr>
                        <tr>
                          <td align="left" valign="bottom" width="30%" style="BORDER-BOTTOM: black 2px solid">
                            <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Contractual
        Obligations</font></div>
                          </td>
                          <td valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                          <td colspan="2" valign="bottom" width="7%" style="BORDER-BOTTOM: black 2px solid">
                            <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Total</font></div>
                          </td>
                          <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                          <td valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                          <td colspan="2" valign="bottom" width="7%" style="BORDER-BOTTOM: black 2px solid">
                            <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Less
        than 1 year</font></div>
                          </td>
                          <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                          <td valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                          <td colspan="2" valign="bottom" width="7%" style="BORDER-BOTTOM: black 2px solid">
                            <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">1-3
        years</font></div>
                          </td>
                          <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                          <td valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                          <td colspan="2" valign="bottom" width="7%" style="BORDER-BOTTOM: black 2px solid">
                            <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">4-5
        years</font></div>
                          </td>
                          <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                          <td valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                          <td colspan="2" valign="bottom" width="7%" style="BORDER-BOTTOM: black 2px solid">
                            <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">More
        than 5 years</font></div>
                          </td>
                          <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        </tr>
                        <tr>
                          <td align="left" valign="bottom" width="30%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
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                          <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                          <td colspan="18" valign="bottom" width="43%">
                            <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(in
        millions)</font></div>
                          </td>
                          <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        </tr>
                        <tr bgcolor="#cceeff">
                          <td align="left" valign="bottom" width="30%">
                            <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Omnibus
        Agreement obligations (1)</font></div>
                          </td>
                          <td align="right" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                          <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></td>
                          <td align="right" valign="bottom" width="6%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">1.2</font></td>
                          <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                          <td align="right" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                          <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></td>
                          <td align="right" valign="bottom" width="6%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">1.2</font></td>
                          <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                          <td align="right" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                          <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></td>
                          <td align="right" valign="bottom" width="6%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">-</font></td>
                          <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                          <td align="right" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                          <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></td>
                          <td align="right" valign="bottom" width="6%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">-</font></td>
                          <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                          <td align="right" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                          <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></td>
                          <td align="right" valign="bottom" width="6%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">-</font></td>
                          <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        </tr>
                        <tr bgcolor="white">
                          <td align="left" valign="bottom" width="30%">
                            <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Debt
        obligations (2)</font></div>
                          </td>
                          <td align="right" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                          <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                          <td align="right" valign="bottom" width="6%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">448.1</font></td>
                          <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                          <td align="right" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                          <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                          <td align="right" valign="bottom" width="6%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">-</font></td>
                          <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                          <td align="right" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                          <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                          <td align="right" valign="bottom" width="6%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">448.1</font></td>
                          <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                          <td align="right" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                          <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                          <td align="right" valign="bottom" width="6%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">-</font></td>
                          <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                          <td align="right" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                          <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                          <td align="right" valign="bottom" width="6%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">-</font></td>
                          <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        </tr>
                        <tr bgcolor="#cceeff">
                          <td align="left" valign="bottom" width="30%">
                            <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Capital
        lease obligations</font></div>
                          </td>
                          <td align="right" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                          <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                          <td align="right" valign="bottom" width="6%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">1.4</font></td>
                          <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                          <td align="right" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                          <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                          <td align="right" valign="bottom" width="6%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">1.0</font></td>
                          <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                          <td align="right" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                          <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                          <td align="right" valign="bottom" width="6%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">0.4</font></td>
                          <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                          <td align="right" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                          <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                          <td align="right" valign="bottom" width="6%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">-</font></td>
                          <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                          <td align="right" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                          <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                          <td align="right" valign="bottom" width="6%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">-</font></td>
                          <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        </tr>
                        <tr bgcolor="white">
                          <td align="left" valign="bottom" width="30%">
                            <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Operating
        lease obligations</font></div>
                          </td>
                          <td align="right" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                          <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                          <td align="right" valign="bottom" width="6%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">13.4</font></td>
                          <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                          <td align="right" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                          <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                          <td align="right" valign="bottom" width="6%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">3.9</font></td>
                          <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                          <td align="right" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                          <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                          <td align="right" valign="bottom" width="6%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">6.5</font></td>
                          <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                          <td align="right" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                          <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                          <td align="right" valign="bottom" width="6%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">2.7</font></td>
                          <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                          <td align="right" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                          <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                          <td align="right" valign="bottom" width="6%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">0.3</font></td>
                          <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        </tr>
                    </table>
                  </div>
                </div>
              </div>
            </div>
          </div>
        </div><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;<font style="DISPLAY: inline; FONT-SIZE: 10pt">&#160;</font></font></div>
      <div>
        <table cellpadding="0" cellspacing="0" width="100%">
            <tr>
              <td align="left" valign="top" width="3%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0.8pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(1)</font></div>
              </td>
              <td align="left" valign="top" width="75%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">As
        of September 30, 2008, the Private Company still provided services to us
        under the Amended Omnibus Agreement and we still paid our general partner
        and the Private Company a fixed administrative fee, in the amount of $7.0
        million per year, for the provision by our general partner and the Private
        Company of various general and administrative services pursuant to the
        Amended Omnibus Agreement.&#160;&#160;The events related to the Bankruptcy
        Filings terminated the Private Company&#8217;s obligations to provide services
        to us under the Amended Omnibus Agreement.&#160;&#160;The Private Company
        continued to provide such services to us until the effective date of the
        Settlement at which time the Private Company rejected the Amended Omnibus
        Agreement and we and the Private Company entered into the Shared Services
        Agreement and the Transition Services Agreement relating to the provision
        of such services (see &#8220;Item 2. Management&#8217;s Discussion and Analysis of
        Financial Condition and Results of Operations<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#8212;Impact
        of the Bankruptcy of the Private Company and Certain of its Subsidiaries
        and Related Events</font>&#8212;Settlement with the Private
        Company&#8221;).</font></div>
              </td>
            </tr>
            <tr>
              <td align="left" valign="top" width="3%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0.8pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(2)</font></div>
              </td>
              <td align="left" valign="top" width="75%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0.8pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Represents
        required future principal repayments of borrowings under our credit
        facility, all of which is variable rate debt. All amounts outstanding
        under the credit facility mature in June 2011.&#160;&#160;See Note 4 of
        the Notes to the Consolidated Financial Statements included in Item 1 of
        this Quarterly Report.</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div><br>
      <div id="PGBRK" style="MARGIN-LEFT: 0pt; WIDTH: 100%; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
        <div id="FTR">
          <div style="WIDTH: 100%" align="left">
            <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
  </font></div>
          </div>
          <div id="GLFTR" style="WIDTH: 100%" align="center">
          </div>
        </div>
        <div id="PN" style="PAGE-BREAK-AFTER: always">
          <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">54</font></div>
          <div style="WIDTH: 100%; TEXT-ALIGN: center">
            <hr style="COLOR: black" noshade size="2">
          </div>
        </div>
        <div id="HDR">
          <div id="GLHDR" style="WIDTH: 100%" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 9pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><a href="#TOC">Table of Contents</a></font></div>
        </div>
      </div><br>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Recent
  Accounting Pronouncements</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">For
  information regarding recent accounting developments that may affect our future
  financial statements, see Note 12 of the Notes to the Consolidated Financial
  Statements included in Item 1 of this Quarterly Report.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table cellpadding="0" cellspacing="0" width="100%">
            <tr>
              <td align="left" valign="top" width="9%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0.8pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;<a name="quant">Item&#160;3.</a></font></div>
              </td>
              <td align="left" valign="top" width="69%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0.8pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Quantitative
        and Qualitative Disclosures about Market
  Risk</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">We are
  exposed to market risk due to variable interest rates under our credit
  facility.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">As of May 22, 2009 we had
  $423.4 million outstanding under our credit facility that was subject to a
  variable interest rate</font>.&#160;&#160;Interest</font> rate swap agreements
  were used to manage a portion of the exposure related to changing interest rates
  by converting floating-rate debt to fixed-rate debt. In August 2007 we entered
  into interest rate swap agreements with an aggregate notional value of $80.0
  million that mature on August&#160;20, 2010. Under the terms of the interest
  rate swap agreements, we were to pay fixed rates of 4.9% and receive three-month
  LIBOR with quarterly settlement.&#160;&#160;In March 2008 we entered into
  interest rate swap agreements with an aggregate notional value of $100.0 million
  that mature on March 31, 2011.&#160;&#160;Under the terms of the interest rate
  swap agreements, we were to pay fixed rates of 2.6% to 2.7% and receive
  three-month LIBOR with quarterly settlement.&#160;&#160;The interest rate swaps
  do not receive hedge accounting treatment under Statement of Financial
  Accounting Standard (&#8220;SFAS&#8221;) SFAS No. 133, &#8220;<font style="DISPLAY: inline; FONT-STYLE: italic">Accounting for Derivative
  Instruments and Hedging Activities</font>&#8221; (&#8220;SFAS 133&#8221;). Changes in the fair
  value of the interest rate swaps are recorded in interest expense in the
  statements of operations.&#160;&#160;In addition, the interest rate swap
  agreements contain cross-default provisions to events of default under the
  credit agreement.&#160;&#160;Due to events related to the Bankruptcy Filings,
  all of these interest rate swap positions were terminated in the third quarter
  of 2008, and we have recorded a $1.5 million liability as of September 30, 2008
  with respect to these positions.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Prior to
  the events of default, indebtedness under the credit agreement bore interest at
  our option, at either (i)&#160;the&#160;Base rate,&#160;plus an applicable
  margin that ranges from 0.50% to 1.75%, depending on our total leverage ratio
  and senior secured leverage ratio, or (ii)&#160;LIBOR plus an applicable margin
  that ranges from 1.50% to 2.75%, depending upon our total leverage ratio and
  senior secured leverage ratio.&#160;&#160;During the Forbearance Period
  indebtedness under the credit agreement bore interest at our option, at either
  (i)&#160;the Base rate, plus an applicable margin that ranges from 2.75% to
  3.75%, depending upon our total leverage ratio, or (ii)&#160;LIBOR plus an
  applicable margin that ranges from 4.25% to 5.25%, depending upon our total
  leverage ratio.&#160;&#160;Pursuant to the Second Forbearance Amendment,
  commencing on December 12, 2008, indebtedness under the credit agreement bore
  interest at our option, at either (i)&#160;the&#160;Base rate&#160;plus 5.0% per
  annum, with a Base rate floor of 4.0% per annum, or (ii)&#160;LIBOR plus 6.0%
  per annum, with a LIBOR floor of 3.0% per annum.&#160;</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">After
  giving effect to the Credit Agreement Amendment, amounts outstanding under our
  credit facility bear interest at either the LIBOR rate plus 6.50% per annum,
  with a LIBOR floor of 3.00%, or the Base rate plus 5.50% per annum, with a Base
  rate floor of 4.00% per annum.&#160;&#160;We now pay a fee of 1.50% on unused
  commitments under our revolving credit facility.&#160;&#160;After giving effect
  to the Credit Agreement Amendment, interest on amounts outstanding under our
  credit facility must be paid monthly.&#160;&#160;Our credit facility, as amended
  by the Credit Agreement Amendment, now requires us to pay additional interest on
  October 6, 2009, April 6, 2010, October 6, 2010 and April 6, 2011, equal to the
  product of (i) the sum of the total amount of term loans then outstanding plus
  the aggregate commitments under the revolving credit facility and (ii) 0.50%,
  0.50%, 1.00% and 1.00%, respectively.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">During
  the three months ended September 30, 2008, the weighted average interest rate
  incurred by us was 7.04% resulting in interest expense of approximately $8.2
  million.&#160;&#160;During the three months ended December 31, 2008, the
  weighted average interest rate incurred by us was 7.72% resulting in interest
  expense of approximately $8.9 million.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Due to
  the Forbearance Agreement, the Second Forbearance Amendment and the Credit
  Agreement Amendment, we expect our interest expense to continue to increase as
  compared to our interest expense prior to the Bankruptcy
  Filings.&#160;&#160;Changes in economic conditions could result in higher
  interest rates, thereby increasing our interest expense and reducing our funds
  available for capital investment, operations or distributions to our
  unitholders. Additionally, if domestic interest rates continue to increase, the
  interest rates on any of our future credit facilities and debt offerings could
  be higher than current levels, causing our financing costs to increase
  accordingly. <font style="FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Based
  on current borrowings, an increase or decrease of 100 basis points in the
  interest rate will result in increased or decreased, respectively, annual
  interest expenses of $4.2 million.</font></font></div>
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          <div id="GLHDR" style="WIDTH: 100%" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 9pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><a href="#TOC">Table of Contents</a></font></div>
        </div>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div>
        <table cellpadding="0" cellspacing="0" width="100%">
            <tr>
              <td align="left" valign="top" width="9%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0.8pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;<a name="controls">Item&#160;4T.</a></font></div>
              </td>
              <td align="left" valign="top" width="70%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0.8pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Controls
        and Procedures</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-STYLE: italic">Evaluation of disclosure controls
  and procedures.</font> Our general partner&#8217;s management, including the Chief
  Executive Officer and Chief Financial Officer of our general partner, evaluated
  as of the end of the period covered by this report, the effectiveness of our
  disclosure controls and procedures as defined in Rule&#160;13a-15(e) under the
  Securities Exchange Act of 1934.&#160;Based on that evaluation, the Chief
  Executive Officer and Chief Financial Officer of our general partner concluded
  that our disclosure controls and procedures, as of September 30, 2008, were
  effective.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-STYLE: italic">Changes in internal control over
  financial reporting.</font> There were no changes in our internal control over
  financial reporting that occurred during the quarter ended September 30, 2008
  that have materially affected, or are reasonably likely to materially affect,
  our internal control over financial reporting.&#160;&#160;However, since the
  beginning of the third quarter of 2008, the Private Company has made the
  Bankruptcy Filings, and a subcommittee of our Board conducted an internal
  review, both as discussed elsewhere in this report.&#160;&#160;One of the
  findings by counsel for such subcommittee was that certain senior executive
  officers of our general partner, who were also senior executive officers of the
  Private Company, showed at least some indifference to known or easily
  discoverable facts and had access to and reviewed financial information from
  which they could have developed an earlier understanding of the nature and
  significance of the trading activities that led to the Private Company&#8217;s
  liquidity problems.&#160;&#160;For a discussion of the internal review, please
  see &#8220;Item 2. Management&#8217;s Discussion and Analysis of Financial Condition and
  Results of Operations &#8722; Impact of the Bankruptcy of the Private Company and
  Certain of its Subsidiaries and Related Events &#8722; Internal Review.&#8221;</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">After
  completion of the internal review, a plan was developed with the advice of the
  Audit Committee of the Board to further strengthen our processes and
  procedures.&#160;&#160;This plan includes, among other things, reevaluating
  executive officers and accounting and finance personnel (including a realignment
  of officers as described elsewhere in this report) and hiring, as deemed
  necessary, additional accounting and finance personnel or consultants;
  reevaluating our internal audit function and determining whether to expand the
  duties and responsibilities of such group; evaluating the comprehensive training
  programs for all management personnel covering, among other things, compliance
  with controls and procedures, revising the reporting structure so that the Chief
  Financial Officer reports directly to the Audit Committee, and increasing the
  business and operational oversight role of the Audit Committee.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">We and
  our general partner rely upon the Private Company for our personnel, including
  those related to designing and implementing internal controls and disclosure
  controls and procedures.&#160;&#160;Staff reductions by the Private Company or
  other departures by the Private Company&#8217;s employees that provide services to us
  could have a material adverse effect on internal controls and the effectiveness
  of disclosure controls and procedures.&#160;&#160;Management is in the process
  of evaluating any such potential impact and is preparing a transition plan that
  may include, among other items, hiring additional personnel and the redesign and
  implementation of internal controls and disclosure controls and procedures as
  needed.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Pursuant
  to the Amended Omnibus Agreement with the Private Company, the Private Company
  operated our assets and performed other administrative services for us such as
  accounting, legal, regulatory, development, finance, land and
  engineering.&#160;&#160;The events related to the Bankruptcy Filings terminated
  the Private Company&#8217;s obligations to provide services to us under the Amended
  Omnibus Agreement.&#160;&#160;The Private Company continued to provide such
  services to us until the effective date of the Settlement at which time the
  Private Company rejected the Amended Omnibus Agreement and we and the Private
  Company entered into the Shared Services Agreement and the Transition Services
  Agreement relating to the provision of such services.&#160;&#160;If the Private
  Company stops providing these services we may incur increased costs to replace
  these services and our financial results may suffer.&#160;&#160;In addition, in
  connection with the Settlement, we made offers of employment to certain
  individuals associated with our crude oil operations and expect to make
  additional offers of employment to certain individuals associated with our
  asphalt operations.&#160;&#160;The costs to directly employ these individuals as
  well as the costs under the Shared Services Agreement and the Transition
  Services Agreement may be higher than those previously paid by us under the
  Amended Omnibus Agreement, which could have a material adverse effect on our
  business, financial condition, results of operations, cash flows, ability to
  make distributions to our unitholders, the trading price of our common units and
  our ability to conduct our business.</font></div><br>
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  </font></div>
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        </div>
      </div><br>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><a name="PART2">PART II. </a>OTHER INFORMATION</font></div>
      <div>
        <table cellpadding="0" cellspacing="0" width="100%">
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              <td align="left" valign="top" width="9%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0.8pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;<a name="legal">Item&#160;1.</a></font></div>
              </td>
              <td align="left" valign="top" width="70%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0.8pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Legal
        Proceedings</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font>On July 21, 2008, we received a letter
  from the staff of the SEC giving notice that the SEC is conducting an inquiry
  relating to us and requesting, among other things, that we voluntarily preserve,
  retain and produce to the SEC certain documents and information relating
  primarily to our disclosures respecting the Private Company&#8217;s liquidity issues,
  which were the subject of our July 17, 2008 press release.&#160;&#160;On October
  22, 2008, we received a subpoena from the SEC pursuant to a formal order of
  investigation requesting certain documents relating to, among other things, the
  Private Company&#8217;s liquidity issues.&#160;&#160;We have been cooperating, and
  intend to continue cooperating, with the SEC in its investigation.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">On July
  23, 2008, we and our general partner each received a Grand Jury subpoena from
  the United States Attorney&#8217;s Office in Oklahoma City, Oklahoma, requiring, among
  other things, that we and our general partner produce financial and other
  records related to our July 17, 2008 press release.&#160;&#160;We have been
  informed that the U.S. Attorneys&#8217; Offices for the Western District of Oklahoma
  and the Northern District of Oklahoma are in discussions regarding the
  subpoenas, and no date has been set for a response to the
  subpoenas.&#160;&#160;We and our general partner intend to cooperate fully with
  this investigation if and when it proceeds.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Between
  July 21, 2008 and September 4, 2008, the following class action complaints were
  filed:</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;&#160;&#160;&#160;&#160;&#160;&#160;
  1.&#160;&#160;&#160;&#160;&#160;<font style="DISPLAY: inline; FONT-STYLE: italic"> Poelman v. SemGroup Energy
  Partners, L.P., et al</font>., Civil Action No. 08-CV-6477, in the United States
  District Court for the Southern District of New York (filed July 21,
  2008).&#160; The plaintiff voluntarily dismissed this case on August 26,
  2008;</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;&#160;&#160;&#160;&#160;&#160;&#160;
  2.&#160;&#160;&#160;&#160;&#160;<font style="DISPLAY: inline; FONT-STYLE: italic"> Carson v. SemGroup Energy Partners,
  L.P. et al</font><font style="DISPLAY: inline; FONT-WEIGHT: bold">.</font>,
  Civil Action No. 08-cv-425, in the Northern District of Oklahoma (filed July 22,
  2008);</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;&#160;&#160;&#160;&#160;&#160;&#160;
  3.&#160;&#160;&#160;&#160;&#160;&#160;<font style="DISPLAY: inline; FONT-STYLE: italic"> Charles D. Maurer SIMP Profit
  Sharing Plan f/b/o Charles D. Maurer v. SemGroup Energy Partners, L.P. et
  al.</font>, Civil Action No. 08-cv-6598, in the United States District Court for
  the Southern District of New York (filed July 25, 2008);</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;&#160;&#160;&#160;&#160;&#160;&#160;
  4.&#160;&#160;&#160;&#160;&#160;<font style="DISPLAY: inline; FONT-STYLE: italic"> Michael Rubin v. SemGroup Energy
  Partners, L.P. et al.</font>, Civil Action No. 08-cv-7063, in the United States
  District Court for the Southern District of New York (filed August 8,
  2008);</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;&#160;&#160;&#160;&#160;&#160;&#160;
  5.&#160;&#160;&#160;&#160;&#160;<font style="DISPLAY: inline; FONT-STYLE: italic"> Dharam V. Jain v. SemGroup Energy
  Partners, L.P. et al.</font>, Civil Action No. 08-cv-7510, in the United States
  District Court for the Southern District of New York&#160; (filed August 25,
  2008); and</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;&#160;&#160;&#160;&#160;&#160;&#160;
  6.&#160;&#160;&#160;&#160;&#160;<font style="DISPLAY: inline; FONT-STYLE: italic"> William L. Hickman v. SemGroup
  Energy Partners, L.P. et al.</font>, Civil Action No. 08-cv-7749, in the United
  States District Court for the Southern District of New York (filed September 4,
  2008).</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;&#160;&#160;&#160;&#160;&#160;&#160;
  </font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;&#160;&#160;&#160;&#160;&#160;&#160;</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div><br>
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          <div id="GLHDR" style="WIDTH: 100%" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 9pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><a href="#TOC">Table of Contents</a></font></div>
        </div>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Pursuant
  to a motion filed with the MDL Panel, the<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">
  Maurer</font> case has been transferred to the Northern District of Oklahoma and
  consolidated with the<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">
  Carson</font> case.&#160; The<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">
  Rubin, Jain,</font> and<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">
  Hickman</font> cases have also been transferred to the Northern District of
  Oklahoma.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;&#160;&#160;&#160;&#160;&#160;&#160;
  A hearing on motions for appointment as lead plaintiff was held in the<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">
  Carson</font> case on October 17, 2008.&#160; At that hearing, the court granted
  a motion to consolidate the <font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">Carson</font>
  and <font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">Maurer</font>
  cases for pretrial proceedings, and the consolidated litigation is now pending
  as<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">
  In Re: SemGroup Energy Partners, L.P. Securities Litigation</font>, Case No.
  08-CV-425-GKF-PJC. The court entered an order on October 27, 2008, granting the
  motion of Harvest Fund Advisors LLC to be appointed lead plaintiff in the
  consolidated litigation.&#160;&#160;On January 23, 2009, the court entered a
  Scheduling Order providing, among other things, that the lead plaintiff may file
  a consolidated amended complaint within 70 days of the date of the order, and
  that defendants may answer or otherwise respond within 60 days of the date of
  the filing of a consolidated amended complaint.&#160; <font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">On
  January 30, 2009, the lead plaintiff filed a motion to modify the stay of
  discovery provided for under the Private Securities Litigation Reform Act. The
  court granted Plaintiff's motion, and we and certain other defendants filed a
  Petition for Writ of Mandamus in the Tenth Circuit Court of Appeals
  that&#160;was denied after&#160;oral argument on April 24,
  2009.</font></font></font></font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font id="TAB2" style="FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; LETTER-SPACING: 9pt">&#160;&#160;&#160;</font>&#160;The
  lead plaintiff obtained an extension to file its consolidated amended complaint
  until May 4, 2009; defendants have 60 days from that date to answer or otherwise
  respond to the complaint.</font></font></font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font id="TAB2" style="FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; LETTER-SPACING: 9pt">&#160;&#160;&#160;</font>&#160;The
  lead plaintiff filed a consolidated amended complaint on May 4, 2009.&#160; In
  that complaint, filed as a putative class action on behalf of all purchasers of
  our units from July 17, 2007 to July 17, 2008 (the &#8220;class period&#8221;), lead
  plaintiff asserts claims under the federal securities laws against us, our
  general partner, certain of our current and former officers and directors,
  certain underwriters in our initial and secondary public offerings, and certain
  entities who were investors in the Private Company and their individual
  representatives who served on the Private Company&#8217;s management committee. Among
  other allegations, the amended complaint alleges that our financial condition
  throughout the class period was dependent upon speculative commodities trading
  by the Private Company and its Chief Executive Officer, Thomas L. Kivisto, and
  that Defendants negligently and intentionally failed to disclose this
  speculative trading in our public filings during the class period. Specifically,
  the amended complaint alleges claims for violations of sections 11, 12(a)(2),
  and 15 of the Securities Act of 1933 for damages and rescission with respect to
  all persons who purchased our units in the initial and secondary offerings, and
  also asserts claims under section 10b, Rule 10b-5, and section 20(a) of the
  Securities and Exchange Act of 1934. The amended complaint seeks certification
  as a class action under the Federal Rules of Civil Procedure, compensatory and
  rescissory damages for class members, pre-judgment interest, costs of court, and
  attorneys&#8217; fees.</font></font></font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;&#160;&#160;&#160;&#160;&#160;&#160;
  We intend to vigorously defend these actions.&#160; There can be no assurance
  regarding the outcome of the litigation.&#160;&#160;An estimate of possible
  loss, if any, or the range of loss cannot be made and therefore we have not
  accrued a loss contingency related to these actions.&#160;&#160;However, the
  ultimate resolution of these actions could have a material adverse effect on our
  business, financial condition, results of operations, cash flows, ability to
  make distributions to our unitholders, the trading price of the our common units
  and our ability to conduct our business.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">In March
  and April 2009, nine current or former executives of the Private Company and
  certain of its affiliates filed wage claims with the Oklahoma Department of
  Labor against our general partner.&#160;&#160;Their claims arise from our
  general partner&#8217;s Long-Term Incentive Plan, Employee Phantom Unit Agreement
  (&#8220;Phantom Unit Agreement&#8221;).&#160;&#160;Most&#160;claimants allege that phantom
  units previously awarded to them vested upon the&#160;Change of Control that
  occurred in July 2008.&#160;&#160;One claimant alleges that his phantom units
  vested upon his termination.&#160;&#160;The claimants contend our general
  partner&#8217;s failure to deliver certificates for the phantom units within 60 days
  after vesting has caused them to be damaged, and they seek recovery of
  approximately $2 million in damages and penalties.&#160;&#160;<font style="FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font size="3" style="FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">On April 30, 2009,
  all of the wage claims were dismissed on jurisdictional grounds by the
  Department of Labor.&#160; </font>Our general partner intends to vigorously
  defend these claims.</font></font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">We may
  become the subject of additional private or government actions regarding these
  matters in the future.&#160;&#160;Litigation may be time-consuming, expensive
  and disruptive to normal business operations, and the outcome of litigation is
  difficult to predict.&#160;&#160;The defense of these lawsuits may result in the
  incurrence of significant legal expense, both directly and as the result of our
  indemnification obligations.&#160;&#160;The litigation may also divert
  management&#8217;s attention from our operations which may cause our business to
  suffer.&#160;&#160;An unfavorable outcome in any of these matters may have a
  material adverse effect on our business, financial condition, results of
  operations, cash flows, ability to make distributions to our unitholders, the
  trading price of the our common units and our ability to conduct our business.
  All or a portion of the defense costs and any amount we may be required to pay
  to satisfy a judgment or settlement of these claims may not be covered by
  insurance.</font></div>
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  </font></div>
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        </div>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div>
        <table cellpadding="0" cellspacing="0" width="100%">
            <tr>
              <td align="left" valign="top" width="9%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0.8pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;<a name="risk">Item&#160;1A.</a></font></div>
              </td>
              <td align="left" valign="top" width="87%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0.8pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Risk
        Factors</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">Limited
  partner interests are inherently different from the capital stock of a
  corporation, although many of the business risks to which we are subject are
  similar to those that would be faced by a corporation engaged in a similar
  business. You should carefully consider the following risk factors together with
  all of the other information included in this report. If any of the following
  risks were actually to occur, our business, financial condition, or results of
  operations could be materially adversely affected. In that case, we might not be
  able to pay distributions on our common units, the trading price of our common
  units could decline and our unitholders could lose all or part of their
  investment.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Risks
  Related to the Bankruptcy Filings</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">The
  Bankruptcy Filings may have a material adverse effect on our results of
  operations and our ability to make distributions to our
  unitholders.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">On July
  22, 2008, the Private Company made the Bankruptcy Filings.&#160;&#160;The
  Private Company and its subsidiaries continue to operate their businesses and
  own and manage their properties as debtors-in-possession under the jurisdiction
  of the Bankruptcy Court and in accordance with the applicable provisions of the
  Bankruptcy Code.&#160;&#160;None of we, our general partner, our subsidiaries
  nor our general partner&#8217;s subsidiaries are debtors in the Bankruptcy
  Cases.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">As of the
  date of the Bankruptcy Filings, we were party to various agreements with the
  Private Company and its subsidiaries, including subsidiaries that are debtors in
  the Bankruptcy Cases.&#160;&#160;Under the Throughput Agreement, we provided
  certain crude oil gathering, transportation, terminalling and storage services
  to a subsidiary of the Private Company that is a debtor in the Bankruptcy
  Cases.&#160;&#160;Under the Terminalling Agreement, we provided certain liquid
  asphalt cement terminalling and storage services to a subsidiary of the Private
  Company that is a debtor in the Bankruptcy Cases.&#160;&#160;For the nine months
  ended September 30, 2008 and the year ended December 31, 2008, we derived
  approximately 81% and approximately 73%, respectively, of our revenues,
  excluding fuel surcharge revenues related to fuel and power consumed to operate
  our liquid asphalt cement storage tanks, from services we provided to the
  Private Company and its subsidiaries.&#160;&#160;Prior to the Order and the
  Settlement, the Private Company was obligated to pay us minimum monthly fees
  totaling $76.1 million annually and $58.9 million annually in respect of the
  minimum commitments under the Throughput Agreement and the Terminalling
  Agreement, respectively, regardless of whether such services were actually used
  by the Private Company.&#160;&#160;The Order required the Private Company to
  make certain payments under the Throughput Agreement and Terminalling Agreement
  during a portion of the third quarter of 2008,&#160; including the contractual
  minimum payments under the Terminalling Agreement.&#160;&#160;In connection with
  the Settlement, we waived the fees due under the Terminalling Agreement during
  March 2009.&#160;&#160;In addition, the Private Company rejected the Throughput
  Agreement and the Terminalling Agreement and we and the Private Company entered
  into the New Throughput Agreement and the New Terminalling
  Agreement.&#160;&#160;We expect revenues from services provided to the Private
  Company under the New Throughput Agreement and New Terminalling Agreement to be
  substantially less than prior revenues from services provided to the Private
  Company as the new agreements are based upon actual volumes gathered,
  transported, terminalled and stored instead of certain minimum volumes and are
  at reduced rates when compared to the Throughput Agreement and Terminalling
  Agreement.&#160;&#160;See &#8220;&#9472;The Private Company has rejected certain contracts
  it has with us as part of the Bankruptcy Cases, which could have a material
  adverse effect on our results of operations, cash flows and ability to make
  distributions to our unitholders.&#8221;</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">We have
  been pursuing opportunities to provide crude oil terminalling and storage
  services and crude oil gathering and transportation services to third
  parties.&#160;&#160;Although average rates for the new third-party crude oil
  terminalling and storage and transportation and gathering contracts are
  comparable with those previously received from the Private Company, the volumes
  being terminalled, stored, transported and gathered have decreased as compared
  to periods prior to the Bankruptcy Filings, which has negatively impacted total
  revenues.&#160;&#160;As an example, fourth quarter 2008 total revenues are
  approximately $8.2 million less than third quarter 2008 total revenues, in each
  case excluding fuel surcharge revenues related to fuel and power consumed to
  operate our liquid asphalt cement storage tanks.&#160; <font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">In
  addition, we have recently entered into leases and storage agreements with third
  parties relating to certain of our asphalt facilities.&#160;&#160;The revenues
  that we will receive pursuant to these leases and storage agreements will be
  less than the revenues received under the Terminalling Agreement with the
  Private Company.</font></font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div><br>
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  </font></div>
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        <div id="HDR">
          <div id="GLHDR" style="WIDTH: 100%" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 9pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><a href="#TOC">Table of Contents</a></font></div>
        </div>
      </div><br>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">There can
  be no assurance that our efforts to increase the third party revenue&#160;will
  be successful.&#160;&#160;In addition, certain third parties may be less likely
  to enter into business transactions with us due to the Bankruptcy
  Filings.&#160;&#160;The Private Company may also choose to curtail its
  operations or liquidate its assets as part of the Bankruptcy
  Cases.&#160;&#160;As a result, unless we are able to generate additional third
  party revenues, we&#160;will continue to experience lower volumes in our system
  which could have a material adverse effect on our results of operations and cash
  flows.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">We
  may not be able to continue as a going concern.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
  financial statements included in this Form 10-Q have been prepared assuming we
  will continue as a going concern, though such an assumption may not be
  true.&#160;&#160;We earned 81% of our revenues, excluding fuel surcharge
  revenues related to fuel and power consumed to operate our liquid asphalt cement
  storage tanks, for the nine months ended September 30, 2008 from the Private
  Company, which commenced the Bankruptcy Cases in July 2008, the effects of which
  are more fully described herein.&#160;&#160;The Bankruptcy Cases, as well as
  other events and uncertainties related to the Bankruptcy Filings, raise
  substantial doubt about our ability to continue as a going
  concern.&#160;&#160;While it is not feasible to predict the ultimate outcome of
  the events surrounding the Bankruptcy Cases, we have been and could continue to
  be materially and adversely affected by such events and we may be forced to make
  a bankruptcy filing or take other action that could have a material adverse
  effect on our business, the price of our common units and our results of
  operations.&#160;&#160;See &#8220;Item 2. Management&#8217;s Discussion and Analysis of
  Financial Condition and Results of Operations&#8221; and Note 2 to the unaudited
  consolidated financial statements.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">The
  Private Company has rejected certain contracts it has with us as part of the
  Bankruptcy Cases, which could have a material adverse effect on our results of
  operations, cash flows and ability to make distributions to our
  unitholders.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">In
  connection with the Settlement, among other things, the Private Company rejected
  certain agreements, including the Terminalling Agreement, the Throughput
  Agreement and the Amended Omnibus Agreement (see &#8220;Item 2. Management&#8217;s
  Discussion and Analysis of Financial Condition and Results of Operations&#8212;Impact
  of the Bankruptcy of the Private Company and Certain of its Subsidiaries and
  Related Events&#8212;Settlement with the Private Company&#8221;).&#160;&#160;We may not be
  able to replace the volumes provided by the Private Company under these
  agreements and any contracts we make with third parties may be for prices that
  are less than those charged the Private Company under the Throughput Agreement
  and the Terminalling Agreement, which could have a material adverse effect on
  our results of operations, cash flows and ability to make distributions to our
  unitholders.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left">
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font id="TAB2" style="LETTER-SPACING: 9pt">&#160;&#160;&#160;</font>&#160;<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">We have
  recently entered into leases and storage agreements with third parties relating
  to 39 of our 46&#160;asphalt facilities.&#160;&#160;The revenues that we will
  receive pursuant to these leases and storage agreements will be less than the
  revenues received under the Terminalling Agreement with the Private
  Company.&#160; </font>Without sufficient&#160;revenues from our asphalt assets,
  we may be unable to meet the covenants, including the minimum liquidity, minimum
  EBITDA and minimum receipt requirements, under our credit
  agreement.&#160;&#160;Any significant decrease in the amount of revenues that we
  receive from our liquid asphalt cement terminalling and storage operations could
  have a material adverse effect on our cash flows, financial condition and
  results of operations.</font></div>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">The
  Private Company may assert claims against us in the Bankruptcy Cases which could
  have a material adverse effect on our cash flows and ability to make
  distributions to our unitholders.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Pursuant
  to the Settlement, the Private Company released certain of its claims against
  us.&#160;&#160;However, there may be other claims against us, that have not been
  released in connection with the Settlement.&#160;&#160;If claims are identified,
  such claims may prompt the filing of lawsuits in the Bankruptcy Cases to seek
  monetary damages or to challenge or to seek to unwind transactions with us under
  the bankruptcy laws.&#160;&#160;Such litigation may be expensive and, if
  successful, would have a material adverse effect on our business, financial
  condition, results of operations, ability to make distributions to our
  unitholders and the trading price of our common units.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div><br>
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  </font></div>
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          </div>
        </div>
        <div id="HDR">
          <div id="GLHDR" style="WIDTH: 100%" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 9pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><a href="#TOC">Table of Contents</a></font></div>
        </div>
      </div><br>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">We
  did not make a distribution for the second quarter, third quarter or fourth
  quarter of 2008 and the first quarter of 2009, do not expect to make a
  distribution for the second quarter of 2009 at this time and may not make
  distributions in the future.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">We did
  not make a distribution to our common unitholders, subordinated unitholders or
  general partner attributable to the results of operations for the quarters ended
  June 30, 2008, September 30, 2008, December 31, 2008 or March 31, 2009 due to
  the events of default under our credit agreement and the uncertainty of our
  future cash flows relating to the Bankruptcy Filings.&#160;&#160;Our unitholders
  will be required to pay taxes on their share of our taxable income even though
  they did not receive a cash distribution for such periods.&#160;&#160;In
  addition, we do not currently expect to make a distribution relating to the
  second quarter of 2009.&#160;&#160;See &#8220;&#8212;Tax Risks to Common Unitholders&#8212;Our
  unitholders have been and will be required to pay taxes on their share of our
  taxable income even if they have not or do not receive any cash distributions
  from us.&#8221;&#160; We distributed approximately $14.3 million to our unitholders
  for the three months ended March 31, 2008.&#160;&#160;Pursuant to the Credit
  Agreement Amendment, we are prohibited from making distributions to our
  unitholders if our leverage ratio (as defined in the credit agreement) exceeds
  3.50 to 1.00.&#160;&#160;As of September 30, 2008 and December 31, 2008, our
  leverage ratio was 4.34 to 1.00 and 4.83 to 1.00, respectively.&#160;&#160;We
  are uncertain as to when, if ever, our leverage ratio will be below 3.50 to 1.00
  and therefore we are uncertain as to when or if&#160;we may again make
  distributions to our unitholders.&#160;&#160;Our partnership agreement provides
  that, during the subordination period, which we are currently in, our common
  units have the right to receive distributions of available cash from operating
  surplus in an amount equal to the minimum quarterly distribution of $0.3125 per
  common unit per quarter, plus any arrearages in the payment of the minimum
  quarterly distribution on the common units from prior quarters, before any
  distributions of available cash from operating surplus may be made on the
  subordinated units.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">We
  are exposed to the credit risk of the Private Company and the material
  nonperformance by the Private Company could reduce our ability to make
  distributions to our unitholders.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">In
  connection with the Settlement we entered into the New Terminalling Agreement,
  the New Throughput Agreement, the Shared Services Agreement and the Transition
  Services Agreement.&#160;&#160;Pursuant to such agreements we continue to rely
  upon the Private Company for a portion of our revenues and to perform certain
  operational and administrative services for us.&#160;&#160;The Private Company
  has defaulted under its credit facilities and its indenture relating to its
  senior notes.&#160;&#160;Moody&#8217;s and Fitch Ratings have withdrawn their ratings
  of the Private Company due to the Bankruptcy Filings.&#160;&#160;Any material
  nonperformance under the New Throughput Agreement, the New Terminalling
  Agreement, the Shared Services Agreement or the Transition Services Agreement by
  the Private Company could materially and adversely impact our results of
  operations and our ability to operate and make distributions to our
  unitholders.&#160;See &#8220;&#9472;The Private Company has rejected&#160;certain contracts
  it has with us as part of the Bankruptcy Cases, which could have a material
  adverse effect on our results of operations, cash flows and ability to make
  distributions to our unitholders.&#8221;</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Though we
  have no indebtedness rated by any credit rating agency, we may have rated debt
  in the future. Credit rating agencies such as Moody&#8217;s and Fitch Ratings may
  consider the Private Company&#8217;s debt ratings when assigning ours, because of the
  Private Company&#8217;s ownership interest in us, the strong operational links between
  the Private Company and us, and our reliance on the Private Company for a
  portion of our revenues. Due to the Private Company&#8217;s default of its
  indebtedness and the uncertainty related to the Bankruptcy Filings, we could
  experience an increase in our borrowing costs or difficulty accessing capital
  markets if we are able to access them at all. Such a development could adversely
  affect our ability to grow our business and to make distributions to
  unitholders.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">Prior
  to the Settlement, we did not have employees and relied solely on the employees
  of the Private Company.&#160;&#160;We continue to rely upon the Private Company
  for certain operational and administrative services and may experience increased
  costs as we begin employing individuals directly associated with our
  operations.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">As is the
  case with many publicly traded partnerships, we have not historically directly
  employed any persons responsible for managing or operating us or for providing
  services relating to day-to-day business affairs.&#160;&#160;Pursuant to the
  Amended Omnibus Agreement, the Private Company operated our assets and performed
  other administrative services for us such as accounting, legal, regulatory,
  development, finance, land and engineering.&#160;&#160;The events related to the
  Bankruptcy Filings terminated the Private Company&#8217;s obligations to provide
  services to us under the Amended Omnibus Agreement.&#160;&#160;The Private
  Company continued to provide such services to us until the effective date of the
  Settlement at which time the Private Company rejected the Amended Omnibus
  Agreement and we and the Private Company entered into the Shared Services
  Agreement and the Transition Services Agreement relating to the provision of
  such services.&#160;&#160;In addition, in connection with the Settlement, we
  made offers of employment to certain individuals associated with our crude oil
  operations and expect to make additional offers of employment to certain
  individuals associated with our asphalt operations.&#160;&#160;The costs to
  directly employ these individuals as well as the costs under the Shared Services
  Agreement and&#160;the Transition Services Agreement may be higher than those
  previously paid by us under the Amended Omnibus Agreement, which could have a
  material adverse effect on our business, financial condition, results of
  operations, cash flows, ability to make distributions to our unitholders, the
  trading price of our common units and our ability to conduct our
  business.</font></div>
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  </font></div>
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        </div>
        <div id="HDR">
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        </div>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">In
  addition, in connection with the Settlement, we agreed to not solicit the
  Private Company&#8217;s employees for a year from the time of the
  Settlement.&#160;&#160;In connection with the Bankruptcy Cases, the Private
  Company may reduce a substantial number of its employees or some of the Private
  Company&#8217;s employees may choose to terminate their employment with the Private
  Company, some of whom may currently be providing general and administrative and
  operating services to us under the Shared Services Agreement or the Transition
  Services Agreement.&#160;&#160;Any reductions in critical personnel who provide
  services to us and any increased costs to replace such personnel could have a
  material adverse effect on our ability to conduct our business and our results
  of operations.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">Certain
  of our officers are also officers of the Private Company.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Prior to
  the events surrounding the Bankruptcy Filings, the officers of our general
  partner were also employees and officers or directors of the Private
  Company.&#160;&#160;Messrs. Foxx and Stallings resigned the positions each
  officer held with SemGroup, L.P. in July 2008.&#160;&#160;Mr. Brochetti had
  previously resigned from his position with SemGroup, L.P. in March
  2008.&#160;&#160;Mr. Parsons left the employment of SemGroup, L.P. in March
  2009.&#160;&#160;Messrs. Foxx, Brochetti, Stallings, and Parsons remain as
  officers of our general partner.&#160;&#160;Mr. Schwiering continues to serve as
  an officer of the Private Company and may have conflicts of interest and may
  favor the Private Company&#8217;s interests over our interests when conducting our
  operations.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">Our
  interests may be adverse to the Private Company&#8217;s interests due to the
  Bankruptcy Filings.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">If the
  Private Company fails to make its payments under the New Throughput Agreement or
  the New Terminalling Agreement or otherwise fails to perform under the contracts
  we have with the Private Company, we may have potential claims against the
  Private Company&#8217;s bankruptcy estate.&#160;&#160;In addition, we may also have
  additional claims against the Private Company that were not released in
  connection with the Settlement.&#160;&#160;Any claims made by us against the
  Private Company in the Bankruptcy Cases will be subject to the claim allowance
  procedure provided in the Bankruptcy Code and Bankruptcy Rules.&#160;&#160;If an
  objection is filed, the Bankruptcy Court would determine the extent to which any
  claim that is objected to is allowed and the priority of such
  claims.&#160;&#160;We are uncertain regarding the ultimate amount of any
  potential damages for breaches of contract or other claims that we may be able
  to establish in the bankruptcy proceedings and we cannot predict the amounts, if
  any, that we will collect or the timing of any such collection, but such losses
  could be substantial and could have a material adverse effect on our ability to
  conduct our business and our results of operations.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">In
  connection with the Settlement, the Private Company has rejected the
  Terminalling Agreement and the Throughput Agreement.&#160;&#160;We have a $35
  million unsecured claim relating to rejection of the Terminalling Agreement in
  the Bankruptcy Cases.&#160;&#160;In addition, we have a $20 million unsecured
  claim against the Private Company relating to rejection of the Throughput
  Agreement (see &#8220;Item 2. Management&#8217;s Discussion and Analysis of Financial
  Condition and Results of Operations&#8212;Impact of the Bankruptcy of the Private
  Company and Certain of its Subsidiaries and Related Events&#8212;Settlement with the
  Private Company&#8221;).</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">As a
  result of these items, our interests may be adverse to the Private Company&#8217;s
  interests.&#160;&#160;The Private Company provides various administrative and
  operational services for us pursuant to the Shared Services Agreement and the
  Transition Services Agreement.&#160;&#160;In addition, we rely upon the Private
  Company&#8217;s personnel for the implementation of certain of our internal
  controls.&#160;&#160;The progress of the Bankruptcy Cases may influence the
  Private Company&#8217;s decision to continue providing any of these services, which
  could have a material adverse effect on our ability to conduct our business and
  results of operations.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">We
  may experience significant costs in changing our name and
  trademark.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">In
  connection with the Settlement, we and the Private Company entered into the
  Trademark Agreement, pursuant to which the Private Company granted us a
  non-exclusive, worldwide license to use certain trade names, including the name
  &#8220;SemGroup&#8221; and the corresponding mark, until December 31, 2009, and the Private
  Company waived claims for infringement relating to such trade names and mark
  prior to the effective date of such&#160;Trademark Agreement (see &#8220;Item 2.
  Management&#8217;s Discussion and Analysis of Financial Condition and Results of
  Operations&#8212;Impact of the Bankruptcy of the Private Company and Certain of its
  Subsidiaries and Related Events&#8212;Settlement with the Private
  Company&#8221;).&#160;&#160;As such, we will be required to change our name and
  trademark upon or prior to the expiration of the Trademark
  Agreement.&#160;&#160;The expenses associated with such a change may be
  significant, which could have a material adverse effect on our business,
  financial condition, results of operations, cash flows, ability to make
  distributions to our unitholders, the trading price of our common units and our
  ability to conduct our business.</font></div>
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        </div>
      </div><br>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt">
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">Without
  sufficient revenues from our asphalt assets, we may be unable to meet the
  covenants under our credit agreement.</font></div>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Historically,
  we provided liquid asphalt cement terminalling and storage services to the
  Private Company pursuant to the Terminalling Agreement.&#160;&#160;In connection
  with the Settlement, the Private Company rejected the Terminalling Agreement and
  we and the Private Company entered into the New Terminalling Agreement whereby
  we provide liquid asphalt cement terminalling and storage services to the
  Private Company in connection with its remaining asphalt
  inventory.&#160;&#160;The New Terminalling Agreement has an initial term that
  ends on October 31, 2009 and the Private Company has agreed to remove all of its
  existing asphalt inventory no later than such date, and we expect that the
  Private Company may remove it much earlier than such date.&#160;&#160;Also in
  connection with the Settlement, the Private Company transferred certain asphalt
  assets to us that were connected to our existing asphalt
  assets.&#160;&#160;</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
  asphalt industry in the United States is characterized by a high degree of
  seasonality. Much of this seasonality is due to the impact that weather
  conditions have on road construction schedules, particularly in cold weather
  states. Refineries produce liquid asphalt cement year round, but the peak
  asphalt demand season is during the warm weather months when most of the road
  construction activity in the United States takes place. As a result, liquid
  asphalt cement is typically purchased from refineries at low prices in the low
  demand winter months and then processed and sold at higher prices in the peak
  summer demand season.&#160;&#160;Any significant decrease in the amount of
  revenues that we receive from our liquid asphalt cement terminalling and storage
  operations could have a material adverse effect on our cash flows, financial
  condition and results of operations.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left">
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font id="TAB2" style="FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; LETTER-SPACING: 9pt">&#160;&#160;&#160;</font>&#160;We
  have recently entered into leases and storage agreements with third parties
  relating to certain of our asphalt facilities.&#160;&#160;The revenues that we
  will receive pursuant to these leases and storage agreements will be less than
  the revenues received under the Terminalling Agreement with the Private
  Company.&#160; </font>Without sufficient revenues from our asphalt assets, we
  may be unable to meet the covenants, including the minimum liquidity, minimum
  EBITDA and minimum receipt requirements, under our credit agreement (see &#8220;Item
  2. Management&#8217;s Discussion and Analysis of Financial Condition and Results of
  Operations&#8212;Impact of the Bankruptcy of the Private Company and Certain of its
  Subsidiaries and Related Events&#8212;Settlement with the Private
  Company&#8221;).</font></div>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">Our
  future operations and cash flows are uncertain and may cause events of default
  under our credit agreement.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Our future operations and
  cash flows, especially those related to our asphalt operations, are
  uncertain.&#160;&#160;The covenants and other requirements under our credit
  facility were designed using certain projections and assumptions relating to
  revenues, EBITDA and cash flows.&#160;&#160;In addition, our interest expense
  has increased due to our entering into the Forbearance Agreement, as amended,
  and the Credit Agreement Amendment.&#160;&#160;For example, the weighted average
  interest rate incurred by us during the three months ended September 30, 2008
  was 7.04% resulting in interest expense of approximately $8.2 million as
  compared to a weighted average interest rate incurred by us of 7.72% during the
  three months ended December 31, 2008 resulting in interest expense of
  approximately $8.9 million.&#160;&#160;This increased interest expense may have
  a material adverse effect on our cash flows and results of operations.&#160;
  <font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">In
  addition, it is an event of default under the credit agreement if we do not file
  our delinquent quarterly and annual reports with the SEC by September 30, 2009,
  unless we retain new auditors, in which case such deadline is extended to
  December 31, 2009.</font></font></font></font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">If an
  event of default exists under the credit agreement, the lenders will be able to
  accelerate the maturity of the credit agreement and exercise other rights and
  remedies, including taking the available cash in our bank
  accounts.&#160;&#160;If an event of default exists and we are unable to obtain
  forbearance from our lenders or a waiver of the events of default under our
  credit agreement, we may be forced to sell assets, make a bankruptcy filing or
  take other action that could have a material adverse effect on our business, the
  price of our common units and our results of operations.&#160;&#160;We are also
  prohibited from making cash distributions to our unitholders while the events of
  default exist.&#160;&#160;Certain lenders under our credit facility are also
  lenders under the Private Company&#8217;s credit facility.&#160;&#160;The progress of
  the Private Company&#8217;s bankruptcy proceedings may influence the decisions of
  these lenders relating to our credit facility which could adversely affect
  us.</font></div>
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        <div id="HDR">
          <div id="GLHDR" style="WIDTH: 100%" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 9pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><a href="#TOC">Table of Contents</a></font></div>
        </div>
      </div><br>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">We
  are subject to an SEC inquiry and a Federal Grand Jury subpoena.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">On July
  21, 2008, we received a letter from the staff of the SEC giving notice that the
  SEC is conducting an inquiry relating to us and requesting, among other things,
  that we voluntarily preserve, retain and produce to the SEC certain documents
  and information relating primarily to our disclosures respecting the Private
  Company&#8217;s liquidity issues, which were the subject of our July 17, 2008 press
  release.&#160;&#160;On October 22, 2008, we received a subpoena from the SEC
  pursuant to a formal order of investigation requesting certain documents
  relating to, among other things, the Private Company&#8217;s liquidity
  issues.&#160;&#160;We have been cooperating, and intend to continue cooperating,
  with the SEC in its investigation.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">On July
  23, 2008, we and our general partner each received a Grand Jury subpoena from
  the United States Attorney&#8217;s Office in Oklahoma City, Oklahoma, requiring, among
  other things, that we and our general partner produce financial and other
  records related to our July 17, 2008 press release.&#160;&#160;We have been
  informed that the U.S. Attorneys&#8217; Offices for the Western District of Oklahoma
  and the Northern District of Oklahoma are in discussions regarding the
  subpoenas, and no date has been set for a response to the
  subpoenas.&#160;&#160;We and our general partner intend to cooperate fully with
  this investigation if and when it proceeds.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">In the
  event that either the SEC inquiry or the Grand Jury investigation leads to
  action against any of our current or former directors or officers, or the
  Partnership itself, the trading price of our common units may be adversely
  impacted.&#160;&#160;In addition, the SEC inquiry and the Grand Jury
  investigation may result in the incurrence of significant legal expense, both
  directly and as the result of our indemnification
  obligations.&#160;&#160;&#160;These matters may also divert management&#8217;s
  attention from our operations which may cause our business to
  suffer.&#160;&#160;If we are subject to adverse findings in either of these
  matters, we could be required to pay damages or penalties or have other remedies
  imposed upon us which could have a material adverse effect on our business,
  financial condition, results of operations, cash flows and ability to make
  distributions to our unitholders.&#160;&#160;All or a portion of the defense
  costs and any amount we may be required to pay in connection with the resolution
  of these matters may not be covered by insurance.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">We
  have been named as a party in lawsuits and may be named in additional litigation
  in the future, all of which could result in an unfavorable outcome and have a
  material adverse effect on our business, financial condition, results of
  operations, cash flows, ability to make distributions to our unitholders, the
  trading price of our common units and our ability to conduct our
  business.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Between
  July 21, 2008 and September 4, 2008, the following class action complaints were
  filed:</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;&#160;&#160;&#160;&#160;&#160;&#160;
  1.&#160;&#160;&#160;&#160;&#160;<font style="DISPLAY: inline; FONT-STYLE: italic"> Poelman v. SemGroup Energy
  Partners, L.P., et al</font>., Civil Action No. 08-CV-6477, in the United States
  District Court for the Southern District of New York (filed July 21,
  2008).&#160; The plaintiff voluntarily dismissed this case on August 26,
  2008;</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;&#160;&#160;&#160;&#160;&#160;&#160;
  2.&#160;&#160;&#160;&#160;&#160;<font style="DISPLAY: inline; FONT-STYLE: italic"> Carson v. SemGroup Energy Partners,
  L.P. et al</font><font style="DISPLAY: inline; FONT-WEIGHT: bold">.</font>,
  Civil Action No. 08-cv-425, in the Northern District of Oklahoma (filed July 22,
  2008);</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;&#160;&#160;&#160;&#160;&#160;&#160;
  3.&#160;&#160;&#160;&#160;&#160;&#160;<font style="DISPLAY: inline; FONT-STYLE: italic"> Charles D. Maurer SIMP Profit
  Sharing Plan f/b/o Charles D. Maurer v. SemGroup Energy Partners, L.P. et
  al.</font>, Civil Action No. 08-cv-6598, in the United States District Court for
  the Southern District of New York (filed July 25, 2008);</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;&#160;&#160;&#160;&#160;&#160;&#160;
  4.&#160;&#160;&#160;&#160;&#160;<font style="DISPLAY: inline; FONT-STYLE: italic"> Michael Rubin v. SemGroup Energy
  Partners, L.P. et al.</font>, Civil Action No. 08-cv-7063, in the United States
  District Court for the Southern District of New York (filed August 8,
  2008);</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;&#160;&#160;&#160;&#160;&#160;&#160;
  5.&#160;&#160;&#160;&#160;&#160;<font style="DISPLAY: inline; FONT-STYLE: italic"> Dharam V. Jain v. SemGroup Energy
  Partners, L.P. et al.</font>, Civil Action No. 08-cv-7510, in the United States
  District Court for the Southern District of New York&#160; (filed August 25,
  2008); and</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;&#160;&#160;&#160;&#160;&#160;&#160;
  6.&#160;&#160;&#160;&#160;&#160;<font style="DISPLAY: inline; FONT-STYLE: italic"> William L. Hickman v. SemGroup
  Energy Partners, L.P. et al.</font>, Civil Action No. 08-cv-7749, in the United
  States District Court for the Southern District of New York (filed September 4,
  2008).</font></div>
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          <div id="GLHDR" style="WIDTH: 100%" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 9pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><a href="#TOC">Table of Contents</a></font></div>
        </div>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Pursuant
  to a motion filed with the MDL Panel, the<font style="DISPLAY: inline; FONT-STYLE: italic"> Maurer</font> case has been
  transferred to the Northern District of Oklahoma and consolidated with the<font style="DISPLAY: inline; FONT-STYLE: italic"> Carson</font> case.&#160; The<font style="DISPLAY: inline; FONT-STYLE: italic"> Rubin, Jain,</font> and<font style="DISPLAY: inline; FONT-STYLE: italic"> Hickman</font> cases have also been
  transferred to the Northern District of Oklahoma.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">A hearing
  on motions for appointment as lead plaintiff was held in the<font style="DISPLAY: inline; FONT-STYLE: italic"> Carson</font> case on October 17,
  2008.&#160; At that hearing, the court granted a motion to consolidate the <font style="DISPLAY: inline; FONT-STYLE: italic">Carson</font> and <font style="DISPLAY: inline; FONT-STYLE: italic">Maurer</font> cases for pretrial
  proceedings, and the consolidated litigation is now pending as<font style="DISPLAY: inline; FONT-STYLE: italic"> In Re: SemGroup Energy Partners,
  L.P. Securities Litigation</font>, Case No. 08-CV-425-GKF-PJC. The court entered
  an order on October 27, 2008, granting the motion of Harvest Fund Advisors LLC
  to be appointed lead plaintiff in the consolidated litigation.&#160;&#160;On
  January 23, 2009, the court entered a Scheduling Order providing, among other
  things, that the lead plaintiff may file a consolidated amended complaint within
  70 days of the date of the order, and that defendants may answer or otherwise
  respond within 60 days of the date of the filing of a consolidated amended
  complaint.&#160; <font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">On
  January 30, 2009, the lead plaintiff filed a motion to modify the stay of
  discovery provided for under the Private Securities Litigation Reform Act. The
  court granted Plaintiff's motion, and we and certain other defendants filed a
  Petition for Writ of Mandamus in the Tenth Circuit Court of Appeals that was
  denied after oral argument on April 24, 2009.</font></font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font id="TAB2" style="LETTER-SPACING: 9pt">&#160;&#160;&#160;</font>&#160;The lead
  plaintiff obtained an extension to file its consolidated amended complaint until
  May 4, 2009; defendants have 60 days from that date to answer or otherwise
  respond to the complaint.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left">&#160;</div><font style="FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font id="TAB2" style="LETTER-SPACING: 9pt">&#160;&#160;&#160;</font>&#160;The lead plaintiff
  filed a consolidated amended complaint on May 4, 2009.&#160; In that complaint,
  filed as a putative class action on behalf of all purchasers of our units from
  July 17, 2007 to July 17, 2008 (the &#8220;class period&#8221;), lead plaintiff asserts
  claims under the federal securities laws against us, our general partner,
  certain of our current and former officers and directors, certain underwriters
  in our initial and secondary public offerings, and certain entities who were
  investors in the Private Company and their individual representatives who served
  on the Private Company&#8217;s management committee. Among other allegations, the
  amended complaint alleges that our financial condition throughout the class
  period was dependent upon speculative commodities trading by the Private Company
  and its Chief Executive Officer, Thomas L. Kivisto, and that Defendants
  negligently and intentionally failed to disclose this speculative trading in our
  public filings during the class period. Specifically, the amended complaint
  alleges claims for violations of sections 11, 12(a)(2), and 15 of the Securities
  Act of 1933 for damages and rescission with respect to all persons who purchased
  our units in the initial and secondary offerings, and also asserts claims under
  section 10b, Rule 10b-5, and section 20(a) of the Securities and Exchange Act of
  1934. The amended complaint seeks certification as a class action under the
  Federal Rules of Civil Procedure, compensatory and rescissory damages for class
  members, pre-judgment interest, costs of court, and attorneys&#8217; fees.</font>
  
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">We intend
  to vigorously defend these actions.&#160; There can be no assurance regarding
  the outcome of the litigation.&#160;</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">In March
  and April 2009, nine current or former executives of the Private Company and
  certain of its affiliates filed wage claims with the Oklahoma Department of
  Labor against our general partner.&#160;&#160;Their claims arise from our
  general partner&#8217;s Long-Term Incentive Plan, Employee Phantom Unit Agreement
  <font style="FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(&#8220;Phantom Unit
  Agreement&#8221;).&#160;&#160;Most&#160;claimants allege that phantom units previously
  awarded to them vested upon the&#160;Change of Control that occurred in July
  2008.&#160;&#160;One claimant alleges that his phantom units vested upon his
  termination.&#160;&#160;The claimants contend our general partner&#8217;s failure to
  deliver certificates for the phantom units within 60 days after vesting has
  caused them to be damaged, and they seek recovery of approximately $2 million in
  damages and penalties<font style="FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">.&#160;&#160;</font><font style="FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">On April 30, 2009, all of
  the wage claims were dismissed on jurisdictional grounds by the Department of
  Labor.&#160; </font>Our general partner intends to vigorously defend these
  claims.</font></font></font></font></font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">We may
  become the subject of additional private or government actions regarding these
  matters in the future.&#160;&#160;Litigation may be time-consuming, expensive
  and disruptive to normal business operations, and the outcome of litigation is
  difficult to predict.&#160;&#160;The defense of these lawsuits may result in the
  incurrence of significant legal expense, both directly and as the result of our
  indemnification obligations.&#160;&#160;The litigation may also divert
  management&#8217;s attention from our operations which may cause our business to
  suffer.&#160;&#160;An unfavorable outcome in any of these matters may have a
  material adverse effect on our business, financial condition, results of
  operations, cash flows, ability to make distributions to our unitholders, the
  trading price of the our common units and our ability to conduct our business.
  All or a portion of the defense costs and any amount we may be required to pay
  to satisfy a judgment or settlement of these claims may not be covered by
  insurance.</font></div>
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        </div>
      </div><br>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">We
  may experience increased losses as a result of waivers relating to the Private
  Company&#8217;s indemnification obligations.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">In the
  Amended Omnibus Agreement and other agreements with the Private Company, the
  Private Company agreed to indemnify us for certain environmental and other
  claims relating to the crude oil and liquid asphalt cement assets that have been
  contributed to us.&#160;&#160;In connection with the Settlement, we waived these
  claims and the Amended Omnibus Agreement and other relevant agreements,
  including the indemnification provisions therein, were rejected as part of the
  Bankruptcy Proceedings.&#160;&#160;If we experience an environmental or other
  loss, we would experience increased losses which may have a material adverse
  effect on our business, financial condition, results of operations, cash flows,
  ability to make distributions to our unitholders, the trading price of our
  common units and the ability to conduct our business.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">Our
  common units were delisted from the Nasdaq and&#160;are currently quoted on the
  Pink Sheets, which may make buying or selling our common units more
  difficult.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Effective
  at the opening of business on February 20, 2009, our common units were delisted
  from Nasdaq due to our failure to timely file this Quarterly Report as well as
  our Quarterly Report on Form 10-Q for the quarter ended June 30,
  2008.&#160;&#160;We filed our Quarterly Report on Form 10-Q for the quarter
  ended June 30, 2008 on March 23, 2008.&#160;&#160;Our common units are currently
  traded on the Pink Sheets, which is an over-the-counter securities market, under
  the symbol SGLP.PK.&#160;&#160;The fact that our common units are not listed on
  a national securities exchange is likely to make trading such common units more
  difficult for broker-dealers, unitholders and investors, potentially leading to
  further declines in the price of our common units.&#160;&#160;In addition, it
  may limit the number of institutional and other investors that will consider
  investing in our common units, which may have an adverse effect on the price of
  our common units.&#160;&#160;It may also make it more difficult for us to raise
  capital in the future.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">We
  continue to work to become compliant with our SEC reporting obligations and
  intend to promptly seek the relisting of our common units on Nasdaq as soon as
  practicable after we have become compliant with such reporting
  obligations.&#160;&#160;However, there can be no assurances that we will be able
  to relist our common units on Nasdaq or any other national securities exchange
  and we may face a lengthy process to relist our common units if we are able to
  relist them at all.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">If
  our general partner fails to develop or maintain an effective system of internal
  controls, then we may not be able to accurately report our financial results or
  prevent fraud. As a result, current and potential unitholders could lose
  confidence in our financial reporting, which would harm our business and the
  trading price of our common units.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">SemGroup
  Energy Partners G.P., L.L.C., our general partner, has sole responsibility for
  conducting our business and for managing our operations. Effective internal
  controls are necessary for our general partner, on our behalf, to provide
  reliable financial reports, prevent fraud and operate us successfully as a
  public company. If our general partner&#8217;s efforts to develop and maintain its
  internal controls are not successful, it is unable to maintain adequate controls
  over our financial processes and reporting in the future or it is unable to
  assist us in complying with our obligations under Section 404 of the
  Sarbanes-Oxley Act of 2002, our operating results could be harmed or we may fail
  to meet our reporting obligations.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">We and
  our general partner rely upon the Private Company for our personnel, including
  those related to&#160;implementation of ceratin of our&#160;internal controls
  and our disclosure controls and procedures.&#160;&#160;Staff reductions by the
  Private Company or other departures by the Private Company&#8217;s employees that
  provide services to us could&#160;have a material adverse&#160;effect on
  internal controls and the effectiveness of our disclosure controls and
  procedures.&#160;&#160;Ineffective internal controls could cause us to report
  inaccurate financial information or cause investors to lose confidence in our
  reported financial information, which would likely have a negative effect on the
  trading price of our common units.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div><br>
      <div id="PGBRK" style="MARGIN-LEFT: 0pt; WIDTH: 100%; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
        <div id="FTR">
          <div style="WIDTH: 100%" align="left">
            <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
  </font></div>
          </div>
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          </div>
        </div>
        <div id="PN" style="PAGE-BREAK-AFTER: always">
          <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">66</font></div>
          <div style="WIDTH: 100%; TEXT-ALIGN: center">
            <hr style="COLOR: black" noshade size="2">
          </div>
        </div>
        <div id="HDR">
          <div id="GLHDR" style="WIDTH: 100%" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 9pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><a href="#TOC">Table of Contents</a></font></div>
        </div>
      </div><br>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">We
  may incur substantial costs as a result of events related to the Bankruptcy
  Filings and we may be unsuccessful in our efforts in effecting a sale of all or
  a portion of our assets.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Events
  related to the Bankruptcy Filings, the securities litigation and governmental
  investigations, and our efforts to enter into storage contracts with third party
  customers and pursue&#160;other strategic&#160;opportunities has resulted in
  increased expense and we expect it to continue to result in increased expense
  due to the costs related to legal and financial advisors as well as other
  related costs.&#160;&#160;General and administrative expenses (exclusive of
  non-cash compensation expense related to the vesting of the units under the
  Plan) increased by approximately $6.9 million and $7.5 million, or approximately
  300% and 326%, to approximately $9.2 million for the third quarter of 2008 and
  $9.8 million for the fourth quarter of 2008, respectively, compared to $2.3
  million in the second quarter of 2008.&#160;&#160;We expect this increased level
  of general and administrative expenses to continue into 2009.&#160;&#160;These
  increased costs may be substantial and could have a material adverse effect on
  our cash flows and results of operations.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">In
  addition, we are currently pursuing various strategic alternatives for our
  business and assets including the possibility of entering into storage contracts
  with third party customers and the sale of all or a portion of our
  assets.&#160;&#160;The uncertainty relating to the Bankruptcy Filings and the
  recent global market and economic conditions may make it more difficult to
  pursue&#160;other strategic&#160;opportunities or enter into storage contracts
  with third party customers.&#160;&#160;If we are unable to contract with third
  parties or if our efforts to sell all or a portion of our assets are
  unsuccessful, it could have a material adverse effect on our cash flows, results
  of operations and ability to conduct our business.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-STYLE: italic">We may not be
  able to raise sufficient capital to operate or grow our business.
  </font>&#160;</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">As of May 22, 2009, we had
  an aggregate unused credit availability under our revolving credit facility and
  cash on hand of <font style="FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">approximately $27.2<font size="+0" style="FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">
  million</font></font></font><font style="FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">.
  Pursuant</font></font><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;to the Credit
  Agreement</font> Amendment, our revolving credit facility is limited to $50.0
  million.&#160;&#160;<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">In
  addition, if any of the financial institutions that support our revolving credit
  facility were to fail, we may not be able to find a replacement lender, which
  could negatively impact our ability to borrow under our revolving credit
  facility.&#160; For instance, Lehman Brothers Commercial Bank is one of the
  lenders under our $50.0 million revolving credit facility, and Lehman Brothers
  Commercial Bank has agreed to fund approximately $2.5 million (approximately 5%)
  of the revolving credit facility.&#160; On several occasions Lehman Brothers
  Commercial Bank has failed to fund revolving loan requests under our revolving
  credit facility, effectively limiting the aggregate amount of our revolving
  credit facility to $47.5 million. &#160;</font>Our ability to access capital
  markets may also be limited due to the Bankruptcy Filings and the related
  uncertainty of our future cash flows.&#160;&#160;In addition, we may have
  difficulty obtaining a credit rating or any credit rating that we do obtain may
  be lower that it otherwise would be due to our relationships with the Private
  Company.&#160;&#160;The lack of a credit rating or a low credit rating may also
  adversely impact our ability to access capital markets.&#160;&#160;If we fail to
  raise additional capital or an event of default exists under our credit
  agreement, we may be forced to sell assets, make a bankruptcy filing or take
  other action that could have a material adverse effect on our business, the
  price of our common units and our results of operations.&#160;&#160;In addition,
  if we are unable to access the capital markets for acquisitions or expansion
  projects, it will have a material adverse effect on our results of operations
  and ability to conduct our business and may adversely effect the trading price
  of our common units.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">We
  are not fully insured against all risks incident to our business, and could
  incur substantial liabilities as a result.&#160;&#160;</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">We may
  not be able to maintain or obtain insurance of the type and amount we desire at
  reasonable rates. As a result of changing market conditions, premiums and
  deductibles for certain of our insurance policies may increase substantially in
  the future. In some instances, certain insurance could become unavailable or
  available only for reduced amounts of coverage. If we were to incur a
  significant liability for which we were not fully insured, it could have a
  material adverse effect on our financial position and ability to make
  distributions to unitholders.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt">&#160;</div><br>
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        <div id="FTR">
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            <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
  </font></div>
          </div>
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          <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">67</font></div>
          <div style="WIDTH: 100%; TEXT-ALIGN: center">
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        </div>
        <div id="HDR">
          <div id="GLHDR" style="WIDTH: 100%" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 9pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><a href="#TOC">Table of Contents</a></font></div>
        </div>
      </div><br>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Risks
  Related to Our Business</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">We
  depend upon the Private Company for a portion of our revenues and are therefore
  indirectly subject to the business risks of the Private Company.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Because
  we depend upon the Private Company for a portion of our revenues, we are
  indirectly subject to the business risks of the Private Company, many of which
  are similar to the business risks we face. In particular, these business risks
  include the following:</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 36pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">the
        inability of the Private Company to generate adequate gross margins from
        the purchase, transportation, storage and marketing of petroleum
        products;</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 36pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">material
        reductions in the supply of crude oil, liquid asphalt cement and petroleum
        products;</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 36pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">a
        material decrease in the demand for crude oil, finished asphalt and
        petroleum products in the markets served by the Private
        Company;</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 36pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">the
        inability of the Private Company to manage its commodity price risk
        resulting from its ownership of crude oil, liquid asphalt cement and
        petroleum products;</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 36pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">contract
        non-performance by the Private Company&#8217;s customers;
    and</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 36pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">various
        operational risks to which the Private Company&#8217;s business is
        subject.</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">In
  addition, as a result of the Bankruptcy Filings, we are also currently subject
  to the risks described above under &#8220;&#8212;Risks Related to the Bankruptcy
  Filings.&#8221;</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">We
  may not be able to obtain funding or obtain funding on acceptable terms because
  of the deterioration of the credit and capital markets. This may hinder or
  prevent us from meeting our future capital needs.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Global
  financial markets and economic conditions have been, and continue to be,
  disrupted and volatile. The debt and equity capital markets have been
  exceedingly distressed. These issues, along with significant write-offs in the
  financial services sector, the re-pricing of credit risk and the current weak
  economic conditions have made, and will likely continue to make, it difficult to
  obtain funding.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">In
  particular, the cost of raising money in the debt and equity capital markets has
  increased substantially while the availability of funds from those markets
  generally has diminished significantly. Also, as a result of concerns about the
  stability of financial markets generally and the solvency of counterparties
  specifically, the cost of obtaining money from the credit markets generally has
  increased as many lenders and institutional investors have increased interest
  rates, enacted tighter lending standards, refused to refinance existing debt at
  maturity at all or on terms similar to our current debt and reduced and, in some
  cases, ceased to provide funding to borrowers.&#160;&#160;These factors may have
  a material adverse effect on our ability to refinance our outstanding debt or,
  in the event we fail to comply with the covenants of the credit facility, to
  obtain a waiver of events of default under our credit agreement or to negotiate
  forbearance with our lenders.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Due to
  these factors, we cannot be certain that funding will be available if needed and
  to the extent required, on acceptable terms or at all. If funding is not
  available when needed, or is available only on unfavorable terms, we may be
  unable to operate or grow our existing business, make future acquisitions, or
  otherwise take advantage of business opportunities or respond to competitive
  pressures any of which could have a material adverse effect on our financial
  condition and results of operations.&#160;&#160;In addition, such financing, if
  available, may be at higher interest rates or result in substantial equity
  dilution.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">We
  require a significant amount of cash to service our indebtedness. Our ability to
  generate cash depends on many factors beyond our control.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Our
  ability to make payments on and to refinance our indebtedness and to fund any
  future capital expenditures depends on our ability to generate cash in the
  future. This, to a certain extent, is subject to general economic, financial,
  competitive, legislative, regulatory and other factors that are beyond our
  control. We cannot assure you that we will generate sufficient cash flow from
  operations or that future borrowings will be available to us under our credit
  agreement or otherwise at all or in an amount sufficient to enable us to pay our
  indebtedness or to fund our other liquidity needs.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left">&#160;</div><br>
      <div id="PGBRK" style="MARGIN-LEFT: 0pt; WIDTH: 100%; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
        <div id="FTR">
          <div style="WIDTH: 100%" align="left">
            <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
  </font></div>
          </div>
          <div id="GLFTR" style="WIDTH: 100%" align="center">
          </div>
        </div>
        <div id="PN" style="PAGE-BREAK-AFTER: always">
          <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">68</font></div>
          <div style="WIDTH: 100%; TEXT-ALIGN: center">
            <hr style="COLOR: black" noshade size="2">
          </div>
        </div>
        <div id="HDR">
          <div id="GLHDR" style="WIDTH: 100%" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 9pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><a href="#TOC">Table of Contents</a></font></div>
        </div>
      </div><br>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">We
  may not have sufficient cash from operations following the establishment of cash
  reserves and payment of fees and expenses, including cost reimbursements to our
  general partner, to enable us to make cash distributions to holders of our
  common units and subordinated units.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Pursuant
  to the Credit Agreement Amendment, we are prohibited from making distributions
  to our unitholders if our leverage ratio (as defined in the credit agreement)
  exceeds 3.50 to 1.00.&#160;&#160;As of September 30, 2008 and December 31, 2008,
  our leverage ratio was 4.34 to 1.00 and 4.83 to 1.00, respectively.&#160;If our
  leverage ratio does not improve, we may not make quarterly distributions to our
  unitholders in the future.&#160;&#160;Even if we are permitted to make
  distributions under our credit agreement, we may not have sufficient available
  cash from operating surplus each quarter to enable us to make cash
  distributions. The amount of cash we can distribute on our units principally
  depends upon the amount of cash we generate from our operations, which will
  fluctuate from quarter to quarter based on, among other things, the risks
  described in this section, including the Bankruptcy Filings.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">In
  addition, the actual amount of cash we will have available for distribution will
  depend on other factors, including:</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 36pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">the
        level of capital expenditures we
  make;</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 36pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">the
        cost of acquisitions;</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 36pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">our
        debt service requirements and other
  liabilities;</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 36pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">fluctuations
        in our working capital needs;</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 36pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">our
        ability to borrow funds and access capital
    markets;</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 36pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">restrictions
        contained in our credit facility or other debt agreements, including the
        ability to make distributions while events of default exist under our
        credit facility; and</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 36pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">the
        amount of cash reserves established by our general
    partner.</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">The
  amount of cash we have available for distribution to holders of our common units
  and subordinated units depends primarily on our cash flow and not solely on
  earnings reflected in our financial statements. Consequently, even if we are
  profitable, we may not be able to make cash distributions to holders of our
  common units and subordinated units.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Our
  unitholders should be aware that the amount of cash we have available for
  distribution depends primarily upon our cash flow and not solely on earnings
  reflected in our financial statements, which will be affected by non-cash items.
  As a result, we may make cash distributions during periods when we record losses
  for financial accounting purposes and may not make cash distributions during
  periods when we record net earnings for financial accounting
  purposes.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">A
  significant decrease in demand for crude oil and/or finished asphalt products in
  the areas served by our storage facilities and pipelines could reduce our
  ability to make distributions to our unitholders.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">A
  sustained decrease in demand for crude oil and/or finished asphalt products in
  the areas served by our storage facilities and pipelines could significantly
  reduce our revenues and, therefore, reduce our ability to make or increase
  distributions to our unitholders. Factors that could lead to a decrease in
  market demand for crude oil and finished asphalt products include:</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 36pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">lower
        demand by consumers for refined products, including finished asphalt
        products, as a result of recession or other adverse economic conditions or
        due to high prices caused by an increase in the market price of crude oil
        or higher fuel taxes or other governmental or regulatory actions that
        increase, directly or indirectly, the cost of gasolines or other refined
        products;</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 36pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">a
        shift by consumers to more fuel-efficient or alternative fuel vehicles or
        an increase in fuel economy of vehicles, whether as a result of
        technological advances by manufacturers, governmental or regulatory
        actions or otherwise; and</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 36pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">fluctuations
        in demand for crude oil, such as those caused by refinery downtime or
        shutdowns, could also significantly reduce our revenues and, therefore,
        reduce our ability to make distributions to our
      unitholders.</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div><br>
      <div id="PGBRK" style="MARGIN-LEFT: 0pt; WIDTH: 100%; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
        <div id="FTR">
          <div style="WIDTH: 100%" align="left">
            <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
  </font></div>
          </div>
          <div id="GLFTR" style="WIDTH: 100%" align="center">
          </div>
        </div>
        <div id="PN" style="PAGE-BREAK-AFTER: always">
          <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">69</font></div>
          <div style="WIDTH: 100%; TEXT-ALIGN: center">
            <hr style="COLOR: black" noshade size="2">
          </div>
        </div>
        <div id="HDR">
          <div id="GLHDR" style="WIDTH: 100%" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 9pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><a href="#TOC">Table of Contents</a></font></div>
        </div>
      </div><br>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Certain
  of our field and pipeline operating costs and expenses are fixed and do not vary
  with the volumes we gather and transport. These costs and expenses may not
  decrease ratably or at all should we experience a reduction in our volumes
  gathered or transmitted by our gathering and transportation operations. As a
  result, we may experience declines in our margin and profitability if our
  volumes decrease.&#160;&#160;Due to events related to the Bankruptcy Filings,
  the volumes being terminalled, stored, transported and gathered have decreased
  as compared to periods prior to the Bankruptcy Filings, which has negatively
  impacted total revenues.&#160; As an example, fourth quarter 2008 total revenues
  are approximately $8.2 million less than&#160;third quarter&#160;2008 total
  revenues, in each case excluding fuel surcharge revenues related to fuel and
  power consumed to operate our liquid asphalt cement storage tanks.&#160; Our
  future total revenues may be further impacted because, in connection with the
  Settlement, the Private Company rejected the Terminalling Agreement and the
  Throughput Agreement and we and the Private Company entered into the New
  Throughput Agreement and the New Terminalling Agreement.&#160;&#160;We expect
  revenues from services provided to the Private Company under the New Throughput
  Agreement and New Terminalling Agreement to be substantially less than prior
  revenues from services provided to the Private Company as the new agreements are
  based upon actual volumes gathered, transported, terminalled and stored instead
  of certain minimum volumes and are at reduced rates when compared to the
  Throughput Agreement and Terminalling Agreement (see &#8220;Item 2. Management&#8217;s
  Discussion and Analysis of Financial Condition and Results of Operations&#8212;Impact
  of the Bankruptcy of the Private Company and Certain of its Subsidiaries and
  Related Events&#8212;Settlement with the Private Company&#8221;).&#160;</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">A
  material decrease in the production of crude oil from the oil fields served by
  our pipelines could materially reduce our ability to make distributions to our
  unitholders.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
  throughput on our crude oil pipelines depends on the availability of
  attractively priced crude oil produced from the oil fields served by such
  pipelines, or through connections with pipelines owned by third parties. Crude
  oil production may decline for a number of reasons, including natural declines
  due to depleting wells, a material decrease in the price of crude oil, or the
  inability of producers to obtain necessary drilling or other permits from
  applicable governmental authorities. If we are unable to replace volumes lost
  due to a temporary or permanent material decrease in production from the oil
  fields served by our crude oil pipelines, our throughput could decline, reducing
  our revenue and cash flow and adversely affecting our ability to make
  distributions to our unitholders. The Private Company may also have difficulty
  attracting producers while it is in bankruptcy.&#160;&#160;In addition, it is
  difficult to attract producers to a new gathering system if the producer is
  already connected to an existing system. As a result, the Private Company or
  third-party shippers on our pipeline systems may experience difficulty acquiring
  crude oil at the wellhead in areas where there are existing relationships
  between producers and other gatherers and purchasers of crude oil.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">A
  material decrease in the production of liquid asphalt cement could materially
  reduce our ability to make distributions to our unitholders.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
  throughput at our liquid asphalt cement terminalling and storage facilities
  depends on the availability of attractively priced liquid asphalt cement
  produced from the various liquid asphalt cement producing refineries. Liquid
  asphalt cement production may decline for a number of reasons, including
  refiners processing more light, sweet crude oil or refiners installing coker
  units that further refine heavy residual fuel oil bottoms such as liquid asphalt
  cement. If we are unable to replace volumes lost due to a temporary or permanent
  material decrease in production from the suppliers of liquid asphalt cement, our
  throughput could decline, reducing our revenue and cash flow and adversely
  affecting our ability to make distributions to our unitholders.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">Our
  debt levels under the credit agreement may limit our ability to make
  distributions and our flexibility in obtaining additional financing and in
  pursuing other business opportunities.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Our level
  of debt under the credit facility could have important consequences for us,
  including the following:</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 36pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">our
        ability to obtain additional financing, if necessary, for working capital,
        capital expenditures, acquisitions or other purposes may be impaired or
        such financing may not be available on favorable
    terms;</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 36pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">we
        will need a substantial portion of our cash flow to make principal and
        interest payments on our debt, reducing the funds that would otherwise be
        available for operations, future business opportunities and distributions
        to unitholders;</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 36pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">our
        debt level will make us more vulnerable to competitive pressures or a
        downturn in our business or the economy generally;
    and</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 36pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">our
        debt level may limit our flexibility in responding to changing business
        and economic conditions.</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div><br>
      <div id="PGBRK" style="MARGIN-LEFT: 0pt; WIDTH: 100%; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
        <div id="FTR">
          <div style="WIDTH: 100%" align="left">
            <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
  </font></div>
          </div>
          <div id="GLFTR" style="WIDTH: 100%" align="center">
          </div>
        </div>
        <div id="PN" style="PAGE-BREAK-AFTER: always">
          <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">70</font></div>
          <div style="WIDTH: 100%; TEXT-ALIGN: center">
            <hr style="COLOR: black" noshade size="2">
          </div>
        </div>
        <div id="HDR">
          <div id="GLHDR" style="WIDTH: 100%" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 9pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><a href="#TOC">Table of Contents</a></font></div>
        </div>
      </div><br>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Our
  ability to service our debt will depend upon, among other things, our future
  financial and operating performance, which will be affected by prevailing
  economic conditions and financial, business, regulatory and other factors. Our
  ability to service debt under our credit facility also will depend on market
  interest rates, since the interest rates applicable to our borrowings will
  fluctuate with the London Interbank Offered Rate, or LIBOR, or the prime rate,
  and are higher due to the Forbearance Agreement, as amended, and the Credit
  Agreement Amendment. If our operating results are not sufficient to service our
  current or future indebtedness, we will be forced to take actions such as
  reducing distributions, reducing or delaying our business activities,
  acquisitions, investments or capital expenditures, selling assets, restructuring
  or refinancing our debt, or seeking additional equity capital. We may not be
  able to effect any of these actions on satisfactory terms, or at
  all.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">Restrictions
  in our credit facility may prevent us from engaging in some beneficial
  transactions or paying distributions to our unitholders.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Our
  credit facility contains covenants limiting our ability to make distributions to
  unitholders so long as an event of default exists under the credit agreement or
  if our leverage ratio exceeds 3.50 to 1.00. In addition, our credit facility
  contains various covenants that limit, among other things, our ability to incur
  indebtedness, make capital expenditures, grant liens or enter into a merger,
  consolidation or sale of assets. Furthermore, our credit facility contains
  covenants requiring us to maintain certain financial ratios and tests. Any
  subsequent refinancing of our current debt may have similar or greater
  restrictions. Please see &#8220;&#8212;Risks Related to the Bankruptcy Filings&#8212;<font style="DISPLAY: inline; FONT-SIZE: 10pt">&#160;</font>Our future operations and
  cash flows are uncertain and&#160;may cause events of default under our credit
  agreement&#8221; and &#8220;Item 2. Management&#8217;s Discussion and Analysis of Financial
  Condition and Results of Operations&#8212;Liquidity and Capital
  Resources.&#8221;</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-STYLE: italic">If we borrow funds to make our
  quarterly distributions, our ability to pursue acquisitions and other business
  opportunities may be limited and our operations may be materially </font><font style="DISPLAY: inline; FONT-STYLE: italic">and </font><font style="DISPLAY: inline; FONT-STYLE: italic">adversely</font><font style="DISPLAY: inline; FONT-STYLE: italic"> a</font><font style="DISPLAY: inline; FONT-STYLE: italic">ffected</font>.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Available
  cash for the purpose of making distributions to unitholders includes working
  capital borrowings. If we borrow funds to pay one or more quarterly
  distributions, such amounts will incur interest and must be repaid in accordance
  with the terms of our credit facility. Currently we are prohibited from paying
  distributions to our unitholders due to our failure to maintain a leverage
  ratio&#160;that is less than&#160;3.50 to 1.00, as required by our credit
  agreement.&#160;&#160;In addition, any amounts borrowed for distributions to our
  unitholders will reduce the funds available to us for other purposes under our
  credit facility, including amounts available for use in connection with
  acquisitions and other business opportunities.&#160;&#160;If we are unable to
  pursue our growth strategy due to our limited ability to borrow funds, our
  operations may be materially and adversely affected.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">We
  face intense competition in our gathering, transportation, terminalling and
  storage activities. Competition from other providers of crude oil gathering,
  transportation, terminalling and storage services that are able to supply
  our&#160;customers with those services at a lower price could reduce our ability
  to make distributions to our unitholders.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">We are
  subject to competition from other crude oil gathering, transportation,
  terminalling and storage operations that may be able to supply the Private
  Company and our other customers with the same or comparable services on a more
  competitive basis. We compete with national, regional and local gathering,
  storage, terminalling and pipeline companies, including the major integrated oil
  companies, of widely varying sizes, financial resources and experience. Some of
  these competitors are substantially larger than us, have greater financial
  resources, and control substantially greater storage capacity than we do. With
  respect to our gathering and transportation services, these competitors include
  TEPPCO Partners, L.P., Plains All American Pipeline, L.P., ConocoPhillips,
  Sunoco Logistics Partners L.P. and National Cooperative Refinery Association,
  among others. With respect to our storage and terminalling services, these
  competitors include BP plc, Enbridge Energy Partners, L.P. and Plains All
  American Pipeline, L.P. &#160;Several of our competitors conduct portions of
  their operations through publicly traded partnerships with structures similar to
  ours, including Plains All American Pipeline, L.P., TEPPCO Partners, L.P.,
  Sunoco Logistics Partners L.P. and Enbridge Energy Partners, L.P. Our ability to
  compete could be harmed by numerous factors, including:</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 36pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">price
        competition;</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 36pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">the
        perception that another company can provide better
    service,</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 36pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">the
        uncertainty relating to the Private Company having filed bankruptcy;
        and</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 36pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">the
        availability of alternative supply points, or supply points located closer
        to the operations of the Private Company&#8217;s
    customers.</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">In
  addition, the Private Company owns midstream assets and may engage in
  competition with us. If we are unable to compete with services offered by other
  midstream enterprises, including the Private Company, our ability to make
  distributions to our unitholders may be adversely affected.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div><br>
      <div id="PGBRK" style="MARGIN-LEFT: 0pt; WIDTH: 100%; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
        <div id="FTR">
          <div style="WIDTH: 100%" align="left">
            <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
  </font></div>
          </div>
          <div id="GLFTR" style="WIDTH: 100%" align="center">
          </div>
        </div>
        <div id="PN" style="PAGE-BREAK-AFTER: always">
          <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">71</font></div>
          <div style="WIDTH: 100%; TEXT-ALIGN: center">
            <hr style="COLOR: black" noshade size="2">
          </div>
        </div>
        <div id="HDR">
          <div id="GLHDR" style="WIDTH: 100%" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 9pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><a href="#TOC">Table of Contents</a></font></div>
        </div>
      </div><br>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">Some
  of our pipeline systems are dependent upon their interconnections with other
  crude oil pipelines to reach end markets.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Some of
  our pipeline systems are dependent upon their interconnections with other crude
  oil pipelines to reach end markets. Reduced throughput on<font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-STYLE: italic">&#160;</font>these
  interconnecting pipelines as a result of testing, line repair, reduced operating
  pressures or other causes could result in reduced throughput on our<font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-STYLE: italic">&#160;</font>pipeline
  systems that would adversely affect our revenue and cash flow and our ability to
  make distributions to our unitholders.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">Prior
  to the Bankruptcy Filings, a principal focus of our business strategy was to
  grow and expand our business through acquisitions. If we are able to pursue this
  strategy in the future but are unable to make acquisitions on economically
  acceptable terms, our future growth may be limited.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Prior to
  the Bankruptcy Filings, a principal focus of our business strategy was to grow
  and expand our business through acquisitions.&#160;&#160;If we are able to
  stabilize our business, we may be able to again pursue this
  strategy.&#160;&#160;Our ability to grow depends, in part, on our ability to
  make acquisitions that result in an increase in the cash generated per unit from
  operations. If we are unable to make these accretive acquisitions, either
  because we are (1) unable to identify attractive acquisition candidates or
  negotiate acceptable purchase contracts with them, (2) unable to obtain
  financing for these acquisitions on economically acceptable terms or (3) outbid
  by competitors, then our future growth and ability to increase distributions
  will be limited. Furthermore, even if we do make acquisitions that we believe
  will be accretive, these acquisitions may nevertheless result in a decrease in
  the cash generated from operations per unit.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Any
  acquisition involves potential risks, including, among other
  things:</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 36pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">mistaken
        assumptions about volumes, revenues and costs, including
        synergies;</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 36pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">an
        inability to integrate successfully the businesses we
      acquire;</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 36pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">an
        inability to hire, train or retain qualified personnel to manage and
        operate our business and assets;</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 36pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">the
        assumption of unknown liabilities;</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 36pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">limitations
        on rights to indemnity from the
  seller;</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 36pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">mistaken
        assumptions about the overall costs of equity or
    debt;</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 36pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">the
        diversion of management&#8217;s and employees&#8217; attention from other business
        concerns;</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 36pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">unforeseen
        difficulties operating in new product areas or new geographic areas;
        and</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 36pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">customer
        or key employee losses at the acquired
    businesses.</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div><br>
      <div id="PGBRK" style="MARGIN-LEFT: 0pt; WIDTH: 100%; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
        <div id="FTR">
          <div style="WIDTH: 100%" align="left">
            <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
  </font></div>
          </div>
          <div id="GLFTR" style="WIDTH: 100%" align="center">
          </div>
        </div>
        <div id="PN" style="PAGE-BREAK-AFTER: always">
          <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">72</font></div>
          <div style="WIDTH: 100%; TEXT-ALIGN: center">
            <hr style="COLOR: black" noshade size="2">
          </div>
        </div>
        <div id="HDR">
          <div id="GLHDR" style="WIDTH: 100%" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 9pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><a href="#TOC">Table of Contents</a></font></div>
        </div>
      </div><br>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">If we
  consummate any future acquisitions, our capitalization and results of operations
  may change significantly, and our unitholders will not have the opportunity to
  evaluate the economic, financial and other relevant information that we will
  consider in determining the application of these funds and other
  resources.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Our
  acquisition strategy is based, in part, on our expectation of ongoing
  divestitures of energy assets by industry participants. A material decrease in
  such divestitures would limit our opportunities for future acquisitions and
  could adversely affect our operations and cash flows available for distribution
  to our unitholders.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">Prior
  to the Bankruptcy Filings, our growth strategy included acquiring midstream
  entities or assets that are distinct and separate from our existing
  terminalling, storage, gathering and transportation operations.&#160;&#160;If we
  are able to pursue this strategy in the future, it could subject us to
  additional business and operating risks.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">We may
  acquire midstream assets that have operations in new and distinct lines of
  business from our crude oil or our liquid asphalt cement operations. Integration
  of a new business is a complex, costly and time-consuming process. Failure to
  timely and successfully integrate acquired entities&#8217; new lines of business with
  our existing operations may have a material adverse effect on our business,
  financial condition or results of operations. The difficulties of integrating a
  new business with our existing operations include, among other
  things:</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 36pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">operating
        distinct businesses that require different operating strategies and
        different managerial expertise;</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 36pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">the
        necessity of coordinating organizations, systems and facilities in
        different locations;</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 36pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">integrating
        personnel with diverse business backgrounds and organizational cultures;
        and</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 36pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">consolidating
        corporate and administrative
  functions.</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">In
  addition, the diversion of our attention and any delays or difficulties
  encountered in connection with the integration of a new business, such as
  unanticipated liabilities or costs, could harm our existing business, results of
  operations, financial conditions and prospects. Furthermore, new lines of
  business will subject us to additional business and operating risks. For
  example, we may in the future determine to acquire businesses that are subject
  to significant risks due to fluctuations in commodity prices. These new business
  and operating risks could have a material adverse effect on our financial
  condition or results of operations.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">Expanding
  our business by constructing new assets subjects us to risks that projects may
  not be completed on schedule, and that the costs associated with projects may
  exceed our expectations, which could cause our cash available for distribution
  to our unitholders to be less than anticipated.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
  construction of additions or modifications to our existing assets, and the
  construction of new assets, involves numerous regulatory, environmental,
  political, legal and operational uncertainties and requires the expenditure of
  significant amounts of capital. If we undertake these types of projects, they
  may not be completed on schedule or at all or at the budgeted cost. In addition,
  our revenues may not increase immediately upon the expenditure of funds on a
  particular project. Moreover, we may construct facilities to capture anticipated
  future growth in demand in a market in which such growth does not
  materialize.&#160;&#160;We acquired certain pipeline and related assets,
  including a 130-mile, 8-inch pipeline that originates in Ardmore, Oklahoma and
  terminates in Drumright, Oklahoma from the Private Company in May
  2008.&#160;&#160;We have suspended capital expenditures on this pipeline due to
  the continuing impact of the Bankruptcy Filings.&#160;&#160;Management currently
  intends to put the asset into service by late 2009 or early 2010 and is
  exploring various alternatives to complete the project.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">We
  are exposed to the credit risks of our third-party customers in the ordinary
  course of our gathering activities. Any material nonpayment or nonperformance by
  our third-party customers could reduce our ability to make distributions to our
  unitholders.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">In
  addition to our dependence on the Private Company, we are subject to risks of
  loss resulting from nonpayment or nonperformance by our third-party customers.
  Some of our customers may be highly leveraged and subject to their own operating
  and regulatory risks. In addition, any material nonpayment or nonperformance by
  our customers could require us to pursue substitute customers for our affected
  assets or provide alternative services. Any such efforts may not be successful
  or may not provide similar fees. These events could reduce our ability to make
  distributions to our unitholders.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div><br>
      <div id="PGBRK" style="MARGIN-LEFT: 0pt; WIDTH: 100%; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
        <div id="FTR">
          <div style="WIDTH: 100%" align="left">
            <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
  </font></div>
          </div>
          <div id="GLFTR" style="WIDTH: 100%" align="center">
          </div>
        </div>
        <div id="PN" style="PAGE-BREAK-AFTER: always">
          <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">73</font></div>
          <div style="WIDTH: 100%; TEXT-ALIGN: center">
            <hr style="COLOR: black" noshade size="2">
          </div>
        </div>
        <div id="HDR">
          <div id="GLHDR" style="WIDTH: 100%" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 9pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><a href="#TOC">Table of Contents</a></font></div>
        </div>
      </div><br>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">Our
  revenues from third-party customers are generated under contracts that must be
  renegotiated periodically and that allow the customer to reduce or suspend
  performance in some circumstances, which could cause our revenues from those
  contracts to decline and reduce our ability to make distributions to our
  unitholders.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Some of
  our contract-based revenues from customers are generated under contracts with
  terms which allow the customer to reduce or suspend performance under the
  contract in specified circumstances, such as the occurrence of a catastrophic
  event to our or the customer&#8217;s operations. The occurrence of an event which
  results in a material reduction or suspension of our customer&#8217;s performance
  could reduce our ability to make distributions to our unitholders.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Many of
  our contracts with customers for producer field services have terms of one year
  or less. As these contracts expire, they must be extended and renegotiated or
  replaced. We may not be able to extend, renegotiate or replace these contracts
  when they expire, and the terms of any renegotiated contracts may not be as
  favorable as the contracts they replace. In particular, our ability to extend or
  replace contracts could be harmed by numerous competitive factors, such as those
  described above under &#8220;&#8212;We face intense competition in our gathering,
  transportation, terminalling and storage activities. Competition from other
  providers of crude oil gathering, transportation, terminalling and storage
  services that are able to supply our&#160;customers with those services at a
  lower price could reduce our ability to make distributions to our unitholders.&#8221;
  Additionally, we may incur substantial costs if modifications to our terminals
  are required in order to attract substitute customers or provide alternative
  services. If we cannot successfully renew significant contracts or must renew
  them on less favorable terms, or if we incur substantial costs in modifying our
  terminals, our revenues from these arrangements could decline and our ability to
  make distributions to our unitholders could suffer.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">We
  may incur significant costs and liabilities as a result of pipeline integrity
  management program testing and any necessary pipeline repair, or preventative or
  remedial measures, which could have a material adverse effect on our results of
  operations.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The DOT
  has adopted regulations requiring pipeline operators to develop integrity
  management programs for transportation pipelines located where a leak or rupture
  could do the most harm in &#8220;high consequence areas&#8221;, including high population
  areas, areas that are sources of drinking water, ecological resource areas that
  are unusually sensitive to environmental damage from a pipeline release and
  commercially navigable waterways, unless the operator effectively demonstrates
  by risk assessment that the pipeline could not affect the area. The regulations
  require operators of covered pipelines to:</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 36pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">perform
        ongoing assessments of pipeline
  integrity;</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 36pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">identify
        and characterize threats to pipeline segments that could impact a high
        consequence area;</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 36pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">improve
        data collection, integration and
  analysis;</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 36pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">repair
        and remediate the pipeline as necessary;
  and</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 36pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">implement
        preventive and mitigating actions.</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">In
  addition to these adopted regulations, in September 2006, the DOT proposed
  amendment of existing pipeline safety standards including its integrity
  management programs to broaden the scope of coverage to include certain rural
  onshore hazardous liquid and low-stress pipeline systems found near &#8220;unusually
  sensitive areas,&#8221; including non-populated areas requiring extra protection
  because of the presence of sole source drinking water resources, endangered
  species, or other ecological resources. Also, in December 2006, the Pipeline
  Inspection, Protection, Enforcement and Safety Act of 2006 was enacted. This act
  reauthorizes and amends the DOT&#8217;s pipeline safety programs and includes a
  provision eliminating the regulatory exemption for hazardous liquid pipelines
  operated at low stress. Adoption of new or more stringent pipeline safety
  regulations affecting our gathering or low-stress pipelines could result in more
  rigorous and costly integrity management planning requirements being imposed on
  those lines, which could have a material adverse effect on our results of
  operations. Please read &#8220;Item 1. Business&#8212;Regulation&#8212;Pipeline Safety&#8221;&#160;in
  our 2007 Form 10-K for more information.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div><br>
      <div id="PGBRK" style="MARGIN-LEFT: 0pt; WIDTH: 100%; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
        <div id="FTR">
          <div style="WIDTH: 100%" align="left">
            <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
  </font></div>
          </div>
          <div id="GLFTR" style="WIDTH: 100%" align="center">
          </div>
        </div>
        <div id="PN" style="PAGE-BREAK-AFTER: always">
          <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">74</font></div>
          <div style="WIDTH: 100%; TEXT-ALIGN: center">
            <hr style="COLOR: black" noshade size="2">
          </div>
        </div>
        <div id="HDR">
          <div id="GLHDR" style="WIDTH: 100%" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 9pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><a href="#TOC">Table of Contents</a></font></div>
        </div>
      </div><br>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">Our
  operations are subject to environmental and worker safety laws and regulations
  that may expose us to significant costs and liabilities. Failure to comply with
  these laws and regulations could adversely affect our ability to make
  distributions to our unitholders.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Our
  midstream crude oil gathering, transportation, terminalling and storage
  operations, together with the liquid asphalt cement terminalling and storage
  assets that we acquired from the Private Company, are subject to stringent
  federal, state and local laws and regulations relating to the protection of the
  environment. Various governmental authorities, including the EPA, have the power
  to enforce compliance with these laws and regulations and the permits issued
  under them, and violators are subject to administrative, civil and criminal
  penalties, including civil fines, injunctions or both. Joint and several strict
  liability may be incurred without regard to fault or the legality of the
  original conduct under CERCLA, RCRA and analogous state laws for the remediation
  of contaminated areas. Private parties, including the owners of properties
  located near our terminalling and storage facilities or through which our
  pipeline systems pass, also may have the right to pursue legal actions to
  enforce compliance, as well as seek damages for non-compliance with
  environmental laws and regulations or for personal injury or property damage.
  Moreover, new stricter laws, regulations or enforcement policies could be
  implemented that significantly increase our compliance costs and the cost of any
  remediation that may become necessary, some of which may be
  material.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">In
  performing midstream operations and liquid asphalt cement terminalling services,
  we incur environmental costs and liabilities in connection with the handling of
  hydrocarbons and solid wastes. We currently own, operate or lease properties
  that for many years have been used for midstream activities, including
  properties in and around the Cushing Interchange, and with respect to our
  asphalt assets, for liquid asphalt cement terminalling and storage activities.
  Activities by us or prior owners, lessees or users of these properties over whom
  we had no control may have resulted in the spill or release of hydrocarbons or
  solid wastes on or under them. Additionally, some sites we own or operate are
  located near current or former storage, terminal and pipeline operations, and
  there is a risk that contamination has migrated from those sites to ours.
  Increasingly strict environmental laws, regulations and enforcement policies as
  well as claims for damages and other similar developments could result in
  significant costs and liabilities, and our ability to make distributions to our
  unitholders could suffer as a result. Please see &#8220;Item
  1&#8212;Business&#8212;Regulation&#8221;&#160;in our 2007 Form 10-K for more
  information.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">In
  addition, the workplaces associated with the storage facilities and pipelines we
  operate are subject to OSHA requirements and comparable state statutes that
  regulate the protection of the health and safety of workers. The OSHA hazard
  communication standard requires that we maintain information about hazardous
  materials used or produced in our operations and that we provide this
  information to employees, state and local government authorities, and local
  residents. Failure to comply with OSHA requirements, including general industry
  standards, recordkeeping requirements and monitoring of occupational exposure to
  regulated substances, could subject us to fines or significant compliance costs
  and adversely affect our ability to make distributions to our
  unitholders.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">Our
  business involves many hazards and operational risks, including adverse weather
  conditions, which could cause us to incur substantial liabilities.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Our
  operations are subject to the many hazards inherent in the transportation and
  storage of crude oil and the storage of liquid asphalt cement,
  including:</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 36pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">explosions,
        fires, accidents, including road and highway accidents involving our
        tanker trucks;</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 36pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">extreme
        weather conditions, such as hurricanes which are common in the
        Gulf&#160;Coast and tornadoes and flooding which are common in the
        Midwest;</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 36pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">damage
        to our pipelines, storage tanks, terminals and related
        equipment;</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 36pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">leaks
        or releases of crude oil into the environment;
    and</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 36pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">acts
        of terrorism or vandalism.</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">If any of
  these events were to occur, we could suffer substantial losses because of
  personal injury or loss of life, severe damage to and destruction of property
  and equipment, and pollution or other environmental damage resulting in
  curtailment or suspension of our related operations. In addition, mechanical
  malfunctions, faulty measurement or other errors may result in significant costs
  or lost revenues.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div><br>
      <div id="PGBRK" style="MARGIN-LEFT: 0pt; WIDTH: 100%; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
        <div id="FTR">
          <div style="WIDTH: 100%" align="left">
            <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
  </font></div>
          </div>
          <div id="GLFTR" style="WIDTH: 100%" align="center">
          </div>
        </div>
        <div id="PN" style="PAGE-BREAK-AFTER: always">
          <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">75</font></div>
          <div style="WIDTH: 100%; TEXT-ALIGN: center">
            <hr style="COLOR: black" noshade size="2">
          </div>
        </div>
        <div id="HDR">
          <div id="GLHDR" style="WIDTH: 100%" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 9pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><a href="#TOC">Table of Contents</a></font></div>
        </div>
      </div><br>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">We
  do not own all of the land on which our pipelines and facilities are located,
  which could disrupt our operations.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">We do not
  own all of the land on which our pipelines and facilities have been constructed,
  and we are therefore subject to the possibility of more onerous terms and/or
  increased costs to retain necessary land use if we do not have valid
  rights-of-way or if such rights-of-way or any material real property leases
  lapse or terminate. We obtain the rights to construct and operate our pipelines
  and some of our terminals and storage facilities on land owned by third parties
  and governmental agencies for a specific period of time. Our loss of these
  rights, through our inability to renew leases, right-of-way contracts or
  otherwise, could have a material adverse effect on our business, results of
  operations and financial condition and our ability to make cash distributions to
  you.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">Terrorist
  attacks, and the threat of terrorist attacks, have resulted in increased costs
  to our business. Continued hostilities in the Middle East or other sustained
  military campaigns may adversely impact our results of operations.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
  long-term impact of terrorist attacks, such as the attacks that occurred on
  September 11, 2001, and the threat of future terrorist attacks on our industry
  in general, and on us in particular, is not known at this time. Increased
  security measures taken by us as a precaution against possible terrorist attacks
  have resulted in increased costs to our business. Uncertainty surrounding
  continued hostilities in the Middle East or other sustained military campaigns
  may affect our operations in unpredictable ways, including disruptions of crude
  oil supplies and markets for our services, and the possibility that
  infrastructure facilities could be direct targets of, or indirect casualties of,
  an act of terror.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Changes
  in the insurance markets attributable to terrorist attacks may make certain
  types of insurance more difficult for us to obtain. Moreover, the insurance that
  may be available to us may be significantly more expensive than our existing
  insurance coverage. Instability in the financial markets as a result of
  terrorism or war could also affect our ability to raise capital.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Risks
  Inherent in an Investment in Us</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">Some
  of our general partner&#8217;s directors are affiliates of certain creditors of the
  Private Company; therefore, such creditors may have different business interests
  than the common unitholders.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Manchester
  is a creditor under a loan agreement with SemGroup Holdings, which is a
  subsidiary of the Private Company.&#160;&#160;This loan is secured by our
  subordinated units and incentive distribution rights and the membership
  interests in our general partner, owned by SemGroup Holdings.&#160;&#160;On July
  18, 2008, Manchester and Alerian declared an event of default under the loan
  agreement and exercised their right under a pledge agreement with SemGroup
  Holdings to direct the vote of the membership interests of our general
  partner.&#160;&#160;Manchester and Alerian exercised these voting rights to
  reconstitute our general partner&#8217;s board of directors.&#160;&#160;On March 20,
  2009, Alerian transferred its interest in the Holdings Credit Agreements to
  Manchester.&#160;&#160;Manchester may have business interests that are different
  from the business interests of our common unitholders.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">Our
  general partner has sole responsibility for conducting our business and managing
  our operations.&#160;&#160;Our general partner has conflicts of interest with us
  and limited fiduciary duties, which may permit it to favor its own interests to
  the detriment of our unitholders.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left">&#160;</div><br>
      <div id="PGBRK" style="MARGIN-LEFT: 0pt; WIDTH: 100%; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
        <div id="FTR">
          <div style="WIDTH: 100%" align="left">
            <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
  </font></div>
          </div>
          <div id="GLFTR" style="WIDTH: 100%" align="center">
          </div>
        </div>
        <div id="PN" style="PAGE-BREAK-AFTER: always">
          <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">76</font></div>
          <div style="WIDTH: 100%; TEXT-ALIGN: center">
            <hr style="COLOR: black" noshade size="2">
          </div>
        </div>
        <div id="HDR">
          <div id="GLHDR" style="WIDTH: 100%" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 9pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><a href="#TOC">Table of Contents</a></font></div>
        </div>
      </div><br>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Conflicts
  of interest may arise between our general partner, on the one hand, and us and
  our unitholders, on the other hand.&#160;&#160;In resolving those conflicts of
  interest, our general partner may favor its own interests and the interests of
  its affiliates over the interests of our unitholders. Although the conflicts
  committee of our general partner&#8217;s board of directors may review such conflicts
  of interest, our general partner&#8217;s board of directors is not required to submit
  such matters to the conflicts committee. These conflicts include, among others,
  the following situations:</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 36pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">neither
        our partnership agreement nor any other agreement requires the general
        partner or any person who controls the general partner to pursue a
        business strategy that favors us.&#160;&#160;Such persons may make these
        decisions in their best interest, which may be contrary to our
        interests;</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 36pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">our
        general partner is allowed to take into account the interests of parties
        other than us, such as creditors and the Private Company and their
        affiliates, in resolving conflicts of
  interest;</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 36pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">if
        we do not have sufficient available cash from operating surplus, our
        general partner could cause us to use cash from non-operating sources,
        such as asset sales, issuances of securities and borrowings, to pay
        distributions, which means that we could make distributions that
        deteriorate our capital base and that our general partner could receive
        distributions on its subordinated units and incentive distribution rights
        to which it would not otherwise be entitled if we did not have sufficient
        available cash from operating surplus to make such
        distributions;</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 36pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">our
        general partner has limited its liability and reduced its fiduciary
        duties, and has also restricted the remedies available to our unitholders
        for actions that, without the limitations, might constitute breaches of
        fiduciary duty;</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 36pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">our
        general partner determines the amount and timing of asset purchases and
        sales, borrowings, issuance of additional partnership securities and
        reserves, each of which can affect the amount of cash that is distributed
        to unitholders;</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 36pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">our
        general partner determines the amount and timing of any capital
        expenditures and whether a capital expenditure is a maintenance capital
        expenditure, which reduces operating surplus, or an expansion capital
        expenditure, which does not reduce operating surplus. This determination
        can affect the amount of cash that is distributed to our unitholders and
        the ability of the subordinated units to convert to common
        units;</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 36pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">our
        general partner may make a determination to receive a quantity of our
        Class B units in exchange for resetting the target distribution levels
        related to its incentive distribution rights without the approval of the
        conflicts committee of our general partner or our
      unitholders;</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 36pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">our
        general partner determines which costs incurred by it and its affiliates
        are reimbursable by us and the Private Company determines the allocation
        of shared overhead expenses;</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 36pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">our
        partnership agreement does not restrict our general partner from causing
        us to pay it or its affiliates for any services rendered to us or entering
        into additional contractual arrangements with any of these entities on our
        behalf;</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 36pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">our
        general partner intends to limit its liability regarding our contractual
        and other obligations and, in some circumstances, is entitled to be
        indemnified by us;</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 36pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">our
        general partner may exercise its limited right to call and purchase common
        units if it and its affiliates own more than 80% of the common
        units;</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 36pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">our
        general partner controls the enforcement of obligations owed to us by our
        general partner and its affiliates;
  and</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 36pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">our
        general partner decides whether to retain separate counsel, accountants or
        others to perform services for us.</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div><br>
      <div id="PGBRK" style="MARGIN-LEFT: 0pt; WIDTH: 100%; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
        <div id="FTR">
          <div style="WIDTH: 100%" align="left">
            <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
  </font></div>
          </div>
          <div id="GLFTR" style="WIDTH: 100%" align="center">
          </div>
        </div>
        <div id="PN" style="PAGE-BREAK-AFTER: always">
          <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">77</font></div>
          <div style="WIDTH: 100%; TEXT-ALIGN: center">
            <hr style="COLOR: black" noshade size="2">
          </div>
        </div>
        <div id="HDR">
          <div id="GLHDR" style="WIDTH: 100%" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 9pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><a href="#TOC">Table of Contents</a></font></div>
        </div>
      </div><br>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">Our
  partnership agreement limits our general partner&#8217;s fiduciary duties to holders
  of our common units and subordinated units and restricts the remedies available
  to holders of our common units and subordinated units for actions taken by our
  general partner that might otherwise constitute breaches of fiduciary
  duty.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Our
  partnership agreement contains provisions that reduce the fiduciary standards to
  which our general partner would otherwise be held by state fiduciary duty laws.
  For example, our partnership agreement:</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 36pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">permits
        our general partner to make a number of decisions in its individual
        capacity, as opposed to in its capacity as our general partner. This
        entitles our general partner to consider only the interests and factors
        that it desires, and it has no duty or obligation to give any
        consideration to any interest of, or factors affecting, us, our affiliates
        or any limited partner. Examples include the exercise of its right to
        receive a quantity of our Class B units in exchange for resetting the
        target distribution levels related to its incentive distribution rights,
        the exercise of its limited call right, the exercise of its rights to
        transfer or vote the units it owns, the exercise of its registration
        rights and its determination whether or not to consent to any merger or
        consolidation of the partnership or amendment to the partnership
        agreement;</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 36pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">provides
        that our general partner will not have any liability to us or our
        unitholders for decisions made in its capacity as a general partner so
        long as it acted in good faith, meaning it believed the decision was in
        the best interests of our
  partnership;</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 36pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">generally
        provides that affiliated transactions and resolutions of conflicts of
        interest not approved by the conflicts committee of the board of directors
        of our general partner acting in good faith and not involving a vote of
        unitholders must be on terms no less favorable to us than those generally
        being provided to or available from unrelated third parties or must be
        &#8220;fair and reasonable&#8221; to us, as determined by our general partner in good
        faith. In determining whether a transaction or resolution is &#8220;fair and
        reasonable,&#8221; our general partner may consider the totality of the
        relationships between the parties involved, including other transactions
        that may be particularly advantageous or beneficial to
    us;</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 36pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">provides
        that our general partner and its officers and directors will not be liable
        for monetary damages to us, our limited partners or assignees for any acts
        or omissions unless there has been a final and non-appealable judgment
        entered by a court of competent jurisdiction determining that the general
        partner or its officers and directors acted in bad faith or engaged in
        fraud or willful misconduct or, in the case of a criminal matter, acted
        with knowledge that the conduct was criminal;
    and</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 36pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">provides
        that in resolving conflicts of interest, it will be presumed that in
        making its decision the general partner acted in good faith, and in any
        proceeding brought by or on behalf of any limited partner or us, the
        person bringing or prosecuting such proceeding will have the burden of
        overcoming such presumption.</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">By
  purchasing a common unit, a common unitholder will become bound by the
  provisions in the partnership agreement, including the provisions discussed
  above.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">The
  Private Company may compete with us, which could adversely affect our existing
  business and limit our ability to acquire additional assets or
  businesses.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Neither
  our partnership agreement nor any other agreement with the Private Company
  prohibits the Private Company or any successor to the Private Company or
  acquirer of its assets from owning assets or engaging in businesses that compete
  directly or indirectly with us. In addition, the Private Company or any
  successor to the Private Company or acquirer of its assets may acquire,
  construct or dispose of additional midstream or other assets in the future,
  without any obligation to offer us the opportunity to purchase or construct any
  of those assets.&#160;&#160;As a result, competition from the Private Company or
  any successor to the Private Company or acquirer of its assets could adversely
  impact our results of operations and cash available for
  distribution.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">Cost
  reimbursements due to our general partner and its affiliates for services
  provided, which are determined by our general partner, may be substantial and
  will reduce our cash available for distribution to our unitholders.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Pursuant
  to our partnership agreement, the Private Company receives reimbursement for the
  payment of operating expenses related to our operations and for the provision of
  various general and administrative services for our benefit. Payments for these
  services may be substantial and reduce the amount of cash available for
  distribution to unitholders. In addition, under Delaware partnership law, our
  general partner has unlimited liability for our obligations, such as our debts
  and environmental liabilities, except for our contractual obligations that are
  expressly made without recourse to our general partner. To the extent our
  general partner incurs obligations on our behalf, we are obligated under our
  partnership agreement to reimburse or indemnify our general partner. If we are
  unable or unwilling to reimburse or indemnify our general partner, our general
  partner may take actions to cause us to make payments of these obligations and
  liabilities. Any such payments would reduce the amount of cash otherwise
  available for distribution to our unitholders. Please see &#8220;Item 13&#8212;Certain
  Relationships and Related Party Transactions, and Director
  Independence&#8212;Agreements Related to Our Acquisition of the Asphalt Assets&#8212;Amended
  Omnibus Agreement&#8221; in our 2007 Form 10-K.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div><br>
      <div id="PGBRK" style="MARGIN-LEFT: 0pt; WIDTH: 100%; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
        <div id="FTR">
          <div style="WIDTH: 100%" align="left">
            <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
  </font></div>
          </div>
          <div id="GLFTR" style="WIDTH: 100%" align="center">
          </div>
        </div>
        <div id="PN" style="PAGE-BREAK-AFTER: always">
          <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">78</font></div>
          <div style="WIDTH: 100%; TEXT-ALIGN: center">
            <hr style="COLOR: black" noshade size="2">
          </div>
        </div>
        <div id="HDR">
          <div id="GLHDR" style="WIDTH: 100%" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 9pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><a href="#TOC">Table of Contents</a></font></div>
        </div>
      </div><br>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">Holders
  of our common units have limited voting rights and are not entitled to elect our
  general partner or its directors.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Unlike
  the holders of common stock in a corporation, unitholders have only limited
  voting rights on matters affecting our business and, therefore, limited ability
  to influence management&#8217;s decisions regarding our business. Unitholders did not
  elect our general partner or our general partner&#8217;s board of directors, and have
  no right to elect our general partner or our general partner&#8217;s board of
  directors on an annual or other continuing basis. The present board of directors
  of our general partner was chosen by Manchester&#160;pursuant to its rights
  under the Holdings Credit Agreements to direct the vote of the membership
  interests of our general partner.&#160;&#160;Furthermore, if the unitholders are
  dissatisfied with the performance of our general partner, they have little
  ability to remove our general partner. Amendments to our partnership agreement
  may be proposed only by or with the consent of our general partner. As a result
  of these limitations, the price at which the common units will trade could be
  diminished because of the absence or reduction of a takeover premium in the
  trading price.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">Removal
  of our general partner without its consent will dilute and adversely affect our
  common unitholders.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">If our
  general partner is removed without cause during the subordination period and
  units held by our general partner and its affiliates are not voted in favor of
  that removal, all remaining subordinated units will automatically convert into
  common units and any existing arrearages on our common units will be
  extinguished. A removal of our general partner under these circumstances would
  adversely affect our common units by prematurely eliminating their distribution
  and liquidation preference over our subordinated units, which would otherwise
  have continued until we had met certain distribution and performance tests.
  Cause is narrowly defined to mean that a court of competent jurisdiction has
  entered a final, non-appealable judgment finding the general partner liable for
  actual fraud or willful or wanton misconduct in its capacity as our general
  partner. Cause does not include most cases of charges of poor management of the
  business, so the removal of the general partner because of the unitholders&#8217;
  dissatisfaction with our general partner&#8217;s performance in managing our
  partnership will most likely result in the termination of the subordination
  period and conversion of all subordinated units to common units.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">Control
  of our general partner may be transferred to a third party without unitholder
  consent.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Our
  general partner may transfer its general partner interest to a third party in a
  merger or in a sale of all or substantially all of its assets without the
  consent of the unitholders. Furthermore, our partnership agreement does not
  restrict the ability of the Private Company, the owner of our general partner,
  from transferring all or a portion of its ownership interest in our general
  partner to a third party, or Manchester from transferring all or a portion of
  its loan interest voting rights in the general partner, to a third party. The
  new owner of our general partner would then be in a position to replace the
  board of directors and officers of our general partner with its own choices and
  thereby influence the decisions made by the board of directors and
  officers.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">We
  may issue additional units without approval of our unitholders, which would
  dilute our unitholders&#8217; ownership interests.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Our
  partnership agreement does not limit the number or price of additional limited
  partner interests (including any securities of equal or senior rank to our
  common units, and options, rights, warrants and appreciation rights relating to
  any such securities) that we may issue at any time without the approval of our
  unitholders. In addition, because we are a limited partnership, we will not be
  subject to the shareholder approval requirements relating to the issuance of
  securities contained in Nasdaq Marketplace Rule 4350(i). The issuance by us of
  additional common units or other equity securities of equal or senior rank will
  have the following effects:</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 36pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">our
        unitholders&#8217; proportionate ownership interest in us will
        decrease;</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 36pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">the
        amount of cash available for distribution on each unit may
        decrease;</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 36pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">because
        a lower percentage of total outstanding units will be subordinated units,
        the risk that a shortfall in the payment of the minimum quarterly
        distribution will be borne by our common unitholders will
        increase;</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 36pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">the
        ratio of taxable income to distributions may
    increase;</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 36pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">the
        relative voting strength of each previously outstanding unit may be
        diminished; and</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 36pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">the
        market price of the common units may
  decline.</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div><br>
      <div id="PGBRK" style="MARGIN-LEFT: 0pt; WIDTH: 100%; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
        <div id="FTR">
          <div style="WIDTH: 100%" align="left">
            <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
  </font></div>
          </div>
          <div id="GLFTR" style="WIDTH: 100%" align="center">
          </div>
        </div>
        <div id="PN" style="PAGE-BREAK-AFTER: always">
          <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">79</font></div>
          <div style="WIDTH: 100%; TEXT-ALIGN: center">
            <hr style="COLOR: black" noshade size="2">
          </div>
        </div>
        <div id="HDR">
          <div id="GLHDR" style="WIDTH: 100%" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 9pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><a href="#TOC">Table of Contents</a></font></div>
        </div>
      </div><br>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">Our
  partnership agreement restricts the voting rights of unitholders, other than our
  general partner and its affiliates, including the Private Company, owning 20% or
  more of our common units.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Unitholders&#8217;
  voting rights are further restricted by the partnership agreement provision
  providing that any units held by a person that owns 20% or more of any class of
  units then outstanding, other than our general partner, its affiliates, their
  transferees and persons who acquired such units with the prior approval of the
  board of directors of our general partner, cannot vote on any matter. Our
  partnership agreement also contains provisions limiting the ability of
  unitholders to call meetings or to acquire information about our operations, as
  well as other provisions.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">Affiliates
  of our general partner may sell common units in the public markets, which sales
  could have an adverse impact on the trading price of the common
  units.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Executive
  officers and directors of our general partner beneficially own an aggregate of
  575,970 common units and&#160;the Private Company indirectly owns 12,570,504
  subordinated units, although such units are collateral to a loan between
  SemGroup Holdings and Manchester. All of the subordinated units will convert
  into common units at the end of the subordination period and may convert
  earlier. The sale of these units in the public markets could have an adverse
  impact on the price of the common units or on any trading market that may
  develop.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">Our
  general partner has a limited call right that may require our unitholders to
  sell their common units at an undesirable time or price.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">If at any
  time our general partner and its affiliates own more than 80% of the common
  units, our general partner will have the right, but not the obligation, which it
  may assign to any of its affiliates or to us, to acquire all, but not less than
  all, of the common units held by unaffiliated persons at a price not less than
  their then-current market price. As a result, our unitholders may be required to
  sell their common units at an undesirable time or price and may not receive any
  return on their investment. Our unitholders also may incur a tax liability upon
  a sale of their units. At the end of the subordination period, assuming no
  additional issuances of common units and no sales of subordinated units, our
  general partner and its affiliates will own 36.8% of the common
  units.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">Common
  units held by persons who are not Eligible Holders will be subject to the
  possibility of redemption.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
  Longview system is, and any additional interstate pipelines that we acquire or
  construct may be, subject to the rate regulation of the FERC. Our general
  partner has the right under our partnership agreement to institute procedures,
  by giving notice to each of our unitholders, that would require transferees of
  common units and, upon the request of our general partner, existing holders of
  our common units to certify that they are Eligible Holders. The purpose of these
  certification procedures would be to enable us to utilize a federal income tax
  expense as a component of the pipeline&#8217;s cost of service upon which tariffs may
  be established under FERC rate-making policies applicable to entities that pass
  through their taxable income to their owners. Eligible Holders are individuals
  or entities subject to United States federal income taxation on the income
  generated by us or entities not subject to United States federal income taxation
  on the income generated by us, so long as all of the entity&#8217;s owners are subject
  to such taxation. If these tax certification procedures are implemented, we will
  have the right to redeem the common units held by persons who are not Eligible
  Holders at the lesser of the holder&#8217;s purchase price and the then-current market
  price of the units. The redemption price would be paid in cash or by delivery of
  a promissory note, as determined by our general partner.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">Our
  unitholders&#8217; liability may not be limited if a court finds that unitholder
  action constitutes control of our business.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">A general
  partner of a partnership generally has unlimited liability for the obligations
  of the partnership, except for those contractual obligations of the partnership
  that are expressly made without recourse to the general partner. Our partnership
  is organized under Delaware law and we conduct business in a number of other
  states. The limitations on the liability of holders of limited partner interests
  for the obligations of a limited partnership have not been clearly established
  in some of the other states in which we do business.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Our
  unitholders could be liable for our obligations as if they were a general
  partner if:</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 36pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">a
        court or government agency determined that we were conducting business in
        a state but had not complied with that particular state&#8217;s partnership
        statute; or</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 36pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">a
        unitholder&#8217;s right to act with other unitholders to remove or replace the
        general partner, to approve some amendments to our partnership agreement
        or to take other actions under our partnership agreement constitute
        &#8220;control&#8221; of our business.</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div><br>
      <div id="PGBRK" style="MARGIN-LEFT: 0pt; WIDTH: 100%; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
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            <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
  </font></div>
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          <div style="WIDTH: 100%; TEXT-ALIGN: center">
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          </div>
        </div>
        <div id="HDR">
          <div id="GLHDR" style="WIDTH: 100%" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 9pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><a href="#TOC">Table of Contents</a></font></div>
        </div>
      </div><br>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">Unitholders
  may have liability to repay distributions that were wrongfully distributed to
  them.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Under
  certain circumstances, unitholders may have to repay amounts wrongfully returned
  or distributed to them. Under Section 17-607 and 17-804 of the Delaware Revised
  Uniform Limited Partnership Act, we may not make a distribution to our
  unitholders if the distribution would cause our liabilities to exceed the fair
  value of our assets. Delaware law provides that for a period of three years from
  the date of the impermissible distribution, limited partners who received the
  distribution and who knew at the time of the distribution that it violated
  Delaware law will be liable to the limited partnership for the distribution
  amount. Substituted limited partners are liable for the obligations of the
  assignor to make contributions to the partnership that are known to the
  substituted limited partner at the time it became a limited partner and for
  unknown obligations if the liabilities could be determined from the partnership
  agreement. Liabilities to partners on account of their partnership interests and
  liabilities that are non-recourse to the partnership are not counted for
  purposes of determining whether a distribution is permitted.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Tax
  Risks to Common Unitholders</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">Our
  unitholders have been and will be required to pay taxes on their share of our
  taxable income even if they have not or do not receive any cash distributions
  from us.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Because
  our unitholders are treated as partners to whom we will allocate taxable income
  which could be different in amount than the cash we distribute, they will be
  required to pay any federal income taxes and, in some cases, state and local
  income taxes on their share of our taxable income, even if our unitholders
  receive no cash distributions from us. In this regard, we did not pay a
  distribution to our unitholders for the quarters ended June 30, 2008, September
  30, 2008, December 31, 2008 or March 31, 2009.&#160;&#160;In addition, we do not
  expect to make a distribution relating to the second quarter of 2009 and may not
  be able to make distributions in the future.&#160;&#160;Thus, our unitholders
  may not receive cash distributions from us equal to their share of our taxable
  income or even equal to the actual tax liability that results from their share
  of our taxable income.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">Our
  tax treatment depends on our status as a partnership for federal income tax
  purposes, as well as our not being subject to a material amount of entity-level
  taxation by individual states. If the IRS were to treat us as a corporation or
  if we were to become subject to a material amount of entity-level taxation for
  state tax purposes, then our cash available for distribution to our unitholders
  would be substantially reduced.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
  anticipated after-tax economic benefit of an investment in our common units
  depends largely on us being treated as a partnership for federal income tax
  purposes.&#160;&#160;If less than 90% of the gross income of a publicly traded
  partnership, such as us, for any taxable year is &#8220;qualifying income&#8221; from
  sources such as the transportation, marketing (other than to end users), or
  processing of crude oil, natural gas or products thereof, interest, dividends or
  similar sources, that partnership will be taxable as a corporation under Section
  7704 of the Internal Revenue Code for federal income tax purposes for that
  taxable year and all subsequent years.&#160;&#160;In this regard, because the
  income we earn from the Private Company is &#8220;qualifying income&#8221; any material
  reduction or elimination of that income, or any amendment to certain contracts
  with the Private Company which change the nature of the services provided or the
  income generated thereunder, may cause our remaining &#8220;qualifying income&#8221; to
  constitute less than 90% of our gross income.&#160;&#160;As a result, we could
  become taxable as a corporation for federal income tax purposes, unless we were
  to transfer the businesses that generate non-qualifying income to one or more
  subsidiaries taxed as corporations and pay entity level income taxes on such
  non-qualifying income.&#160;&#160;The IRS has not provided any ruling to us on
  this matter.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">If we
  were treated as a corporation for federal income tax purposes, then we would pay
  federal income tax on our income at the corporate tax rate, which is currently a
  maximum of 35%, and would likely pay state income tax at varying
  rates.&#160;&#160;Distributions would generally be taxed again to unitholders as
  corporate distributions and none of our income, gains, losses, deductions or
  credits would flow through to our unitholders.&#160;&#160;Because a tax would be
  imposed upon us as an entity, cash available for distribution to our unitholders
  would be substantially reduced.&#160;&#160;Treatment of us as a corporation
  would result in a material reduction in the anticipated cash flow and after-tax
  return to unitholders and thus would likely result in a substantial reduction in
  the value of our common units.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Current
  law may change, so as to cause us to be treated as a corporation for federal
  income tax purposes or otherwise subject us to entity-level taxation. In
  addition, because of widespread state budget deficits and other reasons, several
  states are evaluating ways&#160;&#160;to subject partnerships to entity-level
  taxation through the imposition of state income, franchise and other forms of
  taxation. For example, beginning in 2008 we will be required to pay annually a
  Texas franchise tax at a maximum effective rate of 0.7% of our gross income
  apportioned to Texas with respect to the prior year.&#160;&#160;As of September
  30, 2008, we paid $141,000 representing&#160;our estimated tax liability related
  to our 2007 gross income apportioned to Texas.&#160;&#160;Imposition of such a
  tax on us by Texas and, if applicable, by any other state will reduce the cash
  available for distribution to our unitholders. The partnership agreement
  provides that if a law is enacted or existing law is modified or interpreted in
  a manner that subjects us to taxation as a corporation or otherwise subjects us
  to entity-level taxation for federal, state or local income tax purposes, the
  minimum quarterly distribution amount and the target distribution amounts will
  be adjusted to reflect the impact of that law on us.</font></div>
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        <div id="FTR">
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            <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
  </font></div>
          </div>
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          <div style="WIDTH: 100%; TEXT-ALIGN: center">
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          </div>
        </div>
        <div id="HDR">
          <div id="GLHDR" style="WIDTH: 100%" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 9pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><a href="#TOC">Table of Contents</a></font></div>
        </div>
      </div><br>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">The
  tax treatment of publicly traded partnerships or an investment in our common
  units could be subject to potential legislative, judicial or administrative
  changes and differing interpretations, possibly on a retroactive
  basis.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
  present federal income tax treatment of publicly traded partnerships, including
  us, or an investment in our common units may be modified by administrative,
  legislative or judicial interpretation at any time. For example, members of
  Congress are considering substantive changes to the existing federal income tax
  laws that affect certain publicly traded partnerships. Any modification to the
  federal income tax laws and interpretations thereof may or may not be applied
  retroactively. Although the currently proposed legislation would not appear to
  affect our tax treatment as a partnership, we are unable to predict whether any
  of these changes, or other proposals, will ultimately be enacted. Any such
  changes could negatively impact the value of an investment in our common
  units.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">If
  the IRS contests any of the federal income tax positions we take, the market for
  our common units may be adversely affected, and the costs of any contest will
  reduce our cash available for distribution to our unitholders.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">We have
  not requested a ruling from the IRS with respect to our treatment as a
  partnership for federal income tax purposes or any other matter affecting us.
  The IRS may adopt positions that differ from the conclusions of our counsel. It
  may be necessary to resort to administrative or court proceedings to sustain
  some or all of our counsel&#8217;s conclusions or the positions we take. A court may
  not agree with some or all of our counsel&#8217;s conclusions or the positions we
  take. Any contest with the IRS may materially and adversely impact the market
  for our common units and the price at which they trade. In addition, the costs
  of any contest with the IRS will be borne indirectly by our unitholders and our
  general partner because the costs will reduce our cash available for
  distribution.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">Tax
  gain or loss on the disposition of our common units could be more or less than
  expected.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">If our
  unitholders sell their common units, they will recognize a gain or loss equal to
  the difference between the amount realized and their tax basis in those common
  units. Prior distributions to our unitholders in excess of the total net taxable
  income our unitholders were allocated for a common unit, which decreased their
  tax basis in that common unit, will, in effect, become taxable income to our
  unitholders if the common unit is sold at a price greater than their tax basis
  in that common unit, even if the price our unitholders receive is less than
  their original cost. A substantial portion of the amount realized, whether or
  not representing gain, may be ordinary income. In addition, if our unitholders
  sell their units, they may incur a tax liability in excess of the amount of cash
  our unitholders receive from the sale.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">Tax-exempt
  entities, regulated investment companies and foreign persons face unique tax
  issues from owning common units that may result in adverse tax consequences to
  them.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Investment
  in common units by tax-exempt entities, such as individual retirement accounts
  (known as IRAs), regulated investment companies (known as mutual funds), and
  non-U.S. persons raises issues unique to them. For example, virtually all of our
  income allocated to organizations exempt from federal income tax, including
  individual retirement accounts and other retirement plans, will be unrelated
  business taxable income and will be taxable to them. Distributions to non-U.S.
  persons will be reduced by withholding taxes at the highest applicable effective
  tax rate, and non-U.S. persons will be required to file United States federal
  income tax returns and pay tax on their share of our taxable income. If a
  potential unitholder is a tax-exempt entity or a foreign person, it should
  consult its tax advisor before investing in our common units.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">We
  will treat each purchaser of units as having the same tax benefits without
  regard to the units purchased. The IRS may challenge this treatment, which could
  adversely affect the value of the common units.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Because
  we cannot match transferors and transferees of common units and because of other
  reasons, we will adopt depreciation and/or amortization positions that may not
  conform with all aspects of existing Treasury regulations and, as a result, our
  counsel, Baker Botts L.L.P., is unable to opine as to the validity of these
  positions. A successful IRS challenge to those positions could adversely affect
  the amount of tax benefits available to our unitholders. It also could affect
  the timing of these tax benefits or the amount of gain from their sale of common
  units and could have a negative impact on the value of our common units or
  result in audit adjustments to our unitholders&#8217; tax returns.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div><br>
      <div id="PGBRK" style="MARGIN-LEFT: 0pt; WIDTH: 100%; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
        <div id="FTR">
          <div style="WIDTH: 100%" align="left">
            <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
  </font></div>
          </div>
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          <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">82</font></div>
          <div style="WIDTH: 100%; TEXT-ALIGN: center">
            <hr style="COLOR: black" noshade size="2">
          </div>
        </div>
        <div id="HDR">
          <div id="GLHDR" style="WIDTH: 100%" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 9pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><a href="#TOC">Table of Contents</a></font></div>
        </div>
      </div><br>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">The
  sale or exchange of 50% or more of our capital and profits interests during any
  twelve-month period will result in the termination of our partnership for
  federal income tax purposes.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">We will
  be considered to have terminated for federal income tax purposes if there are
  one or more transfers of interests in our partnership that together represent a
  sale or exchange of 50% or more of the total interests in our capital and
  profits within a twelve-month period. For these purposes,</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 36pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">multiple
        transfers of the same interest within a twelve month period will be
        counted only once;</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 36pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">if
        the Private Company sells or exchanges its interests in SemGroup Holdings
        or our general partner, the interests held by SemGroup Holdings or our
        general partner, as the case may be, in us will be deemed to have been
        sold or exchanged; and</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 36pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">if
        50% or more of the total interests in the Private Company&#8217;s capital and
        profits are sold or exchanged within a twelve month period, the Private
        Company, SemGroup Holdings and the general partner will be deemed to have
        sold or exchanged all of their interests in
  us.</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Our
  termination would, among other things, result in the closing of our taxable year
  for all unitholders, which would result in us filing two tax returns (and our
  unitholders could receive two Schedules K-1) for one fiscal year and could
  result in a deferral of depreciation deductions allowable in computing our
  taxable income. In the case of a unitholder reporting on a taxable year other
  than a fiscal year ending December 31, the closing of our taxable year may also
  result in more than twelve months of our taxable income or loss being includable
  in his taxable income for the year of termination. Our termination currently
  would not affect our classification as a partnership for federal income tax
  purposes, but instead, we would be treated as a new partnership for tax
  purposes. If treated as a new partnership, we must make new tax elections and
  could be subject to penalties if we are unable to determine that a termination
  occurred.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">Our
  unitholders likely will be subject to state and local taxes and return filing or
  withholding requirements as a result of investing in our common
  units.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">In
  addition to federal income taxes, our unitholders will likely be subject to
  other taxes, such as state and local income taxes, unincorporated business taxes
  and estate, inheritance, or intangible taxes that are imposed by the various
  jurisdictions in which we do business or own property. Our unitholders likely
  will be required to file state and local income tax returns and pay state and
  local income taxes in some or all of these various jurisdictions. Further, our
  unitholders may be subject to penalties for failure to comply with those
  requirements. We own property and conduct business in Texas, Oklahoma, Kansas,
  Colorado, New Mexico, Arkansas, California, Georgia, Idaho, Illinois, Indiana,
  Missouri, Michigan, Montana, Nebraska, Nevada, New Jersey, North Carolina, Ohio,
  Pennsylvania, Tennessee, Utah, Virginia and Washington. Of these states, Texas
  does not currently impose a state income tax on individuals. We may own property
  or conduct business in other states or foreign countries in the future. It is
  each unitholder&#8217;s responsibility to file all federal, state and local tax
  returns. Under the tax laws of some states where we will conduct business, we
  may be required to withhold a percentage from amounts to be distributed to a
  unitholder who is not a resident of that state. For example, in the case of
  Oklahoma, we are required to either report detailed tax information about our
  non-Oklahoma resident unitholders with an income in Oklahoma in excess of $500
  to the taxing authority, or withhold an amount equal to 5% of the portion of our
  distributions to unitholders which is deemed to be the Oklahoma share of our
  income. Similarly, we are required to withhold Kansas income tax at a rate of
  6.45% on each non-Kansas resident unitholder&#8217;s share of our taxable income that
  is attributable to Kansas (regardless of whether such income is distributed),
  unless the non-Kansas resident unitholder files a tax reporting affidavit with
  us which we, in turn, are required to file with the Kansas Department of
  Revenue. Our counsel has not rendered an opinion on the state and local tax
  consequences of an investment in our common units.</font></div>
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            <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
  </font></div>
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          <div style="WIDTH: 100%; TEXT-ALIGN: center">
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          </div>
        </div>
        <div id="HDR">
          <div id="GLHDR" style="WIDTH: 100%" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 9pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><a href="#TOC">Table of Contents</a></font></div>
        </div>
      </div><br>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">We
  prorate our items of income, gain, loss and deduction between transferors and
  transferees of our units each month based upon the ownership of our units on the
  first day of each month, instead of on the basis of the date a particular unit
  is transferred. The IRS may challenge this treatment, which could change the
  allocation of items of income, gain, loss and deduction among our
  unitholders.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">We
  prorate our items of income, gain, loss and deduction between transferors and
  transferees of our units each month based upon the ownership of our units on the
  first day of each month, instead of on the basis of the date a particular unit
  is transferred. The use of this proration method may not be permitted under
  existing Treasury Regulations, and, accordingly, our counsel is unable to opine
  as to the validity of this method. If the IRS were to challenge this method or
  new Treasury regulations were issued, we may be required to change the
  allocation of items of income, gain, loss and deduction among our
  unitholders.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">A
  unitholder whose units are loaned to a &#8220;short seller&#8221; to cover a short sale of
  units may be considered as having disposed of those units. If so, he would no
  longer be treated for tax purposes as a partner with respect to those units
  during the period of the loan and may recognize gain or loss from the
  disposition.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Because a
  unitholder whose units are loaned to a &#8220;short seller&#8221; to cover a short sale of
  units may be considered as having disposed of the loaned units, he may no longer
  be treated for tax purposes as a partner with respect to those units during the
  period of the loan to the short seller and the unitholder may recognize gain or
  loss from such disposition. Moreover, during the period of the loan to the short
  seller, any of our income, gain, loss or deduction with respect to those units
  may not be reportable by the unitholder and any cash distributions received by
  the unitholder as to those units could be fully taxable as ordinary income. Our
  counsel has not rendered an opinion regarding the treatment of a unitholder
  where common units are loaned to a short seller to cover a short sale of common
  units; therefore, unitholders desiring to assure their status as partners and
  avoid the risk of gain recognition from a loan to a short seller are urged to
  modify any applicable brokerage account agreements to prohibit their brokers
  from borrowing their units.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">We
  will adopt certain valuation methodologies that may result in a shift of income,
  gain, loss and deduction between the general partner and the unitholders. The
  IRS may challenge this treatment, which could adversely affect the value of the
  common units.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">When we
  issue additional units or engage in certain other transactions, we determine the
  fair market value of our assets and allocate any unrealized gain or loss
  attributable to our assets to the capital accounts of our unitholders and our
  general partner. Our methodology may be viewed as understating the value of our
  assets. In that case, there may be a shift of income, gain, loss and deduction
  between certain unitholders and the general partner, which may be unfavorable to
  such unitholders. Moreover, under our valuation methods, subsequent purchasers
  of common units may have a greater portion of their Internal Revenue Code
  Section 743(b) adjustment allocated to our tangible assets and a lesser portion
  allocated to our intangible assets. Because the determination of value and the
  allocation of value are factual matters, rather than legal matters, our counsel
  is unable to opine as to these matters. The IRS may challenge our valuation
  methods, or our allocation of the Section 743(b) adjustment attributable to our
  tangible and intangible assets, and&#160;&#160;allocations of income, gain, loss
  and deduction between the general partner and certain of our
  unitholders.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">A
  successful IRS challenge to these methods or allocations could adversely affect
  the amount of taxable income or loss being allocated to our unitholders. It also
  could affect the amount of gain from our unitholders&#8217; sale of common units and
  could have a negative impact on the value of the common units or result in audit
  adjustments to our unitholders&#8217; tax returns without the benefit of additional
  deductions.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table cellpadding="0" cellspacing="0" width="100%">
            <tr>
              <td align="left" valign="top" width="9%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0.8pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"><a name="default">Item&#160;3</a>.</font></div>
              </td>
              <td align="left" valign="top" width="69%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0.8pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Defaults
        Upon Senior Securities</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Due to
  events related to the Bankruptcy Filings, events of default occurred under our
  credit agreement.&#160;&#160;Effective on September 18, 2008, we and the
  requisite lenders under our credit facility entered into the Forbearance under
  which the lenders agreed, subject to specified limitations and conditions, to
  forbear from exercising their rights and remedies arising from the defaults and
  events of default described therein for the Forbearance Period, which was
  subsequently extended pursuant to the First Forbearance Amendment, the Second
  Forbearance Amendment and the Third Forbearance Amendment.</font></div><br>
      <div id="PGBRK" style="MARGIN-LEFT: 0pt; WIDTH: 100%; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
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            <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
  </font></div>
          </div>
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        </div>
        <div id="HDR">
          <div id="GLHDR" style="WIDTH: 100%" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 9pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><a href="#TOC">Table of Contents</a></font></div>
        </div>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">We, our
  subsidiaries that are guarantors of the obligations under the credit facility,
  Wachovia Bank, National Association, as Administrative Agent, and the requisite
  lenders under our credit agreement entered into the Credit Agreement Amendment
  under which, among other things,&#160;the lenders consented to the Settlement
  and waived all existing defaults and events of default described in the
  Forbearance Agreement and amendments thereto.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Prior to
  the execution of the Forbearance Agreement, the credit agreement was comprised
  of a $350 million revolving credit facility and a $250 million term loan
  facility.&#160;&#160;The Forbearance Agreement permanently reduced our revolving
  credit facility under the credit agreement from $350 million to $300 million and
  prohibited us from borrowing additional funds under our revolving credit
  facility during the Forbearance Period.&#160;&#160;&#160;Under the Forbearance
  Agreement, we agreed to pay the lenders executing the Forbearance Agreement a
  fee equal to 0.25% of the aggregate commitments under the credit agreement after
  giving effect to the above described commitment reduction.&#160;&#160;The Second
  Forbearance Amendment further permanently reduced our revolving credit facility
  under the credit agreement from $300 million to $220 million.&#160;&#160;In
  addition, under the Second Forbearance Amendment, we agreed to pay the lenders
  executing the Second Forbearance Amendment a fee equal to 0.375% of the
  aggregate commitments under the credit agreement after the above described
  commitment reduction.&#160;&#160;Under the Third Forbearance Amendment, we
  agreed to pay a fee equal to 0.25% of the aggregate commitments under the credit
  agreement after the above described commitment reduction.&#160; The amendments
  to the Forbearance Agreement prohibited us from borrowing additional funds under
  our revolving credit facility during the extended Forbearance
  Period.&#160;&#160;</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
  Credit Agreement Amendment subsequently further permanently reduced our
  revolving credit facility under the credit agreement from $220 million to $50
  million, and increased the term loan facility from $250 million to $400
  million.&#160;&#160;Upon the execution of the Credit Agreement Amendment, $150
  million of our outstanding revolving loans were converted to term loans and we
  became able to borrow additional funds under our revolving credit
  facility.&#160;&#160;Pursuant to the Credit Agreement Amendment, the credit
  facility and all obligations thereunder will mature on June 30,
  2011.&#160;&#160;Under the Credit Agreement Amendment, we agreed to pay the
  lenders executing the Credit Agreement Amendment a fee equal to 2.00% of the
  aggregate commitments under the credit agreement after the above described
  commitment reduction, offset by the fee paid pursuant to the Third Forbearance
  Amendment.&#160;&#160;<font style="FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">As of May 22, 2009, we
  had&#160;$423.4 million in outstanding borrowings under our credit facility
  (including&#160;$23.4 million under our revolving credit facility and $400.0
  million under our term loan facility) with an aggregate unused credit
  availability under our revolving credit facility and cash on hand of
  approximately $27.2 million. Pursuant to the Credit Agreement Amendment, our
  revolving credit facility is limited to $50.0 million.&#160; <font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">If any of
  the financial institutions that support our revolving credit facility were to
  fail, we may not be able to find a replacement lender, which could negatively
  impact our ability to borrow under our revolving credit facility.&#160; For
  instance, Lehman Brothers Commercial Bank is one of the lenders under our $50.0
  million revolving credit facility, and Lehman Brothers Commercial Bank has
  agreed to fund approximately $2.5 million (approximately 5%) of the revolving
  credit facility.&#160; On several occasions Lehman Brothers Commercial Bank has
  failed to fund revolving loan requests under our revolving credit facility,
  effectively limiting the aggregate amount of our revolving credit facility to
  $47.5 million.&#160;</font></font></font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Prior to
  the events of default, indebtedness under the credit agreement bore interest at
  our option, at either (i)&#160;the higher of the&#160;Base rate,&#160;plus an
  applicable margin that ranges from 0.50% to 1.75%, depending on our total
  leverage ratio and senior secured leverage ratio, or (ii)&#160;LIBOR plus an
  applicable margin that ranges from 1.50% to 2.75%, depending upon our total
  leverage ratio and senior secured leverage ratio.&#160;&#160;During the
  Forbearance Period indebtedness under the credit agreement bore interest at our
  option, at either (i)&#160;the Base rate, plus an applicable margin that ranges
  from 2.75% to 3.75%, depending upon our total leverage ratio, or (ii)&#160;LIBOR
  plus an applicable margin that ranges from 4.25% to 5.25%, depending upon our
  total leverage ratio.&#160;&#160;Pursuant to the Second Forbearance Amendment,
  commencing on December 12, 2008, indebtedness under the credit agreement bore
  interest at our option, at either (i)&#160;the Base rate plus 5.0% per annum,
  with a&#160;Base rate floor of 4.0% per annum, or (ii)&#160;LIBOR plus 6.0% per
  annum, with a LIBOR floor of 3.0% per annum.&#160;</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">After
  giving effect to the Credit Agreement Amendment, amounts outstanding under our
  credit facility bear interest at either the LIBOR rate plus 6.50% per annum,
  with a LIBOR floor of 3.00%, or the base rate plus 5.50% per annum, with a base
  rate floor of 4.00% per annum.&#160;&#160;We now pay a fee of 1.50% on unused
  commitments under our revolving credit facility.&#160;&#160;After giving effect
  to the Credit Agreement Amendment, interest on amounts outstanding under our
  credit facility must be paid monthly.&#160;&#160;Our credit facility, as amended
  by the Credit Agreement Amendment, now requires us to pay additional interest on
  October 6, 2009, April 6, 2010, October 6, 2010 and April 6, 2011, equal to the
  product of (i) the sum of the total amount of term loans then outstanding plus
  the aggregate commitments under the revolving credit facility and (ii) 0.50%,
  0.50%, 1.00% and 1.00%, respectively.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div><br>
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        <div id="FTR">
          <div style="WIDTH: 100%" align="left">
            <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
  </font></div>
          </div>
          <div id="GLFTR" style="WIDTH: 100%" align="center">
          </div>
        </div>
        <div id="PN" style="PAGE-BREAK-AFTER: always">
          <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">85</font></div>
          <div style="WIDTH: 100%; TEXT-ALIGN: center">
            <hr style="COLOR: black" noshade size="2">
          </div>
        </div>
        <div id="HDR">
          <div id="GLHDR" style="WIDTH: 100%" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 9pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><a href="#TOC">Table of Contents</a></font></div>
        </div>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">During
  the three months ended September 30, 2008, the weighted average interest rate
  incurred by us was 7.04% resulting in interest expense of approximately $8.2
  million.&#160;&#160;During the three months ended December 31, 2008, the
  weighted average interest rate incurred by us was 7.72% resulting in interest
  expense of approximately $8.9 million.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Among
  other things, our credit facility, as amended by the Credit Agreement Amendment,
  now requires us to make (i) minimum quarterly amortization payments on March 31,
  2010 in the amount of $2.0 million, June 30, 2010 in the amount of $2.0 million,
  September 30, 2010 in the amount of $2.5 million, December 31, 2010 in the
  amount of $2.5 million and March 31, 2011 in the amount of $2.5 million, (ii)
  mandatory prepayments of amounts outstanding under the revolving credit facility
  (with no commitment reduction) whenever cash on hand exceeds $15.0 million,
  (iii) mandatory prepayments with 100% of asset sale proceeds, (iv) mandatory
  prepayment with 50% of the proceeds raised through equity raises and (v) annual
  prepayments with 50% of excess cash flow.&#160;&#160;Our credit facility, as
  amended by the Credit Agreement Amendment, prohibits us from making draws under
  the revolving credit facility if we would have more than $15.0 million of cash
  on hand after making the draw and applying the proceeds thereof.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Under the
  credit agreement, we are subject to certain limitations, including limitations
  on our ability to grant liens, incur additional indebtedness, engage in a
  merger, consolidation or dissolution, enter into transactions with affiliates,
  sell or otherwise dispose of our assets (other than the sale or other
  disposition of the assets of the asphalt business, provided that such
  disposition is at arm&#8217;s length to a non-affiliate for fair market value in
  exchange for cash and the proceeds of the disposition are used to pay down
  outstanding loans), businesses and operations, materially alter the character of
  our business, and make acquisitions, investments and capital
  expenditures.&#160;&#160;The credit agreement prohibits us from making
  distributions of available cash to our unitholders if any default or event of
  default (as defined in the credit agreement) exists.&#160;&#160;The credit
  agreement, as amended by the Credit Agreement Amendment, requires us to maintain
  a leverage ratio (the ratio of our consolidated funded indebtedness to our
  consolidated adjusted EBITDA, in each case as defined in the credit agreement),
  determined as of the last day of each<font style="DISPLAY: inline; FONT-SIZE: 10pt">&#160;</font>month for the twelve month
  period ending on the date of determination, that ranges on a monthly basis from
  not more than 5.50 to 1.00 to not more than 9.75 to 1.00.&#160;&#160;In
  addition, pursuant to the Credit Agreement Amendment, our ability to make
  acquisitions and investments in unrestricted subsidiaries is limited and we may
  only make distributions if our leverage ratio is less than 3.50 to 1.00 and
  certain other conditions are met.&#160;&#160;As of September 30, 2008 and
  December 31, 2008, our leverage ratio was 4.34 to 1.00 and 4.83 to 1.00,
  respectively.&#160;If our leverage ratio does not improve, we may not make
  quarterly distributions to our unitholders in the
  future.&#160;&#160;</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
  credit agreement, as amended by the Credit Agreement Amendment, also requires us
  to maintain an interest coverage ratio (the ratio of our consolidated EBITDA to
  our consolidated interest expense, in each case as defined in the credit
  agreement) that ranges on a monthly basis from not less than 2.50 to 1.00 to not
  less than 1.00 to 1.00. As of September 30, 2008 and December 31, 2008, our
  interest coverage ratio was 4.95 to 1.00 and 3.60 to 1.00,
  respectively.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Further,
  we are required to maintain a minimum monthly consolidated adjusted EBITDA for
  the prior twelve months ranging from $45.4 million to $82.9 million as
  determined at the end of each month.&#160;&#160;In addition, capital
  expenditures are limited to $12.5 million in 2009, $8.0 million in 2010 and $4.0
  million in the six months ending June 30, 2011.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
  credit agreement specifies a number of events of default (many of which are
  subject to applicable cure periods), including, among others, failure to pay any
  principal when due or any interest or fees within three business days of the due
  date, failure to perform or otherwise comply with the covenants in the credit
  agreement, failure of any representation or warranty to be true and correct in
  any material respect, failure to pay debt, a change of control of us or our
  general partner, and other customary defaults.&#160;&#160;<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">In
  addition, it is an event of default under the credit agreement if we do not file
  our delinquent quarterly and annual reports with the SEC by September 30, 2009,
  unless we retain new auditors, in which case such deadline is extended to
  December 31, 2009.&#160; </font>If an event of default exists under the credit
  agreement, the lenders will be able to accelerate the maturity of the credit
  agreement and exercise other rights and remedies, including taking available
  cash in our bank accounts.&#160;&#160;If an event of default exists and we are
  unable to obtain forbearance from our lenders or a waiver of the events of
  default under our credit agreement, we may be forced to sell assets, make a
  bankruptcy filing or take other action that could have a material adverse effect
  on our business, the price of our common units and our results of
  operations.&#160;&#160;We are also prohibited from making cash distributions to
  our unitholders while the events of default exist.&#160;&#160;</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">We used
  interest rate swap agreements to manage a portion of the exposure related to
  changing interest rates by converting floating-rate debt to fixed-rate debt. See
  Note 4 <font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">of the
  Notes to the Consolidated Financial Statements included in Item 1 of this
  Quarterly Report</font> for a description of these interest rate
  swaps.&#160;&#160;&#160;The interest rate swap agreements contain cross-default
  provisions to events of default under the credit agreement.&#160;&#160;Due to
  events related to the Bankruptcy Filings, all of these interest rate swap
  positions were terminated in the third quarter of 2008, and we have recorded a
  $1.5 million liability as of September 30, 2008 with respect to these
  positions.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div>
        <table cellpadding="0" cellspacing="0" width="100%">
            <tr>
              <td align="left" valign="top" width="9%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0.8pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"><a name="exhibits">Item</a>&#160;6.</font></div>
              </td>
              <td align="left" valign="top" width="69%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0.8pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Exhibits</font></div>
              </td>
            </tr>
        </table>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
  information required by this Item&#160;6 is set forth in the Index to Exhibits
  accompanying this quarterly report and is incorporated herein by
  reference.</font></div><br>
      <div id="PGBRK" style="MARGIN-LEFT: 0pt; WIDTH: 100%; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
        <div id="FTR">
          <div style="WIDTH: 100%" align="left">
            <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
  </font></div>
          </div>
          <div id="GLFTR" style="WIDTH: 100%" align="center">
          </div>
        </div>
        <div id="PN" style="PAGE-BREAK-AFTER: always">
          <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">86</font></div>
          <div style="WIDTH: 100%; TEXT-ALIGN: center">
            <hr style="COLOR: black" noshade size="2">
          </div>
        </div>
        <div id="HDR">
          <div id="GLHDR" style="WIDTH: 100%" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 9pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><a href="#TOC">Table of Contents</a></font></div>
        </div>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><a name="SIGNATURE">SIGNA</a>TURES</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">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.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
      <div>
        <table cellpadding="0" cellspacing="0" width="100%">
            <tr>
              <td valign="middle" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
              <td valign="bottom" width="3%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
              <td valign="middle" width="18%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
              <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
              <td valign="middle" width="4%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
              <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
              <td valign="middle" width="7%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
              <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
              <td valign="middle" width="39%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
            </tr>
            <tr>
              <td valign="top" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
              <td align="left" valign="bottom" width="3%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
              <td valign="bottom" width="18%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
              <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
              <td valign="top" width="4%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
              <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
              <td align="left" colspan="3" valign="top" width="46%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 2.8pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">SemGroup
        Energy Partners, L.P.</font></div>
              </td>
            </tr>
            <tr>
              <td valign="middle" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
              <td colspan="2" valign="middle" width="22%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
              <td colspan="2" valign="middle" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
              <td colspan="2" valign="middle" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
              <td colspan="2" valign="middle" width="40%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
            </tr>
            <tr>
              <td valign="top" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
              <td align="left" valign="bottom" width="3%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
              <td valign="bottom" width="18%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
              <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
              <td valign="top" width="4%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
              <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
              <td align="left" valign="top" width="7%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0.8pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">By:&#160;&#160;&#160;&#160;</font></div>
              </td>
              <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
              <td align="left" valign="bottom" width="39%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0.8pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">SemGroup
        Energy Partners G.P., L.L.C.</font></div>
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0.8pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">its
        General Partner</font></div>
              </td>
            </tr>
            <tr>
              <td colspan="3" valign="middle" width="24%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
              <td colspan="2" valign="middle" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
              <td colspan="2" valign="middle" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
              <td colspan="2" valign="middle" width="40%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
            </tr>
            <tr>
              <td align="left" colspan="3" valign="top" width="24%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 2.8pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Date:&#160;May
        27,&#160;2009</font></div>
              </td>
              <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
              <td valign="top" width="4%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
              <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
              <td align="left" valign="top" width="7%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0.8pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">By:&#160;&#160;&#160;&#160;</font></div>
              </td>
              <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
              <td align="left" valign="top" width="39%" style="BORDER-BOTTOM: black 2px solid">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0.8pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">/s/
        Alex G. Stallings</font></div>
              </td>
            </tr>
            <tr>
              <td colspan="3" valign="top" width="24%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
              <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
              <td valign="bottom" width="4%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
              <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
              <td valign="bottom" width="7%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
              <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
              <td align="left" valign="bottom" width="39%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0.8pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Alex
        G. Stallings</font></div>
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0.8pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Chief
        Financial Officer and Secretary</font></div>
              </td>
            </tr>
            <tr>
              <td valign="top" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
              <td align="left" valign="bottom" width="3%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
              <td valign="top" width="18%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
              <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
              <td valign="top" width="4%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
              <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
              <td valign="top" width="7%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
              <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
              <td valign="bottom" width="39%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
            </tr>
            <tr>
              <td colspan="3" valign="middle" width="24%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
              <td colspan="2" valign="middle" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
              <td colspan="2" valign="middle" width="8%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
              <td colspan="2" valign="middle" width="40%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
            </tr>
            <tr>
              <td align="left" colspan="3" valign="top" width="24%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 2.8pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Date:
        May 27, 2009</font></div>
              </td>
              <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
              <td valign="top" width="4%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
              <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
              <td align="left" valign="top" width="7%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0.8pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">By:&#160;&#160;&#160;&#160;</font></div>
              </td>
              <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
              <td align="left" valign="top" width="39%" style="BORDER-BOTTOM: black 2px solid">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0.8pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">/s/
        James R. Griffin</font></div>
              </td>
            </tr>
            <tr>
              <td valign="top" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
              <td align="left" valign="bottom" width="3%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
              <td valign="top" width="18%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
              <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
              <td valign="top" width="4%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
              <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
              <td valign="top" width="7%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
              <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
              <td align="left" valign="bottom" width="39%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0.8pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">James
        R. Griffin</font></div>
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0.8pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Chief
        Accounting Officer</font></div>
              </td>
            </tr>
        </table>
      </div><br>
      <div id="PGBRK" style="MARGIN-LEFT: 0pt; WIDTH: 100%; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
        <div id="FTR">
          <div style="WIDTH: 100%" align="left">
            <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
          </div>
          <div id="GLFTR" style="WIDTH: 100%" align="center">
          </div>
        </div>
        <div id="PN" style="PAGE-BREAK-AFTER: always">
          <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 8pt; FONT-FAMILY: Times New Roman">&#160;
  </font></div>
          <div style="WIDTH: 100%; TEXT-ALIGN: center">
            <hr style="COLOR: black" noshade size="2">
          </div>
        </div>
        <div id="HDR">
          <div id="GLHDR" style="WIDTH: 100%" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 9pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><a href="#TOC">Table of Contents</a></font></div>
        </div>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">INDEX
  TO EXHIBITS</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
      <div>
        <div align="center">
          <div align="center">
            <div align="center">
              <table cellpadding="0" cellspacing="0" width="100%">
                  <tr>
                    <td valign="middle" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                    <td valign="bottom" width="3%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                    <td valign="middle" width="83%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                  </tr>
                  <tr>
                    <td valign="bottom" width="5%" style="BORDER-BOTTOM: black 2px solid">
                      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0.8pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Exhibit</font></div>
                      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0.8pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Number</font></div>
                    </td>
                    <td align="left" valign="bottom" width="3%">
                      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0.8pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;&#160;</font></div>
                    </td>
                    <td valign="bottom" width="83%" style="BORDER-BOTTOM: black 2px solid">
                      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
                        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Exhibit
        Name</font></div>
                      </div>
                    </td>
                  </tr>
                  <tr>
                    <td valign="top" width="5%">
                      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0.8pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;&#160;3.1</font></div>
                    </td>
                    <td align="left" valign="bottom" width="3%">
                      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0.8pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;&#160;</font></div>
                    </td>
                    <td align="left" valign="top" width="83%">
                      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0.8pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Certificate
        of Limited Partnership of SemGroup Energy Partners, L.P. (the
        &#8220;Partnership&#8221;), dated February 22, 2007 (filed as Exhibit 3.1 to the
        Partnership&#8217;s Registration Statement on Form S-1 (Reg. No. 333-141196),
        filed March 9, 2007, and incorporated herein by
    reference).</font></div>
                    </td>
                  </tr>
                  <tr>
                    <td valign="middle" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                    <td colspan="2" valign="middle" width="86%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                  </tr>
                  <tr>
                    <td valign="top" width="5%">
                      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0.8pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;&#160;3.2</font></div>
                    </td>
                    <td align="left" valign="bottom" width="3%">
                      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0.8pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;&#160;</font></div>
                    </td>
                    <td align="left" valign="top" width="83%">
                      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0.8pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">First
        Amended and Restated Agreement of Limited Partnership of the Partnership,
        dated July 20, 2007 (filed as Exhibit 3.1 to the Partnership&#8217;s Current
        Report on Form 8-K, filed July 25, 2007, and incorporated herein by
        reference).</font></div>
                    </td>
                  </tr>
                  <tr>
                    <td valign="middle" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                    <td colspan="2" valign="middle" width="86%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                  </tr>
                  <tr>
                    <td valign="top" width="5%">
                      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0.8pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;&#160;3.3</font></div>
                    </td>
                    <td valign="bottom" width="3%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                    <td align="left" valign="top" width="83%">
                      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0.8pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Amendment
        No. 1 to First Amended and Restated Agreement of Limited Partnership of
        the Partnership, effective as of July 20, 2007 (filed as Exhibit 3.1 to
        the Partnership&#8217;s Current Report on Form 8-K, filed on April 14, 2008, and
        incorporated herein by reference).</font></div>
                    </td>
                  </tr>
                  <tr>
                    <td valign="top" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                    <td valign="bottom" width="3%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                    <td valign="top" width="83%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                  </tr>
                  <tr>
                    <td valign="top" width="5%">
                      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0.8pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;&#160;3.4</font></div>
                    </td>
                    <td valign="bottom" width="3%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                    <td align="left" valign="top" width="83%">
                      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0.8pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Amendment
        No. 2 to First Amended and Restated Agreement of Limited Partnership of
        the Partnership, dated June 25, 2008 (filed as Exhibit 3.1 to the
        Partnership&#8217;s Current Report on Form 8-K, filed on June 30, 2008, and
        incorporated herein by reference).</font></div>
                    </td>
                  </tr>
                  <tr>
                    <td valign="top" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                    <td valign="bottom" width="3%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                    <td valign="top" width="83%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                  </tr>
                  <tr>
                    <td valign="top" width="5%">
                      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0.8pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;&#160;3.5</font></div>
                    </td>
                    <td align="left" valign="bottom" width="3%">
                      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0.8pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;&#160;</font></div>
                    </td>
                    <td align="left" valign="top" width="83%">
                      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0.8pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Certificate
        of Formation of SemGroup Energy Partners G.P., L.L.C. (the &#8220;General
        Partner&#8221;), dated February 22, 2007 (filed as Exhibit 3.3 to the
        Partnership&#8217;s Registration Statement on Form S-1 (Reg. No. 333-141196),
        filed March 9, 2007, and incorporated herein by
    reference).</font></div>
                    </td>
                  </tr>
                  <tr>
                    <td valign="middle" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                    <td colspan="2" valign="middle" width="86%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                  </tr>
                  <tr>
                    <td valign="top" width="5%">
                      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0.8pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;&#160;3.6</font></div>
                    </td>
                    <td align="left" valign="bottom" width="3%">
                      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0.8pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;&#160;</font></div>
                    </td>
                    <td align="left" valign="top" width="83%">
                      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0.8pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Amended
        and Restated Limited Liability Company Agreement of the General Partner,
        dated July 20, 2007 (filed as Exhibit 3.2 to the Partnership&#8217;s Current
        Report on Form 8-K, filed July 25, 2007, and incorporated herein by
        reference).</font></div>
                    </td>
                  </tr>
                  <tr>
                    <td valign="middle" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                    <td colspan="2" valign="middle" width="86%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                  </tr>
                  <tr>
                    <td valign="top" width="5%">
                      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0.8pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;&#160;3.7</font></div>
                    </td>
                    <td align="left" valign="bottom" width="3%">
                      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0.8pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;&#160;</font></div>
                    </td>
                    <td align="left" valign="top" width="83%">
                      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0.8pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Amendment
        No. 1 to Amended and Restated Limited Liability Company Agreement of the
        General Partner, dated June 25, 2008 (filed as Exhibit 3.2 to the
        Partnership&#8217;s Current Report on Form 8-K, filed on June 30, 2008, and
        incorporated herein by reference).</font></div>
                    </td>
                  </tr>
                  <tr>
                    <td valign="middle" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                    <td colspan="2" valign="middle" width="86%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                  </tr>
                  <tr>
                    <td valign="top" width="5%">
                      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0.8pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;&#160;3.8</font></div>
                    </td>
                    <td align="left" valign="bottom" width="3%">
                      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0.8pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;&#160;</font></div>
                    </td>
                    <td align="left" valign="top" width="83%">
                      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0.8pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Amendment
        No. 2 to Amended and Restated Limited Liability Company Agreement of the
        General Partner, dated July 18, 2008 (filed as Exhibit 3.1 to the
        Partnership&#8217;s Current Report on Form 8-K, filed on July 22, 2008, and
        incorporated herein by reference).</font></div>
                    </td>
                  </tr>
                  <tr>
                    <td valign="middle" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                    <td colspan="2" valign="middle" width="86%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                  </tr>
                  <tr>
                    <td valign="top" width="5%">
                      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0.8pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;&#160;4.1</font></div>
                    </td>
                    <td align="left" valign="bottom" width="3%">
                      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0.8pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;&#160;</font></div>
                    </td>
                    <td align="left" valign="top" width="83%">
                      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0.8pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Specimen
        Unit Certificate (included in Exhibit 3.2).</font></div>
                    </td>
                  </tr>
                  <tr>
                    <td valign="middle" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                    <td colspan="2" valign="middle" width="86%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                  </tr>
                  <tr>
                    <td valign="top" width="5%">
                      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0.8pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">10.1</font></div>
                    </td>
                    <td valign="bottom" width="3%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                    <td align="left" valign="top" width="83%">
                      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0.8pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Agreed
        Order of the United States Bankruptcy Court for the District of Delaware
        Regarding Motion by SemGroup Energy Partners, L.P. (i) to Compel Debtors
        to Provide Adequate Protection and (ii) to Modify the Automatic Stay
        (filed as Exhibit 99.1 to the Partnership&#8217;s Current Report on Form 8-K,
        filed on September 9, 2008, and incorporated herein by
        reference).</font></div>
                    </td>
                  </tr>
                  <tr>
                    <td valign="middle" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                    <td colspan="2" valign="middle" width="86%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                  </tr>
                  <tr>
                    <td valign="top" width="5%">
                      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0.8pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">10.2</font></div>
                    </td>
                    <td valign="bottom" width="3%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                    <td align="left" valign="top" width="83%">
                      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0.8pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Forbearance
        Agreement and Amendment to Credit Agreement, dated September 12, 2008 but
        effective as of September 18, 2008, by and among SemGroup Energy Partners,
        L.P., Wachovia Bank, National Association, as Administrative Agent, L/C
        Issuer and Swing Line Lender, and the Lenders party thereto (filed as
        Exhibit 10.1 to the Partnership&#8217;s Current Report on Form 8-K, filed on
        September 22, 2008, and incorporated herein by
    reference).</font></div>
                    </td>
                  </tr>
                  <tr>
                    <td valign="middle" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                    <td colspan="2" valign="middle" width="86%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                  </tr>
                  <tr>
                    <td valign="top" width="5%">
                      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0.8pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">10.3</font></div>
                    </td>
                    <td valign="bottom" width="3%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                    <td align="left" valign="top" width="83%">
                      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0.8pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">First
        Amendment to Forbearance Agreement and Amendment to Credit Agreement,
        dated as of December 11, 2008, by and among SemGroup Energy Partners,
        L.P., Wachovia Bank, National Association, as Administrative Agent, L/C
        Issuer and Swing Line Lender, and the Lenders party thereto (filed as
        Exhibit 10.1 to the Partnership&#8217;s Current Report on Form 8-K, filed on
        December 12, 2008, and incorporated herein by
    reference).</font></div>
                    </td>
                  </tr>
                  <tr>
                    <td valign="top" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                    <td valign="bottom" width="3%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                    <td valign="top" width="83%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                  </tr>
                  <tr>
                    <td valign="top" width="5%">
                      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0.8pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">10.4</font></div>
                    </td>
                    <td valign="bottom" width="3%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                    <td align="left" valign="top" width="83%">
                      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Second
        Amendment to Forbearance Agreement and Amendment to Credit Agreement,
        dated as of December 18, 2008, by and among SemGroup Energy Partners,
        L.P., Wachovia Bank, National Association, as Administrative Agent, L/C
        Issuer and Swing Line Lender, and the Lenders party thereto (filed as
        Exhibit 10.1 to the Partnership&#8217;s Current Report on Form 8-K, filed on
        December 19, 2008, and incorporated herein by
    reference).</font></div>
                    </td>
                  </tr>
                  <tr>
                    <td valign="top" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                    <td valign="bottom" width="3%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                    <td valign="top" width="83%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                  </tr>
                  <tr>
                    <td valign="top" width="5%">
                      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0.8pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">10.5</font></div>
                    </td>
                    <td valign="bottom" width="3%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                    <td align="left" valign="top" width="83%">
                      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Third
        Amendment to Forbearance Agreement and Amendment to Credit Agreement,
        dated as of March 17, 2009, by and among SemGroup Energy Partners, L.P.,
        Wachovia Bank, National Association, as Administrative Agent, L/C Issuer
        and Swing Line Lender, and the Lenders party thereto (filed as Exhibit
        10.1 to the Partnership&#8217;s Current Report on Form 8-K, filed on March 19,
        2009, and incorporated herein by reference).</font></div>
                    </td>
                  </tr>
                  <tr>
                    <td valign="top" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                    <td valign="bottom" width="3%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                    <td valign="top" width="83%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                  </tr>
                  <tr>
                    <td valign="top" width="5%">
                      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0.8pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">10.6</font></div>
                    </td>
                    <td valign="bottom" width="3%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                    <td align="left" valign="top" width="83%">
                      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0.8pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Consent,
        Waiver and Amendment to Credit Agreement, dated as of April 7, 2009, by
        and among SemGroup Energy Partners, L.P., as Borrower, SemGroup Energy
        Partners G.P., L.L.C., SemGroup Energy Partners Operating, L.L.C.,
        SemMaterials Energy Partners, L.L.C., SemGroup Energy Partners, L.L.C.,
        SemGroup Crude Storage, L.L.C., SemPipe, L.P., SemPipe G.P., L.L.C. and
        SGLP Management, Inc., as Guarantors, Wachovia Bank, National Association,
        as Administrative Agent, L/C Issuer and Swing Line Lender, and the Lenders
        party thereto (filed as Exhibit 10.14 to the Partnership&#8217;s Current Report
        on Form 8-K, filed on April 10, 2009, and incorporated herein by
        reference).</font></div>
                    </td>
                  </tr>
                  <tr>
                    <td valign="top" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                    <td valign="bottom" width="3%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                    <td valign="top" width="83%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                  </tr>
                  <tr>
                    <td valign="top" width="5%">
                      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0.8pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">10.7</font></div>
                    </td>
                    <td valign="bottom" width="3%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                    <td align="left" valign="top" width="83%">
                      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0.8pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Amendment
        to the SemGroup Energy Partners G.P., L.L.C. Long Term Incentive Plan
        (filed as Exhibit 10.1 to the Partnership&#8217;s Current Report on Form 8-K,
        filed on December 23, 2008, and incorporated herein by
        reference).</font></div>
                    </td>
                  </tr>
                  <tr>
                    <td valign="top" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                    <td valign="bottom" width="3%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                    <td valign="top" width="83%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                  </tr>
                  <tr>
                    <td valign="top" width="5%">
                      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0.8pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">10.8</font></div>
                    </td>
                    <td valign="bottom" width="3%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                    <td align="left" valign="top" width="83%">
                      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0.8pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Form
        of Director Restricted Common Unit Agreement (filed as Exhibit 10.2 to the
        Partnership&#8217;s Current Report on Form 8-K, filed on December 23, 2008, and
        incorporated herein by reference).</font></div>
                    </td>
                  </tr>
                  <tr>
                    <td valign="top" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                    <td valign="bottom" width="3%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                    <td valign="top" width="83%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                  </tr>
                  <tr>
                    <td valign="top" width="5%">
                      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0.8pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">10.9</font></div>
                    </td>
                    <td valign="bottom" width="3%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                    <td align="left" valign="top" width="83%">
                      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0.8pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Form
        of Director Restricted Subordinated Unit Agreement (filed as Exhibit 10.3
        to the Partnership&#8217;s Current Report on Form 8-K, filed on December 23,
        2008, and incorporated herein by reference).</font></div>
                    </td>
                  </tr>
                  <tr>
                    <td valign="top" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                    <td valign="bottom" width="3%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                    <td valign="top" width="83%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                  </tr>
                  <tr>
                    <td valign="top" width="5%">
                      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">10.10</font></div>
                    </td>
                    <td align="left" valign="bottom" width="3%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                    <td align="left" valign="top" width="83%">
                      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;Term
        Sheet, dated as of March 6, 2009 (filed as Exhibit 10.1 to the
        Partnership&#8217;s Current Report on Form 8-K, filed on March 10, 2009, and
        incorporated herein by reference).</font></div>
                    </td>
                  </tr>
                  <tr>
                    <td valign="top" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                    <td valign="bottom" width="3%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                    <td valign="top" width="83%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                  </tr>
                  <tr>
                    <td valign="top" width="5%">
                      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">10.11</font></div>
                    </td>
                    <td valign="bottom" width="3%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                    <td align="left" valign="top" width="83%">
                      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Master
        Agreement, dated as of April 7, 2009 to be effective as of 11:59 PM CDT
        March 31, 2009, by and among by and among SemGroup, L.P., SemManagement,
        L.L.C., SemOperating G.P., L.L.C., SemMaterials, L.P., K.C. Asphalt,
        L.L.C., SemCrude, L.P., Eaglwing, L.P., SemGroup Holdings, L.P., SemGroup
        Energy Partners, L.P., SemGroup Energy Partners G.P., L.L.C., SemGroup
        Energy Partners Operating, L.L.C., SemGroup Energy Partners, L.L.C.,
        SemGroup Crude Storage, L.L.C., SemPipe, L.P., SemPipe G.P., L.L.C., SGLP
        Management, Inc. and SemMaterials Energy Partners, L.L.C. (filed as
        Exhibit 10.1 to the Partnership&#8217;s Current Report on Form 8-K, filed on
        April 10, 2009, and incorporated herein by reference).</font></div>
                    </td>
                  </tr>
                  <tr>
                    <td valign="top" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                    <td valign="bottom" width="3%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                    <td valign="top" width="83%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                  </tr>
                  <tr>
                    <td valign="top" width="5%">
                      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">10.12</font></div>
                    </td>
                    <td valign="bottom" width="3%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                    <td align="left" valign="top" width="83%">
                      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Shared
        Services Agreement, dated as of April 7, 2009 to be effective as of 11:59
        PM CDT March 31, 2009, by and among SemGroup Energy Partners, L.P.,
        SemGroup Energy Partners, L.L.C., SemGroup Crude Storage, L.L.C., SemPipe
        G.P., L.L.C., SemPipe, L.P., SemCrude, L.P. and SemManagement, L.L.C.
        (filed as Exhibit 10.2 to the Partnership&#8217;s Current Report on Form 8-K,
        filed on April 10, 2009, and incorporated herein by
        reference).</font></div>
                    </td>
                  </tr>
                  <tr>
                    <td valign="top" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                    <td valign="bottom" width="3%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                    <td valign="top" width="83%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                  </tr>
                  <tr>
                    <td valign="top" width="5%">
                      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">10.13</font></div>
                    </td>
                    <td valign="bottom" width="3%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                    <td align="left" valign="top" width="83%">
                      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Transition
        Services Agreement, dated as of April 7, 2009 to be effective as of 11:59
        PM CDT March 31, 2009, by and among SemGroup Energy Partners, L.P.,
        SemGroup Energy Partners, L.L.C., SemGroup Crude Storage, L.L.C., SemPipe
        G.P., L.L.C., SemPipe, L.P., SemMaterials Energy Partners, L.L.C., SGLP
        Asphalt L.L.C., SemCrude, L.P., SemGroup, L.P., SemMaterials, L.P. and
        SemManagement, L.L.C. (filed as Exhibit 10.3 to the Partnership&#8217;s Current
        Report on Form 8-K, filed on April 10, 2009, and incorporated herein by
        reference).</font></div>
                    </td>
                  </tr>
                  <tr>
                    <td valign="top" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                    <td valign="bottom" width="3%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                    <td valign="top" width="83%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                  </tr>
                  <tr>
                    <td valign="top" width="5%">
                      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">10.14</font></div>
                    </td>
                    <td valign="bottom" width="3%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                    <td align="left" valign="top" width="83%">
                      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Contribution,
        Conveyance, Assignment and Assumption Agreement, dated as of April 7, 2009
        to be effective as of 11:59 PM CDT March 31, 2009, by and among
        SemMaterials, L.P., K.C. Asphalt, L.L.C., SGLP Asphalt, L.L.C. and
        SemMaterials Energy Partners, L.L.C. (filed as Exhibit 10.4 to the
        Partnership&#8217;s Current Report on Form 8-K, filed on April 10, 2009, and
        incorporated herein by reference).</font></div>
                    </td>
                  </tr>
                  <tr>
                    <td valign="top" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                    <td valign="bottom" width="3%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                    <td valign="top" width="83%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                  </tr>
                  <tr>
                    <td valign="top" width="5%">
                      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">10.15</font></div>
                    </td>
                    <td valign="bottom" width="3%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                    <td align="left" valign="top" width="83%">
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        Interest Transfer Agreement, dated as of April 7, 2009 to be effective as
        of 11:59 PM CDT March 31, 2009, by and between SemMaterials, L.P. and
        SemMaterials Energy Partners, L.L.C. (filed as Exhibit 10.5 to the
        Partnership&#8217;s Current Report on Form 8-K, filed on April 10, 2009, and
        incorporated herein by reference).</font></div>
                    </td>
                  </tr>
                  <tr>
                    <td valign="top" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                    <td valign="bottom" width="3%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                    <td valign="top" width="83%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                  </tr>
                  <tr>
                    <td valign="top" width="5%">
                      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">10.16</font></div>
                    </td>
                    <td valign="bottom" width="3%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                    <td align="left" valign="top" width="83%">
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        Agreement, dated as of April 7, 2009 to be effective as of 11:59 PM CDT
        March 31, 2009, by and among SemGroup Energy Partners, L.L.C. and
        SemCrude, L.P. (filed as Exhibit 10.6 to the Partnership&#8217;s Current Report
        on Form 8-K, filed on April 10, 2009, and incorporated herein by
        reference).</font></div>
                    </td>
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                  <tr>
                    <td valign="top" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                    <td valign="bottom" width="3%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                    <td valign="top" width="83%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                  </tr>
                  <tr>
                    <td valign="top" width="5%">
                      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">10.17</font></div>
                    </td>
                    <td valign="bottom" width="3%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                    <td align="left" valign="top" width="83%">
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        and Storage Agreement, dated as of April 7, 2009 to be effective as of
        11:59 PM CDT March 31, 2009, by and between SemMaterials Energy Partners,
        L.L.C. and SemMaterials, L.P. (filed as Exhibit 10.7 to the Partnership&#8217;s
        Current Report on Form 8-K, filed on April 10, 2009, and incorporated
        herein by reference).</font></div>
                    </td>
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                  <tr>
                    <td valign="top" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                    <td valign="bottom" width="3%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                    <td valign="top" width="83%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                  </tr>
                  <tr>
                    <td valign="top" width="5%">
                      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">10.18</font></div>
                    </td>
                    <td valign="bottom" width="3%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                    <td align="left" valign="top" width="83%">
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        and Use Agreement, dated as of April 7, 2009 to be effective as of 11:59
        PM CDT March 31, 2009, by and between SemMaterials, L.P. and SemMaterials
        Energy Partners, L.L.C. (filed as Exhibit 10.8 to the Partnership&#8217;s
        Current Report on Form 8-K, filed on April 10, 2009, and incorporated
        herein by reference).</font></div>
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                  <tr>
                    <td valign="top" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                    <td valign="bottom" width="3%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                    <td valign="top" width="83%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                  </tr>
                  <tr>
                    <td valign="top" width="5%">
                      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">10.19</font></div>
                    </td>
                    <td valign="bottom" width="3%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                    <td align="left" valign="top" width="83%">
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        License Agreement, dated as of April 7, 2009 to be effective as of 11:59
        PM CDT March 31, 2009, by and among SemGroup, L.P., SemMaterials, L.P. and
        SemGroup Energy Partners, L.P. (filed as Exhibit 10.9 to the Partnership&#8217;s
        Current Report on Form 8-K, filed on April 10, 2009, and incorporated
        herein by reference).</font></div>
                    </td>
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                  <tr>
                    <td valign="top" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
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                    <td valign="bottom" width="3%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
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                    <td valign="top" width="83%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
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                  </tr>
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                    <td valign="top" width="5%">
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                    <td valign="bottom" width="3%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
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                    <td align="left" valign="top" width="83%">
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        Lease, dated as of April 7, 2009 to be effective as of 11:59 PM CDT March
        31, 2009, by and between SemGroup Energy Partners, L.L.C. and SemCrude,
        L.P. (filed as Exhibit 10.10 to the Partnership&#8217;s Current Report on Form
        8-K, filed on April 10, 2009, and incorporated herein by
        reference).</font></div>
                    </td>
                  </tr>
                  <tr>
                    <td valign="top" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                    <td valign="bottom" width="3%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                    <td valign="top" width="83%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                  </tr>
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                    <td valign="top" width="5%">
                      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">10.21</font></div>
                    </td>
                    <td valign="bottom" width="3%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                    <td align="left" valign="top" width="83%">
                      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Building
        Lease, dated as of April 7, 2009 to be effective as of 11:59 PM CDT March
        31, 2009, by and between SemGroup Energy Partners, L.L.C. and SemCrude,
        L.P. (filed as Exhibit 10.11 to the Partnership&#8217;s Current Report on Form
        8-K, filed on April 10, 2009, and incorporated herein by
        reference).</font></div>
                    </td>
                  </tr>
                  <tr>
                    <td valign="top" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                    <td valign="bottom" width="3%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                    <td valign="top" width="83%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                  </tr>
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                    <td valign="top" width="5%">
                      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">10.22</font></div>
                    </td>
                    <td valign="bottom" width="3%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                    <td align="left" valign="top" width="83%">
                      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Mutual
        Easement Agreement, dated as of April 7, 2009 to be effective as of 11:59
        PM CDT March 31, 2009, among SemCrude, L.P., SemGroup Energy Partners,
        L.L.C., and SemGroup Crude Storage, L.L.C. (filed as Exhibit 10.12 to the
        Partnership&#8217;s Current Report on Form 8-K, filed on April 10, 2009, and
        incorporated herein by reference).</font></div>
                    </td>
                  </tr>
                  <tr>
                    <td valign="top" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                    <td valign="bottom" width="3%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                    <td valign="top" width="83%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
        </font></td>
                  </tr>
                  <tr>
                    <td valign="top" width="5%">
                      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">10.23</font></div>
                    </td>
                    <td valign="bottom" width="3%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
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                    <td align="left" valign="top" width="83%">
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        Easement Agreement, dated as of April 7, 2009 to be effective as of 11:59
        PM CDT March 31, 2009, by and among White Cliffs Pipeline, L.L.C.,
        SemGroup Energy Partners, L.L.C., and SemGroup Crude Storage, L.L.C.
        (filed as Exhibit 10.13 to the Partnership&#8217;s Current Report on Form 8-K,
        filed on April 10, 2009, and incorporated herein by
        reference).</font></div>
                    </td>
                  </tr>
                  <tr>
                    <td valign="top" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
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                    <td valign="bottom" width="3%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
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                    <td valign="top" width="83%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
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                    <td valign="top" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
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        Sarbanes-Oxley Act of 2002. Pursuant to SEC Release 34-47551, this Exhibit
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text: form10q.htm
  UNITED
  STATES
  SECURITIES
  AND EXCHANGE COMMISSION
  Washington,
  D.C. 20549
  FORM
  10-Q
  x
  QUARTERLY
        REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES EXCHANGE ACT OF
        1934
  For the
  quarterly period ended September 30, 2008
  OR
  ¨
  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 001-33503
  SEMGROUP
  ENERGY PARTNERS, L.P.
  (Exact
  name of registrant as specified in its charter)
  Delaware
  20-8536826
  (State
        or other jurisdiction of
  incorporation
        or organization)
  (IRS
        Employer
  Identification
        No.)
  Two
  Warren Place
  6120
  South Yale Avenue, Suite 500
  Tulsa,
  Oklahoma 74136
  (Address
  of principal executive offices, zip code)
  Registrant's
  telephone number, including area code: (918) 524-5500
  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
  ¨
  No
  x
  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
  o
  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 Rule 12b-2 of the Exchange Act. (Check one):
  Large
  accelerated filer
  ¨
  Accelerated
  filer
  ¨
  Non-accelerated
  filer
  x
  (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
  ¨
  No
  x
  As
  of May 22, 2009, there were
  21,557,309
  common
  units and
  12,570,504
  subordinated
  units
  outstanding.
  Table of
        Contents
  Page
  PART I - FINANCIAL INFORMATION
  Item I.
  Financial Statements
  1
  SemGroup
        Energy Partners, L.P.
  Consolidated Balance Sheets as of December 31, 2007 and
        September 30, 2008
  1
  Consolidated Statements of Operations for the three and nine
        months ended September 30, 2007 and 2008
  2
  Consolidated Statements of Changes in Partners' Capital
        (Deficit) for the nine months ended September 30, 2008
  3
  Consolidated Statements of Cash Flows for the nine months ended
        September 30, 2007 and 2008
  4
  Notes to the Consolidated Financial
        Statements
  5
  Item 2.
  Management's Discussion and Analysis of Financial Condition
        and Results of Operations
  32
  Item 3.
  Quantitative and Qualitative Disclosures about Market
        Risk
  55
  Item 4T.
  Controls and Procedures
  56
  PART II. OTHER INFORMATION
  57
  Item 1.
  Legal Proceedings
  57
  Item
        1A.
  Risk Factors
  59
  Item
        3.
  Defaults Upon Senior Securities
  84
  Item 6.
  Exhibits
  86
  SIGNATURES
  CERTIFICATIONS
  Table of Contents
  PART
  I – FINANCIAL INFORMATION
  Item
  1.
  Financial
        Statements
  SEMGROUP
  ENERGY PARTNERS, L.P.
  CONSOLIDATED
  BALANCE SHEETS
  (in
  thousands, except units)
  As
        of December 31,
  As
        of September 30,
  2007
  2008
  (unaudited)
  ASSETS
  Current
        assets:
  Cash
        and cash equivalents
  $
  416
  $
  16,558
  Accounts
        receivable, net of allowance for doubtful accounts of $0 and
        $432
  at
        December 31, 2007 and September 30, 2008, respectively
  2,666
  7,954
  Receivables
        from related parties, net of allowance for doubtful accounts
        of
  $0
        for both dates
  9,665
  19,291
  Prepaid
        insurance
  797
  3,303
  Other
        current assets
  442
  1,666
  Total
        current assets
  13,986
  48,772
  Property,
        plant and equipment, net of accumulated depreciation of $40,222 and
        $74,731
  at
        December 31, 2007 and September 30, 2008, respectively
  102,239
  289,716
  Goodwill
  6,340
  6,340
  Debt
        issuance costs
  944
  2,422
  Other
        assets, net
  1,973
  1,863
  Total
        assets
  $
  125,482
  $
  349,113
  LIABILITIES AND PARTNERS' CAPITAL
        (DEFICIT)
  Current
        liabilities:
  Accounts
        payable
  $
  3,045
  $
  2,836
  Payables
        to related parties
  10,227
  15,904
  Accrued
        interest payable
  449
  -
  Accrued
        property taxes payable
  -
  1,944
  Interest
        rate swap settlements payable
  -
  1,505
  Unearned
        revenue
  -
  453
  Other
        accrued liabilities
  340
  1,956
  Current
        portion of capital lease obligations
  1,236
  992
  Total
        current liabilities
  15,297
  25,590
  Long-term
        debt
  89,600
  448,100
  Long-term
        capital lease obligations
  1,123
  418
  Interest
        rate swaps liability
  2,233
  -
  Commitments
        and contingencies (Notes 4, 10 and 13)
  Partners'
        capital (deficit):
  Common
        unitholders (14,375,000 and 21,557,309 units issued and outstanding
        at
  December
        31, 2007 and September 30, 2008, respectively)
  317,004
  482,086
  Subordinated
        unitholders (12,570,504 units issued and outstanding for both
        dates)
  (287,210
  )
  (283,717
  )
  General
        partner interest (2.0% interest with 549,908 and 690,725 general partner
        units
  outstanding
        at December 31, 2007 and September 30, 2008, respectively)
  (12,565
  )
  (323,364
  )
  Total
        Partners' capital (deficit)
  17,229
  (124,995
  )
  Total
        liabilities and Partners' capital (deficit)
  $
  125,482
  $
  349,113
  See
  accompanying notes to unaudited consolidated financial
  statements.
  1
  Table of Contents
  SEMGROUP
  ENERGY PARTNERS, L.P.
  CONSOLIDATED
  STATEMENTS OF OPERATIONS
  (
  in thousands, except per unit
  data)
  Three
        Months Ended
  Nine
        Months Ended
  September
        30,
  September
        30,
  2007
  2008
  2007
  2008
  (unaudited)
  Service revenue:
  Third
        party revenue
  $
  4,872
  $
  15,571
  $
  23,847
  $
  26,222
  Related
        party revenue
  20,408
  38,223
  20,531
  123,062
  Total
        revenue
  25,280
  53,794
  44,378
  149,284
  Expenses:
  Operating
  15,952
  28,187
  50,110
  79,958
  Allowance
        for doubtful accounts
  -
  (819
  )
  -
  447
  General
        and administrative
  2,525
  27,177
  11,015
  33,244
  Total
        expenses
  18,477
  54,545
  61,125
  113,649
  Operating
        income (loss)
  6,803
  (751
  )
  (16,747
  )
  35,635
  Other
        expenses:
  Interest
        expense
  2,424
  11,041
  3,369
  15,905
  Income
        (loss) before income taxes
  4,379
  (11,792
  )
  (20,116
  )
  19,730
  Provision
        for income taxes
  62
  59
  62
  227
  Net
        income (loss)
  $
  4,317
  $
  (11,851
  )
  $
  (20,178
  )
  $
  19,503
  Allocation
        of net income (loss) to limited and subordinated
        partners:
  Net
        loss attributable to SemGroup Energy Partners Predecessor
  $
  (1,623
  )
  $
  -
  $
  (26,118
  )
  $
  -
  General
        partner interest in net income (loss)
  $
  119
  $
  (237
  )
  $
  119
  $
  3,368
  Net
        income (loss) allocable to limited and subordinated
      partners
  $
  5,821
  $
  (11,614
  )
  $
  5,821
  $
  16,135
  Basic
        and diluted net income (loss) per common unit
  $
  0.24
  $
  (0.33
  )
  $
  0.24
  $
  0.51
  Basic
        and diluted net income (loss) per subordinated unit
  $
  0.19
  $
  (0.33
  )
  $
  0.19
  $
  0.51
  Weighted
        average common units outstanding - basic and diluted
  14,375
  21,426
  14,375
  20,015
  Weighted
        average subordinated partners' units outstanding - basic and
        diluted
  12,571
  12,571
  12,571
  12,571
  See
  accompanying notes to unaudited consolidated financial
  statements.
  2
  Table of Contents
  SEMGROUP
  ENERGY PARTNERS, L.P.
  CONSOLIDATED
  STATEMENTS OF CHANGES IN PARTNERS' CAPITAL (DEFICIT)
  (in
  thousands)
  General
  Total
  Common
  Subordinated
  Partner
  Partners'
  Unitholders
  Unitholders
  Interest
  Capital
        (Deficit)
  (unaudited)
  Balance,
        December 31, 2007
  $
  317,004
  $
  (287,210
  )
  $
  (12,565
  )
  $
  17,229
  Net
        income
  9,897
  6,238
  3,368
  19,503
  Equity-based
        incentive compensation
  11,081
  6,526
  357
  17,964
  Distributions
        paid
  (13,719
  )
  (9,271
  )
  (727
  )
  (23,717
  )
  Proceeds
        from sale of 6,900,000 common units, net of underwriters' discount
        and
  -
  offering
        expenses of $7.1 million
  157,823
  -
  -
  157,823
  Proceeds
        from issuance of 140,817 general partner units
  -
  -
  3,365
  3,365
  Consideration
        paid in excess of historical cost of assets acquired from Private
        Company
  -
  -
  (317,162
  )
  (317,162
  )
  Balance,
        September 30, 2008
  $
  482,086
  $
  (283,717
  )
  $
  (323,364
  )
  $
  (124,995
  )
  See
  accompanying notes to unaudited consolidated financial statements.
  3
  Table of Contents
  SEMGROUP
  ENERGY PARTNERS, L.P.
  CONSOLIDATED
  STATEMENTS OF CASH FLOWS
  (in
  thousands)
  Nine
        Months Ended
  September
        30,
  2007
  2008
  (unaudited)
  Cash flows from operating
  activities:
  Net
        income (loss)
  $
  (20,178
  )
  $
  19,503
  Adjustments
        to reconcile net income (loss) to net cash provided by (used in) operating
        activities:
  Provision
        for uncollectible receivables from third parties
  (25
  )
  432
  Depreciation
        and amortization
  6,781
  15,587
  Amortization
        and write off of debt issuance costs
  41
  616
  Unrealized
        loss related to interest rate swaps
  627
  -
  Loss
        on sale of assets
  68
  178
  Equity-based
        incentive compensation
  532
  17,964
  Changes
        in assets and liabilities:
  Decrease
        (increase) in accounts receivable
  701
  (5,720
  )
  Increase
        in receivables from related parties
  (1,428
  )
  (9,626
  )
  Increase
        in prepaid insurance
  (28
  )
  (2,506
  )
  Increase
        in other current assets
  (107
  )
  (1,529
  )
  Decrease
        (increase) in other assets
  72
  (113
  )
  Decrease
        in accounts payable
  (1,126
  )
  (377
  )
  Increase in
        payables to related parties
  3,325
  5,677
  Increase
        (decrease) in accrued interest payable
  606
  (449
  )
  Increase
        in accrued property taxes
  -
  1,944
  Increase
        in interest rate swap settlements payable
  -
  1,505
  Increase
        in unearned revenue
  -
  453
  Increase
        (decrease) in other accrued liabilities
  (1,602
  )
  1,616
  Decrease
        in interest rate swap liability
  -
  (2,233
  )
  Net
        cash provided by (used in) operating activities
  (11,741
  )
  42,922
  Cash
        flows from investing activities:
  Acquisition
        of assets from Private Company
  -
  (514,669
  )
  Capital
        expenditures
  (18,951
  )
  (5,485
  )
  Proceeds
        from sale of assets
  338
  386
  Net
        cash used in investing activities
  (18,613
  )
  (519,768
  )
  Cash
        flows from financing activities:
  Debt
        issuance costs
  (1,037
  )
  (2,094
  )
  Payments
        on capital lease obligations
  (1,294
  )
  (939
  )
  Borrowings
        under credit facility
  146,550
  518,600
  Payments
        under credit facility
  (54,050
  )
  (160,100
  )
  Proceeds
        from equity issuance, net of offering costs
  38,036
  161,238
  Distributions
        paid
  (136,463
  )
  (23,717
  )
  Contributions
        from Private Company
  39,780
  -
  Net
        cash provided by financing activities
  31,522
  492,988
  Net
        increase in cash and cash equivalents
  1,168
  16,142
  Cash
        and cash equivalents at beginning of period
  -
  416
  Cash
        and cash equivalents at end of period
  $
  1,168
  $
  16,558
  Supplemental
        disclosure of cash flow information:
  Increase
        (decrease) in accounts payable related to purchases of property, plant and
        equipment
  $
  (846
  )
  $
  168
  See
  accompanying notes to unaudited consolidated financial
  statements.
  4
  Table of Contents
  SEMGROUP
  ENERGY PARTNERS, L.P.
  NOTES
  TO UNAUDITED CONSOLIDATED FINANCIAL
  STATEMENTS
  1. ORGANIZATION
  AND NATURE OF BUSINESS
  SemGroup
  Energy Partners, L.P. and subsidiaries (the "Partnership") is a publicly traded
  master limited partnership with operations in twenty-three states. The
  Partnership provides integrated terminalling, storage, gathering and
  transportation services for companies engaged in the production, distribution
  and marketing of crude oil and liquid asphalt cement. The Partnership manages
  its operations through two operating segments: (i) terminalling and storage
  services and (ii) gathering and transportation services. The Partnership
  was formed in February 2007 as a Delaware master limited partnership initially
  to own, operate and develop a diversified portfolio of complementary midstream
  energy assets.
  On
  July 20, 2007, the Partnership issued 12,500,000 common units, representing
  limited partner interests in the Partnership, and 12,570,504 subordinated units,
  representing additional limited partner interests in the Partnership, to
  SemGroup Holdings, L.P. ("SemGroup Holdings") and 549,908 general partner units
  representing a 2.0% general partner interest in the Partnership to SemGroup
  Energy Partners G.P., L.L.C. SemGroup Holdings subsequently offered 12,500,000
  common units pursuant to a public offering at a price of $22 per unit. In
  addition, the Partnership issued an additional 1,875,000 common units to the
  public pursuant to the underwriters' exercise of their over-allotment option.
  The initial public offering closed on July 23, 2007.  In
  connection with its initial public offering, the Partnership entered into a
  Throughput Agreement (the "Throughput Agreement") with SemGroup, L.P.
  (collectively, with its subsidiaries other than the Partnership and the
  Partnership's general partner, the "Private Company") under which the
  Partnership provided crude oil gathering and transportation and terminalling and
  storage services to the Private Company.
  On
  February 20, 2008, the Partnership purchased land, receiving
  infrastructure, machinery, pumps and piping and 46 liquid asphalt cement and
  residual fuel oil terminalling and storage facilities (the "Acquired Asphalt
  Assets") from the Private Company for aggregate consideration of $379.5 million,
  including $0.7 million of acquisition-related costs. For accounting purposes,
  the acquisition has been reflected as a purchase of assets, with the Acquired
  Asphalt Assets recorded at the historical cost of the Private Company, which was
  approximately $145.5 million, with the additional purchase price of $234.0
  million reflected in the statement of changes in partners' capital as a
  distribution to the Private Company.  In conjunction with the purchase
  of the Acquired Asphalt Assets, the Partnership amended its existing credit
  facility, increasing its borrowing capacity to $600 million. Concurrently, the
  Partnership issued 6,000,000 common units, receiving proceeds, net of
  underwriting discounts and offering-related costs, of $137.2 million. The
  Partnership's general partner also made a capital contribution of $2.9 million
  to maintain its 2.0% general partner interest in the Partnership. On
  March 5, 2008, the Partnership issued an additional 900,000 common units,
  receiving proceeds, net of underwriting discounts, of $20.6 million, in
  connection with the underwriters' exercise of their over-allotment option in
  full. The Partnership's general partner made a corresponding capital
  contribution of $0.4 million to maintain its 2.0% general partner interest in
  the Partnership.  In connection with the acquisition of the Acquired
  Asphalt Assets, the Partnership entered into a Terminalling and Storage
  Agreement (the "Terminalling Agreement") with the Private Company and certain of
  its subsidiaries under which the Partnership provided liquid asphalt cement
  terminalling and storage and throughput services to the Private Company and the
  Private Company agreed to use the Partnership's services at certain minimum
  levels.  The board of directors of the Partnership's general partner
  (the "Board") approved the acquisition of the Acquired Asphalt Assets as well as
  the terms of the related agreements based on a recommendation from its conflicts
  committee, which consisted entirely of independent directors. The conflicts
  committee retained independent legal and financial advisors to assist it in
  evaluating the transaction and considered a number of factors in approving the
  acquisition, including an opinion from the committee's independent financial
  advisor that the consideration paid for the Acquired Asphalt Assets was fair,
  from a financial point of view, to the Partnership.
  On May
  12, 2008, the Partnership purchased the Eagle North Pipeline System, a 130-mile,
  8-inch pipeline that originates in Ardmore, Oklahoma and terminates in
  Drumright, Oklahoma (the "Acquired Pipeline Assets") from the Private Company
  for aggregate consideration of $45.1 million, including $0.1 million of
  acquisition-related costs.  For accounting purposes, the acquisition
  has been reflected as a purchase of assets, with the Acquired Pipeline Assets
  recorded at the historical cost of the Private Company, which was approximately
  $35.1 million, with the additional purchase price of $10.0 million reflected in
  the statement of changes in partners' capital as a distribution to the Private
  Company.  The acquisition was funded with borrowings under the
  Partnership's existing revolving credit facility.  The Board approved
  the acquisition of the Acquired Pipeline Assets based on a recommendation from
  its conflicts committee, which consisted entirely of independent directors. The
  conflicts committee retained independent legal and financial advisors to assist
  it in evaluating the transaction and considered a number of factors in approving
  the acquisition, including an opinion from the committee's independent financial
  advisor that the consideration paid for the Acquired Pipeline Assets was fair,
  from a financial point of view, to the Partnership.
  5
  Table of Contents
  SEMGROUP
  ENERGY PARTNERS, L.P.
  NOTES
  TO UNAUDITED CONSOLIDATED FINANCIAL
  STATEMENTS
  On May
  30, 2008, the Partnership purchased eight recently constructed crude oil storage
  tanks located at the Cushing Interchange from the Private Company and the
  Private Company assigned a take-or-pay, fee-based agreement to the
  Partnership that commits substantially all of the 2.0 million barrels of new
  storage to a third-party customer through August 2010 (the "Acquired
  Storage Assets") for aggregate consideration of $90.3 million, including $0.3
  million of acquisition-related costs.  For accounting purposes, the
  acquisition has been reflected as a purchase of assets, with the Acquired
  Storage Assets recorded at the historical cost of the Private Company, which was
  approximately $17.1 million, inclusive of $0.5 million of completion costs
  subsequent to the close of the acquisition, with the additional purchase price
  of $73.2 million reflected in the statement of changes in partners' capital as a
  distribution to the Private Company.  The acquisition was funded with
  borrowings under the Partnership's existing revolving credit
  facility.  The Board approved the acquisition of the Acquired Storage
  Assets based on a recommendation from its conflicts committee, which consisted
  entirely of independent directors. The conflicts committee retained independent
  legal and financial advisors to assist it in evaluating the transaction and
  considered a number of factors in approving the acquisition, including an
  opinion from the committee's independent financial advisor that the
  consideration paid for the Acquired Storage Assets was fair, from a financial
  point of view, to the Partnership.
  For the
  nine months ended September 30, 2008 and the year ended December 31, 2008, the
  Partnership derived approximately 81% and approximately 73%, respectively, of
  its revenues, excluding fuel surcharge revenues related to fuel and power
  consumed to operate its liquid asphalt cement storage tanks, from services it
  provided to the Private Company.
  On July
  22, 2008, the Private Company and certain of its subsidiaries filed voluntary
  petitions (the "Bankruptcy Filings") for reorganization under Chapter 11 of the
  Bankruptcy Code in the United States Bankruptcy Court for the District of
  Delaware (the "Bankruptcy Court"), Case No. 08-11547-BLS.   The
  Private Company and its subsidiaries continue to operate their businesses and
  own and manage their properties as debtors-in-possession under the jurisdiction
  of the Bankruptcy Court and in accordance with the applicable provisions of the
  Bankruptcy Code. None of the Partnership, its general partner, the
  subsidiaries of the Partnership nor the subsidiaries of the Partnership's
  general partner were party to the Bankruptcy Filings.  See Notes 4 and
  13 for a discussion of the impact of the Bankruptcy Filings and related events
  upon the Partnership.
  2.
  BASIS OF PRESENTATION
  The
  accompanying financial statements have been prepared assuming that the
  Partnership will continue as a going concern.  Prior to consummating
  the Settlement (as defined below), events of default existed under the
  Partnership's credit facility, including during the quarter ended September 30,
  2008.  As discussed in Notes 4 and 13 to the financial statements, the
  Partnership entered into the Credit Agreement Amendment (as defined below) under
  which, among other things, the lenders under the Partnership's credit facility
  consented to the Settlement and waived all existing defaults and events of
  default described in the Forbearance Agreement (as defined below) and amendments
  thereto.  However, the Partnership continues to face uncertainty
  relating to its future cash flows and operations, particularly with respect to
  its liquid asphalt cement terminalling and storage
  operations.  Additionally, the Partnership earned 73% of its revenues,
  excluding fuel surcharge revenues related to fuel and power consumed to operate
  its liquid asphalt cement storage tanks, for the year ended December 31, 2008
  from the Private Company, which made the Bankruptcy Filings in July 2008, the
  effects of which are more fully disclosed in Note 13.  These factors
  raise substantial doubt about the Partnership's ability to continue as a going
  concern.  Management's plans in regard to these matters are also
  discussed in Note 13.  The accompanying financial statements do not
  include any adjustments that might result from the outcome of this
  uncertainty.
  The
  accompanying consolidated financial statements and related notes include the
  accounts of the Partnership, and prior to July 20, 2007, the operations
  contributed to the Partnership by the Private Company in connection with the
  Partnership's initial public offering. The financial statements have been
  prepared in accordance with accounting principles and practices generally
  accepted in the United States of America ("GAAP").
  The
  accompanying financial statements include the results of operations of crude oil
  terminalling and storage and gathering and transportation operations that were
  contributed to the Partnership prior to the closing of the Partnership's initial
  public offering on a carve-out basis and are referred to herein as the
  "Predecessor."  Both the Partnership and the Predecessor had common
  ownership and, in accordance with Emerging Issues Task Force Issue
  No. 87-21, "Change of Accounting Basis in Master Limited Partnership
  Transactions," the assets and liabilities transferred were carried forward to
  the Partnership at their historical amounts.  Additionally, due to the
  previous common control of the Private Company and the Partnership, the
  subsequent acquisitions of fixed assets from the Private Company prior to July
  2008 were recorded at the historical cost of the Private Company.  All
  significant intercompany accounts and transactions have been eliminated in the
  preparation of the accompanying financial statements.
  6
  Table of Contents
  SEMGROUP
  ENERGY PARTNERS, L.P.
  NOTES
  TO UNAUDITED CONSOLIDATED FINANCIAL
  STATEMENTS
  Through
  the date of the initial public offering, the Private Company provided cash
  management services to the Predecessor through a centralized treasury system. As
  a result, all of the Predecessor's charges and cost allocations covered by the
  centralized treasury system were deemed to have been paid to the Private Company
  in cash during the period in which the cost was recorded in the financial
  statements. In addition, cash advances by the Private Company in excess of cash
  earned by the Predecessor are reflected as contributions from the Private
  Company in the statements of cash flows.
  Historically,
  the Predecessor was a part of the integrated operations of the Private Company,
  and neither the Private Company nor the Predecessor recorded revenue associated
  with the terminalling and storage and gathering and transportation services
  provided on an intercompany basis. The Private Company and the Predecessor
  recognized only the costs associated with providing such services. Accordingly,
  revenues reflected in these financial statements for all periods prior to the
  contribution of the assets, liabilities and operations to the Partnership by the
  Private Company on July 20, 2007 relate to services provided to third
  parties. Prior to the close of its initial public offering in July 2007, the
  Partnership entered into a Throughput Agreement with the Private Company under
  which the Partnership provided crude oil gathering and transportation and
  terminalling and storage services to the Private Company.  In
  connection with its February 2008 purchase of the Acquired Asphalt Assets, the
  Partnership entered into a Terminalling Agreement with the Private Company under
  which the Partnership provided liquid asphalt cement terminalling and storage
  and throughput services to the Private Company (see Note 8).  In
  connection with the Settlement, the Private Company rejected the Throughput
  Agreement and the Terminalling Agreement as part of its Bankruptcy Proceedings
  (as defined below) (see Note 13).
  The
  accompanying financial statements include allocated general and administrative
  charges from the Private Company for indirect corporate overhead to cover costs
  of functions such as legal, accounting, treasury, environmental safety,
  information technology and other corporate services. General and administrative
  charges allocated by the Private Company prior to the contribution of the
  assets, liabilities and operations to the Partnership by the Private Company
  were $3.2 million for the nine months ended September 30, 2007. Management
  believes that the allocated general and administrative expense is representative
  of the costs and expenses incurred by the Private Company for the Predecessor.
  Prior to the close of its initial public offering in July 2007, the Partnership
  entered into an Omnibus Agreement with the Private Company under which the
  Partnership reimbursed the Private Company for the provision of various general
  and administrative services for the Partnership's benefit.  The
  Omnibus Agreement was amended and restated in conjunction with the purchase of
  the Acquired Asphalt Assets in February 2008 (the "Amended Omnibus Agreement")
  (see Note 8).  The events related to the Bankruptcy Filings
  terminated the Private Company's obligations to provide services to the
  Partnership under the Amended Omnibus Agreement.  The Private Company
  continued to provide such services to the Partnership until the effective date
  of the Settlement at which time the Private Company rejected the Amended Omnibus
  Agreement and the Private Company and the Partnership entered into the Shared
  Services Agreement (as defined below) and the Transition Services Agreement (as
  defined below) relating to the provision of such services (see Note
  13).
  The
  statements of operations for the three and nine months ended September 30, 2007
  and 2008 and the statements of cash flows for the nine months ended September
  30, 2007 and 2008 are unaudited. In the opinion of management, the unaudited
  interim financial statements have been prepared on the same bases as the audited
  financial statements and include all adjustments necessary to present fairly the
  financial position and results of operations for the respective interim periods.
   These consolidated financial statements and notes should be read in
  conjunction with the consolidated financial statements and notes thereto
  included in the Partnership's annual report on Form 10-K for the year ended
  December 31, 2007 filed with the Securities and Exchange Commission (the
  "SEC") on March 6, 2008.  Interim financial results are not
  necessarily indicative of the results to be expected for an annual period. The
  year-end balance sheet data was derived from audited financial statements, but
  does not include all disclosures required by accounting principles generally
  accepted in the United States of America.
  7
  Table of Contents
  SEMGROUP
  ENERGY PARTNERS, L.P.
  NOTES
  TO UNAUDITED CONSOLIDATED FINANCIAL
  STATEMENTS
  3.
  PROPERTY, PLANT AND EQUIPMENT
  Property,
  plant and equipment, net is stated at cost and consisted of the following (in
  thousands):
  Estimated
  Useful
  December
        31,
  September
        30,
  Lives
        (Years)
  2007
  2008
  Land
  $
  309
  $
  15,065
  Land
        improvements
  10-20
  -
  5,297
  Pipelines
        and facilities
  5-31
  34,626
  94,600
  Storage
        and terminal facilities
  10-35
  71,873
  166,944
  Transportation
        equipment
  3-10
  25,133
  24,824
  Office
        property and equipment and other
  3-31
  8,505
  19,983
  Construction-in-progress
  2,015
  37,734
  Property,
        plant and equipment, gross
  142,461
  364,447
  Accumulated
        depreciation
  (40,222
  )
  (74,731
  )
  Property,
        plant and equipment, net
  $
  102,239
  $
  289,716
  Property,
  plant and equipment includes assets under capital leases of $2.4 million and
  $1.4 million, net of accumulated depreciation of $4.2 million and
  $5.1 million at December 31, 2007 and September 30, 2008,
  respectively. All capital leases relate to the transportation equipment asset
  category.  At September 30, 2008, $37.6 million of
  construction-in-progress consists of the Eagle North Pipeline System, a
  130-mile, 8-inch pipeline that was acquired by the Partnership from the Private
  Company on May 12, 2008.  The Partnership has suspended capital
  expenditures on this pipeline due to the continuing impact of the Bankruptcy
  Filings (see Note 13).  Management currently intends to put the asset into
  service by late 2009 or early 2010 and is exploring various alternatives to
  complete the project.
  Depreciation
  expense for the nine months ended September 30, 2007 and September 30, 2008 was
  $6.5 million and $15.4 million, respectively.
  4.
  LONG TERM DEBT
  On
  July 20, 2007, the Partnership entered into a $250.0 million five-year
  credit facility with a syndicate of financial institutions. The Partnership
  borrowed approximately $137.5 million prior to the closing of the initial
  public offering. The Partnership distributed $136.5 million, net of debt
  issuance costs of $1.0 million, advanced under the credit agreement to SemGroup
  Holdings. On July 23, 2007, the Partnership repaid approximately $38.7
  million under the credit facility with the proceeds it received in connection
  with the exercise of the underwriters' over-allotment option in the
  Partnership's initial public offering.
  In
  connection with its purchase of the Acquired Asphalt Assets, the Partnership
  amended this credit facility to increase the total borrowing capacity to $600.0
  million.
  Due to
  events related to the Bankruptcy Filings, events of default occurred under the
  Partnership's credit agreement (see Note 13).  Effective on September
  18, 2008, the Partnership and the requisite lenders under its credit facility
  entered into a Forbearance Agreement and Amendment to Credit Agreement (the
  "Forbearance Agreement") under which the lenders agreed, subject to specified
  limitations and conditions, to forbear from exercising their rights and remedies
  arising from the Partnership's defaults and events of default described therein
  for the period commencing on September 18, 2008 and ending on the earliest of
  (i) December 11, 2008, (ii) the occurrence of any default or event of default
  under the credit agreement other than certain defaults and events of default
  indicated in the Forbearance Agreement, or (iii) the failure of the Partnership
  to comply with any of the terms of the Forbearance Agreement (the "Forbearance
  Period").  On December 11, 2008, the lenders agreed to extend the
  Forbearance Period until December 18, 2008 pursuant to a First Amendment to
  Forbearance Agreement and Amendment to Credit Agreement (the "First Forbearance
  Amendment"), on December 18, 2008, the lenders agreed to extend the Forbearance
  Period until March 18, 2009 pursuant to a Second Amendment to Forbearance
  Agreement and Amendment to Credit Agreement (the "Second Forbearance
  Amendment"), and on March 18, 2009, the lenders agreed to further extend the
  Forbearance Period until April 8, 2009 pursuant to a Third Amendment to
  Forbearance Agreement and Amendment to Credit Agreement (the "Third Forbearance
  Amendment").
  8
  Table of Contents
  SEMGROUP
  ENERGY PARTNERS, L.P.
  NOTES
  TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
  The
  Partnership, its subsidiaries that are guarantors of the obligations under the
  credit facility, Wachovia Bank, National Association, as Administrative Agent,
  and the requisite lenders under the Partnership's credit agreement entered into
  the Consent, Waiver and Amendment to Credit Agreement (the "Credit Agreement
  Amendment"), dated as of April 7, 2009, under which, among other
  things, the lenders consented to the Settlement (see Note 13) and
  waived all existing defaults and events of default described in the Forbearance
  Agreement and amendments thereto.
  Prior to
  the execution of the Forbearance Agreement, the credit agreement was comprised
  of a $350 million revolving credit facility and a $250 million term loan
  facility.  The Forbearance Agreement permanently reduced the
  Partnership's revolving credit facility under the credit agreement from $350
  million to $300 million and prohibited the Partnership from borrowing additional
  funds under its revolving credit facility during the Forbearance
  Period.   Under the Forbearance Agreement, the Partnership agreed
  to pay the lenders executing the Forbearance Agreement a fee equal to 0.25% of
  the aggregate commitments under the credit agreement after giving effect to the
  above described commitment reduction.  The Second Forbearance
  Amendment further permanently reduced the Partnership's revolving credit
  facility under the credit agreement from $300 million to $220
  million.  In addition, under the Second Forbearance Amendment, the
  Partnership agreed to pay the lenders executing the Second Forbearance Amendment
  a fee equal to 0.375% of the aggregate commitments under the credit agreement
  after the above described commitment reduction.  Under the Third
  Forbearance Amendment, the Partnership agreed to pay a fee equal to 0.25% of the
  aggregate commitments under the credit agreement after the above described
  commitment reduction.  The amendments to the Forbearance Agreement
  prohibited the Partnership from borrowing additional funds under its revolving
  credit facility during the extended Forbearance Period.
  The
  Credit Agreement Amendment subsequently further permanently reduced the
  Partnership's revolving credit facility under the credit agreement from $220
  million to $50 million, and increased the term loan facility from $250 million
  to $400 million.  Upon the execution of the Credit Agreement
  Amendment, $150 million of the Partnership's outstanding revolving loans were
  converted to term loans and the Partnership became able to borrow additional
  funds under its revolving credit facility.  Pursuant to the Credit
  Agreement Amendment, the credit facility  and all obligations thereunder
  will mature on June 30, 2011.  Under the Credit Agreement Amendment,
  the Partnership agreed to pay the lenders executing the Credit Agreement
  Amendment a fee equal to 2.00% of the aggregate commitments under the credit
  agreement after the above described commitment reduction, offset by the fee paid
  pursuant to the Third Forbearance Amendment.
  As
  of May 22, 2009, the Partnership had
  $423.4 million in outstanding
  borrowings under its credit facility (including $23.4 million under its
  revolving credit facility and $400.0 million under its term loan facility) with
  an aggregate unused credit availability under its revolving credit facility and
  cash on hand of approximately $27.2 million. Pursuant to the Credit Agreement
  Amendment, the Partnership's revolving credit facility is limited
  to $
  50.0
  million.
  If any of
  the financial institutions that support the Partnership's revolving credit
  facility were to fail, it may not be able to find a replacement lender, which
  could negatively impact its ability to borrow under its revolving credit
  facility.  For instance, Lehman Brothers Commercial Bank is one of the
  lenders under the Partnership's $50.0 million revolving credit facility, and
  Lehman Brothers Commercial Bank has agreed to fund approximately $2.5 million
  (approximately 5%) of the revolving credit facility.  On several occasions
  Lehman Brothers Commercial Bank has failed to fund revolving loan requests under
  the Partnership's revolving credit facility, effectively limiting the aggregate
  amount of the Partnership's revolving credit facility to $47.5
  million.
  Prior
  to the events of default, indebtedness under the credit agreement bore interest
  at the Partnership's option, at either (i) the higher of the administrative
  agent's prime rate or the federal funds rate plus 0.5% (the "Base rate"), plus
  an applicable margin that ranges from 0.50% to 1.75%, depending on the
  Partnership's total leverage ratio and senior secured leverage ratio, or
  (ii) LIBOR plus an applicable margin that ranges from 1.50% to 2.75%,
  depending upon the Partnership's total leverage ratio and senior secured
  leverage ratio.  During the Forbearance Period indebtedness under the
  credit agreement bore interest at the Partnership's option, at either
  (i) the Base rate, plus an applicable margin that ranges from 2.75% to
  3.75%, depending upon the Partnership's total leverage ratio, or (ii) LIBOR
  plus an applicable margin that ranges from 4.25% to 5.25%, depending upon the
  Partnership's total leverage ratio.  Pursuant to the Second
  Forbearance Amendment, commencing on December 12, 2008, indebtedness under the
  credit agreement bore interest at the Partnership's option, at either
  (i) the Base rate plus 5.0% per annum, with a Base rate floor of
  4.0% per annum, or (ii) LIBOR plus 6.0% per annum, with a LIBOR floor of
  3.0% per annum.
  After
  giving effect to the Credit Agreement Amendment, amounts outstanding under the
  Partnership's credit facility bear interest at either the LIBOR rate plus 6.50%
  per annum, with a LIBOR floor of 3.00%, or the Base rate plus 5.50% per annum,
  with a Base rate floor of 4.00% per annum.  The Partnership now pays a
  fee of 1.50% on unused commitments under its revolving credit
  facility.  After giving effect to the Credit Agreement Amendment,
  interest on amounts outstanding under the Partnership's credit facility must be
  paid monthly.  The Partnership's credit facility, as amended by the
  Credit Agreement Amendment, now requires the Partnership to pay additional
  interest on October 6, 2009, April 6, 2010, October 6, 2010 and April 6, 2011,
  equal to the product of (i) the sum of the total amount of term loans then
  outstanding plus the aggregate commitments under the revolving credit facility
  and (ii) 0.50%, 0.50%, 1.00% and 1.00%, respectively.
  9
  Table of Contents
  SEMGROUP
  ENERGY PARTNERS, L.P.
  NOTES
  TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
  During
  the three months ended September 30, 2008, the weighted average interest rate
  incurred by the Partnership was 7.04% resulting in interest expense of
  approximately $8.2 million.  During the three months ended December
  31, 2008, the weighted average interest rate incurred by the Partnership was
  7.72% resulting in interest expense of approximately $8.9 million.
  Among
  other things, the Partnership's credit facility, as amended by the Credit
  Agreement Amendment, now requires the Partnership to make (i) minimum quarterly
  amortization payments on March 31, 2010 in the amount of $2.0 million, June 30,
  2010 in the amount of $2.0 million, September 30, 2010 in the amount of $2.5
  million, December 31, 2010 in the amount of $2.5 million and March 31, 2011 in
  the amount of $2.5 million, (ii) mandatory prepayments of amounts outstanding
  under the revolving credit facility (with no commitment reduction) whenever cash
  on hand exceeds $15.0 million, (iii) mandatory prepayments with 100% of asset
  sale proceeds, (iv) mandatory prepayment with 50% of the proceeds raised through
  equity sales and (v) annual prepayments with 50% of excess cash flow (as
  defined in the Credit Agreement Amendment).  The Partnership's credit
  facility, as amended by the Credit Agreement Amendment, prohibits the
  Partnership from making draws under the revolving credit facility if it would
  have more than $15.0 million of cash on hand after making the draw and applying
  the proceeds thereof.
  Under the
  credit agreement, the Partnership is subject to certain limitations, including
  limitations on its ability to grant liens, incur additional indebtedness, engage
  in a merger, consolidation or dissolution, enter into transactions with
  affiliates, sell or otherwise dispose of its assets (other than the sale or
  other disposition of the assets of the asphalt business, provided that such
  disposition is at arm's length to a non-affiliate for fair market value in
  exchange for cash and the proceeds of the disposition are used to pay down
  outstanding loans), businesses and operations, materially alter the character of
  its business, and make acquisitions, investments and capital
  expenditures.  The credit agreement prohibits the Partnership from
  making distributions of available cash to its unitholders if any default or
  event of default (as defined in the credit agreement) exists.  The
  credit agreement, as amended by the Credit Agreement Amendment, requires the
  Partnership to maintain a leverage ratio (the ratio of its consolidated funded
  indebtedness to its consolidated adjusted EBITDA, in each case as defined in the
  credit agreement), determined as of the last day of each
  month
  for the twelve month period ending on the date of determination, that
  ranges on a monthly basis from not more than 5.50 to 1.00 to not more than 9.75
  to 1.00.  In addition, pursuant to the Credit Agreement Amendment, the
  Partnership's ability to make acquisitions and investments in unrestricted
  subsidiaries is limited and the Partnership may only make distributions if its
  leverage ratio is less than 3.50 to 1.00 and certain other conditions are
  met.  As of September 30, 2008 and December 31, 2008, the
  Partnership's leverage ratio was 4.34 to 1.00 and 4.83 to 1.00,
  respectively. If the Partnership's leverage ratio does not improve, it may
  not make quarterly distributions to its unitholders in the future.
  The
  credit agreement, as amended by the Credit Agreement Amendment, also requires
  the Partnership to maintain an interest coverage ratio (the ratio of its
  consolidated EBITDA to its consolidated interest expense, in each case as
  defined in the credit agreement) that ranges on a monthly basis from not less
  than 2.50 to 1.00 to not less than 1.00 to 1.00. As of September 30, 2008 and
  December 31, 2008, the Partnership's interest coverage ratio was 4.95 to 1.00
  and 3.60 to 1.00, respectively.
  Further,
  the Partnership is required to maintain a monthly consolidated adjusted EBITDA
  for the prior twelve months ranging from $45.4 million to $82.9 million as
  determined at the end of each month.  In addition, capital
  expenditures are limited to $12.5 million in 2009, $8.0 million in 2010 and $4.0
  million in the six months ending June 30, 2011.
  The
  credit agreement specifies a number of events of default (many of which are
  subject to applicable cure periods), including, among others, failure to pay any
  principal when due or any interest or fees within three business days of the due
  date, failure to perform or otherwise comply with the covenants in the credit
  agreement, failure of any representation or warranty to be true and correct in
  any material respect, failure to pay debt, a change of control of the
  Partnership or the Partnership's general partner, and other customary
  defaults.
  In
  addition, it is an event of default under the credit agreement if the
  Partnership does not file its delinquent quarterly and annual reports with the
  SEC by September 30, 2009, unless the Partnership retains new auditors, in which
  case such deadline is extended to December 31, 2009.
  If an event of
  default exists under the credit agreement, the lenders will be able to
  accelerate the maturity of the credit agreement and exercise other rights and
  remedies, including taking available cash in the Partnership's bank
  accounts.  If an event of default exists and the Partnership is unable
  to obtain forbearance from its lenders or a waiver of the events of default
  under its credit agreement, it may be forced to sell assets, make a bankruptcy
  filing or take other action that could have a material adverse effect on its
  business, the price of its common units and its results of
  operations.  The Partnership is also prohibited from making cash
  distributions to its unitholders while the events of default
  exist.
  The
  Partnership is exposed to market risk for changes in interest rates related to
  its credit facility. Interest rate swap agreements were used to manage a portion
  of the exposure related to changing interest rates by converting floating-rate
  debt to fixed-rate debt. In August 2007 the Partnership entered into interest
  rate swap agreements with an aggregate notional value of $80.0 million that
  mature on August 20, 2010. Under the terms of the interest rate swap
  agreements, the Partnership was to pay fixed rates of 4.9% and receive
  three-month LIBOR with quarterly settlement.  In March 2008 the
  Partnership entered into interest rate swap agreements with an aggregate
  notional value of $100.0 million that mature on March 31, 2011.  Under
  the terms of the interest rate swap agreements, the Partnership was to pay fixed
  rates of 2.6% to 2.7% and receive three-month LIBOR with quarterly
  settlement.  The interest rate swaps do not receive hedge accounting
  treatment under Statement of Financial Accounting Standard ("SFAS") SFAS No.
  133, "
  Accounting for
  Derivative Instruments and Hedging Activities
  " ("SFAS 133"). Changes in
  the fair value of the interest rate swaps are recorded in interest expense in
  the statements of operations.  In addition, the interest rate swap
  agreements contain cross-default provisions to events of default under the
  credit agreement.  Due to events related to the Bankruptcy Filings,
  all of these interest rate swap positions were terminated in the third quarter
  of 2008, and the Partnership has recorded a $1.5 million liability as of
  September 30, 2008 with respect to these positions.
  10
  Table of Contents
  SEMGROUP
  ENERGY PARTNERS, L.P.
  NOTES
  TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
  5.
  FAIR VALUE MEASUREMENTS
  The
  Partnership adopted SFAS No. 157, "
  Fair Value Measurements
  ,"
  effective January 1, 2008 for financial assets and liabilities measured on
  a recurring basis. SFAS No. 157 applies to all financial assets and
  financial liabilities that are being measured and reported on a fair value
  basis. In February 2008, the FASB issued FSP No. 157-2, which delayed the
  effective date of SFAS No. 157 by one year for nonfinancial assets and
  liabilities except those that are recognized and recorded in the financial
  statements at fair value on a recurring basis. As defined in SFAS No. 157, fair
  value is the price that would be received to sell an asset or paid to transfer a
  liability in an orderly transaction between market participants at the
  measurement date (exit price). SFAS No. 157 requires disclosure that
  establishes a framework for measuring fair value and expands disclosure about
  fair value measurements. The statement requires fair value measurements be
  classified and disclosed in one of the following categories:
  Level
        1:
  Unadjusted
        quoted prices in active markets that are accessible at the measurement
        date for identical, unrestricted assets or liabilities. The Partnership
        considers active markets as those in which transactions for the assets or
        liabilities occur in sufficient frequency and volume to provide pricing
        information on an ongoing basis.
  Level
        2:
  Quoted
        prices in markets that are not active, or inputs which are observable,
        either directly or indirectly, for substantially the full term of the
        asset or liability.
  Level
        3:
  Measured
        based on prices or valuation models that require inputs that are both
        significant to the fair value measurement and less observable from
        objective sources (i.e., supported by little or no market activity). The
        Partnership's Level 3 instruments are comprised of interest rate
        swaps.  Although the Partnership utilizes third party broker
        quotes to assess the reasonableness of its prices and valuation, the
        Partnership does not have sufficient corroborating market evidence to
        support classifying these assets and liabilities as Level
      2.
  As
  required by SFAS No. 157, financial assets and liabilities are classified
  based on the lowest level of input that is significant to the fair value
  measurement. The Partnership's assessment of the significance of a particular
  input to the fair value measurement requires judgment, and may affect the
  valuation of the fair value of assets and liabilities and their placement within
  the fair value hierarchy levels. The following table summarizes the valuation of
  the Partnership's investments and financial instruments by SFAS No. 157
  pricing levels as of September 30, 2008 (in thousands):
  Fair
        Value Measurements at Reporting Date Using
  Quoted
        Prices in Active
  Significant
        Other
  Significant
  Markets
        for Identical
  Observable
  Unobservable
  Assets
  Inputs
  Inputs
  Description
  September
        30, 2008
  (Level
        1)
  (Level
        2)
  (Level
        3)
  Interest
        rate swap assets
  $
  -
  $
  -
  $
  -
  $
  -
  Interest
        rate swap liabilities
  -
  -
  -
  -
  Total
  $
  -
  $
  -
  $
  -
  $
  -
  11
  Table of Contents
  SEMGROUP
  ENERGY PARTNERS, L.P.
  NOTES
  TO UNAUDITED CONSOLIDATED FINANCIAL
  STATEMENTS
  The
  following table sets forth a reconciliation of changes in the fair value of the
  Partnership's net financial liabilities classified as level 3 in the fair value
  hierarchy (in thousands):
  Fair
        Value Measurements Using
  Significant
        Unobservable Inputs
  (Level
        3)
  Three
        Months Ended September 30, 2008
  Nine
        Months Ended September 30, 2008
  Beginning
        balance
  $
  496
  $
  (2,233
  )
  Total
        gains or losses (realized/unrealized)
  Included
        in earnings (1)
  216
  2,785
  Included
        in other comprehensive income
  -
  -
  Purchases,
        issuances, and settlements
  (712
  )
  (552
  )
  Transfers
        in and/or out of Level 3
  -
  -
  Ending
        balance, September 30, 2008
  $
  -
  $
  -
  The
        amount of total losses for the period included
  in
        earnings attributable to the change in the unrealized
  gains
        or losses relating to liabilities still held at
  the
        reporting date
  $
  -
  $
  -
  (1)
        Amounts reported as included in earnings are reported as interest expense
        on the statements of operations.
  6.
  NET INCOME PER LIMITED PARTNER UNIT
  Subject
  to applicability of Emerging Issues Task Force Issue No. 03-06 ("EITF
  03-06"), "Participating Securities and the Two-Class Method under Financial
  Accounting Standards Board ("FASB") Statement No. 128," as discussed below,
  Partnership income is allocated to the limited partners, including the holders
  of subordinated units, and to the general partner after consideration of its
  incentive distribution rights.  Income allocable to the limited
  partners is first allocated to the common unitholders up to the quarterly
  minimum distribution of $0.3125 per unit, with remaining income allocated to the
  subordinated unitholders up to the minimum distribution amount. Basic and
  diluted net income per common and subordinated partner unit is determined by
  dividing net income attributable to common and subordinated partners by the
  weighted average number of outstanding common and subordinated partner units
  during the period.
  EITF
  03-06 addresses the computation of earnings per share by entities that have
  issued securities other than common stock that contractually entitle the holder
  to participate in dividends and earnings of the entity when, and if, it declares
  dividends on its common stock (or partnership distributions to unitholders).
  Under EITF 03-06, in accounting periods where the Partnership's aggregate net
  income exceeds aggregate dividends declared in the period, the Partnership is
  required to present earnings per unit as if all of the earnings for the periods
  were distributed.  The nine months ended September 30, 2008 earnings
  per share calculation reflects the summation of the quarterly calculations, as
  earnings per share for master limited partnerships is calculated based on the
  distribution provisions set forth in the partnership
  agreement.  The following sets forth the computation of basic and
  diluted net income per common and subordinated unit (in thousands, except per
  unit data):
  July
        1, 2007 to
  July
        20, 2007 to
  Three
        Months Ended
  January
        1, 2007 to
  July
        20, 2007 to
  Nine
        Months Ended
  July
        19,
  September
        30,
  September
        30,
  July
        19,
  September
        30,
  September
        30,
  2007
  2007
  2008
  2007
  2007
  2008
  Net
        income (loss)
  $
  (1,623
  )
  $
  5,940
  $
  (11,851
  )
  $
  (26,118
  )
  $
  5,940
  $
  19,503
  Less:
        General partner interest in net income (loss)
  (1,623
  )
  119
  (237
  )
  (26,118
  )
  119
  3,368
  Net
        income (loss) available to limited and subordinated
      partners
  $
  -
  $
  5,821
  $
  (11,614
  )
  $
  -
  $
  5,821
  $
  16,135
  Basic
        weighted average number of units:
  Common
        units
  14,375
  21,426
  14,375
  20,015
  Subordinated
        units
  12,571
  12,571
  12,571
  12,571
  Restricted
        and phantom units
  -
  641
  -
  552
  Diluted
        weighted average number of units:
  Common
        units
  14,508
  21,426
  14,508
  20,015
  Subordinated
        units
  12,571
  12,571
  12,571
  12,571
  Restricted
        and phantom units
  -
  641
  -
  552
  Basic
        and diluted net income (loss) per common unit
  $
  0.24
  $
  (0.33
  )
  $
  0.24
  $
  0.51
  Basic
        and diluted net income (loss) per subordinated unit
  $
  0.19
  $
  (0.33
  )
  $
  0.19
  $
  0.51
  12
  Table of Contents
  SEMGROUP
  ENERGY PARTNERS, L.P.
  NOTES
  TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
  7.
  PARTNERS' CAPITAL AND DISTRIBUTIONS
  The
  Partnership has not made a distribution to its common unitholders, subordinated
  unitholders or general partner since May 15, 2008 due to the events of default
  that existed under its credit agreement and the uncertainty of its future cash
  flows relating to the Bankruptcy Filings.  The Partnership's
  unitholders will be required to pay taxes on their share of the Partnership's
  taxable income even though they did not receive a distribution for the quarters
  ended June 30, 2008, September 30, 2008, December 31, 2008 or March 31,
  2009.  In addition, the Partnership does not currently expect to make
  a distribution relating to operations during the second quarter of
  2009.  Pursuant to the Credit Agreement Amendment, the Partnership is
  prohibited from making distributions to its unitholders if its leverage ratio
  (as defined in the credit agreement) exceeds 3.50 to 1.00.  As of
  September 30, 2008 and December 31, 2008, the Partnership's leverage ratio was
  4.34 to 1.00 and 4.83 to 1.00, respectively. If the Partnership's leverage
  ratio does not improve, it may not make quarterly distributions to its
  unitholders in the future.  The Partnership's partnership agreement
  provides that, during the subordination period, which the Partnership is
  currently in, the Partnership's common units will have the right to receive
  distributions of available cash from operating surplus in an amount equal to the
  minimum quarterly distribution of $0.3125 per common unit per quarter, plus any
  arrearages in the payment of the minimum quarterly distribution on the common
  units from prior quarters, before any distributions of available cash from
  operating surplus may be made on the subordinated units.
  On April
  24, 2008, the Partnership declared a cash distribution of $0.40 per unit on its
  outstanding units for the three month period ended March 31,
  2008.  The distribution was paid on May 15, 2008 to unitholders of
  record on May 5, 2008. The total distribution paid was approximately $14.3
  million, with approximately $8.5 million, $5.0 million, and $0.6 million paid to
  the Partnership's common unitholders, subordinated unitholders and general
  partner, respectively, and $0.2 million paid to phantom and restricted
  unitholders pursuant to awards granted under the Partnership's long-term
  incentive plan.
  On
  February 20, 2008, the Partnership purchased the Acquired Asphalt Assets
  from the Private Company for aggregate consideration of $379.5 million,
  including $0.7 million of acquisition-related costs. For accounting purposes,
  the acquisition has been reflected as a purchase of assets, with the Acquired
  Asphalt Assets recorded at the historical cost of the Private Company, which was
  approximately $145.5 million, and with the additional purchase price of $234.0
  million reflected in the statement of changes in partners' capital as a
  distribution to the Private Company.  The Board approved the
  acquisition of the Acquired Asphalt Assets as well as the terms of the related
  agreements based on a recommendation from its conflicts committee, which
  consisted entirely of independent directors. The conflicts committee retained
  independent legal and financial advisors to assist it in evaluating the
  transaction and considered a number of factors in approving the acquisition,
  including an opinion from the committee's independent financial advisor that the
  consideration paid for the Acquired Asphalt Assets was fair, from a financial
  point of view, to the Partnership.
  On May
  12, 2008, the Partnership purchased the Acquired Pipeline Assets from the
  Private Company for aggregate consideration of $45.1 million, including $0.1
  million of acquisition-related costs. For accounting purposes, the acquisition
  has been reflected as a purchase of assets, with the Acquired Pipeline Assets
  recorded at the historical cost of the Private Company, which was approximately
  $35.1 million, and with the additional purchase price of $10.0 million reflected
  in the statement of changes in partners' capital as a distribution to the
  Private Company.  The Board approved the acquisition of the Acquired
  Pipeline Assets based on a recommendation from its conflicts committee, which
  consisted entirely of independent directors. The conflicts committee retained
  independent legal and financial advisors to assist it in evaluating the
  transaction and considered a number of factors in approving the acquisition,
  including an opinion from the committee's independent financial advisor that the
  consideration paid for the Acquired Pipeline Assets was fair, from a financial
  point of view, to the Partnership.
  On May
  30, 2008, the Partnership purchased the Acquired Storage Assets from the Private
  Company for aggregate consideration of $90.3 million, including $0.3 million of
  acquisition-related costs. For accounting purposes, the acquisition has been
  reflected as a purchase of assets, with the Acquired Storage Assets recorded at
  the historical cost of the Private Company, which was approximately $17.1
  million, inclusive of $0.5 million of completion costs subsequent to the close
  of the acquisition, and with the additional purchase price of $73.2 million
  reflected in the statement of changes in partners' capital as a distribution to
  the Private Company.  The Board approved the acquisition of the
  Acquired Storage Assets based on a recommendation from its conflicts committee,
  which consisted entirely of independent directors. The conflicts committee
  retained independent legal and financial advisors to assist it in evaluating the
  transaction and considered a number of factors in approving the acquisition,
  including an opinion from the committee's independent financial advisor that the
  consideration paid for the Acquired Storage Assets was fair, from a financial
  point of view, to the Partnership.
  13
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  SEMGROUP
  ENERGY PARTNERS, L.P.
  NOTES
  TO UNAUDITED CONSOLIDATED FINANCIAL
  STATEMENTS
  As a
  result of the Private Company's control of the Partnership's general partner,
  consideration paid in excess of the historical cost of the Acquired Asphalt
  Assets, Acquired Pipeline Assets, and Acquired Storage Assets were treated as
  distributions to the Private Company.  This resulted in an aggregate
  reduction in Partners' Capital of $317.2 million and negative Partners' Capital
  of $125.0 million as of September 30, 2008.  As discussed in the
  Partnership's Annual Report on Form 10-K for the year ended December 31, 2007,
  as a result of the Private Company's control of the Partnership's general
  partner, the Partnership was subject to the risk that the Private Company may
  favor its own interest in proposing the terms of any acquisition (or drop downs)
  the Partnership makes from the Private Company and such terms may not be as
  favorable as those received from an unrelated third party.  The Board
  approved the acquisition of the Acquired Asphalt Assets, the Acquired Pipeline
  Assets, and Acquired Storage Assets, as well as the terms of the related
  agreements based on a recommendation from its conflicts committee, which
  consisted entirely of independent directors. The conflicts committee retained
  independent legal and financial advisors to assist it in evaluating these
  transactions and considered a number of factors in approving the acquisitions,
  including opinions from the committee's independent financial advisor that the
  consideration paid for the Acquired Asphalt Assets, the Acquired Pipeline
  Assets, and the Acquired Storage Assets was fair, from a financial point of
  view, to the Partnership.
  8.
  RELATED PARTY TRANSACTIONS
  Prior to
  the close of its initial public offering in July 2007, the Partnership entered
  into the Throughput Agreement with the Private Company. For the nine months
  ended September 30, 2008, the Partnership recognized revenue of $73.4 million
  under the Throughput Agreement.
  In
  conjunction with the purchase of the Acquired Asphalt Assets in February 2008,
  the Partnership entered into the Terminalling Agreement with the Private
  Company. For the nine months ended September 30, 2008, the Partnership
  recognized revenue of $49.1 million under the Terminalling Agreement, including
  fuel surcharge revenues related to fuel and power consumed to operate its liquid
  asphalt cement storage tanks.
  Based on
  the minimum requirements under the Throughput Agreement and the Terminalling
  Agreement, the Private Company was obligated to pay the Partnership an aggregate
  minimum monthly fee totaling $135 million annually for the Partnership's
  gathering and transportation services and the Partnership's terminalling and
  storage services.  Pursuant to an order of the Bankruptcy Court
  entered on September 9, 2008, the Private Company began making payments under
  the Throughput Agreement at a market rate based upon the Private Company's
  actual usage rather than the contractual minimums.  In connection with
  the Settlement, the Private Company rejected the Throughput Agreement and the
  Terminalling Agreement as part of its Bankruptcy Proceedings (see
  Note 13).
  In
  connection with the Settlement, the Partnership and the Private Company entered
  into various agreements including the New Throughput Agreement pursuant to which
  the Partnership provides certain crude oil gathering, transportation,
  terminalling and storage services to the Private Company and the New
  Terminalling Agreement pursuant to which the Partnership provides certain
  liquid asphalt cement terminalling and storage services for the Private
  Company's remaining asphalt inventory.  For a further discussion of
  these agreements, and the other agreements entered into in connection with the
  Settlement, please see Note 13.
  As of
  December 31, 2007 and September 30, 2008, the Partnership had
  $9.7 million and $19.3 million, respectively, in receivables from the
  Private Company and its subsidiaries, including the pre-petition
  receivables that will be netted and waived due to the Settlement of $0 and $10.5
  million, respectively.  The $10.5 million relates to amounts that were
  due from the Private Company as of September 30, 2008 and are considered
  prepetition debt in the Bankruptcy Cases.  In connection with the
  Settlement, these pre-petition claims by the Partnership will be netted against
  pre-petition claims by the Private Company and waived (see Note
  13).
  Prior to
  the Bankruptcy Filings, the Partnership paid the Private Company a fixed
  administrative fee for providing general and administrative services to the
  Partnership.  This fixed administrative fee was initially fixed at
  $5.0 million per year through July 2010.  Concurrently with the
  closing of the purchase of the Acquired Asphalt Assets, the Partnership amended
  and restated the Omnibus Agreement, increasing the fixed administrative fee the
  Partnership paid the Private Company for providing general and administrative
  services to the Partnership from $5.0 million per year to $7.0 million per
  year.  For the nine months ended September 30, 2008, the Partnership
  paid the Private Company $5.0
  million for the services
  provided under the Omnibus Agreement.  The obligation for the Private
  Company to provide services under the Amended Omnibus Agreement and the
  corresponding administrative fee payable by the Partnership were terminated in
  connection with the events related to the change of control of the Partnership's
  general partner.  The Private Company continued to provide such
  services to the Partnership until the effective date of the Settlement at which
  time the Private Company rejected the Amended Omnibus Agreement and the Private
  Company and the Partnership entered into the Shared Services Agreement and
  the Transition Services Agreement relating to the provision of such
  services (see Note 13).
  In
  addition, in connection with the Settlement, the Private Company
  waived the fixed administrative fee payable by the Partnership under
  the Amended Omnibus Agreement for the month of March 2009 (see Note
  13).
  14
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  SEMGROUP
  ENERGY PARTNERS, L.P.
  NOTES
  TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
  The
  Partnership also reimburses the Private Company for direct operating payroll and
  payroll-related costs and other operating costs associated with services the
  Private Company's employees provide to the Partnership. For the three months and
  nine months ended September 30, 2008, the Partnership recorded $7.3 million and
  $21.6 million, respectively, in compensation costs and $0.7 and $2.3 million,
  respectively, in other operating costs related to services provided by the
  Private Company's employees which are reflected as operating expenses in the
  accompanying statement of operations. As of December 31, 2007 and September
  30, 2008, the Partnership had $10.2 million and $15.9 million in
  payables to the Private Company and its subsidiaries, including the pre-petition
  payables that will be netted and waived due to the Settlement of $0 and $10.6
  million, respectively.  Pursuant to the Settlement, these pre-petition
  claims by the Private Company will be netted against pre-petition claims by the
  Partnership and waived (see Note 13).  After the effective date of the
  Settlement, these costs will be reimbursed pursuant to the Shared Services
  Agreement and the Transition Services Agreement (see Note 13).
  In
  addition, in connection with the Settlement, the Private Company waived the
  direct operational costs attributable to the Partnership's asphalt operations
  and payable by the Partnership under the Amended Omnibus Agreement for the month
  of March 2009 (see Note 13).
  The
  Partnership has acquired various assets, including the Acquired Asphalt Assets,
  the Acquired Pipeline Assets and the Acquired Storage Assets, from the Private
  Company.  See Notes 1 and 7 for a description of these
  acquisitions.  In addition, the Partnership acquired certain liquid
  asphalt cement assets and crude oil assets from the Private Company in
  connection with the Settlement (see Note 13).
  During
  the three months and nine months ended September 30, 2008, the Partnership made
  payments of $0.8 million and $1.8 million, respectively, to a third party
  entity on whose board of directors a former member of the Board served in
  connection with leased transport trucks and trailers utilized in the
  Partnership's gathering and transportation services segment. At September
  30, 2008 the Partnership had future commitments to this entity totaling $8.3
  million.
  As of
  September 30, 2008, the Partnership had a banking relationship with a third
  party banking entity on whose board of directors a former member of the Board
  served.
  9.
  LONG-TERM INCENTIVE PLAN
  In July
  2007, the Partnership's general partner adopted the SemGroup Energy Partners
  G.P., L.L.C. Long-Term Incentive Plan (the "Plan"). The compensation committee
  of the Board administers the Plan. The Plan authorizes the grant of an aggregate
  of 1.25 million common units deliverable upon vesting. Although other types
  of awards are contemplated under the Plan, currently outstanding awards include
  "phantom" units, which convey the right to receive common units upon vesting,
  and "restricted" units, which are grants of common units restricted until the
  time of vesting. The phantom unit awards also include distribution equivalent
  rights ("DERs").
  Subject
  to applicable earning criteria, a DER entitles the grantee to a cash payment
  equal to the cash distribution paid on an outstanding common unit prior to the
  vesting date of the underlying award. Recipients of restricted units are
  entitled to receive cash distributions paid on common units during the vesting
  period which distributions are reflected initially as a reduction of partners'
  capital. Distributions paid on units which ultimately do not vest are
  reclassified as compensation expense.
  In July
  2007, 475,000 phantom common units and 5,000 restricted common units were
  granted which vest ratably over periods of four and three years, respectively.
  In October 2007, 5,000 restricted common units were granted which vest ratably
  over three years. In June 2008, 375,000 phantom common units were granted which
  vest ratably over three years.  In July 2008, 5,000 restricted common
  units were granted which vest ratably over three years.  These grants
  are equity awards under SFAS 123(R), "
  Share-Based Payment
  " and,
  accordingly, the fair value of the awards as of the grant date is expensed over
  the vesting period. The weighted average grant date fair-value of the awards is
  $23.86 per unit. The value of these award grants was approximately
  $10.5 million, $0.1 million, $0.1 million, $9.8 million and $0.1
  million on their grant dates, respectively.  Due to the change of
  control of the Partnership's general partner related to the Private Company's
  liquidity issues, all outstanding awards as of July 18, 2008
  vested.  The Partnership's equity-based incentive compensation expense
  for the three months and nine months ended September 30, 2007 and 2008 was $0.5
  million, $0.5 million, $18.0 and $19.4 million, respectively.  On
  August 14, 2008, 282,309 common units were issued in connection with the vesting
  of certain of the outstanding awards.  In addition, in December 2008
  the Plan was amended to provide for the delivery of subordinated units in
  addition to common units upon vesting and 3,333 restricted common units and
  1,667 restricted subordinated units were awarded under the Plan (see Note
  13).  In April 2009, the 1,667 restricted subordinated units were
  cancelled and were replaced by a grant of 1,667 restricted common units (see
  Note 13).
  15
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  SEMGROUP
  ENERGY PARTNERS, L.P.
  NOTES
  TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
  10.
  COMMITMENTS AND CONTINGENCIES
  The
  Partnership is from time to time subject to various legal actions and claims
  incidental to its business, including those arising out of environmental-related
  matters. Management believes that these routine legal proceedings will not have
  a material adverse effect on the financial position, results of operations or
  cash flows of the Partnership. Once management determines that information
  pertaining to a legal proceeding indicates that it is probable that a liability
  has been incurred and the amount of such liability can be reasonably estimated,
  an accrual is established equal to its estimate of the likely exposure. The
  Partnership did not have an accrual for legal settlements as of
  December 31, 2007 or September 30, 2008.  The Partnership is
  subject to a securities class action and other lawsuits, an SEC investigation
  and a Grand Jury investigation due to events related to the Bankruptcy Filings
  (see Note 13).  An unfavorable outcome in any of these matters may
  have a material adverse effect on the Partnership's business, financial
  condition, results of operations, cash flows, ability to make distributions to
  its unitholders and the trading price of the Partnership's common
  units.
  The
  Partnership has contractual obligations to perform dismantlement and removal
  activities in the event that some of its liquid asphalt cement and residual fuel
  oil terminalling and storage assets are abandoned. These obligations include
  varying levels of activity including completely removing the assets and
  returning the land to its original state. The Partnership has determined that
  the settlement dates related to the retirement obligations are indeterminate.
  The assets with indeterminate settlement dates have been in existence for many
  years and with regular maintenance will continue to be in service for many years
  to come. Also, it is not possible to predict when demands for the Partnership's
  terminalling and storage services will cease, and the Partnership does not
  believe that such demand will cease for the foreseeable
  future.  Accordingly, the Partnership believes the date when these
  assets will be abandoned is indeterminate. With no reasonably determinable
  abandonment date, the Partnership cannot reasonably estimate the fair value of
  the associated asset retirement obligations.  Management believes that
  if the Partnership's asset retirement obligations were settled in the
  foreseeable future the potential cash flows that would be required to settle the
  obligations based on current costs are not material.  The Partnership
  will record asset retirement obligations for these assets in the period in which
  sufficient information becomes available for it to reasonably determine the
  settlement dates.
  In the
  Amended Omnibus Agreement and other agreements with the Private Company, the
  Private Company agreed to indemnify the Partnership for certain environmental
  and other claims relating to the crude oil and liquid asphalt cement assets that
  have been contributed to the Partnership.  In connection with the
  Settlement, the Partnership waived these claims and the Amended Omnibus
  Agreement and other relevant agreements, including the indemnification
  provisions therein, were rejected as part of the Bankruptcy
  Proceedings.  If the Partnership experiences an environmental or other
  loss, it would experience increased losses which may have a material adverse
  effect on its business, financial condition, results of operations, cash flows,
  ability to make distributions to its unitholders, the trading price of its
  common units and the ability to conduct its business.
  11.
  OPERATING SEGMENTS
  The
  Partnership's operations consist of two operating segments:
  (i) terminalling and storage services and (ii) gathering and
  transportation services.
  TERMINALLING AND STORAGE
  SERVICES
  —The Partnership provides crude oil and liquid asphalt cement
  terminalling and storage services at its terminalling and storage facilities
  located in twenty-three states.
  GATHERING AND TRANSPORTATION
  SERVICES
  —The Partnership owns and operates two pipeline systems, the
  Mid-Continent system and the Longview system, that gather crude oil purchased by
  the Private Company and its other customers and transports it to refiners, to
  common carrier pipelines for ultimate delivery to refiners or to terminalling
  and storage facilities owned by the Partnership and others. The Partnership
  refers to its gathering and transportation system located in Oklahoma and the
  Texas Panhandle as the Mid-Continent system. It refers to its second gathering
  and transportation system, which is located in Texas, as the Longview system. In
  addition to its pipelines, the Partnership uses its owned and leased tanker
  trucks to gather crude oil for the Private Company and its other customers at
  remote wellhead locations generally not covered by pipeline and gathering
  systems and to transport the crude oil to aggregation points and storage
  facilities located along pipeline gathering and transportation systems. In
  connection with its gathering services, the Partnership also provides a number
  of producer field services, ranging from gathering condensates from natural gas
  companies to hauling produced water to disposal wells.
  16
  Table of Contents
  SEMGROUP
  ENERGY PARTNERS, L.P.
  NOTES
  TO UNAUDITED CONSOLIDATED FINANCIAL
  STATEMENTS
  The
  Partnership's management evaluates performance based upon segment operating
  margin, which includes revenues from related parties and external customers and
  operating expenses excluding depreciation and amortization. The non-GAAP measure
  of operating margin (in the aggregate and by segment) is presented in the
  following table. The Partnership computes the components of operating margin by
  using amounts that are determined in accordance with GAAP. A reconciliation of
  operating margin to income (loss) before income tax, which is its nearest
  comparable GAAP financial measure, is included in the following table. The
  Partnership believes that investors benefit from having access to the same
  financial measures being utilized by management. Operating margin is an
  important measure of the economic performance of the Partnership's core
  operations. This measure forms the basis of the Partnership's internal financial
  reporting and is used by its management in deciding how to allocate capital
  resources between segments.  Income (loss) before income tax,
  alternatively, includes expense items, such as depreciation and amortization,
  general and administrative expenses and interest expense, which management does
  not consider when evaluating the core profitability of an
  operation.
  The
  following table reflects certain financial data for each segment for the periods
  indicated:
  Terminalling
        and Storage
  Gathering
        and Transportation
  Total
  (in thousands)
  Three
        Months Ended September 30, 2007
  Service
        revenue
  Third
        party revenue
  $
  691
  $
  4,181
  $
  4,872
  Related
        party revenue
  7,245
  13,163
  20,408
  Total
        revenue for reportable segments
  7,936
  17,344
  25,280
  (1
  )
  Operating
        expenses (excluding depreciation and amortization)
  293
  13,265
  13,558
  Operating
        margin (excluding depreciation and amortization)
  7,643
  4,079
  11,722
  (2
  )
  Total
        assets (end of period)
  63,134
  54,182
  117,316
  Three
        Months Ended September 30, 2008
  Service
        revenue
  Third
        party revenue
  $
  4,661
  $
  10,910
  $
  15,571
  Related
        party revenue
  27,555
  10,668
  38,223
  Total
        revenue for reportable segments
  32,216
  21,578
  53,794
  Operating
        expenses (excluding depreciation and amortization)
  7,958
  14,415
  22,373
  Allowance
        for doubtful accounts
  (817
  )
  (2
  )
  (819)
  Operating
        margin (excluding depreciation and amortization)
  25,075
  7,165
  32,240
  (2
  )
  Total
        assets (end of period)
  246,651
  102,462
  349,113
  Nine
        Months Ended September 30, 2007
  Service
        revenue
  Third
        party revenue
  $
  7,836
  $
  16,011
  $
  23,847
  Related
        party revenue
  7,245
  13,286
  20,531
  Total
        revenue for reportable segments
  15,081
  29,297
  44,378
  (1
  )
  Operating
        expenses (excluding depreciation and amortization)
  1,449
  41,880
  43,329
  Operating
        margin (excluding depreciation and amortization)
  13,632
  (12,583
  )
  1,049
  (2
  )
  Total
        assets (end of period)
  63,134
  54,182
  117,316
  Nine
        Months Ended September 30, 2008
  Service
        revenue
  Third
        party revenue
  $
  5,674
  $
  20,548
  $
  26,222
  Related
        party revenue
  75,434
  47,628
  123,062
  Total
        revenue for reportable segments
  81,108
  68,176
  149,284
  Operating
        expenses (excluding depreciation and amortization)
  18,928
  45,444
  64,372
  Allowance
        for doubtful accounts
  -
  447
  447
  Operating
        margin (excluding depreciation and amortization)
  62,180
  22,285
  84,465
  (2
  )
  Total
        assets (end of period)
  246,651
  102,462
  349,113
  (1)
        Historically, the Predecessor was a part of the integrated operations of
        the Private Company, and neither the Private Company nor the Predecessor
        recorded revenue associated with the terminalling and storage and
        gathering and transportation services provided on an intercompany basis.
        Accordingly, revenues reflected for all periods prior to the contribution
        of the assets, liabilities and operations to the Partnership by the
        Private Company on July 20, 2007 are substantially services provided
        to third parties.
  (2)
        The following table reconciles segment operating margin (excluding
        depreciation and amortization) to income (loss) before income
        taxes:
  Three
        Months Ended September 30,
  Nine
        Months Ended September 30,
  2007
  2008
  2007
  2008
  (in
        thousands)
  Operating
        margin (excluding depreciation and amortization)
  $
  11,722
  $
  32,240
  $
  1,049
  $
  84,465
  Depreciation
        and amortization
  2,394
  5,814
  6,781
  15,586
  General
        and administrative expenses
  2,525
  27,177
  11,015
  33,244
  Interest expense
  2,424
  11,041
  3,369
  15,905
  Income
        (loss) before income taxes
  $
  4,379
  $
  (11,792
  )
  $
  (20,116
  )
  $
  19,730
  17
  Table of Contents
  SEMGROUP
  ENERGY PARTNERS, L.P.
  NOTES
  TO UNAUDITED CONSOLIDATED FINANCIAL
  STATEMENTS
  12.
  RECENTLY ISSUED ACCOUNTING STANDARDS
  In April
  2009, the Financial and Accounting Standards Board (FASB) issued FASB Staff
  Position (FSP) Statement No. 107-1 and Accounting Principles Board (APB)
  28-1 (collectively, FSP FAS 107-1), "Interim Disclosures about Fair Value of
  Financial Instruments."  FSP FAS 107-1 amends FAS 107, "Disclosures about
  Fair Value of Financial Instruments," to require an entity to provide
  disclosures about fair value of financial instruments in interim financial
  information.  The FSP FAS 107-1 also amends APB Opinion 28, "Interim
  Financial Reporting," to require those disclosures in summarized financial
  information at interim reporting periods. Under FSP FAS 107-1, the Partnership
  will be required to include disclosures about the fair value of its financial
  instruments whenever it issues financial information for interim reporting
  periods.  In addition, the Partnership will be required to disclose in the
  body or in the accompanying notes of its summarized financial information for
  interim reporting periods and in its financial statements for annual reporting
  periods the fair value of all financial instruments for which it is practicable
  to estimate that value, whether recognized or not recognized in the statement of
  financial position.  FSP FAS 107-1 is effective for periods ending after
  June 15, 2009. The Partnership is currently evaluating the impact FSP FAS
  107-1 may have on our consolidated financial statements.
  In
  June 2008, the Emerging Issues Task Force ("EITF") issued Issue
  No. 03-6-1, "
  Determining
  Whether Instruments Granted in Share-Based Payment Transactions Are
  Participating Securities
  " ("EITF 03-6-1").  EITF 03-6-1 addresses
  whether instruments granted in share-based payment transactions are
  participating securities prior to vesting and, therefore, need to be included in
  the earnings allocation in computing earnings per share ("EPS") under the
  two-class method.  EITF 03-6-1 will be effective for financial statements
  issued for fiscal years beginning after December 15, 2008, and interim
  periods within those years.  All prior-period EPS data presented will be
  adjusted retrospectively to conform with the provisions of EITF 03-6-1. The
  Partnership is evaluating the expected impact of adoption of EITF
  03-6-1.
  In
  April 2008, the Financial Accounting Standards Board ("FASB") issued FASB
  Staff Position ("FSP") No. FAS 142-3 "
  Determination of the Useful Life of
  Intangible Assets
  " ("FSP No. FAS 142-3").  FSP No. FAS
  142-3 amends the factors that should be considered in developing renewal or
  extension assumptions used to determine the useful life of a recognized
  intangible asset under SFAS No. 142, "
  Goodwill and Other Intangible Assets
  " ("SFAS 142").  The intent of this FSP is to improve the
  consistency between the useful life of a recognized intangible asset under
  SFAS 142 and the period of expected cash flows used to measure the fair
  value of the asset under SFAS No. 141 (revised 2007), "
  Business Combinations
  ," and
  other GAAP.  This FSP will be effective for financial statements issued for
  fiscal years beginning after December 15, 2008, and interim periods within
  those fiscal years.  The Partnership is evaluating the expected impact;
  however, it believes adoption will not impact the Partnership's financial
  position, results of operations or cash flows.
  In
  March 2008, the FASB issued SFAS No. 161, "Disclosures about
  Derivative Instruments and Hedging Activities-an amendment of FASB Statement No.
  133" ("SFAS No. 161"). This Statement requires enhanced disclosures about the
  Partnership's derivative and hedging activities. This statement is effective for
  financial statements issued for fiscal years and interim periods beginning after
  November 15, 2008. The Partnership will adopt SFAS No. 161 beginning
  January 1, 2009. With the adoption of this statement, the Partnership does
  not expect any significant impact on its financial position, results of
  operations or cash flows.
  In March
  2008, the Emerging Issues Task Force ("EITF") of the FASB reached a final
  consensus on Issue No. 07-4, "Application of the Two-Class Method under
  FASB Statement No. 128, Earnings per Share, to Master Limited Partnerships"
  ("Issue No. 07-4"). This conclusion reached by the EITF affects how a
  master limited partnership ("MLP") allocates income between its general partner,
  which typically holds incentive distribution rights ("IDRs") along with the
  general partner interest, and the limited partners. It is not uncommon for MLPs
  to experience timing differences between the recognition of income and
  partnership distributions. The amount of incentive distribution is typically
  calculated based on the amount of distributions paid to the MLP's partners. The
  issue is whether current period earnings of an MLP should be allocated to the
  holders of IDRs as well as the holders of the general and limited partnership
  interests when applying the two-class method under SFAS No. 128, "Earnings Per
  Share."
  The
  conclusion reached by the EITF in Issue No. 07-4 is that when current
  period earnings are in excess of cash distributions, the undistributed earnings
  should be allocated to the holders of the general partner interest, the holders
  of the limited partner interest and incentive distribution rights holders based
  upon the terms of the partnership agreement. Under this model, contractual
  limitations on distributions to incentive distribution rights holders would be
  considered when determining the amount of earnings to allocate to them. That is,
  undistributed earnings would not be considered available cash for purposes of
  allocating earnings to incentive distribution rights holders. Conversely, when
  cash distributions are in excess of earnings, net income (or loss) should be
  reduced (increased) by the distributions made to the holders of the general
  partner interest, the holders of the limited partner interest and incentive
  distribution rights holders. The resulting net loss would then be allocated to
  the holders of the general partner interest and the holders of the limited
  partner interest based on their respective sharing of the losses based upon the
  terms of the partnership agreement.
  Issue
  No. 07-4 is effective for fiscal years beginning after December 15,
  2008 and interim periods within those fiscal years. The accounting treatment is
  effective for all financial statements presented. The Partnership is currently
  considering the impact of the adoption of Issue 07-4 on its presentation of
  earnings per unit.
  In
  December 2007, the FASB issued SFAS No. 141(R), "Business
  Combinations."  This statement requires assets acquired and
  liabilities assumed to be measured at fair value as of the acquisition date,
  acquisition related costs incurred prior to the acquisition to be expensed and
  contractual contingencies to be recognized at fair value as of the acquisition
  date. This statement is effective for financial statements issued for fiscal
  years beginning after December 15, 2008. The Partnership is currently
  assessing the impact, if any, the adoption of this statement will have on its
  financial position, results of operations or cash flows.
  18
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  SEMGROUP
  ENERGY PARTNERS, L.P.
  NOTES
  TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
  13.
  EVENTS RELATED TO THE BANKRUPTCY FILINGS AND SUBSEQUENT EVENTS
  Due to
  the events related to the Bankruptcy Filings described herein, including the
  uncertainty relating to future cash flows, the Partnership faces substantial
  doubt as to its ability to continue as a going concern.  While it is
  not feasible to predict the ultimate outcome of the events surrounding the
  Bankruptcy Cases, the Partnership has been and could continue to be materially
  and adversely affected by such events and it may be forced to make a bankruptcy
  filing or take other action that could have a material adverse effect on its
  business, the price of its common units and its results of
  operations.
  Bankruptcy
  Filings
  On July
  17, 2008, the Partnership issued a press release announcing that the Private
  Company was experiencing liquidity issues and was exploring various
  alternatives, including raising additional equity, debt capital or the filing of
  a voluntary petition for reorganization under Chapter 11 of the Bankruptcy Code
  to address these issues.  The Partnership filed this press release in
  a Current Report on Form 8-K filed with the SEC on July 18, 2008.
  On July
  22, 2008 and thereafter, the Private Company and certain of its subsidiaries
  made the Bankruptcy Filings.  The Private Company and its subsidiaries
  continue to operate their businesses and own and manage their properties as
  debtors-in-possession under the jurisdiction of the Bankruptcy Court and in
  accordance with the applicable provisions of the Bankruptcy Code (the
  "Bankruptcy Cases"). None of the Partnership, its general partner, the
  subsidiaries of the Partnership nor the subsidiaries of the general partner are
  debtors in the Bankruptcy Cases.  However, because of the contractual
  relationships with the Private Company and certain of its subsidiaries, the
  Bankruptcy Filings have adversely impacted the Partnership and may in the future
  impact the Partnership in various ways, including the items discussed
  below.  The Partnership's financial results as of September 30, 2008
  also reflect a $0.4 million allowance for doubtful accounts related to amounts
  due from third parties as of September 30, 2008.  The allowance
  related to amounts due from third parties was established as a result of certain
  third party customers netting amounts due them from the Private Company with
  amounts due to the Partnership.  Also, due to the change of control of
  the Partnership's general partner related to the Private Company's liquidity
  issues, all outstanding awards under the Plan vested on July 18, 2008, resulting
  in an incremental $18.0 million in non-cash compensation expense for the three
  months ended September 30, 2008 (see Note 9).  In addition to the
  allowance for doubtful accounts and non-cash compensation expense described
  above, the results of operations for the three and nine months ended September
  30, 2008 included in this quarterly report were affected by the Bankruptcy
  Filings and related events, which resulted in decreased revenues and increased
  general and administrative expenses as described below under "—Partnership
  Revenues," and "—Other Effects," respectively.
  Board
  and Management Composition
  On July
  9, 2008, Edward F. Kosnik was appointed as an independent member of the
  Board.  Mr. Kosnik is the chairman of the compensation committee
  and also serves on the audit committee and the conflicts committee of the Board.
  Under the provisions of the Plan, Mr. Kosnik was granted an award of 5,000
  restricted common units on July 9, 2008. These restricted common units
  vested on July 18, 2008 in connection with the change of control of the
  Partnership's general partner described below.
  On July
  18, 2008, Manchester Securities Corp. ("Manchester") and Alerian Finance
  Partners, LP ("Alerian"), as lenders to SemGroup Holdings, the sole member of
  the Partnership's general partner, exercised certain rights described below
  under a Loan Agreement and a Pledge Agreement, each dated June 25, 2008 (the
  "Holdings Credit Agreements"), that were triggered by certain events of default
  under the Holdings Credit Agreements.  On March 20, 2009, Alerian
  transferred its interest in the Holdings Credit Agreements to
  Manchester.  The Holdings Credit Agreements are secured by the
  subordinated units and incentive distribution rights of the Partnership and the
  membership interests in the Partnership's general partner owned by SemGroup
  Holdings.  Manchester has not foreclosed on the subordinated units of
  the Partnership owned by SemGroup Holdings or the membership interests in the
  Partnership's general partner.  Manchester may in the future exercise
  other remedies available to them under the Holdings Credit Agreement and related
  loan documents, including taking action to foreclose on the collateral securing
  the loan.  Neither the Partnership nor the Partnership's general
  partner is a party to the Holdings Credit Agreements or the related loan
  documents.
  19
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  SEMGROUP
  ENERGY PARTNERS, L.P.
  NOTES
  TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
  On July
  18, 2008, Manchester and Alerian exercised their right under the Holdings Credit
  Agreements to vote the membership interests of the Partnership's general partner
  in order to reconstitute the Board (the "Change of Control").  Messrs.
  Thomas L. Kivisto, Gregory C. Wallace, Kevin L. Foxx, Michael J. Brochetti and
  W. Anderson Bishop were removed from the Board.  Mr. Bishop had served
  as the chairman of the audit committee and as a member of the conflicts
  committee and compensation committee of the Board.  Messrs. Sundar S.
  Srinivasan, David N. Bernfeld and Gabriel Hammond (each of whom is affiliated
  with Manchester or Alerian) were appointed to the Board.  Mr.
  Srinivasan was elected as Chairman of the Board.  Messrs. Brian F.
  Billings and Edward F. Kosnik remain as independent directors of the Board and
  continue to serve as members of the conflicts committee, audit committee and
  compensation committee of the Board.  In addition, Messrs. Foxx and
  Alex Stallings resigned the positions each officer held with SemGroup, L.P. in
  July 2008.  Mr. Brochetti had previously resigned from his position
  with SemGroup, L.P. in March 2008.  Messrs. Foxx, Brochetti and
  Stallings remain as officers of the Partnership's general partner.
  On
  October 1, 2008, Dave Miller (who is an affiliate of Manchester) and Duke R.
  Ligon were appointed members of the Board. Mr. Ligon is an independent member of
  the Board and is the chairman of the audit committee and also serves on the
  compensation committee and the conflicts committee of the Board. Under the
  provisions of the Plan, Mr. Ligon was granted an award of 3,333 restricted
  common units and 1,667 restricted subordinated units on December 23, 2008 (see
  Note 9). In April 2009, the 1,667 restricted subordinated units granted to Mr.
  Ligon were cancelled and replaced with 1,667 restricted common units (see Note
  9).  The restricted common units granted to Mr. Ligon vest in
  one-third increments over a three-year period.
  On
  January 9, 2009, Mr. Srinivasan resigned his positions as Chairman of the Board
  and as a director.  Mr. Ligon was subsequently elected as Chairman of
  the Board.
  On March
  18, 2009, the Board realigned the officers of the Partnership's general partner
  appointing Michael J. Brochetti as Executive Vice President—Corporate
  Development and Treasurer, Alex G. Stallings as Chief Financial Officer and
  Secretary, and James R. Griffin as Chief Accounting Officer.  Mr.
  Brochetti had previously served as Chief Financial Officer, Mr. Stallings had
  previously served as Chief Accounting Officer and Secretary and Mr. Griffin had
  previously served as Controller.
  Bankruptcy
  Court Order
  On
  September 9, 2008, the Bankruptcy Court entered an order relating to the
  settlement of certain matters between the Partnership and the Private Company
  (the "Order") in the Bankruptcy Cases.  Among other things, the Order
  provided that (i) the Private Company was to directly pay any utility costs
  attributable to the operations of the Private Company at certain shared
  facilities, and the Private Company was to pay the Partnership for past utility
  cost reimbursements that were due from the Private Company; (ii) commencing
  on September 15, 2008, payments under the Terminalling Agreement were netted
  against amounts due under the Amended Omnibus Agreement and were made on the
  15th day of each month for the prior month (with a three business-day grace
  period); (iii) the Private Company provided the Partnership with a letter of
  credit in the amount of approximately $4.9 million to secure the Private
  Company's postpetition obligations under the Terminalling Agreement; (iv) the
  Private Company was to make payments under the Throughput Agreement for the
  month of August on September 15, 2008 (with a three business-day grace period)
  based upon the monthly contract minimums in the Throughput Agreement and netted
  against amounts due under the Amended Omnibus Agreement; (v) the Private Company
  was to make payments under the Throughput Agreement for the months of September
  and October on October 15, 2008 (with a three business-day grace period) and
  November 15, 2008 (with a three business-day grace period), respectively, or
  three business days after amounts due are determined and documentation therefore
  was provided and exchanged based upon actual volumes for each such month and at
  a rate equal to the average rate charged by the Partnership to third-party
  shippers in the same geographical area, with any such amounts netted against
  amounts due under the Amended Omnibus Agreement; (vi) the parties were to
  reevaluate the Throughput Agreement and the payment terms with respect to
  services provided after October 2008; (vii) representatives of the Private
  Company and the Partnership were to meet to discuss the transition to the
  Partnership of certain of the Private Company's employees necessary to maintain
  the Partnership's business, and pending agreement between the parties, the
  Private Company was to continue to provide services in accordance with the
  Amended Omnibus Agreement through at least November 30, 2008; (viii) the Private
  Company was to consent to an order relating a third-party storage contract which
  provided that the Partnership was the rightful owner of the rights in and to a
  certain third-party storage agreement and the corresponding amounts due
  thereunder; and (ix) the Partnership was to enter into a specified lease with
  the Private Company to permit the Private Company to construct a
  pipeline.
  20
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  SEMGROUP
  ENERGY PARTNERS, L.P.
  NOTES
  TO UNAUDITED CONSOLIDATED FINANCIAL
  STATEMENTS
  Settlement
  with the Private Company
  On March
  12, 2009, the Bankruptcy Court held a hearing and approved the transactions
  contemplated by a term sheet (the "Settlement Term Sheet") relating to the
  settlement of certain matters between the Private Company and the Partnership
  (the "Settlement").  The Bankruptcy Court entered an order approving
  the Settlement upon the terms contained in the Settlement Term Sheet on March
  20, 2009.  The Partnership and the Private Company executed definitive
  documentation, in the form of a master agreement (the "Master Agreement"), dated
  April 7, 2009 to be effective as of 11:59 PM CDT March 31, 2009, and certain
  other transaction documents to effectuate the Settlement and that superseded the
  Settlement Term Sheet.  The Bankruptcy Court entered an order
  approving the Master Agreement and the Settlement on April 7,
  2009.  In addition, in connection with the Settlement, the Partnership
  and the requisite lenders under the Partnership's secured credit facility
  entered into the Credit Agreement Amendment under which, among other things, the
  lenders consented to the Settlement and waived all existing defaults and events
  of default described in the Forbearance Agreement and amendments
  thereto.
  The
  Settlement provided for the following:
  ·
  the
        Partnership transferred certain crude oil storage assets located in Kansas
        and northern Oklahoma to the Private
  Company;
  ·
  the
        Private Company transferred ownership of 355,000 barrels of crude oil tank
        bottoms and line fill to the
  Partnership;
  ·
  the
        Private Company rejected the Throughput
    Agreement;
  ·
  the
        Partnership and one of its subsidiaries have a $20 million unsecured claim
        against the Private Company and certain of its subsidiaries relating to
        rejection of the Throughput
  Agreement;
  ·
  the
        Partnership and the Private Company entered into the New Throughput
        Agreement (as defined below) pursuant to which the Partnership provides
        certain crude oil gathering, transportation, terminalling and storage
        services to the Private Company;
  ·
  the
        Partnership offered employment to certain crude oil
      employees;
  ·
  the
        Private Company transferred its asphalt assets that are connected to the
        Partnership's asphalt assets to the
  Partnership;
  ·
  the
        Private Company rejected the Terminalling
    Agreement;
  ·
  a
        subsidiary of the Partnership has a $35 million unsecured claim against
        the Private Company and certain of its subsidiaries relating to rejection
        of the Terminalling Agreement;
  ·
  the
        Partnership and the Private Company entered into the New Terminalling
        Agreement (as defined below) pursuant to which the Partnership provides
        liquid asphalt cement terminalling and storage services for the Private
        Company's remaining asphalt
  inventory;
  ·
  the
        Private Company agreed to remove all of its remaining asphalt inventory
        from the Partnership's asphalt storage facilities no later than October
        31, 2009;
  ·
  the
        Private Company will be entitled to receive 20% of the proceeds of any
        sale by the Partnership of any of the asphalt assets transferred to the
        Partnership in connection with the Settlement that occurs prior to
        December 31, 2009;
  ·
  the
        Private Company rejected the Amended Omnibus
    Agreement;
  ·
  the
        Partnership and the Private Company entered into the Shared Services
        Agreement (as defined below) pursuant to which the Private Company
        provides certain operational services for the
    Partnership;
  ·
  other
        than as provided above, the Partnership and the Private Company entered
        into mutual releases of claims relating to the rejection of the
        Terminalling Agreement, the Throughput Agreement and the Amended Omnibus
        Agreement;
  ·
  certain
        pre-petition claims by the Private Company and the Partnership were netted
        and waived;
  ·
  the
        Private Company and the Partnership resolved certain remaining issues
        related to the contribution of crude oil assets to the Partnership in
        connection with the Partnership's initial public offering, the
        Partnership's acquisition of the Acquired Asphalt Assets, the
        Partnership's acquisition of the Acquired Pipeline Assets and the
        Partnership's acquisition of the Acquired Storage Assets, including the
        release of claims relating to such acquisitions;
    and
  ·
  the
        Partnership and the Private Company entered into the Trademark Agreement
        (as defined below) which provides the Partnership with a non-exclusive,
        worldwide license to use certain trade names, including the name
        "SemGroup", and the corresponding mark until December 31, 2009, and the
        Private Company waived claims for infringement relating to such trade
        names and mark prior to the date of such license
    agreement.
  Management
  is currently evaluating the accounting for the Settlement, and is obtaining
  independent valuations of the assets transferred.  Certain terms of
  transaction documents relating to the Settlement are discussed in more detail
  below.
  21
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  SEMGROUP
  ENERGY PARTNERS, L.P.
  NOTES
  TO UNAUDITED CONSOLIDATED FINANCIAL
  STATEMENTS
  Shared
  Services Agreement
  In
  connection with the Settlement, the Partnership entered into a Shared Services
  Agreement, dated April 7, 2009 to be effective as of 11:59 PM CDT March 31, 2009
  (the "Shared Services Agreement"), with the Private Company.  Pursuant
  to the Shared Services Agreement, the Private Company will provide certain
  general shared services, Cushing shared services (as described below), and SCADA
  services (as described below) to the Partnership.
  The
  general shared services include crude oil movement services, Department of
  Transportation services, right-of-way services, environmental services, pipeline
  and civil structural maintenance services, safety services, pipeline truck
  station maintenance services, project support services and truck dispatch
  services.  The fees for such general shared services are fixed at
  $125,000 for the month of April 2009 and such fixed fee may be extended by
  mutual agreement of the parties for one additional month.  Thereafter
  the fees will be calculated in accordance with the formulas contained
  therein.  The Private Company has agreed to provide the general shared
  services for three years (subject to earlier termination as provided therein)
  and the term may be extended an additional year by mutual agreement of the
  parties.
  The
  Cushing shared services include operational and maintenance services related to
  terminals at Cushing, Oklahoma.  The fees for such Cushing shared
  services are fixed at $20,000 for the month of April 2009 and such fixed
  fee may be extended by mutual agreement of the parties for one additional
  month.  Thereafter the fees will be calculated in accordance with the
  formulas contained therein.  The Private Company has agreed to provide
  the Cushing shared services for three years (subject to earlier termination as
  provided therein) and the term may be extended an additional year by mutual
  agreement of the parties.
  The SCADA
  services include services related to the operation of the SCADA system which is
  used in connection with the Partnership's crude oil operations.  The
  fees for such SCADA services are fixed at $15,000 for the month of April
  2009 and such fixed fee may be extended by mutual agreement of the parties for
  one additional month.  Thereafter the fees will be calculated in
  accordance with the formulas contained therein.  The Private Company
  has agreed to provide the SCADA services for five years (subject to earlier
  termination as provided therein) and the Partnership may elect to extend the
  term for two subsequent five year periods.
  Transition
  Services Agreement
  In
  connection with the Settlement, the Partnership entered into a Transition
  Services Agreement, dated April 7, 2009 to be effective as of 11:59 PM CDT March
  31, 2009 (the "Transition Services Agreement"), with the Private
  Company.  Pursuant to the Transition Services Agreement, the Private
  Company will provide certain corporate, crude oil and asphalt transition
  services, in each case for a limited amount of time, to the
  Partnership.
  Transfer
  of Crude Oil Assets
  In
  connection with the Settlement, the Partnership transferred certain crude oil
  assets located in Kansas and northern Oklahoma to the Private
  Company.  These transfers included real property and associated
  personal property at locations where the Private Company owned the
  pipeline.  The Partnership retained certain access and connection
  rights to enable it to continue to operate its crude oil trucking business in
  such areas.  In addition, the Partnership transferred its interests in
  the SCADA System, a crude oil inventory tracking system, to the Private
  Company.
  In
  addition, the Private Company transferred to the Partnership (i) 355,000 barrels
  of crude oil line fill and tank bottoms, which are necessary for the Partnership
  to operate its crude oil tank storage operations and its Oklahoma and Texas
  crude oil pipeline systems, (ii) certain personal property located in Oklahoma,
  Texas and Kansas used in connection with the Partnership's crude oil trucking
  business and (iii) certain real property located in Oklahoma, Kansas, Texas and
  New Mexico that was intended to be transferred in connection with the
  Partnership's initial public offering.
  Transfer
  of Asphalt Assets
  In
  connection with the Settlement, the Private Company transferred certain asphalt
  processing assets that were connected to, adjacent to, or otherwise
  contiguous with the Partnership's existing asphalt facilities and associated
  real property interests to the Partnership.  The transfer of the
  Private Company's asphalt assets in connection with the Settlement provides the
  Partnership with outbound logistics for its existing asphalt assets and,
  therefore, allows it to provide asphalt terminalling and storage services to
  third parties.
  22
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  SEMGROUP
  ENERGY PARTNERS, L.P.
  NOTES
  TO UNAUDITED CONSOLIDATED FINANCIAL
  STATEMENTS
  New
  Throughput Agreement
  In
  connection with the Settlement, the Partnership and the Private Company entered
  into a Throughput Agreement, dated as of April 7, 2009 to be effective as of
  11:59 PM CDT March 31, 2009 (the "New Throughput Agreement"), pursuant to which
  the Partnership provides certain crude oil gathering, transportation,
  terminalling and storage services to the Private Company.
  Under the
  New Throughput Agreement, the Partnership charges the following fees: (i)
  barrels gathered via gathering lines will be charged a gathering rate of $0.75
  per barrel, (ii) barrels transported within Oklahoma will be charged $1.00 per
  barrel while barrels transported on the Masterson Mainline will be charged $0.55
  per barrel, (iii) barrels transported by truck will be charged in accordance
  with the schedule contained therein, including a fuel surcharge, (iv) storage
  fees shall equal $0.50 per barrel per month for product located in storage tanks
  located in Cushing, Oklahoma and $0.44 per barrel per month for product not
  located in dedicated Cushing storage tanks, and (v) a delivery charge of $0.08
  per barrel will be charged for deliveries out of the Cushing Interchange
  Terminal. The New Throughput Agreement has an initial term of one year with
  additional automatic one-month renewals unless either party terminates the
  agreement upon thirty-days prior notice.
  New
  Terminalling and Storage Agreement
  In
  connection with the Settlement, the Partnership and the Private Company entered
  into a Terminalling and Storage Agreement, dated as of April 7, 2009 to be
  effective as of 11:59 PM CDT March 31, 2009 (the "New Terminalling Agreement"),
  pursuant to which the Partnership provides certain asphalt terminalling and
  storage services for the remaining asphalt inventory of the Private
  Company.  Storage services under the New Terminalling Agreement are
  equal to $0.565 per barrel per month multiplied by the total shell capacity in
  barrels for each storage tank where the Private Company and its affiliates have
  product; provided that if the Private Company removes all product from a storage
  tank prior to the end of the month, then the storage service fees shall be
  pro-rated for such month based on the number of calendar days storage was
  actually used.  Throughput fees under the New Terminalling Agreement
  are equal to $9.25 per ton; provided that no fees are payable for transfers of
  product between storage tanks located at the same or different
  terminals.  The New Terminalling Agreement has an initial term that
  expires on October 31, 2009, which may be extended for one month by mutual
  agreement of the parties.
  New
  Access and Use Agreement
  In
  connection with the Settlement, the Partnership and the Private Company entered
  into an Access and Use Agreement, dated as of April 7, 2009 to be effective as
  of 11:59 PM CDT March 31, 2009 (the "New Access and Use Agreement"), pursuant to
  which the Partnership will allow the Private Company access rights to the
  Partnership's asphalt facilities relating to its existing asphalt
  inventory.  The term of the Access and Use Agreement will end
  separately for each terminal upon the earlier of October 31, 2009 or until all
  of the existing asphalt inventory of the Private Company is removed from such
  terminal.
  Trademark
  Agreement
  In
  connection with the Settlement, the Private Company and the Partnership entered
  into a Trademark License Agreement, dated as of April 7, 2009 to be effective as
  of 11:59 PM CDT March 31, 2009 (the "Trademark Agreement"), pursuant to which
  the Private Company granted the Partnership a non-exclusive, worldwide license
  to use certain trade names, including the name "SemGroup", and the corresponding
  mark until December 31, 2009, and the Private Company waived claims for
  infringement relating to such trade names and mark prior to the effective date
  of the Trademark Agreement.
  Building
  and Office Leases
  In
  connection with the Settlement, the Partnership leased office space in Oklahoma
  City, Oklahoma and certain facilities in Cushing, Oklahoma to the Private
  Company.  The terms for the leases expire on March 31,
  2014.  The rents for such leases are as described in the exhibits
  thereto.
  23
  Table of Contents
  SEMGROUP
  ENERGY PARTNERS, L.P.
  NOTES
  TO UNAUDITED CONSOLIDATED FINANCIAL
  STATEMENTS
  Easements
  In
  connection with the Settlement, the Partnership and the Private Company granted
  mutual easements relating to access, facility improvements, existing and future
  pipeline rights and corresponding rights of ingress and egress for properties
  owned by the parties at Cushing, Oklahoma.  In addition, the
  Partnership granted the Private Company certain pipeline easements at Cushing,
  Oklahoma, together with the corresponding rights of ingress and
  egress.
  Partnership
  Revenues
  For the
  nine months ended September 30, 2008 and the year ended December 31, 2008, the
  Partnership derived approximately 81% and approximately 73%, respectively, of
  its revenues, excluding fuel surcharge revenues related to fuel and power
  consumed to operate its liquid asphalt cement storage tanks, from services it
  provided to the Private Company and its subsidiaries.  Prior to the
  Order and the Settlement, the Private Company was obligated to pay the
  Partnership minimum monthly fees totaling $76.1 million annually and $58.9
  million annually in respect of the minimum commitments under the Throughput
  Agreement and the Terminalling Agreement, respectively, regardless of whether
  such services were actually utilized by the Private Company.  As
  described above, the Order required the Private Company to make certain payments
  under the Throughput Agreement and Terminalling Agreement during a portion of
  the third quarter of 2008, including the contractual minimum payments under the
  Terminalling Agreement.  In connection with the Settlement, the
  Partnership waived the fees due under the Terminalling Agreement during March
  2009.  In addition, the Private Company rejected the Throughput
  Agreement and the Terminalling Agreement and the Partnership and the Private
  Company entered into the New Throughput Agreement and the New Terminalling
  Agreement.  The Partnership expects revenues from services provided to
  the Private Company under the New Throughput Agreement and New Terminalling
  Agreement to be substantially less than prior revenues from services provided to
  the Private Company as the new agreements are based upon actual volumes
  gathered, transported, terminalled and stored instead of certain minimum volumes
  and are at reduced rates when compared to the Throughput Agreement and
  Terminalling Agreement.
  The
  Partnership has been pursuing opportunities to provide crude oil terminalling
  and storage services and crude oil gathering and transportation services to
  third parties.  As a result of new crude oil third-party storage
  contracts, the Partnership increased its third-party terminalling and storage
  revenue (excluding fuel surcharge revenues related to fuel and power consumed to
  operate its liquid asphalt cement storage tanks) from approximately $1.0
  million, or approximately 4% of total terminalling and storage
  revenue during the second quarter of 2008, to approximately $4.6 million
  and $8.4 million, or approximately 17% and 34% of total terminalling and storage
  revenue for the third quarter of 2008 and the fourth quarter of 2008,
  respectively.
  In
  addition, as a result of new third-party crude oil transportation contracts and
  reduced commitments of usage by the Private Company under the Throughput
  Agreement, the Partnership increased its third-party gathering and
  transportation revenue from approximately $5.0 million, or approximately 21% of
  total gathering and transportation revenue during the second quarter of 2008, to
  approximately $10.9 million and $13.6 million, or approximately 51% and 85% of
  total gathering and transportation revenue for the third quarter of 2008
  and the fourth quarter of 2008, respectively.
  The
  significant majority of the increase in third party revenues results from an
  increase in third-party crude oil services provided and a corresponding decrease
  in the Private Company's crude oil services provided due to the termination of
  the monthly contract minimum revenues under the Throughput Agreement in
  September 2008.  Average rates for the new third-party crude oil
  terminalling and storage and transportation and gathering contracts are
  comparable with those previously received from the Private
  Company.  However, the volumes being terminalled, stored, transported
  and gathered have decreased as compared to periods prior to the Bankruptcy
  Filings, which has negatively impacted total revenues.  As an example,
  fourth quarter 2008 total revenues are approximately $8.2 million less than
  third quarter 2008 total revenues, in each case excluding fuel surcharge
  revenues related to fuel and power consumed
  to operate its liquid
  asphalt cement storage tanks.
  In addition,
  the Partnership has recently entered into leases and storage agreements with
  third parties relating to 39 of its 46 asphalt
  facilities.
  The
  Partnership has entered into various crude oil transportation and storage
  contracts with third parties and is continuing to pursue additional contracts
  with third parties; however, there can be no assurance that any of these
  additional efforts will be successful.  In addition, certain third
  parties may be less likely to enter into business transactions with the
  Partnership due to the Bankruptcy Filings.  The Private Company may
  also choose to curtail its operations or liquidate its assets as part of the
  Bankruptcy Cases.  As a result, unless the Partnership is able to
  generate additional third party revenues, the Partnership will continue to
  experience lower volumes in its system which could have a material adverse
  effect on its results of operations and cash flows.
  24
  Table of Contents
  SEMGROUP
  ENERGY PARTNERS, L.P.
  NOTES
  TO UNAUDITED CONSOLIDATED FINANCIAL
  STATEMENTS
  Asphalt
  Operations
  Historically,
  the Partnership provided liquid asphalt cement terminalling and storage services
  to the Private Company pursuant to the Terminalling Agreement.  In
  connection with the Settlement, the Private Company rejected the Terminalling
  Agreement and the Partnership and the Private Company entered into the New
  Terminalling Agreement whereby the Partnership provides liquid asphalt cement
  terminalling and storage services to the Private Company in connection with its
  remaining asphalt inventory.  The New Terminalling Agreement has an
  initial term that ends on October 31, 2009 and the Private Company has agreed to
  remove all of its existing asphalt inventory no later than such date, and the
  Partnership expects that the Private Company may remove it much earlier than
  such date.  Also in connection with the Settlement, the Private
  Company transferred certain asphalt assets to the Partnership that were
  connected to the Partnership's existing asphalt assets.  The transfer
  of the Private Company's asphalt assets in connection with the Settlement
  provides the Partnership with outbound logistics for its existing asphalt assets
  and, therefore, allows it to provide asphalt terminalling and storage services
  to third parties.
  The
  asphalt industry in the United States is characterized by a high degree of
  seasonality. Much of this seasonality is due to the impact that weather
  conditions have on road construction schedules, particularly in cold weather
  states. Refineries produce liquid asphalt cement year round, but the peak
  asphalt demand season is during the warm weather months when most of the road
  construction activity in the United States takes place. As a result, liquid
  asphalt cement is typically purchased from refineries at low prices in the low
  demand winter months and then processed and sold at higher prices in the peak
  summer demand season.  Any significant decrease in the amount of
  revenues that the Partnership receives from its liquid asphalt cement
  terminalling and storage operations could have a material adverse effect on the
  Partnership's cash flows, financial condition and results of
  operations.
  The Partnership has
  recently entered into leases and storage agreements with third parties relating
  to 39 of its 46 asphalt
  facilities.
  The
  revenues that the Partnership will receive pursuant to these leases and storage
  agreements will be less than the revenues received under the Terminalling
  Agreement with the Private Company.  Without sufficient revenues from its
  asphalt assets, the Partnership may be unable to meet the covenants, including
  the minimum liquidity, minimum EBITDA and minimum receipt requirements, under
  its credit agreement.
  Operation
  and General Administration of the Partnership
  As is the
  case with many publicly traded partnerships, the Partnership has not
  historically directly employed any persons responsible for managing or operating
  the Partnership or for providing services relating to day-to-day business
  affairs.  Pursuant to the Amended Omnibus Agreement, the Private
  Company operated the Partnership's assets and performed other administrative
  services for the Partnership such as accounting, legal, regulatory, development,
  finance, land and engineering.  The events related to the Bankruptcy
  Filings terminated the Private Company's obligations to provide services to the
  Partnership under the Amended Omnibus Agreement.  The Private Company
  continued to provide such services to the Partnership until the effective date
  of the Settlement at which time the Private Company rejected the Amended Omnibus
  Agreement and the Private Company and the Partnership entered into the Shared
  Services Agreement and the Transition Services Agreement relating to the
  provision of such services.  In addition, in connection with the
  Settlement, the Partnership made offers of employment to certain individuals
  associated with its crude oil operations and expects to make additional offers
  of employment to certain individuals associated with its asphalt
  operations.  The costs to directly employ these individuals as well as
  the costs under the Shared Services Agreement and the Transition Services
  Agreement may be higher than those previously paid by the Partnership under the
  Amended Omnibus Agreement, which could have a material adverse effect on the
  Partnership's business, financial condition, results of operations, cash flows,
  ability to make distributions to its unitholders, the trading price of its
  common units and its ability to conduct its business.
  In
  addition, in connection with the Settlement, the Partnership agreed to not
  solicit the Private Company's employees for a year from the time of the
  Settlement.  In connection with the Bankruptcy Cases, the Private
  Company may reduce a substantial number of its employees or some of the Private
  Company's employees may choose to terminate their employment with the Private
  Company, some of whom may currently be providing general and administrative and
  operating services to the Partnership under the Shared Services Agreement or the
  Transition Services Agreement.  Any reductions in critical personnel
  who provide services to the Partnership and any increased costs to replace such
  personnel could have a material adverse effect on the Partnership's ability to
  conduct its business and its results of operations.
  25
  Table of Contents
  SEMGROUP
  ENERGY PARTNERS, L.P.
  NOTES
  TO UNAUDITED CONSOLIDATED FINANCIAL
  STATEMENTS
  Intellectual
  Property Rights
  Pursuant
  to the Amended Omnibus Agreement, the Partnership licensed the use of certain
  trade names and marks, including the name "SemGroup."  This license
  terminated automatically upon the Change of Control.  In connection
  with the Settlement, the Private Company and the Partnership entered into the
  Trademark Agreement, pursuant to which the Private Company granted the
  Partnership a non-exclusive, worldwide license to use certain trade names,
  including the name "SemGroup" and the corresponding mark, until December 31,
  2009, and the Private Company waived claims for infringement relating to such
  trade names and mark prior to the effective date of such Trademark
  Agreement (see "—Settlement with the Private Company").  As such, the
  Partnership will be required to change its name and trademark upon or prior to
  the expiration of the Trademark Agreement.  The expenses associated
  with such a change may be significant, which could have a material adverse
  effect on the Partnership's business, financial condition, results of
  operations, cash flows, ability to make distributions to its unitholders, the
  trading price of its common units and its ability to conduct its
  business.
  Credit
  Facility
  As
  described in Note 4, in connection with the events related to the Bankruptcy
  Filings, events of default occurred under the Partnership's credit
  agreement.  On September 18, 2008, the Partnership and the requisite
  lenders under its credit facility entered into the Forbearance Agreement
  relating to such events of default.   On April 7, 2009, the
  Partnership and the requisite lenders entered into the Credit Agreement
  Amendment, under which the lenders consented to the Settlement and waived all
  existing defaults and events of default described in the Forbearance Agreement
  and amendments thereto.  See Note 4 for more information regarding the
  Partnership's credit facility, the Forbearance Agreement and the Credit
  Agreement Amendment.
  Distributions
  to Unitholders
  The
  Partnership did not make a distribution to its common unitholders, subordinated
  unitholders or general partner attributable to the results of operations for the
  quarters ended June 30, 2008, September 30, 2008, December 31, 2008 or March 31,
  2009 due to the events of default under its credit agreement and the uncertainty
  of its future cash flows relating to the Bankruptcy Filings.  The
  Partnership's unitholders will be required to pay taxes on their share of the
  Partnership's taxable income even though they did not receive a cash
  distribution for such periods.  In addition, the Partnership does not
  currently expect to make a distribution relating to the second quarter of
  2009.  The Partnership distributed approximately $14.3 million to its
  unitholders for the three months ended March 31, 2008.  Pursuant to
  the Credit Agreement Amendment, the Partnership is prohibited from making
  distributions to its unitholders if its leverage ratio (as defined in the credit
  agreement) exceeds 3.50 to 1.00.  As of September 30, 2008 and
  December 31, 2008, the Partnership's leverage ratio was 4.34 to 1.00 and 4.83 to
  1.00, respectively. If the Partnership's leverage ratio does not improve,
  it may not make quarterly distributions to its unitholders in the
  future.
  The
  Partnership's partnership agreement provides that, during the subordination
  period, which the Partnership is currently in, the Partnership's common units
  will have the right to receive distributions of available cash from operating
  surplus in an amount equal to the minimum quarterly distribution of $0.3125 per
  common unit per quarter, plus any arrearages in the payment of the minimum
  quarterly distribution on the common units from prior quarters, before any
  distributions of available cash from operating surplus may be made on the
  subordinated units.
  Nasdaq
  Delisting
  Effective
  at the opening of business on February 20, 2009, the Partnership's common units
  were delisted from the Nasdaq Global Market ("Nasdaq") due to the Partnership's
  failure to timely file this Quarterly Report as well as its Quarterly Report on
  Form 10-Q for the quarter ended June 30, 2008.  The Partnership filed
  its Quarterly Report on Form 10-Q for the quarter ended June 30, 2008 on March
  23, 2009.  The Partnership's common units are currently traded on the
  Pink Sheets, which is an over-the-counter securities market, under the symbol
  SGLP.PK.  The fact that the Partnership's common units are not listed
  on a national securities exchange is likely to make trading such common units
  more difficult for broker-dealers, unitholders and investors, potentially
  leading to further declines in the price of the common units.  In
  addition, it may limit the number of institutional and other investors that will
  consider investing in the Partnership's common units, which may have an adverse
  effect on the price of its common units.  It may also make it more
  difficult for the Partnership to raise capital in the future.
  The
  Partnership continues to work to become compliant with its SEC reporting
  obligations and intends to promptly seek the relisting of its common units on
  Nasdaq as soon as practicable after it has become compliant with such reporting
  obligations.  However, there can be no assurances that the Partnership
  will be able to relist its common units on Nasdaq or any other national
  securities exchange and the Partnership may face a lengthy process to relist its
  common units if it is able to relist them at all.
  26
  Table of Contents
  SEMGROUP
  ENERGY PARTNERS, L.P.
  NOTES
  TO UNAUDITED CONSOLIDATED FINANCIAL
  STATEMENTS
  Claims
  Against and By the Private Company's Bankruptcy Estate
  In
  connection with the Settlement, the Partnership and the Private Company entered
  into mutual releases regarding certain claims.  In addition, the
  Settlement provided that the Partnership has a $35 million unsecured claim
  against the Private Company relating to the rejection of the Terminalling
  Agreement and a $20 million unsecured claim against the Private Company relating
  to rejection of the Throughput Agreement.
  On May
  15, 2009, the Private Company filed a joint plan of
  reorganization.  If such plan is confirmed without material amendment,
  the Partnership's claims will be impaired.
  The Partnership may
  also have additional claims against the Private Company that were not released
  in connection with the Settlement, and the Private Company may also have
  additional claims against the Partnership that were not released in connection
  with the Settlement.  Any claims asserted by the Partnership against
  the Private Company in the Bankruptcy Cases will be subject to the claim
  allowance procedure provided in the Bankruptcy Code and Bankruptcy
  Rules.  If an objection is filed, the Bankruptcy Court will determine
  the extent to which any such claim that has been objected to is allowed and the
  priority of such claims.
  Governmental
  Investigations
  On July
  21, 2008, the Partnership received a letter from the staff of the SEC giving
  notice that the SEC is conducting an inquiry relating to the Partnership and
  requesting, among other things, that the Partnership voluntarily preserve,
  retain and produce to the SEC certain documents and information relating
  primarily to the Partnership's disclosures respecting the Private Company's
  liquidity issues, which were the subject of the Partnership's July 17, 2008
  press release.  On October 22, 2008, the Partnership received a
  subpoena from the SEC pursuant to a formal order of investigation requesting
  certain documents relating to, among other things, the Private Company's
  liquidity issues.  The Partnership has been cooperating, and intends
  to continue cooperating, with the SEC in its investigation.
  On July
  23, 2008, the Partnership and its general partner each received a Grand Jury
  subpoena from the United States Attorney's Office in Oklahoma City, Oklahoma,
  requiring, among other things, that the Partnership and its general partner
  produce financial and other records related to the Partnership's July 17, 2008
  press release.  The Partnership has been informed that the U.S.
  Attorneys' Offices for the Western District of Oklahoma and the Northern
  District of Oklahoma are in discussions regarding the subpoenas, and no date has
  been set for a response to the subpoenas.  The Partnership and its
  general partner intend to cooperate fully with this investigation if and when it
  proceeds.
  Securities
  and Other Litigation
  Between
  July 21, 2008 and September 4, 2008, the following class action complaints were
  filed:
  1.
  Poelman v. SemGroup Energy
  Partners, L.P., et al
  ., Civil Action No. 08-CV-6477, in the United States
  District Court for the Southern District of New York (filed July 21,
  2008).  The plaintiff voluntarily dismissed this case on August 26,
  2008;
  2.
  Carson v. SemGroup Energy Partners,
  L.P. et al
  .
  ,
  Civil Action No. 08-cv-425, in the Northern District of Oklahoma (filed July 22,
  2008);
  3.
  Charles D. Maurer SIMP Profit
  Sharing Plan f/b/o Charles D. Maurer v. SemGroup Energy Partners, L.P. et
  al.
  , Civil Action No. 08-cv-6598, in the United States District Court for
  the Southern District of New York (filed July 25, 2008);
  4.
  Michael Rubin v. SemGroup Energy
  Partners, L.P. et al.
  , Civil Action No. 08-cv-7063, in the United States
  District Court for the Southern District of New York (filed August 8,
  2008);
  5.
  Dharam V. Jain v. SemGroup Energy
  Partners, L.P. et al.
  , Civil Action No. 08-cv-7510, in the United States
  District Court for the Southern District of New York  (filed August 25,
  2008); and
  6.
  William L. Hickman v. SemGroup
  Energy Partners, L.P. et al.
  , Civil Action No. 08-cv-7749, in the United
  States District Court for the Southern District of New York (filed September 4,
  2008).
  27
  Table of Contents
  SEMGROUP
  ENERGY PARTNERS, L.P.
  NOTES
  TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
  Pursuant
  to a motion filed with the United States Judicial Panel on Multidistrict
  Litigation ("MDL Panel"), the
  Maurer
  case has been transferred to the Northern District of Oklahoma and
  consolidated with the
  Carson
  case.  The
  Rubin, Jain,
  and
  Hickman
  cases have also been transferred to the Northern District of
  Oklahoma.
  A hearing
  on motions for appointment as lead plaintiff was held in the
  Carson
  case on October 17,
  2008.  At that hearing, the court granted a motion to consolidate the
  Carson
  and
  Maurer
  cases for pretrial
  proceedings, and the consolidated litigation is now pending as
  In Re: SemGroup Energy Partners,
  L.P. Securities Litigation
  , Case No. 08-CV-425-GKF-PJC. The court entered
  an order on October 27, 2008, granting the motion of Harvest Fund Advisors LLC
  to be appointed lead plaintiff in the consolidated litigation.  On
  January 23, 2009, the court entered a Scheduling Order providing, among other
  things, that the lead plaintiff may file a consolidated amended complaint within
  70 days of the date of the order, and that defendants may answer or otherwise
  respond within 60 days of the date of the filing of a consolidated amended
  complaint.
  On
  January 30, 2009 the lead plaintiff filed a motion to modify the stay of
  discovery provided for under the Private Securities Litigation Reform Act. The
  court granted Plaintiff's motion, and the Partnership and certain other
  defendants filed a Petition for Writ of Mandamus in the Tenth Circuit Court of
  Appeals that was denied after oral argument on April 24,
  2009.
  The lead
  plaintiff obtained an extension to file its consolidated amended complaint until
  May 4, 2009; defendants have 60 days from that date to answer or otherwise
  respond to the complaint.
  The lead
  plaintiff filed a consolidated amended complaint on May 4, 2009.  In
  that complaint, filed as a putative class action on behalf of all purchasers of
  the Partnership's units from July 17, 2007 to July 17, 2008 (the "class
  period"), lead plaintiff asserts claims under the federal securities laws
  against the Partnership, its general partner, certain of the Partnership's
  current and former officers and directors, certain underwriters in the
  Partnership's initial and secondary public offerings, and certain entities who
  were investors in the Private Company and their individual representatives who
  served on the Private Company's management committee. Among other allegations,
  the amended complaint alleges that the Partnership's financial condition
  throughout the class period was dependent upon speculative commodities trading
  by the Private Company and its Chief Executive Officer, Thomas L. Kivisto, and
  that Defendants negligently and intentionally failed to disclose this
  speculative trading in the Partnership's public filings during the class period.
  Specifically, the amended complaint alleges claims for violations of sections
  11, 12(a)(2), and 15 of the Securities Act of 1933 for damages and rescission
  with respect to all persons who purchased the Partnership's units in the initial
  and secondary offerings, and also asserts claims under section 10b, Rule 10b-5,
  and section 20(a) of the Securities and Exchange Act of 1934. The amended
  complaint seeks certification as a class action under the Federal Rules of Civil
  Procedure, compensatory and rescissory damages for class members, pre-judgment
  interest, costs of court, and attorneys' fees.
  The
  Partnership intends to vigorously defend these actions.  There can be
  no assurance regarding the outcome of the litigation.  An estimate of
  possible loss, if any, or the range of loss cannot be made and therefore the
  Partnership has not accrued a loss contingency related to these actions.
  However, the ultimate resolution of these actions could have a material adverse
  effect on the Partnership's business, financial condition, results of
  operations, cash flows, ability to make distributions to its unitholders, the
  trading price of the Partnership's common units and its ability to conduct its
  business.
  In March
  and April 2009, nine current or former executives of the Private Company and
  certain of its affiliates filed wage claims with the Oklahoma Department of
  Labor against the Partnership's general partner.  Their claims arise
  from the Partnership's general partner's Long-Term Incentive Plan, Employee
  Phantom Unit Agreement ("Phantom Unit
  Agreement").  Most claimants allege that phantom units previously
  awarded to them vested upon the Change of Control that occurred in July
  2008.  One claimant alleges that his phantom units vested upon his
  termination.  The claimants contend the Partnership's general
  partner's failure to deliver certificates for the phantom units within 60 days
  after vesting has caused them to be damaged, and they seek recovery of
  approximately $2 million in damages and penalties.
  On April
  30, 2009, all of the wage claims were dismissed on jurisdictional grounds by the
  Department of Labor.
  The Partnership's general partner intends to
  vigorously defend these claims.
  The
  Partnership may become the subject of additional private or government actions
  regarding these matters in the future.  Litigation may be
  time-consuming, expensive and disruptive to normal business operations, and the
  outcome of litigation is difficult to predict.  The defense of these
  lawsuits may result in the incurrence of significant legal expense, both
  directly and as the result of the Partnership's indemnification
  obligations.  The litigation may also divert management's attention
  from the Partnership's operations which may cause its business to
  suffer.  An unfavorable outcome in any of these matters may have a
  material adverse effect on the Partnership's business, financial condition,
  results of operations, cash flows, ability to make distributions to its
  unitholders, the trading price of the Partnership's common units and its ability
  to conduct its business. All or a portion of the defense costs and any amount
  the Partnership may be required to pay to satisfy a judgment or settlement of
  these claims may not be covered by insurance.
  28
  SEMGROUP
  ENERGY PARTNERS, L.P.
  NOTES
  TO UNAUDITED CONSOLIDATED FINANCIAL
  STATEMENTS
  Examiner
  On August
  12, 2008, a motion was filed by the United States Trustee asking the Bankruptcy
  Court to appoint an examiner to investigate the Private Company's trading
  strategies as well as certain "insider transactions," including the contribution
  of the crude oil assets to the Partnership in connection with its initial public
  offering, the sale of the Acquired Asphalt Assets to the Partnership, the sale
  of the Acquired Pipeline Assets to the Partnership, the sale of the Acquired
  Storage Assets to the Partnership, and the entering into the Holdings Credit
  Agreements by SemGroup Holdings.  On September 10, 2008, the
  Bankruptcy Court approved the appointment of an examiner, and on October 14,
  2008, the United States Trustee appointed Louis J. Freeh, former director of the
  Federal Bureau of Investigation, as the examiner.
  On April
  15, 2009, the examiner filed a report summarizing the findings of his
  investigation with the Bankruptcy Court (the "Examiner's Report").
  The examiner
  was directed by the Bankruptcy Court to (i) investigate the circumstances
  surrounding the Private Company's trading strategy, the transfer of the New York
  Mercantile Exchange account, certain insider transactions, the formation of the
  Partnership, the potential improper use of borrowed funds and funds generated
  from the Private Company's operations and the liquidation of their assets to
  satisfy margin calls related to the trading strategy for the Private Company and
  certain entities owned or controlled by the Private Company's officers and
  directors and (ii) determine whether any directors, officers or employees of the
  Private Company participated in fraud, dishonesty, incompetence, misconduct,
  mismanagement, or irregularity in the management of the affairs of the Private
  Company and whether the Private Company's estates have causes of action against
  such persons arising from any such participation.
  The
  Examiner's Report identified potential claims or causes of action against
  current officers of the Partnership's general partner who were former officers
  of the Private Company, including, without limitation, (i)
  against Kevin L. Foxx
  for his failure to develop a suitable risk management policy or integrate a
  suitable risk management policy into the Private Company's business controls,
  and for his failure to comply with the risk management policy that did exist,
  thereby subjecting the Private Company to increased risk and (ii) against Alex
  Stallings for his failure to stop Thomas L. Kivisto from engaging in trading
  activity on his own behalf through Westback Purchasing Company, L.L.C., a
  limited liability trading partnership which Mr. Kivisto owned and controlled,
  thereby subjecting the Private Company to increased risk and
  losses.
  In
  addition, the Examiner's Report criticized Mr. Foxx for certain conflicts of
  interest with entities that he or his family invested in and which had a
  business relationship with the Private Company.
  Additionally, the
  Examiner's Report identified a number of potential claims or causes of action
  against Mr. Kivisto and Gregory C. Wallace, who are former directors of the
  Partnership's general partner and former officers of the Private Company,
  including, without limitation, for negligence and mismanagement, fraud and false
  statements, conversion and corporate waste, unjust enrichment, breach of
  fiduciary duties and breach of contract.
  The
  Examiner's Report and related exhibits are publicly available at
  www.kccllc.net/SemGroup.
  Internal
  Review
  As
  previously announced, in July 2008 the Board created an internal review
  subcommittee of the Board comprised of directors who are independent of
  management and the Private Company to determine whether the Partnership
  participates in businesses other than as described in its filings with the SEC
  and to conduct investigations into other such specific items as are deemed to be
  appropriate by the subcommittee.  The subcommittee retained
  independent legal counsel to assist it in its investigations.
  The
  subcommittee has investigated a short-term financing transaction involving two
  subsidiaries of the Private Company.  This transaction was identified
  as a potential source of concern in a whistleblower report made after the
  Private Company filed for bankruptcy.  Although the transaction did
  not involve the Partnership or its subsidiaries, it was investigated because it
  did involve certain senior executive officers of the Partnership's general
  partner who were also senior executive officers of the Private Company at the
  time of the transaction.  Based upon its investigation, counsel for
  the subcommittee found that, subject to the subcommittee's lack of access to
  Private Company documents and electronic records and witnesses, although certain
  irregularities occurred in the transactions, the transaction did not appear to
  cause the relevant officers to understand or believe that the Private Company
  had a lack of liquidity that imperiled the Private Company's ability to meet its
  obligations to the Partnership and that certain aspects of the documentation of
  the transaction that were out of the ordinary did not call into question the
  integrity of any of the relevant officers.
  The
  subcommittee also investigated whether certain senior executive officers of the
  Partnership's general partner who were also senior executive officers of the
  Private Company knew and understood, beginning as early as July 2007 and at
  various times thereafter, about a lack of liquidity at the Private Company that
  imperiled the Private Company's ability to meet its obligations to the
  Partnership.  Based upon this investigation, and subject to the
  subcommittee's lack of access to Private Company documents and electronic
  records and witnesses, counsel for the subcommittee found that each of the
  officers had access to and reviewed Private Company financial information,
  including information regarding the Private Company's commodity trading
  activities, from which they could have developed an understanding of the nature
  and significance of the trading activities that led to liquidity problems at the
  Private Company well before they say they did.  While the officers
  each stated sincerely that they did not understand the nature or extent of the
  Private Company's trading-related problems until the first week of July 2008 or
  later, objective evidence suggests that they showed at least some indifference
  to known or easily discoverable facts and that they failed to adhere to
  procedures under the Private Company's Risk Management Policy created expressly
  to ensure that the Private Company's trading activities were properly
  monitored.  Nonetheless, counsel for the subcommittee was not
  persuaded by the documents and other evidence it was able to access that the
  officers in fact knew and understood that the Private Company's liquidity or
  capital needs were a significant cause for alarm until, at the earliest, the
  second quarter of 2008.  Moreover, while it appeared to counsel that
  the officers developed a growing awareness of the nature and severity of the
  Private Company's liquidity issues over the second quarter of 2008, counsel was
  unable to identify with any more precision the specific level of concern or
  understanding these individuals had prior to July 2008.  While not
  within the scope of such counsel's investigation, counsel was requested by the
  subcommittee to note any information that came to counsel's attention during its
  investigation that suggested that the officers intended to deceive or mislead
  any third party.  Subject to limitations described in its report, no
  information came to counsel's attention during its investigation that suggested
  to counsel that the officers intended to deceive or to mislead any third
  parties.  In addition, in connection with the investigation, counsel
  for the subcommittee did not express any findings of intentional misconduct or
  fraud on the part of any officer or employee of the Partnership.
  29
  Table of Contents
  SEMGROUP
  ENERGY PARTNERS, L.P.
  NOTES
  TO UNAUDITED CONSOLIDATED FINANCIAL
  STATEMENTS
  After
  completion of the internal review, a plan was developed with the advice of the
  Audit Committee of the Board to further strengthen the processes and procedures
  at the Partnership.  This plan includes, among other things,
  reevaluating executive officers and accounting and finance personnel (including
  a realignment of officers as described elsewhere in this report) and hiring, as
  deemed necessary, additional accounting and finance personnel or consultants;
  reevaluating the Partnership's internal audit function and determining whether
  to expand the duties and responsibilities of such group; evaluating the
  comprehensive training programs for all management personnel covering, among
  other things, compliance with controls and procedures, revising the reporting
  structure so that the Chief Financial Officer reports directly to the Audit
  Committee, and increasing the business and operational oversight role of the
  Audit Committee.
  Equity
  Awards and Employment Agreements
  The
  Change of Control constituted a change of control under the Plan, which resulted
  in the early vesting of all awards under the Plan.  As such, the
  phantom units awarded to Messrs. Kevin L. Foxx, Michael J. Brochetti, Alex G.
  Stallings, Peter L. Schwiering and Jerry A. Parsons in the amounts of 150,000
  units, 90,000 units, 75,000 units, 45,000 units and 20,000 units, respectively,
  are fully vested.  The common units underlying such awards were issued
  to such individuals in August 2008.  In addition, the 5,000 restricted
  units awarded to each of Messrs. Billings, Kosnik and Bishop for their service
  as independent members of the Board fully vested.
  The
  Change of Control also resulted in a change of control under the employment
  agreements of Messrs. Foxx, Brochetti, Stallings, Schwiering and
  Parsons.  If within one year after the Change of Control any such
  officer is terminated by the Partnership's general partner without Cause (as
  defined below) or such officer terminates the agreement for Good Reason (as
  defined below), he will be entitled to payment of any unpaid base salary and
  vested benefits under any incentive plans, a lump sum payment equal to 24 months
  of base salary and continued participation in the Partnership's general
  partner's welfare benefit programs for one year after termination. Upon such an
  event, Messrs Foxx, Brochetti, Stallings, Schwiering and Parsons would be
  entitled to lump sum payments of $900,000, $600,000, $550,000, $500,000 and
  $500,000, respectively, in addition to continued participation in the
  Partnership's general partner's welfare benefit programs.  As of the
  date of the filing of this report, none of these officers is entitled to these
  benefits as none of them has been terminated by the Partnership's general
  partner without Cause or has terminated his agreement for Good
  Reason.
  For
  purposes of the employment agreements:
  "Cause"
  means (i) conviction of the executive officer by a court of competent
  jurisdiction of any felony or a crime involving moral turpitude; (ii) the
  executive officer's willful and intentional failure or willful intentional
  refusal to follow reasonable and lawful instructions of the Board;
  (iii) the executive officer's material breach or default in the performance
  of his obligations under the employment agreement; or (iv) the executive
  officer's act of misappropriation, embezzlement, intentional fraud or similar
  conduct involving the Partnership's general partner.
  "Good
  Reason" means (i) a material reduction in the executive officer's base
  salary; (ii) a material diminution of the executive officer's duties,
  authority or responsibilities as in effect immediately prior to such diminution;
  or (iii) the relocation of the named executive officer's principal work
  location to a location more than 50 miles from its current
  location.
  30
  Table of Contents
  SEMGROUP
  ENERGY PARTNERS, L.P.
  NOTES
  TO UNAUDITED CONSOLIDATED FINANCIAL
  STATEMENTS
  Taxation
  as a Corporation
  The
  anticipated after-tax economic benefit of an investment in the Partnership's
  common units depends largely on the Partnership being treated as a partnership
  for federal income tax purposes.  If less than 90% of the gross income
  of a publicly traded partnership, such as the Partnership, for any taxable year
  is "qualifying income" from sources such as the transportation, marketing (other
  than to end users), or processing of crude oil, natural gas or products thereof,
  interest, dividends or similar sources, that partnership will be taxable as a
  corporation under Section 7704 of the Internal Revenue Code for federal income
  tax purposes for that taxable year and all subsequent years.  In this
  regard, because the income the Partnership earns from the Throughput Agreement
  and the Terminalling Agreement with the Private Company is "qualifying income"
  any material reduction or elimination of that income or any amendment to the
  Throughput Agreement or the Terminalling Agreement which changes the nature of
  the services provided or the income generated thereunder, may cause the
  Partnership's remaining "qualifying income" to constitute less than 90% of its
  gross income.  As a result, the Partnership could become taxable as a
  corporation for federal income tax purposes, unless it were to transfer the
  businesses that generate non-qualifying income to one or more subsidiaries taxed
  as corporations and pay entity level income taxes on such non-qualifying
  income.  The IRS has not provided any ruling to the Partnership on
  this matter.
  If the
  Partnership were treated as a corporation for federal income tax purposes, then
  it would pay federal income tax on its income at the corporate tax rate, which
  is currently a maximum of 35%, and would likely pay state income tax at varying
  rates.  Distributions would generally be taxed again to unitholders as
  corporate distributions and none of the Partnership's income, gains, losses,
  deductions or credits would flow through to its unitholders.  Because
  a tax would be imposed upon the Partnership as an entity, cash available for
  distribution to its unitholders would be substantially
  reduced.  Treatment of the Partnership as a corporation would result
  in a material reduction in the anticipated cash flow and after-tax return to
  unitholders and thus would likely result in a substantial reduction in the value
  of the Partnership's common units.
  Other
  Effects
  The
  Bankruptcy Filings have had and may in the future continue to have a number of
  other impacts on the Partnership's business and management.  In the
  Amended Omnibus Agreement and other agreements with the Private Company, the
  Private Company agreed to indemnify the Partnership for certain environmental
  and other claims relating to the crude oil and liquid asphalt cement assets that
  have been contributed to the Partnership.  In connection with the
  Settlement, the Partnership waived these claims and the Amended Omnibus
  Agreement and other relevant agreements, including the indemnification
  provisions therein, were rejected as part of the Bankruptcy
  Proceedings.  If the Partnership experiences an environmental or other
  loss, it would experience increased losses which may have a material adverse
  effect on its business, financial condition, results of operations, cash flows,
  ability to make distributions to its unitholders, the trading price of its
  common units and the ability to conduct its business.
  The
  Partnership is currently pursuing various strategic alternatives for its
  business and assets including the possibility of entering into storage contracts
  with third party customers and the sale of all or a portion of its
  assets.  The uncertainty relating to the Bankruptcy Filings and the
  recent global market and economic conditions may make it more difficult to
  pursue merger opportunities or enter into storage contracts with third party
  customers.
  In
  addition, general and administrative expenses (exclusive of non-cash
  compensation expense related to the vesting of the units under the Plan - see
  Note 9) increased by approximately $6.9 million and $7.5 million, or
  approximately 300% and 326%, to approximately $9.2 million for the third quarter
  of 2008 and $9.8 million for the fourth quarter of 2008, respectively, compared
  to $2.3 million in the second quarter of 2008.  This increase is due
  to increased costs related to legal and financial advisors as well as other
  related costs in connection with events related to the Bankruptcy Filings, the
  securities litigation and governmental investigations, and the Partnership's
  efforts to enter into storage contracts with third party customers and pursue
  merger opportunities.  The Partnership expects this increased level of
  general and administrative expenses to continue into 2009.
  31
  Table of Contents
  Item 2.
  Management's
        Discussion and Analysis of Financial Condition and Results of
        Operations
  As
  used in this quarterly report, unless we indicate otherwise: (1) "SemGroup
  Energy Partners," "our," "we," "us" and similar terms refer to SemGroup Energy
  Partners, L.P., together with our subsidiaries, (2) the "Private Company" refers
  to SemGroup, L.P. and its subsidiaries and affiliates (other than our general
  partner and us), and (3) "Crude Oil Business" refers to the crude oil
  gathering, transportation, terminalling and storage assets that were contributed
  to us by the Private Company. The historical financial statements for periods
  prior to the contribution of the operations to us by the Private Company on
  July 20, 2007 reflect the operations of our predecessor. The following
  discussion analyzes the historical financial condition and results of operations
  of the Partnership and should be read in conjunction with our predecessor's
  financial statements and notes thereto, and Management's Discussion and Analysis
  of Financial Condition and Results of Operations presented in our Annual Report
  on Form 10-K for the year ended December 31, 2007.  The Partnership as
  used herein refers to the financial results and operations of our predecessor
  until its contribution to us, and to our financial results and operations
  thereafter.
  Forward-Looking
  Statements
  This
  report contains "forward-looking statements" intended to qualify for the safe
  harbors from liability established by the federal securities laws. Statements
  included in this quarterly report that are not historical facts (including any
  statements concerning the benefits of the Settlement (as defined below) or the
  Credit Agreement Amendment (as defined below), the impact of the Bankruptcy
  Filings (as defined below) and any statements regarding plans and objectives of
  management for future operations or economic performance, or assumptions or
  forecasts related thereto), including, without limitation, the information set
  forth in Management's Discussion and Analysis of Financial Condition and Results
  of Operations, are forward-looking statements. These statements can be
  identified by the use of forward-looking terminology including "may," "will,"
  "should," "believe," "expect," "intend," "anticipate," "estimate," "continue,"
  or other similar words. These statements discuss future expectations, contain
  projections of results of operations or of financial condition, or state other
  "forward-looking" information. We and our representatives may from time to time
  make other oral or written statements that are also forward-looking
  statements.
  Such
  forward-looking statements are subject to various risks and uncertainties that
  could cause actual results to differ materially from those anticipated as of the
  date of the filing of this report. Although we believe that the expectations
  reflected in these forward-looking statements are based on reasonable
  assumptions, no assurance can be given that these expectations will prove to be
  correct. Important factors that could cause our actual results to differ
  materially from the expectations reflected in these forward-looking statements
  include, among other things, those set forth in Part I, "Item 1A. Risk Factors"
  in our Annual Report on Form 10-K for the year ended December 31, 2007, which
  was filed with the Securities and Exchange Commission (the "SEC") on March 6,
  2008 (the "2007 Form 10-K"), and those set forth in "Item 1A. Risk Factors" of
  this report.
  All
  forward-looking statements included in this report are based on information
  available to us on the date of this report. We undertake no obligation to
  publicly update or revise any forward-looking statement, whether as a result of
  new information, future events or otherwise. All subsequent written and oral
  forward-looking statements attributable to us or persons acting on our behalf
  are expressly qualified in their entirety by the cautionary statements contained
  throughout this report.
  Overview
  We are a
  publicly traded master limited partnership with operations in twenty-three
  states. We provide integrated terminalling, storage, gathering and
  transportation services for companies engaged in the production, distribution
  and marketing of crude oil and liquid asphalt cement. We manage our operations
  through two operating segments: (i) terminalling and storage services and
  (ii) gathering and transportation services. We were formed in February 2007
  as a Delaware master limited partnership initially to own, operate and develop a
  diversified portfolio of complementary midstream energy assets.
  In July
  2007, we issued 12,500,000 common units, representing limited partner interests,
  and 12,570,504 subordinated units, representing additional limited partner
  interests, to SemGroup Holdings, L.P., or SemGroup Holdings, and 549,908 general
  partner units representing a 2% general partner interest to SemGroup Energy
  Partners G.P., L.L.C., our general partner. SemGroup Holdings then completed a
  public offering of 12,500,000 common units at a price of $22 per unit. In
  addition, we issued an additional 1,875,000 common units to the public pursuant
  to the underwriters' exercise of their over-allotment option. We did not receive
  any proceeds from the common units sold by SemGroup Holdings. We received net
  proceeds of approximately $38.7 million after deducting underwriting discounts
  from the sale of common units in connection with the exercise of the
  underwriters' over-allotment option. We used these net proceeds to reduce
  outstanding borrowings under our credit facility.  In connection with
  our initial public offering, we entered into a Throughput Agreement (the
  "Throughput Agreement") with the Private Company under which we provided crude
  oil gathering and transportation and terminalling and storage services to the
  Private Company.
  32
  Table of Contents
  On
  February 20, 2008, we purchased land, receiving infrastructure, machinery,
  pumps and piping and 46 liquid asphalt cement and residual fuel oil terminalling
  and storage facilities (the "Acquired Asphalt Assets") from the Private Company
  for aggregate consideration of $379.5 million, including $0.7 million of
  acquisition-related costs. For accounting purposes, the acquisition has been
  reflected as a purchase of assets, with the Acquired Asphalt Assets recorded at
  the historical cost of the Private Company, which was approximately $145.5
  million, with the additional purchase price of $234.0 million reflected in the
  statement of changes in partners' capital as a distribution to the Private
  Company.  In conjunction with the purchase of the Acquired Asphalt
  Assets, we amended our existing credit facility, increasing our
  borrowing capacity to $600 million. Concurrently, we issued 6,000,000
  common units, receiving proceeds, net of underwriting discounts and
  offering-related costs, of $137.2 million. Our general partner also made a
  capital contribution of $2.9 million to maintain its 2.0% general partner
  interest in us. On March 5, 2008, we issued an additional 900,000
  common units, receiving proceeds, net of underwriting discounts, of $20.6
  million, in connection with the underwriters' exercise of their over-allotment
  option in full. Our general partner made a corresponding capital
  contribution of $0.4 million to maintain its 2.0% general partner interest in
  us.  In connection with the acquisition of the Acquired Asphalt
  Assets, we entered into a Terminalling and Storage Agreement (the
  "Terminalling Agreement") with the Private Company and certain of its
  subsidiaries under which we provided liquid asphalt cement terminalling and
  storage and throughput services to the Private Company and the Private Company
  has agreed to use the our services at certain minimum
  levels.  Our general partner's Board of Directors (the "Board")
  approved the acquisition of the Acquired Asphalt Assets as well as the terms of
  the related agreements based on a recommendation from its conflicts committee,
  which consisted entirely of independent directors. The conflicts committee
  retained independent legal and financial advisors to assist it in evaluating the
  transaction and considered a number of factors in approving the acquisition,
  including an opinion from the committee's independent financial advisor that the
  consideration paid for the Acquired Asphalt Assets was fair, from a financial
  point of view, to us.
  On May
  12, 2008, we purchased the Eagle North Pipeline System, a 130-mile, 8-inch
  pipeline that originates in Ardmore, Oklahoma and terminates in Drumright,
  Oklahoma as well as other real and personal property related to the pipeline
  (the "Acquired Pipeline Assets") from the Private Company for aggregate
  consideration of $45.1 million, including $0.1 million of acquisition-related
  costs.  The acquisition was funded with borrowings under our revolving
  credit facility.  We have suspended capital expenditures on this
  pipeline due to the continuing impact of the Bankruptcy Filings. 
  Management currently intends to put the asset into service by late 2009 or early
  2010 and is exploring various alternatives to complete the
  project.  The Board approved the acquisition of the Acquired Pipeline
  Assets based on a recommendation from its conflicts committee, which consisted
  entirely of independent directors. The conflicts committee retained independent
  legal and financial advisors to assist it in evaluating the transaction and
  considered a number of factors in approving the acquisition, including an
  opinion from the committee's independent financial advisor that the
  consideration paid for the Acquired Pipeline Assets was fair, from a financial
  point of view, to us.
  On May
  30, 2008, we purchased certain land, crude oil storage and terminalling
  facilities with an aggregate of approximately 2.0 million barrels of storage
  capacity and related assets located at the Cushing Interchange from the Private
  Company and we assumed a take-or-pay, fee-based, third party contract through
  August 2010 relating to the additional 2.0 million barrels of storage capacity
  (the "Acquired Storage Assets") for aggregate consideration of $90.3 million,
  including $0.3 million of acquisition-related costs.  The acquisition
  was funded with borrowings under our revolving credit facility.  The
  Board approved the acquisition of the Acquired Storage Assets based on a
  recommendation from its conflicts committee, which consisted entirely of
  independent directors. The conflicts committee retained independent legal and
  financial advisors to assist it in evaluating the transaction and considered a
  number of factors in approving the acquisition, including an opinion from the
  committee's independent financial advisor that the consideration paid for the
  Acquired Storage Assets was fair, from a financial point of view, to
  us.
  Impact
  of the Bankruptcy of the Private Company and Certain of its Subsidiaries and
  Related Events
  Due to
  the events related to the Bankruptcy Filings (as defined below) described
  herein, including the uncertainty relating to future cash flows, we face
  substantial doubt as to our ability to continue as a going
  concern.  While it is not feasible to predict the ultimate outcome of
  the events surrounding the Bankruptcy Cases (as defined below), we have been and
  could continue to be materially and adversely affected by such events and we may
  be forced to make a bankruptcy filing or take other action that could have a
  material adverse effect on our business, the price of our common units and our
  results of operations.
  33
  Table of Contents
  Bankruptcy
  Filings
  On July
  17, 2008, we issued a press release announcing that the Private Company was
  experiencing liquidity issues and was exploring various alternatives, including
  raising additional equity, debt capital or the filing of a voluntary petition
  for reorganization under Chapter 11 of the Bankruptcy Code to address these
  issues.  We filed this press release in a Current Report on Form 8-K
  filed with the SEC on July 18, 2008.
  On July
  22, 2008, the Private Company and certain of its subsidiaries filed voluntary
  petitions (the "Bankruptcy Filings") for reorganization under Chapter 11 of the
  Bankruptcy Code in the United States Bankruptcy Court for the District of
  Delaware (the "Bankruptcy Court"), Case No. 08-11547-BLS.   The
  Private Company and its subsidiaries continue to operate their businesses and
  own and manage their properties as debtors-in-possession under the jurisdiction
  of the Bankruptcy Court and in accordance with the applicable provisions of the
  Bankruptcy Code (the "Bankruptcy Cases"). None of us, our general partner,
  our subsidiaries nor the subsidiaries of our general partner are debtors in the
  Bankruptcy Cases.  However, because of the contractual relationships
  with the Private Company and certain of its subsidiaries, the Bankruptcy Filings
  have adversely impacted us and may in the future impact us in various ways,
  including the items discussed below.  Our financial results as of
  September 30, 2008 reflect a $0.4 million allowance for doubtful accounts
  related to amounts due from third parties as of September 30,
  2008.  The allowance related to amounts due from third parties was
  established as a result of certain third party customers netting amounts due
  them from the Private Company with amounts due to us.  Also, due to
  the change of control of our general partner related to the Private Company's
  liquidity issues, all outstanding awards under our general partner's long-term
  incentive plan (the "Plan") vested on July 18, 2008, resulting in an
  incremental $18.0 million in non-cash compensation expense for the three months
  ended September 30, 2008.  In addition to the allowance for doubtful
  accounts and non-cash compensation expense described above, the results of
  operations for the three and nine months ended September 30, 2008 included in
  this quarterly report were affected by the Bankruptcy Filings and related
  events, which resulted in decreased revenues and increased general and
  administrative expenses as described below under "—Our Revenues," and "—Other
  Effects," respectively.
  Board
  and Management Composition
  On July
  9, 2008, Edward F. Kosnik was appointed as an independent member of the
  Board.  Mr. Kosnik is the chairman of the compensation committee
  and also serves on the audit committee and the conflicts committee of the Board.
  Under the provisions of the Plan, Mr. Kosnik was granted an award of 5,000
  restricted common units on July 9, 2008. These restricted common units
  vested on July 18, 2008 in connection with the change of control of our general
  partner described below.
  On July
  18, 2008, Manchester Securities Corp. ("Manchester") and Alerian Finance
  Partners, LP ("Alerian"), as lenders to SemGroup Holdings, the sole member of
  our general partner, exercised certain rights described below under a Loan
  Agreement and a Pledge Agreement, each dated June 25, 2008 (the "Holdings Credit
  Agreements"), that were triggered by certain events of default under the
  Holdings Credit Agreements.  On March 20, 2009, Alerian transferred
  its interest in the Holdings Credit Agreements to Manchester.  The
  Holdings Credit Agreements are secured by our subordinated units and incentive
  distribution rights and the membership interests in our general partner owned by
  SemGroup Holdings.  Manchester has not foreclosed on our subordinated
  units owned by SemGroup Holdings or the membership interests in our general
  partner.  Manchester may in the future exercise other remedies
  available to them under the Holdings Credit Agreement and related loan
  documents, including taking action to foreclose on the collateral securing the
  loan.  Neither us nor our general partner is a party to the Holdings
  Credit Agreements or the related loan documents.
  On July
  18, 2008, Manchester and Alerian exercised their right under the Holdings Credit
  Agreements to vote the membership interests of our general partner in order to
  reconstitute the Board (the "Change of Control").  Messrs. Thomas L.
  Kivisto, Gregory C. Wallace, Kevin L. Foxx, Michael J. Brochetti and W. Anderson
  Bishop were removed from the Board.  Mr. Bishop had served as the
  chairman of the audit committee and as a member of the conflicts committee and
  compensation committee of the Board.  Messrs. Sundar S. Srinivasan,
  David N. Bernfeld and Gabriel Hammond (each of whom is affiliated with
  Manchester or Alerian) were appointed to the Board.  Mr. Srinivasan
  was elected as Chairman of the Board.  Messrs. Brian F. Billings and
  Edward F. Kosnik remain as independent directors of the Board and continue to
  serve as members of the conflicts committee, audit committee and compensation
  committee of the Board.  In addition, Messrs. Foxx and Alex Stallings
  resigned the positions each officer held with SemGroup, L.P. in July
  2008.  Mr. Brochetti had previously resigned from his position with
  SemGroup, L.P. in March 2008.  Messrs. Foxx, Brochetti and Stallings
  remain as officers of our general partner.
  34
  Table of Contents
  On
  October 1, 2008, Dave Miller (who is an affiliate of Manchester) and Duke R.
  Ligon were appointed members of the Board. Mr. Ligon is an independent member of
  the Board and is the chairman of the audit committee and also serves on the
  compensation committee and the conflicts committee of the Board. In connection
  with his appointment to the Board, Mr. Ligon was granted an award of 5,000
  restricted common units.  The restricted common units granted to Mr.
  Ligon vest in one-third increments over a three-year period.
  On
  January 9, 2009, Mr. Srinivasan resigned his positions as Chairman of the Board
  and as a director.  Mr. Ligon was subsequently elected as Chairman of
  the Board.
  On March
  18, 2009, the Board realigned the officers of our general partner appointing
  Michael J. Brochetti as Executive Vice President—Corporate Development and
  Treasurer, Alex G. Stallings as Chief Financial Officer and Secretary, and James
  R. Griffin as Chief Accounting Officer.  Mr. Brochetti had previously
  served as Chief Financial Officer, Mr. Stallings had previously served as Chief
  Accounting Officer and Secretary and Mr. Griffin had previously served as
  Controller.
  Bankruptcy
  Court Order
  On
  September 9, 2008, the Bankruptcy Court entered an order relating to the
  settlement of certain matters between us and the Private Company (the "Order")
  in the Bankruptcy Cases.  Among other things, the Order provided that
  (i) the Private Company was to directly pay any utility costs attributable to
  the operations of the Private Company at certain shared facilities, and the
  Private Company was to pay us for past utility cost reimbursements that were due
  from the Private Company; (ii) commencing on September 15, 2008, payments under
  the Terminalling Agreement were netted against amounts due under the Amended
  Omnibus Agreement and were made on the 15th day of each month for the prior
  month (with a three business-day grace period); (iii) the Private Company
  provided us with a letter of credit in the amount of approximately $4.9 million
  to secure the Private Company's postpetition obligations under the Terminalling
  Agreement; (iv) the Private Company was to make payments under the Throughput
  Agreement for the month of August on September 15, 2008 (with a three
  business-day grace period) based upon the monthly contract minimums in the
  Throughput Agreement and netted against amounts due under the Amended Omnibus
  Agreement; (v) the Private Company was to make payments under the Throughput
  Agreement for the months of September and October on October 15, 2008 (with a
  three business-day grace period) and November 15, 2008 (with a three
  business-day grace period), respectively, or three business days after amounts
  due are determined and documentation therefore was provided and exchanged based
  upon actual volumes for each such month and at a rate equal to the average rate
  charged by us to third-party shippers in the same geographical area, with any
  such amounts netted against amounts due under the Amended Omnibus Agreement (as
  defined below); (vi) the parties were to reevaluate the Throughput Agreement and
  the payment terms with respect to services provided after October 2008; (vii)
  representatives of us and the Private Company were to meet to discuss the
  transition to us of certain of the Private Company's employees necessary to
  maintain our business, and pending agreement between the parties, the Private
  Company was to continue to provide services in accordance with the Amended
  Omnibus Agreement through at least November 30, 2008; (viii) the Private Company
  was to consent to an order relating a third-party storage contract which
  provided that we were the rightful owner of the rights in and to a certain
  third-party storage agreement and the corresponding amounts due thereunder; and
  (ix) we were to enter into a specified lease with the Private Company to permit
  the Private Company to construct a pipeline.
  Settlement
  with the Private Company
  On March
  12, 2009, the Bankruptcy Court held a hearing and approved the transactions
  contemplated by a term sheet (the "Settlement Term Sheet") relating to the
  settlement of certain matters between the Private Company and us (the
  "Settlement").  The Bankruptcy Court entered an order approving the
  Settlement upon the terms contained in the Settlement Term Sheet on March 20,
  2009.  We and the Private Company executed definitive documentation,
  in the form of a master agreement (the "Master Agreement"), dated April 7, 2009
  to be effective as of 11:59 PM CDT March 31, 2009, and certain other transaction
  documents to effectuate the Settlement and that superseded the Settlement Term
  Sheet.  The Bankruptcy Court entered an order approving the Master
  Agreement and the Settlement on April 7, 2009.  In addition, in
  connection with the Settlement, we and the requisite lenders under our secured
  credit facility entered into the Credit Agreement Amendment (as defined below)
  under which, among other things, the lenders consented to the Settlement and
  waived all existing defaults and events of default described in the Forbearance
  Agreement (as defined below) and amendments thereto.
  35
  Table of Contents
  The
  Settlement provided for the following:
  ·
  we
        transferred certain crude oil storage assets located in Kansas and
        northern Oklahoma to the Private
  Company;
  ·
  the
        Private Company transferred ownership of 355,000 barrels of crude oil tank
        bottoms and line fill to us;
  ·
  the
        Private Company rejected the Throughput
    Agreement;
  ·
  we
        and one of our subsidiaries have a $20 million unsecured claim against the
        Private Company and certain of its subsidiaries relating to rejection of
        the Throughput Agreement;
  ·
  we
        and the Private Company entered into the New Throughput Agreement (as
        defined below) pursuant to which we provide certain crude oil gathering,
        transportation, terminalling and storage services to the Private
        Company;
  ·
  we
        offered employment to certain crude oil
    employees;
  ·
  the
        Private Company transferred its asphalt assets that are connected to our
        asphalt assets to us;
  ·
  the
        Private Company rejected the Terminalling
    Agreement;
  ·
  one
        of our subsidiaries has a $35 million unsecured claim against the Private
        Company and certain of its subsidiaries relating to rejection of the
        Terminalling Agreement;
  ·
  we
        and the Private Company entered into the New Terminalling Agreement (as
        defined below) pursuant to which we provide liquid asphalt cement
        terminalling and storage services for the Private Company's remaining
        asphalt inventory;
  ·
  the
        Private Company agreed to remove all of its remaining asphalt inventory
        from our asphalt storage facilities no later than October 31,
        2009;
  ·
  the
        Private Company will be entitled to receive 20% of the proceeds of any
        sale by us of any of the asphalt assets transferred to us in connection
        with the Settlement that occurs prior to December 31,
    2009;
  ·
  the
        Private Company rejected the Amended Omnibus
    Agreement;
  ·
  we
        and the Private Company entered into the Shared Services Agreement (as
        defined below) pursuant to which the Private Company provides certain
        operational services for us;
  ·
  other
        than as provided above, we and the Private Company entered into mutual
        releases of claims relating to the rejection of the Terminalling
        Agreement, the Throughput Agreement and the Amended Omnibus
        Agreement;
  ·
  certain
        pre-petition claims by the Private Company and us were netted and
        waived;
  ·
  we
        and the Private Company resolved certain remaining issues related to the
        contribution of crude oil assets to us in connection with our initial
        public offering, our acquisition of the Acquired Asphalt Assets, our
        acquisition of the Acquired Pipeline Assets and our acquisition of the
        Acquired Storage Assets, including the release of claims relating to such
        acquisitions; and
  ·
  we
        and the Private Company entered into the Trademark Agreement (as defined
        below) which provides us with a non-exclusive, worldwide license to use
        certain trade names, including the name "SemGroup", and the corresponding
        mark until December 31, 2009, and the Private Company waived claims for
        infringement relating to such trade names and mark prior to the date of
        such license agreement.
  Management
  is currently evaluating the accounting for the Settlement, and is obtaining
  independent valuations of the assets transferred.  Certain terms of the
  transaction documents relating to the Settlement are discussed in more detail
  below.
  36
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  Shared
  Services Agreement
  In
  connection with the Settlement, we entered into a Shared Services Agreement,
  dated April 7, 2009 to be effective as of 11:59 PM CDT March 31, 2009 (the
  "Shared Services Agreement"), with the Private Company.  Pursuant to
  the Shared Services Agreement, the Private Company will provide certain general
  shared services, Cushing shared services (as described below), and SCADA
  services (as described below) to us.
  The
  general shared services include crude oil movement services, Department of
  Transportation services, right-of-way services, environmental services, pipeline
  and civil structural maintenance services, safety services, pipeline truck
  station maintenance services, project support services and truck dispatch
  services.  The fees for such general shared services are fixed at
  $125,000 for the month of April 2009 and such fixed fee may be extended by
  mutual agreement of the parties for one additional month.  Thereafter
  the fees will be calculated in accordance with the formulas contained
  therein.  The Private Company has agreed to provide the general shared
  services for three years (subject to earlier termination as provided therein)
  and the term may be extended an additional year by mutual agreement of the
  parties.
  The
  Cushing shared services include operational and maintenance services related to
  terminals at Cushing, Oklahoma.  The fees for such Cushing shared
  services are fixed at $20,000 for the month of April 2009 and such fixed
  fee may be extended by mutual agreement of the parties for one additional
  month.  Thereafter the fees will be calculated in accordance with the
  formulas contained therein.  The Private Company has agreed to provide
  the Cushing shared services for three years (subject to earlier termination as
  provided therein) and the term may be extended an additional year by mutual
  agreement of the parties.
  The SCADA
  services include services related to the operation of the SCADA system which is
  used in connection with our crude oil operations.  The fees for such
  SCADA services are fixed at $15,000 for the month of April 2009 and such
  fixed fee may be extended by mutual agreement of the parties for one additional
  month.  Thereafter the fees will be calculated in accordance with the
  formulas contained therein.  The Private Company has agreed to provide
  the SCADA services for five years (subject to earlier termination as provided
  therein) and we may elect to extend the term for two subsequent five year
  periods.
  Transition
  Services Agreement
  In
  connection with the Settlement, we entered into a Transition Services Agreement,
  dated April 7, 2009 to be effective as of 11:59 PM CDT March 31, 2009 (the
  "Transition Services Agreement"), with the Private Company.  Pursuant
  to the Transition Services Agreement, the Private Company will provide certain
  corporate, crude oil and asphalt transition services, in each case for a limited
  amount of time, to us.
  Transfer
  of Crude Oil Assets
  In
  connection with the Settlement, we transferred certain crude oil assets located
  in Kansas and northern Oklahoma to the Private Company.  These
  transfers included real property and associated personal property at locations
  where the Private Company owned the pipeline.  We retained certain
  access and connection rights to enable us to continue to operate our crude oil
  trucking business in such areas.  In addition, we transferred our
  interests in the SCADA System, a crude oil inventory tracking system, to the
  Private Company.
  In
  addition, the Private Company transferred to us (i) 355,000 barrels of crude oil
  line fill and tank bottoms, which are necessary for us to operate our crude oil
  tank storage operations and our Oklahoma and Texas crude oil pipeline systems,
  (ii) certain personal property located in Oklahoma, Texas and Kansas used in
  connection with our crude oil trucking business and (iii) certain real property
  located in Oklahoma, Kansas, Texas and New Mexico that was intended to be
  transferred in connection with our initial public offering.
  Transfer
  of Asphalt Assets
  In
  connection with the Settlement, the Private Company transferred certain asphalt
  processing assets that were connected to, adjacent to, or otherwise
  contiguous with our existing asphalt facilities and associated real property
  interests to us.  The transfer of the Private Company's asphalt assets
  in connection with the Settlement provides us with outbound logistics for our
  existing asphalt assets and, therefore, allows us to provide asphalt
  terminalling and storage services to third parties.
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  Table of Contents
  New
  Throughput Agreement
  In
  connection with the Settlement, we and the Private Company entered into a
  Throughput Agreement, dated as of April 7, 2009 to be effective as of 11:59 PM
  CDT March 31, 2009 (the "New Throughput Agreement"), pursuant to which we
  provide certain crude oil gathering, transportation, terminalling and storage
  services to the Private Company.
  Under the
  New Throughput Agreement, we charge the following fees: (i) barrels gathered via
  gathering lines will be charged a gathering rate of $0.75 per barrel, (ii)
  barrels transported within Oklahoma will be charged $1.00 per barrel while
  barrels transported on the Masterson Mainline will be charged $0.55 per barrel,
  (iii) barrels transported by truck will be charged in accordance with the
  schedule contained therein, including a fuel surcharge, (iv) storage fees shall
  equal $0.50 per barrel per month for product located in storage tanks located in
  Cushing, Oklahoma and $0.44 per barrel per month for product not located in
  dedicated Cushing storage tanks, and (v) a delivery charge of $0.08 per barrel
  will be charged for deliveries out of the Cushing Interchange Terminal. The
  New Throughput Agreement has an initial term of one year with additional
  automatic one-month renewals unless either party terminates the agreement upon
  thirty-days prior notice.
  New
  Terminalling and Storage Agreement
  In
  connection with the Settlement, we and the Private Company entered into a
  Terminalling and Storage Agreement, dated as of April 7, 2009 to be effective as
  of 11:59 PM CDT March 31, 2009 (the "New Terminalling Agreement"), pursuant to
  which we provide certain asphalt terminalling and storage services for the
  remaining asphalt inventory of the Private Company.  Storage services
  under the New Terminalling Agreement are equal to $0.565 per barrel per month
  multiplied by the total shell capacity in barrels for each storage tank where
  the Private Company and its affiliates have product; provided that if the
  Private Company removes all product from a storage tank prior to the end of the
  month, then the storage service fees shall be pro-rated for such month based on
  the number of calendar days storage was actually used.  Throughput
  fees under the New Terminalling Agreement are equal to $9.25 per ton; provided
  that no fees are payable for transfers of product between storage tanks located
  at the same or different terminals.  The New Terminalling Agreement
  has an initial term that expires on October 31, 2009, which may be extended for
  one month by mutual agreement of the parties.
  New
  Access and Use Agreement
  In
  connection with the Settlement, we and the Private Company entered into an
  Access and Use Agreement, dated as of April 7, 2009 to be effective as of 11:59
  PM CDT March 31, 2009 (the "New Access and Use Agreement"), pursuant to which we
  will allow the Private Company access rights to our asphalt facilities relating
  to its existing asphalt inventory.  The term of the Access and Use
  Agreement will end separately for each terminal upon the earlier of October 31,
  2009 or until all of the existing asphalt inventory of the Private Company is
  removed from such terminal.
  Trademark
  Agreement
  In
  connection with the Settlement, we and the Private Company entered into a
  Trademark License Agreement, dated as of April 7, 2009 to be effective as of
  11:59 PM CDT March 31, 2009 (the "Trademark Agreement"), pursuant to which the
  Private Company granted us a non-exclusive, worldwide license to use certain
  trade names, including the name "SemGroup", and the corresponding mark until
  December 31, 2009, and the Private Company waived claims for infringement
  relating to such trade names and mark prior to the effective date of the
  Trademark Agreement.
  Building
  and Office Leases
  In
  connection with the Settlement, we leased office space in Oklahoma City,
  Oklahoma and certain facilities in Cushing, Oklahoma to the Private
  Company.  The term for the leases expires on March 31,
  2014.
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  Table of Contents
  Easements
  In
  connection with the Settlement, we and the Private Company granted mutual
  easements relating to access, facility improvements, existing and future
  pipeline rights and corresponding rights of ingress and egress for properties
  owned by the parties at Cushing, Oklahoma.  In addition, we granted
  the Private Company certain pipeline easements at Cushing, Oklahoma, together
  with the corresponding rights of ingress and egress.
  Partnership
  Revenues
  For the
  nine months ended September 30, 2008 and the year ended December 31, 2008, we
  derived approximately 81% and approximately 73%, respectively, of our revenues,
  excluding fuel surcharge revenues related to fuel and power consumed to operate
  our liquid asphalt cement storage tanks, from services we provided to the
  Private Company and its subsidiaries.  Prior to the Order and the
  Settlement, the Private Company was obligated to pay us minimum monthly fees
  totaling $76.1 million annually and $58.9 million annually in respect of the
  minimum commitments under the Throughput Agreement and the Terminalling
  Agreement, respectively, regardless of whether such services were actually
  utilized by the Private Company.  As described above, the Order
  required the Private Company to make certain payments under the Throughput
  Agreement and Terminalling Agreement during a portion of the third quarter of
  2008, including the contractual minimum payments under the Terminalling
  Agreement.  In connection with the Settlement, we waived the fees due
  under the Terminalling Agreement during March 2009.  In addition, the
  Private Company rejected the Throughput Agreement and the Terminalling Agreement
  and we and the Private Company entered into the New Throughput Agreement and the
  New Terminalling Agreement.  We expect revenues from services provided
  to the Private Company under the New Throughput Agreement and New Terminalling
  Agreement to be substantially less than prior revenues from services provided to
  the Private Company as the new agreements are based upon actual volumes
  gathered, transported, terminalled and stored instead of certain minimum volumes
  and are at reduced rates when compared to the Throughput Agreement and
  Terminalling Agreement.
  We have
  been pursuing opportunities to provide crude oil terminalling and storage
  services and crude oil gathering and transportation services to third
  parties.  As a result of new crude oil third-party storage contracts,
  we increased our third-party terminalling and storage revenue (excluding fuel
  surcharge revenues related to fuel and power consumed to operate our liquid
  asphalt cement storage tanks) from approximately $1.0 million, or
  approximately 4% of total terminalling and storage revenue during the
  second quarter of 2008, to approximately $4.6 million and $8.4 million, or
  approximately 17% and 34% of total terminalling and storage revenue for the
  third quarter of 2008 and the fourth quarter of 2008,
  respectively.
  In
  addition, as a result of new third-party crude oil transportation contracts and
  reduced commitments of usage by the Private Company under the Throughput
  Agreement, we increased our third-party gathering and transportation revenue
  from approximately $5.0 million, or approximately 21% of total gathering and
  transportation revenue during the second quarter of 2008, to approximately $10.9
  million and $13.6 million, or approximately 51% and 85% of total gathering and
  transportation revenue for the third quarter of 2008 and the fourth quarter
  of 2008, respectively.
  The
  significant majority of the increase in third party revenues results from an
  increase in third-party crude oil services provided and a corresponding decrease
  in the Private Company's crude oil services provided due to the termination of
  the monthly contract minimum revenues under the Throughput Agreement in
  September 2008.  Average rates for the new third-party crude oil
  terminalling and storage and transportation and gathering contracts are
  comparable with those previously received from the Private
  Company.  However, the volumes being terminalled, stored, transported
  and gathered have decreased as compared to periods prior to the Bankruptcy
  Filings, which has negatively impacted total revenues.  As an example,
  fourth quarter 2008 total revenues are approximately $8.2 million less than
  third quarter 2008 total revenues, in each case excluding fuel surcharge
  revenues related to fuel and power consumed to operate our liquid asphalt cement
  storage tanks.
  In addition,
  we have recently entered into leases and storage agreements with third parties
  relating to 39 of our 46 asphalt facilities.
  We have
  entered into various crude oil transportation and storage contracts with third
  parties and are continuing to pursue additional contracts with third parties;
  however, there can be no assurance that any of these additional efforts will be
  successful.  In addition, certain third parties may be less likely to
  enter into business transactions with us due to the Bankruptcy
  Filings.  The Private Company may also choose to curtail its
  operations or liquidate its assets as part of the Bankruptcy
  Cases.  As a result, unless we are able to generate additional third
  party revenues, we will continue to experience lower volumes in our system which
  could have a material adverse effect on our results of operations and cash
  flows.
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  Table of Contents
  Asphalt
  Operations
  Historically,
  we provided liquid asphalt cement terminalling and storage services to the
  Private Company pursuant to the Terminalling Agreement.  In connection
  with the Settlement, the Private Company rejected the Terminalling Agreement and
  we and the Private Company entered into the New Terminalling Agreement whereby
  we provide liquid asphalt cement terminalling and storage services to the
  Private Company in connection with its remaining asphalt
  inventory.  The New Terminalling Agreement has an initial term that
  ends on October 31, 2009 and the Private Company has agreed to remove all of its
  existing asphalt inventory no later than such date, and we expect that the
  Private Company may remove it much earlier than such date.  Also in
  connection with the Settlement, the Private Company transferred certain asphalt
  assets to us that were connected to our existing asphalt assets.  The
  transfer of the Private Company's asphalt assets in connection with the
  Settlement provides us with outbound logistics for our existing asphalt assets
  and, therefore, allows us to provide asphalt terminalling and storage services
  for third parties.
  The
  asphalt industry in the United States is characterized by a high degree of
  seasonality. Much of this seasonality is due to the impact that weather
  conditions have on road construction schedules, particularly in cold weather
  states. Refineries produce liquid asphalt cement year round, but the peak
  asphalt demand season is during the warm weather months when most of the road
  construction activity in the United States takes place. As a result, liquid
  asphalt cement is typically purchased from refineries at low prices in the low
  demand winter months and then processed and sold at higher prices in the peak
  summer demand season.  Any significant decrease in the amount of
  revenues that we receive from our liquid asphalt cement terminalling and storage
  operations could have a material adverse effect on our cash flows, financial
  condition and results of operations.
  We have recently entered
  into leases and storage agreements with third parties relating to 39 of
  our 46 asphalt facilities.  The revenues that we will receive
  pursuant to these leases and storage agreements will be less than the revenues
  received under the Terminalling Agreement with the Private Company.
  Without sufficient
  revenues from our asphalt assets, we may be unable to meet the covenants,
  including the minimum liquidity, minimum EBITDA and minimum receipt
  requirements, under our credit agreement.
  Operation
  and General Administration of the Partnership
  As is the
  case with many publicly traded partnerships, we have not historically directly
  employed any persons responsible for managing or operating us or for providing
  services relating to day-to-day business affairs.  Pursuant to the
  Amended Omnibus Agreement, the Private Company operated our assets and performed
  other administrative services for us such as accounting, legal, regulatory,
  development, finance, land and engineering.  The events related to the
  Bankruptcy Filings terminated the Private Company's obligations to provide
  services to us under the Amended Omnibus Agreement.  The Private
  Company continued to provide such services to us until the effective date of the
  Settlement at which time the Private Company rejected the Amended Omnibus
  Agreement and we and the Private Company entered into the Shared Services
  Agreement and the Transition Services Agreement relating to the provision of
  such services.  In addition, in connection with the Settlement, we
  made offers of employment to certain individuals associated with our crude oil
  operations and expect to make additional offers of employment to certain
  individuals associated with our asphalt operations.  The costs to
  directly employ these individuals as well as the costs under the Shared Services
  Agreement and the Transition Services Agreement may be higher than those
  previously paid by us under the Amended Omnibus Agreement, which could have a
  material adverse effect on our business, financial condition, results of
  operations, cash flows, ability to make distributions to our unitholders, the
  trading price of our common units and our ability to conduct our
  business.
  In
  addition, in connection with the Settlement, we agreed to not solicit the
  Private Company's employees for a year from the time of the
  Settlement.  In connection with the Bankruptcy Cases, the Private
  Company may reduce a substantial number of its employees or some of the Private
  Company's employees may choose to terminate their employment with the Private
  Company, some of whom may currently be providing general and administrative and
  operating services to us under the Shared Services Agreement or the Transition
  Services Agreement.  Any reductions in critical personnel who provide
  services to us and any increased costs to replace such personnel could have a
  material adverse effect on our ability to conduct our business and our results
  of operations.
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  Table of Contents
  Intellectual
  Property Rights
  Pursuant
  to the Amended Omnibus Agreement, we licensed the use of certain trade names and
  marks, including the name "SemGroup."  This license terminated
  automatically upon the Change of Control.  In connection with the
  Settlement, we and the Private Company entered into the Trademark Agreement,
  pursuant to which the Private Company granted us a non-exclusive, worldwide
  license to use certain trade names, including the name "SemGroup" and the
  corresponding mark, until December 31, 2009, and the Private Company waived
  claims for infringement relating to such trade names and mark prior to the
  effective date of such Trademark Agreement (see "—Settlement with the Private
  Company").  As such, we will be required to change our name and
  trademark upon or prior to the expiration of the Trademark
  Agreement.  The expenses associated with such a change may be
  significant, which could have a material adverse effect on our business,
  financial condition, results of operations, cash flows, ability to make
  distributions to our unitholders, the trading price of our common units and our
  ability to conduct our business.
  Credit
  Facility
  As
  described below under "—Liquidity and Capital Resources", in connection with the
  events related to the Bankruptcy Filings, certain events of default occurred
  under our credit agreement.  On September 18, 2008, we and the
  requisite lenders under our credit facility entered into the Forbearance
  Agreement relating to such events of default.  On April 7, 2009, we
  and the requisite lenders entered into the Credit Agreement Amendment, under
  which the lenders consented to the Settlement and waived all existing defaults
  and events of default described in the Forbearance Agreement and amendments
  thereto.  See "—Liquidity and Capital Resources" for more information
  regarding our credit facility, the Forbearance Agreement and the Credit
  Agreement Amendment.
  Distributions
  to Our Unitholders
  We did
  not make a distribution to our common unitholders, subordinated unitholders or
  general partner attributable to the results of operations for the quarters ended
  June 30, 2008, September 30, 2008, December 31, 2008 or March 31, 2009 due to
  the events of default under our credit agreement and the uncertainty of our
  future cash flows relating to the Bankruptcy Filings.  Our unitholders
  will be required to pay taxes on their share of our taxable income even though
  they did not receive a cash distribution for such periods.  In
  addition, we do not currently expect to make a distribution relating to the
  second quarter of 2009.  We distributed approximately $14.3 million to
  our unitholders for the three months ended March 31, 2008.  Pursuant
  to the Credit Agreement Amendment, we are prohibited from making distributions
  to our unitholders if our leverage ratio (as defined in the credit agreement)
  exceeds 3.50 to 1.00.  As of September 30, 2008 and December 31, 2008,
  our leverage ratio was 4.34 to 1.00 and 4.83 to 1.00, respectively. If our
  leverage ratio does not improve, we may not make quarterly distributions to our
  unitholders in the future.
  Our
  partnership agreement provides that, during the subordination period, which we
  are currently in, our common units have the right to receive distributions of
  available cash from operating surplus in an amount equal to the minimum
  quarterly distribution of $0.3125 per common unit per quarter, plus any
  arrearages in the payment of the minimum quarterly distribution on the common
  units from prior quarters, before any distributions of available cash from
  operating surplus may be made on the subordinated units.
  Nasdaq
  Delisting
  Effective
  at the opening of business on February 20, 2009, our common units were delisted
  from the Nasdaq Global Market ("Nasdaq") due to our failure to timely file this
  Quarterly Report as well as our Quarterly Report on Form 10-Q for the quarter
  ended June 30, 2008.  We filed our Quarterly Report on Form 10-Q for
  the quarter ended June 30, 2008 on March 23, 2009.  Our common units
  are currently traded on the Pink Sheets, which is an over-the-counter securities
  market, under the symbol SGLP.PK.  The fact that our common units are
  not listed on a national securities exchange is likely to make trading such
  common units more difficult for broker-dealers, unitholders and investors,
  potentially leading to further declines in the price of our common
  units.  In addition, it may limit the number of institutional and
  other investors that will consider investing in our common units, which may have
  an adverse effect on the price of our common units.  It may also make
  it more difficult for us to raise capital in the future.
  We
  continue to work to become compliant with our SEC reporting obligations and
  intend to promptly seek the relisting of our common units on Nasdaq as soon as
  practicable after we have become compliant with such reporting
  obligations.  However, there can be no assurances that we will be able
  to relist our common units on Nasdaq or any other national securities exchange
  and we may face a lengthy process to relist our common units if we are able to
  relist them at all.
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  Table of Contents
  Claims
  Against and By The Private Company's Bankruptcy Estate
  In
  connection with the Settlement, we and the Private Company entered into mutual
  releases regarding certain claims.  In addition, the Settlement
  provided that we have a $35 million unsecured claim against the Private Company
  relating to rejection of the Terminalling Agreement and a $20 million unsecured
  claim against the Private Company relating to rejection of the Throughput
  Agreement.
  On May
  15, 2009, the Private Company filed a joint plan of
  reorganization.  If such plan is confirmed without material amendment,
  our claims will be impaired.
  We may also have additional claims
  against the Private Company that were not released in connection with the
  Settlement, and the Private Company may also have additional claims against us
  that were not released in connection with the Settlement.  Any claims
  asserted by us against the Private Company in the Bankruptcy Cases will be
  subject to the claim allowance procedure provided in the Bankruptcy Code and
  Bankruptcy Rules.  If an objection is filed, the Bankruptcy Court will
  determine the extent to which any such claim that has been objected to is
  allowed and the priority of such claims.
  Governmental
  Investigations
  On July
  21, 2008, we received a letter from the staff of the SEC giving notice that the
  SEC is conducting an inquiry relating to us and requesting, among other things,
  that we voluntarily preserve, retain and produce to the SEC certain documents
  and information relating primarily to our disclosures respecting the Private
  Company's liquidity issues, which were the subject of our July 17, 2008 press
  release.  On October 22, 2008, we received a subpoena from the SEC
  pursuant to a formal order of investigation requesting certain documents
  relating to, among other things, the Private Company's liquidity
  issues.  We have been cooperating, and intend to continue cooperating,
  with the SEC in its investigation.
  On July
  23, 2008, we and our general partner each received a Grand Jury subpoena from
  the United States Attorney's Office in Oklahoma City, Oklahoma, requiring, among
  other things, that we and our general partner produce financial and other
  records related to our July 17, 2008 press release.  We have been
  informed that the U.S. Attorneys' Offices for the Western District of Oklahoma
  and the Northern District of Oklahoma are in discussions regarding the
  subpoenas, and no date has been set for a response to the
  subpoenas.  We and our general partner intend to cooperate fully with
  this investigation if and when it proceeds.
  Securities
  and Other Litigation
  Please
  see "Part II—Item I. Legal Proceedings" for a discussion of certain securities
  and other litigation to which we are a party.
  Examiner
  On August
  12, 2008, a motion was filed by the United States Trustee asking the Bankruptcy
  Court to appoint an examiner to investigate the Private Company's trading
  strategies as well as certain "insider transactions," including the contribution
  of the crude oil assets to us in connection with our initial public offering,
  the sale of the asphalt assets to us in February 2008, the sale of the Eagle
  North Pipeline System to us in May 2008, the sale of certain crude oil storage
  assets to us in May 2008, and the entering into the Holdings Credit Agreements
  by SemGroup Holdings.  On September 10, 2008, the Bankruptcy Court
  approved the appointment of an examiner, and on October 14, 2008, the United
  States Trustee appointed Louis J. Freeh, former director of the Federal Bureau
  of Investigation, as the examiner.
  On April
  15, 2009, the examiner filed a report summarizing the findings of his
  investigation with the Bankruptcy Court (the "Examiner's Report").
  The examiner
  was directed by the Bankruptcy Court to (i) investigate the circumstances
  surrounding the Private Company's trading strategy, the transfer of the New York
  Mercantile Exchange account, certain insider transactions, the formation of us,
  the potential improper use of borrowed funds and funds generated from the
  Private Company's operations and the liquidation of their assets to satisfy
  margin calls related to the trading strategy for the Private Company and certain
  entities owned or controlled by the Private Company's officers and directors and
  (ii) determine whether any directors, officers or employees of the Private
  Company participated in fraud, dishonesty, incompetence, misconduct,
  mismanagement, or irregularity in the management of the affairs of the Private
  Company and whether the Private Company's estates have causes of action against
  such persons arising from any such participation.
  The
  Examiner's Report identified potential claims or causes of action against
  current officers of our general partner who were former officers of the Private
  Company, including, without limitation, (i) against Kevin L. Foxx for his
  failure to develop a suitable risk management policy or integrate a suitable
  risk management policy into the Private Company's business controls, and for his
  failure to comply with the risk management policy that did exist, thereby
  subjecting the Private Company to increased risk and (ii) against Alex Stallings
  for his failure to stop Thomas L. Kivisto from engaging in trading activity on
  his own behalf through Westback Purchasing Company, L.L.C., a limited liability
  trading partnership which Mr. Kivisto owned and controlled, thereby subjecting
  the Private Company to increased risk and losses.
  In
  addition, the Examiner's Report criticized Mr. Foxx for certain conflicts of
  interest with entities that he or his family invested in and which had a
  business relationship with the Private Company.
  Additionally, the
  Examiner's Report identified a number of potential claims or causes of action
  against Mr. Kivisto and Gregory C. Wallace, who are former directors of our
  general partner and former officers of the Private Company, including, without
  limitation, for negligence and mismanagement, fraud and false statements,
  conversion and corporate waste, unjust enrichment, breach of fiduciary duties
  and breach of contract.
  The
  Examiner's Report and related exhibits are publicly available at
  www.kccllc.net/SemGroup.
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  Table of Contents
  Internal
  Review
  As
  previously announced, in July 2008 the Board created an internal review
  subcommittee of the Board comprised of directors who are independent of
  management and the Private Company to determine whether we participate in
  businesses other than as described in our filings with the SEC and to conduct
  investigations into other such specific items as are deemed to be appropriate by
  the subcommittee.  The subcommittee retained independent legal counsel
  to assist it in its investigations.
  The
  subcommittee has investigated a short-term financing transaction involving two
  subsidiaries of the Private Company.  This transaction was identified
  as a potential source of concern in a whistleblower report made after the
  Private Company filed for bankruptcy.  Although the transaction did
  not involve us or our subsidiaries, it was investigated because it did involve
  certain senior executive officers of our general partner who were also senior
  executive officers of the Private Company at the time of the
  transaction.  Based upon its investigation, counsel for the
  subcommittee found that, subject to the subcommittee's lack of access to Private
  Company documents and electronic records and witnesses, although certain
  irregularities occurred in the transactions, the transaction did not appear to
  cause the relevant officers to understand or believe that the Private Company
  had a lack of liquidity that imperiled the Private Company's ability to meet its
  obligations to us and that certain aspects of the documentation of the
  transaction that were out of the ordinary did not call into question the
  integrity of any of the relevant officers.
  The
  subcommittee also investigated whether certain senior executive officers of our
  general partner who were also senior executive officers of the Private Company
  knew and understood, beginning as early as July 2007 and at various times
  thereafter, about a lack of liquidity at the Private Company that imperiled the
  Private Company's ability to meet its obligations to us.  Based upon
  this investigation, and subject to the subcommittee's lack of access to Private
  Company documents and electronic records and witnesses, counsel for the
  subcommittee found that each of the officers had access to and reviewed Private
  Company financial information, including information regarding the Private
  Company's commodity trading activities, from which they could have developed an
  understanding of the nature and significance of the trading activities that led
  to liquidity problems at the Private Company well before they say they
  did.  While the officers each stated sincerely that they did not
  understand the nature or extent of the Private Company's trading-related
  problems until the first week of July 2008 or later, objective evidence suggests
  that they showed at least some indifference to known or easily discoverable
  facts and that they failed to adhere to procedures under the Private Company's
  Risk Management Policy created expressly to ensure that the Private Company's
  trading activities were properly monitored.  Nonetheless, counsel for
  the subcommittee was not persuaded by the documents and other evidence it was
  able to access that the officers in fact knew and understood that the Private
  Company's liquidity or capital needs were a significant cause for alarm until,
  at the earliest, the second quarter of 2008.  Moreover, while it
  appeared to counsel that the officers developed a growing awareness of the
  nature and severity of the Private Company's liquidity issues over the second
  quarter of 2008, counsel was unable to identify with any more precision the
  specific level of concern or understanding these individuals had prior to July
  2008.  While not within the scope of such counsel's investigation,
  counsel was requested by the subcommittee to note any information that came to
  counsel's attention during its investigation that suggested that the officers
  intended to deceive or mislead any third party.  Subject to
  limitations described in its report, no information came to counsel's attention
  during its investigation that suggested to counsel that the officers intended to
  deceive or to mislead any third parties.  In addition, in connection
  with the investigation, counsel for the subcommittee did not express any
  findings of intentional misconduct or fraud on the part of any officer or
  employee of us.
  After
  completion of the internal review, a plan was developed with the advice of the
  Audit Committee of the Board to further strengthen our processes and
  procedures.  This plan includes, among other things, reevaluating
  executive officers and accounting and finance personnel (including a realignment
  of officers as described elsewhere in this report) and hiring, as deemed
  necessary, additional accounting and finance personnel or consultants;
  reevaluating our internal audit function and determining whether to expand the
  duties and responsibilities of such group; evaluating the comprehensive training
  programs for all management personnel covering, among other things, compliance
  with controls and procedures, revising the reporting structure so that the Chief
  Financial Officer reports directly to the Audit Committee, and increasing the
  business and operational oversight role of the Audit Committee.
  43
  Table of Contents
  Equity
  Awards and Employment Agreements
  The
  Change of Control constituted a change of control under the Plan, which resulted
  in the early vesting of all awards under the Plan.  As such, the
  phantom units awarded to Messrs. Kevin L. Foxx, Michael J. Brochetti, Alex G.
  Stallings, Peter L. Schwiering and Jerry A. Parsons in the amounts of 150,000
  units, 90,000 units, 75,000 units, 45,000 units and 20,000 units, respectively,
  are fully vested.   The common units underlying such awards were
  issued to such individuals in August 2008.  In addition, the 5,000
  restricted units awarded to each of Messrs. Billings, Kosnik and Bishop for
  their service as independent members of the Board are fully vested.
  The
  Change of Control also resulted in a change of control under the employment
  agreements of Messrs. Foxx, Brochetti, Stallings, Schwiering and
  Parsons.  If within one year after the Change of Control any such
  officer is terminated by our general partner without Cause (as defined below) or
  such officer terminates the agreement for Good Reason (as defined below), he
  will be entitled to payment of any unpaid base salary and vested benefits under
  any incentive plans, a lump sum payment equal to 24 months of base salary and
  continued participation in the our general partner's welfare benefit programs
  for one year after termination. Upon such an event, Messrs Foxx, Brochetti,
  Stallings, Schwiering and Parsons would be entitled to lump sum payments of
  $900,000, $600,000, $550,000, $500,000 and $500,000, respectively, in addition
  to continued participation in our general partner's welfare benefit
  programs.  As of the date of the filing of this report, none of these
  officers is entitled to these benefits as none of them has been terminated by
  our general partner without Cause or has terminated his agreement for Good
  Reason.
  For
  purposes of the employment agreements:
  "Cause"
  means (i) conviction of the executive officer by a court of competent
  jurisdiction of any felony or a crime involving moral turpitude; (ii) the
  executive officer's willful and intentional failure or willful intentional
  refusal to follow reasonable and lawful instructions of the Board;
  (iii) the executive officer's material breach or default in the performance
  of his obligations under the employment agreement; or (iv) the executive
  officer's act of misappropriation, embezzlement, intentional fraud or similar
  conduct involving our general partner.
  "Good
  Reason" means (i) a material reduction in the executive officer's base
  salary; (ii) a material diminution of the executive officer's duties,
  authority or responsibilities as in effect immediately prior to such diminution;
  or (iii) the relocation of the named executive officer's principal work
  location to a location more than 50 miles from its current
  location.
  Internal
  Controls
  SemGroup
  Energy Partners G.P., L.L.C., our general partner, has sole responsibility for
  conducting our business and for managing our operations. Effective internal
  controls are necessary for our general partner, on our behalf, to provide
  reliable financial reports, prevent fraud and operate us successfully as a
  public company. If our general partner's efforts to develop and maintain its
  internal controls are not successful, it is unable to maintain adequate controls
  over our financial processes and reporting in the future or it is unable to
  assist us in complying with our obligations under Section 404 of the
  Sarbanes-Oxley Act of 2002, our operating results could be harmed or we may fail
  to meet our reporting obligations.
  We and
  our general partner rely upon the Private Company for their personnel, including
  those related to the implementation of internal controls and disclosure controls
  and procedures.  Staff reductions by the Private Company or other
  departures by the Private Company's employees that provide services to us could
  have a material adverse effect on internal controls and the effectiveness of
  disclosure controls and procedures.  Ineffective internal controls
  could cause us to report inaccurate financial information or cause investors to
  lose confidence in our reported financial information, which would likely have a
  negative effect on the trading price of our common units.
  44
  Table of Contents
  Taxation
  as a Corporation
  The
  anticipated after-tax economic benefit of an investment in our common units
  depends largely on us being treated as a partnership for federal income tax
  purposes.  If less than 90% of the gross income of a publicly traded
  partnership, such as us, for any taxable year is "qualifying income" from
  sources such as the transportation, marketing (other than to end users), or
  processing of crude oil, natural gas or products thereof, interest, dividends or
  similar sources, that partnership will be taxable as a corporation under Section
  7704 of the Internal Revenue Code for federal income tax purposes for that
  taxable year and all subsequent years.  In this regard, because the
  income we earn from the Throughput Agreement and the Terminalling Agreement with
  the Private Company is "qualifying income" any material reduction or elimination
  of that income, or any amendment to the Throughput Agreement or the Terminalling
  Agreement which changes the nature of the services provided or the income
  generated thereunder, may cause our remaining "qualifying income" to constitute
  less than 90% of our gross income.  As a result, we could become
  taxable as a corporation for federal income tax purposes, unless we were to
  transfer the businesses that generate non-qualifying income to one or more
  subsidiaries taxed as corporations and pay entity level income taxes on such
  non-qualifying income.  The IRS has not provided any ruling to us on
  this matter.
  If we
  were treated as a corporation for federal income tax purposes, then we would pay
  federal income tax on our income at the corporate tax rate, which is currently a
  maximum of 35%, and would likely pay state income tax at varying
  rates.  Distributions would generally be taxed again to unitholders as
  corporate distributions and none of our income, gains, losses, deductions or
  credits would flow through to our unitholders.  Because a tax would be
  imposed upon us as an entity, cash available for distribution to our unitholders
  would be substantially reduced.  Treatment of us as a corporation
  would result in a material reduction in the anticipated cash flow and after-tax
  return to unitholders and thus would likely result in a substantial reduction in
  the value of our common units.
  Other
  Effects
  The
  Bankruptcy Filings have had and may in the future continue to have a number of
  other impacts on our business and management.  In the Amended Omnibus
  Agreement and other agreements with the Private Company, the Private Company
  agreed to indemnify us for certain environmental and other claims relating to
  the crude oil and liquid asphalt cement assets that have been contributed to
  us.  In connection with the Settlement, we waived these claims and the
  Amended Omnibus Agreement and other relevant agreements, including the
  indemnification provisions therein, were rejected as part of the Bankruptcy
  Proceedings.  If we experience an environmental or other loss, we
  would experience increased losses which may have a material adverse effect on
  our business, financial condition, results of operations, cash flows, ability to
  make distributions to our unitholders, the trading price of our common units and
  the ability to conduct our business.
  We are
  currently pursuing various strategic alternatives for our business and assets
  including the possibility of entering into additional storage contracts with
  third party customers and the sale of all or a portion of our
  assets.  The uncertainty relating to the Bankruptcy Filings and the
  recent global market and economic conditions may make it more difficult to
  pursue merger opportunities or enter into storage contracts with third party
  customers.
  In
  addition, events related to the Bankruptcy Filings, the securities litigation
  and governmental investigations, and our efforts to enter into storage contracts
  with third party customers and pursue merger opportunities has resulted in
  increased expense beginning in the third quarter of 2008 due to the costs
  related to legal and financial advisors as well as other related
  costs.  General and administrative expenses (exclusive of non-cash
  compensation expense related to the vesting of the units under the Plan)
  increased by approximately $6.9 million and $7.5 million, or approximately 300%
  and 326%, to approximately $9.2 million for the third quarter of 2008 and $9.8
  million for the fourth quarter of 2008, respectively, compared to $2.3 million
  in the second quarter of 2008.  We expect this increased level of
  general and administrative expenses to continue into 2009.
  Items
  Impacting the Comparability of Our Financial Results
  ·
  There
        are differences in the way our predecessor recorded revenues and the way
        we record revenues.
  o
  Historically,
        a substantial portion of our revenues were derived from services provided
        to the crude oil purchasing, marketing and distribution operations of the
        Private Company pursuant to the Throughput Agreement. Under the Throughput
        Agreement, the Private Company paid us a fee for gathering,
        transportation, terminalling and storage services based on volume and
        throughput. In rendering these services, we did not take title to, or
        marketing responsibility for, the crude oil that we gathered, transported,
        terminalled or stored and, therefore, we had minimal direct exposure to
        changes in crude oil prices.
  o
  The
        Crude Oil Business had historically been a part of the integrated
        operations of the Private Company, and neither the Private Company nor our
        predecessor recorded revenue associated with the gathering,
        transportation, terminalling and storage services provided on an
        intercompany basis. The Private Company and our predecessor recognized
        only the costs associated with providing such services. As such, the
        revenues we received under the Throughput Agreement are not reflected in
        the historical financial statements of our
    predecessor.
  o
  Our
        predecessor recognized revenues from third parties for (1) crude oil
        storage services, (2) crude oil transportation services and
        (3) crude oil producer field services. Although a substantial
        majority of our revenues are derived from services provided to the Private
        Company, we also recognize revenue for gathering, transportation,
        terminalling and storage services provided to third
      parties.
  ·
  There
        are differences in the way general and administrative expenses were
        allocated to our predecessor and the way we recognize general and
        administrative expenses.
  o
  General
        and administrative expenses include office personnel and benefit expenses,
        costs related to our administration facilities, and insurance, accounting
        and legal expenses, including costs allocated by the Private Company for
        centralized general and administrative services performed by the Private
        Company. Such costs were allocated to our predecessor based on the nature
        of the respective expenses and its proportionate share of the Private
        Company's head count, compensation expense, net revenues or square footage
        as appropriate.
  o
  We
        were party to an Omnibus Agreement with the Private
        Company.  The Omnibus Agreement was amended (the "Amended
        Omnibus Agreement") in connection with the purchase of the Acquired
        Asphalt Assets to, among other things, increase the fixed administrative
        fee payable under such agreement from $5.0 million per year to $7.0
        million per year. Pursuant to the Amended Omnibus Agreement, we were
        required to pay our general partner and the Private Company this fixed
        administrative fee for the provision by our general partner and the
        Private Company of various general and administrative services to us for
        three years following the acquisition of our asphalt
        assets.  The events related to the Bankruptcy Filings terminated
        the Private Company's obligations to provide services to us under the
        Amended Omnibus Agreement.  The Private Company continued to
        provide such services to us until the effective date of the Settlement at
        which time the Private Company rejected the Amended Omnibus Agreement and
        we and the Private Company entered into the Shared Services Agreement and
        the Transition Services Agreement relating to the provision of such
        services (see "Item 2. Management's Discussion and Analysis of Financial
        Condition and Results of Operations
  —Impact
        of the Bankruptcy of the Private Company and Certain of its Subsidiaries
        and Related Events
  —Settlement with the Private
        Company").  In addition, in connection with the Settlement, we
        made offers of employment to certain individuals associated with our crude
        oil operations and expect to make additional offers of employment to
        certain individuals associated with our asphalt operations.  The
        costs to directly employ these individuals as well as the costs under the
        Shared Services Agreement and the Transition Services Agreement may
        be higher than those previously paid by us under the Amended Omnibus
        Agreement, which could have a material adverse effect on our business,
        financial condition, results of operations, cash flows, ability to make
        distributions to our unitholders, the trading price of our common units
        and our ability to conduct our business.  For a more complete
        description of the Omnibus Agreement, see "Item 13—Certain Relationships
        and Related Party Transactions, and Director Independence—Agreements
        Related to Our Acquisition of the Asphalt Assets —Amended Omnibus
        Agreement" in our 2007 Form 10-K.
  o
  We
        incur incremental general and administrative expenses as a result of being
        a publicly traded limited partnership, including costs associated with
        annual and quarterly reports to unitholders, financial statement audit,
        tax return and Schedule K-1 preparation and distribution, investor
        relations activities, registrar and transfer agent fees, incremental
        director and officer liability insurance costs and independent director
        compensation. These incremental general and administrative expenditures
        are not reflected in the historical financial statements of our
        predecessor.
  ·
  With
        the exception of capital lease obligations and prepaid insurance, no
        working capital was contributed to us in connection with our initial
        public offering.
  ·
  Our
        predecessor had $31.2 million in debt payable to the Private Company which
        was not assumed by us in our initial public offering. We entered into a
        $250.0 million five-year credit facility and borrowed $137.5 million under
        that facility and used net proceeds of approximately $38.7 million from
        the issuance of 1,875,000 common units pursuant to the underwriters'
        exercise of their over-allotment option in our initial public offering to
        reduce outstanding borrowings under our credit facility.  In
        connection with the purchase of our Acquired Asphalt Assets, we amended
        our credit facility to increase our borrowing capacity to $600.0
        million.  This borrowing capacity has subsequently been reduced
        as described in "—Liquidity and Capital Resources."  Our credit
        facility matures in June 2011.
  As of May
        22, 2009, we had $423.4 million in outstanding borrowings under
        our credit facility (including $23.4 million under our revolving credit
        facility and $400.0 million under our term loan facility) with an
        aggregate unused credit availability under our revolving credit facility
        and cash on hand of approximately $27.2 million. Pursuant to the Credit
        Agreement Amendment, our revolving credit facility is limited
        to $50.0 million.
  Please see "—Liquidity and
        Capital Resources."
  45
  Table of Contents
  Results
  of Operations
  The table
  below summarizes the financial results of the Partnership for the three and nine
  months ended September 30, 2007 and 2008.  These financial results
  reflect a $0.4 million allowance for doubtful accounts related to amounts
  collectible from third parties as of September 30, 2008.  The
  allowance related to amounts collectible from third parties was established as a
  result of certain third party customers netting amounts due them from the
  Private Company with amounts due to us.  Also, due to the change of
  control of our general partner related to the Private Company's liquidity
  issues, all outstanding awards under our general partner's long-term incentive
  plan vested on July 18, 2008, resulting in an incremental $18.0 million in
  non-cash compensation expense for the three months ended September 30,
  2008.  In addition to the allowance for doubtful accounts and non-cash
  compensation expense described above, the results of operations for the three
  and nine months ended September 30, 2008 included in this quarterly report were
  affected by the Bankruptcy Filings and related events, which resulted in
  decreased revenues and increased general and administrative expenses (see "Item
  2. Management's Discussion and Analysis of Financial Condition and results of
  Operations
  —Impact
  of the Bankruptcy of the Private Company and Certain of its Subsidiaries and
  Related Events
  —Our Revenues," and "Item 2. Management's Discussion and
  Analysis of Financial Condition and results of Operations
  —Impact
  of the Bankruptcy of the Private Company and Certain of its Subsidiaries and
  Related Events
  —Other Effects," respectively).
  Due to the events
  related to the Bankruptcy Filings, including uncertainties related to future
  revenues and cash flows, we do not expect our financial results for the three
  and nine months ended September 30, 2008 to be indicative of our future
  financial results.  For example, since the Bankruptcy Filings we have
  experienced increased general and administrative expenses related to the costs
  of legal and financial advisors and increased interest expense related to the
  events of default under our credit facility and the associated Forbearance
  Agreement (as defined below) and amendments thereto.  In addition, the
  volumes being terminalled, stored, transported and gathered have decreased as
  compared to periods prior to the Bankruptcy Filings, which has negatively
  impacted total revenues.  As an example, fourth quarter 2008 total
  revenues are approximately $8.2 million less than third quarter 2008 total
  revenues, in each case excluding fuel surcharge revenues related to fuel and
  power consumed to operate our liquid asphalt cement storage
  tanks.  Our future total revenues will be further impacted because,
  pursuant to the Settlement, the Private Company rejected the Terminalling
  Agreement and the Throughput Agreement.  We entered into the New
  Terminalling Agreement and the New Throughput Agreement on the terms described
  elsewhere herein (see "Item 2. Management's Discussion and Analysis of Financial
  Condition and Results of Operations
  —Impact
  of the Bankruptcy of the Private Company and Certain of its Subsidiaries and
  Related Events
  —Settlement with the Private Company").
  Three
        Months ended September 30,
  Nine
        Months ended September 30,
  2007
  2008
  2007
  2008
  (in
        thousands)
  Service
        revenues:
  Terminalling
        and storage revenues:
  Third
        party
  $
  691
  $
  4,661
  $
  7,836
  $
  5,674
  Related
        party
  7,245
  27,555
  7,245
  75,434
  Total
        terminalling and storage
  7,936
  32,216
  15,081
  81,108
  Gathering
        and transportation revenues:
  Third
        party
  4,181
  10,910
  16,011
  20,548
  Related
        party
  13,163
  10,668
  13,286
  47,628
  Total
        gathering and transportation
  17,344
  21,578
  29,297
  68,176
  Total
        revenues
  25,280
  53,794
  44,378
  149,284
  Operating
        expenses:
  Terminalling
        and storage
  1,078
  11,975
  3,408
  29,071
  Gathering
        and transportation
  14,874
  16,212
  46,702
  50,887
  Allowance
        for doubtful accounts
  -
  (819
  )
  -
  447
  Total
        operating expenses
  15,952
  27,368
  50,110
  80,405
  General
        and administrative expenses:
  2,525
  27,177
  11,015
  33,244
  Operating
        income (loss)
  6,803
  (751
  )
  (16,747
  )
  35,635
  Interest
        expense
  2,424
  11,041
  3,369
  15,905
  Income
        tax expense
  62
  59
  62
  227
  Net
        income (loss)
  $
  4,317
  $
  (11,851
  )
  $
  (20,178
  )
  $
  19,503
  46
  Table of Contents
  Three
  Months Ended September 30, 2008 Compared to the Three Months Ended September 30,
  2007
  Service revenues.
  Service
  revenues were $53.8 million for the three months ended September 30, 2008
  compared to $25.3 million for the three months ended September 30, 2007, an
  increase of $28.5 million, or 113%. Service revenues include revenues from
  terminalling and storage services and gathering and transportation services.
  Terminalling and storage revenues increased by $24.3 million to $32.2 million
  for the three months ended September 30, 2008 compared to $7.9 million for the
  three months ended September 30, 2007, primarily due to revenues generated under
  the Terminalling Agreement (revenues of $20.9 million for the three months ended
  September 30, 2008).  The Terminalling Agreement was entered into in
  February 2008 in conjunction with the purchase of the Acquired Asphalt Assets
  therefore it was not present in the three months ended September 30,
  2007.  In addition, our third party terminalling and storage revenue
  increased by $4.0 million due to additional volume from third party crude
  oil storage agreements during the three months ended September 30,
  2008.
  Our
  gathering and transportation services revenue increased by $4.3 million to $21.6
  million for the three months ended September 30, 2008 compared to $17.3 million
  for the three months ended September 30, 2007.  The increase is
  primarily due to third party customer revenues increasing for the three months
  ended September 30, 2008 compared to the three months ended September 30,
  2007.  The increase in third party revenues is primarily due to the
  replacement of services previously provided to the Private Company with third
  party gathering and transportation customers due to an order of the Bankruptcy
  Court entered on September 9, 2008, that stated the Private Company would no
  longer make minimum payments under the Throughput Agreement but instead pay a
  market rate based upon the Private Company's actual
  usage.  Historically, our Predecessor was a part of the integrated
  operations of the Private Company, and neither the Private Company nor the
  Predecessor recorded revenue associated with the terminalling and storage and
  gathering and transportation services provided on an intercompany basis.
  Accordingly, revenues reflected for all periods prior to the contribution of the
  assets, liabilities and operations to the Partnership by the Private Company on
  July 20, 2007 are substantially services provided to third
  parties.
  Operating expenses
  . 
  Operating expenses increased by $11.4 million, or 71%, to $27.4 million for the
  three months ended September 30, 2008 compared to $16.0 million for the three
  months ended September 30, 2007. Our fuel expenses increased by $5.5 million to
  $8.0 million for the three months ended September 30, 2008 compared to $2.5
  million for the three months ended September 30, 2007. The increase in our fuel
  costs is attributable to the increase in number of transport trucks we operated
  for the respective periods and the rising price of diesel fuel during the
  comparative periods.   The Throughput Agreement provides for a
  fuel surcharge, recorded in revenue, which offsets increases in fuel expenses
  related to either rising diesel prices or force majeure events.  Also
  included in fuel expense for the three months ended September 30, 2008 is $4.7
  million of fuel and power expense associated with the boiler systems utilized to
  heat our liquid asphalt cement storage tanks that were acquired in February
  2008.  Under the Terminalling Agreement, this component of fuel
  expense is passed through to the Private Company.  As a result of this
  agreement, we have recorded $4.7 million in fuel surcharge revenues in relation
  to fuel and power consumed to operate our liquid asphalt cement storage tanks
  for the three months ended September 30, 2008.
  Compensation
  expense increased by $1.8 million to $7.3 million for the three months ended
  September 30, 2008 primarily as a result of the purchase of our Acquired Asphalt
  Assets in February 2008.  Our repair and maintenance expenses
  decreased by $0.8 million to $1.2 million for the three months ended September
  30, 2008 compared to $2.0 million for the three months ended September 30, 2007,
  primarily due to the timing of routine maintenance in our gathering and
  transportation segment. Lease expense related to crude oil tanker trucks
  increased by $0.3 million to $0.8 million for the three months ended September
  30, 2008. This increase is attributable to the replacement of crude oil
  transport vehicles that were historically financed through capital
  leases.  As a result of the growth in our property and equipment, our
  property taxes increased by $0.7 million to $0.9 million for the three months
  ended September 30, 2008 compared to $0.2 million for the three months ended
  September 30, 2007.
  Outside
  services expenses increased by $0.2 million to $0.8 million for the three months
  ended September 30, 2008 compared to $0.6 million for the three months ended
  September 30, 2007, primarily due to an increase in third party transportation
  costs resulting from increased volumes gathered in our gathering and
  transportation segment.
  Depreciation
  expense increased by $3.4 million to $5.7 million for the three months ended
  September 30, 2008 compared to $2.3 million for the three months ended September
  30, 2007, primarily as a result of capital expenditures in our terminalling and
  storage segment and as a result of the purchase of our Acquired Asphalt Assets
  in February 2008.
  47
  Table of Contents
  The three
  months ended September 30, 2008 includes a decrease of $0.9 million in our
  allowance for doubtful accounts for amounts due from the Private Company that
  had been reserved as of June 30, 2008.  Pursuant to the
  Settlement, our pre-petition claims have been netted against pre-petition
  claims by the Private Company and waived.  The three months ended
  September 30, 2008 also includes an allowance for doubtful accounts increase of
  $0.1 million for services provided to certain third parties as of September 30,
  2008.  The allowance related to amounts due from third parties
  increased as a result of certain third party customers netting amounts due them
  from the Private Company with amounts due to us.
  General and administrative
  expenses
  . General and administrative expenses increased by $24.7
  million, or 988%, to $27.2 million for the three months ended September 30, 2008
  compared to $2.5 million for the three months ended September 30, 2007. Due to
  the change of control of our general partner related to the Private Company's
  liquidity issues, all awards outstanding under our long-term incentive plan as
  of June 30, 2008 vested on July 18, 2008.  As a result, general and
  administrative expenses for the three months ended September 30, 2008 included
  $18.0 million in non-cash, equity-based compensation recognized under our
  long-term incentive plan.  General and administrative expenses
  (exclusive of non-cash compensation expense related to the vesting of the units
  under the Plan) increased by approximately $6.9 million and $7.5 million, or
  approximately 300% and 326%, to approximately $9.2 million for the third quarter
  of 2008 and $9.8 million for the fourth quarter of 2008, respectively, compared
  to $2.3 million in the second quarter of 2008.  We expect this
  increased level of general and administrative expenses to continue into
  2009.  This increase is due to increased costs related to legal and
  financial advisors as well as other related costs in connection with events
  related to the Bankruptcy Filings, the securities litigation and governmental
  investigations, and our efforts to enter into storage contracts with third party
  customers and pursue other strategic opportunities.  We expect
  this increased level of general and administrative expenses to continue into
  2009.
  Interest expense
  . 
  Interest expense represents interest on capital lease obligations and long-term
  borrowings under our credit facility and the impact of our interest rate swap
  agreements. Interest expense increased by $8.6 million to $11.0 million interest
  expense for the three months ended September 30, 2008 compared to $2.4 million
  interest expense for the three months ended September 30, 2007.  The
  increase was primarily due to an increase in the average long-term borrowings
  outstanding during the three months ended September 30, 2008 compared to the
  three months ended September 30, 2007, which accounted for approximately $7.8
  million of an increase in interest expense, net of capitalized
  interest.  In addition, the two interest rate swap agreements entered
  into during the third quarter of 2007 and the three additional interest rate
  swap agreements entered into in February 2008 resulted in $0.6 million in
  interest expense for the three months ended September 30, 2008.  Due
  to events related to the Bankruptcy Filings, all of these interest rate swap
  positions were terminated in the third quarter of 2008, and we have recorded a
  $1.5 million liability as of September 30, 2008 with respect to these
  positions.
  Nine
  months Ended September 30, 2008 Compared to the Nine months Ended September 30,
  2007
  Service revenues.
  Service revenues were $149.3 million for the nine months ended
  September 30, 2008 compared to $44.4 million for the nine months ended September
  30, 2007, an increase of $104.9 million, or 236%. Service revenues include
  revenues from terminalling and storage services and gathering and transportation
  services. Terminalling and storage revenues increased by $66.0 million to $81.1
  million for the nine months ended September 30, 2008 compared to $15.1 million
  for the nine months ended September 30, 2007, primarily due to revenues
  generated under both the Throughput Agreement (revenues of $26.3 million for the
  nine months ended September 30, 2008 compared to revenues of $7.2 million for
  the nine months ended September 30, 2007) and the Terminalling Agreement
  (revenues of $49.1 million for the nine months ended September 30,
  2008).  The Terminalling Agreement was entered into in February 2008
  in conjunction with the purchase of the Acquired Asphalt Assets therefore it was
  not present in the nine months ended September 30,
  2007.  Historically, our Predecessor was a part of the integrated
  operations of the Private Company, and neither the Private Company nor the
  Predecessor recorded revenue associated with the terminalling and storage and
  gathering and transportation services provided on an intercompany basis.
  Accordingly, revenues reflected for all periods prior to the contribution of the
  crude oil assets, liabilities and operations to the Partnership by the Private
  Company on July 20, 2007 are substantially services provided to third
  parties.
  Our
  gathering and transportation services revenue increased by $38.9 million to
  $68.2 million for the nine months ended September 30, 2008 compared to $29.3
  million for the nine months ended September 30, 2007. This increase is primarily
  due to revenues generated under the Throughput Agreement subsequent to the
  closing of our initial public offering.  Historically, our Predecessor
  was a part of the integrated operations of the Private Company, and neither the
  Private Company nor the Predecessor recorded revenue associated with the
  terminalling and storage and gathering and transportation services provided on
  an intercompany basis. Accordingly, revenues reflected for all periods prior to
  the contribution of the crude oil assets, liabilities and operations to the
  Partnership by the Private Company on July 20, 2007 are substantially
  services provided to third parties.
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  Table of Contents
  Operating expenses
  . 
  Operating expenses increased by $30.3 million, or 60%, to $80.4 million for the
  nine months ended September 30, 2008 compared to $50.1 million for the nine
  months ended September 30, 2007. Our fuel expenses increased by $13.1 million to
  $20.5 million for the nine months ended September 30, 2008 compared to $7.4
  million for the nine months ended September 30, 2007. The increase in our fuel
  costs is attributable to the increase in number of transport trucks we operated
  for the respective periods and the rising price of diesel fuel during the
  comparative periods.   The Throughput Agreement provides for a
  fuel surcharge, recorded in revenue, which offsets increases in fuel expenses
  related to either rising diesel prices or force majeure events.  Also
  included in fuel expense for the nine months ended September 30, 2008 is $10.8
  million of fuel and power expense associated with the boiler systems utilized to
  heat our liquid asphalt cement storage tanks that were acquired in February
  2008.  Under the Terminalling Agreement, this component of fuel
  expense is passed through to the Private Company.  As a result of this
  agreement, we have recorded $10.8 million in fuel surcharge revenues in relation
  to fuel and power consumed to operate our liquid asphalt cement storage tanks
  for the nine months ended September 30, 2008.
  Compensation
  expense increased by $4.7 million to $21.6 million for the nine months ended
  September 30, 2008 primarily as a result of the purchase of our Acquired Asphalt
  Assets in February 2008.  Our repair and maintenance expenses
  decreased by $1.5 million to $5.0 million for the nine months ended September
  30, 2008 compared to $6.5 million for the nine months ended September 30, 2007,
  primarily due to the timing of routine maintenance in our gathering and
  transportation segment. Lease expense related to crude oil tanker trucks
  increased by $0.9 million to $2.0 million for the nine months ended September
  30, 2008. This increase is attributable to the replacement of crude oil
  transport vehicles that were historically financed through capital
  leases.  As a result of the growth in our property and equipment, our
  property taxes increased by $1.7 million to $2.3 million for the nine months
  ended September 30, 2008 compared to $0.6 million for the nine months ended
  September 30, 2007.
  Outside
  services expenses increased by $1.6 million to $3.2 million for the nine months
  ended September 30, 2008 compared to $1.6 million for the nine months ended
  September 30, 2007, primarily due to an increase in third party transportation
  costs resulting from increased volumes gathered in our gathering and
  transportation segment.  In addition, our utilities expenses increased
  by $0.4 million to $1.7 million for the nine months ended September 30, 2008
  compared to $1.3 million for the nine months ended September 30, 2007, primarily
  due to growth in our gathering and transportation segment.
  Depreciation
  expense increased by $8.8 million to $15.3 million for the nine months ended
  September 30, 2008 compared to $6.5 million for the nine months ended September
  30, 2007, primarily as a result of capital expenditures in our terminalling and
  storage segment and as a result of the purchase of our Acquired Asphalt Assets
  in February 2008.
  The nine
  months ended September 30, 2008 reflects a $0.4 million allowance for doubtful
  accounts related to amounts due from third parties as of September 30,
  2008.  The allowance related to amounts due from third parties was
  established as a result of certain third party customers netting amounts due
  them from the Private Company with amounts due to us.
  General and administrative
  expenses
  . General and administrative expenses increased by $22.2
  million, or 202%, to $33.2 million for the nine months ended September 30, 2008
  compared to $11.0 million for the nine months ended September 30,
  2007.  Due to the change of control of our general partner related to
  the Private Company's liquidity issues, all awards outstanding under our
  long-term incentive plan as of June 30, 2008 vested on July 18,
  2008.  As a result, general and administrative expenses for the nine
  months ended September 30, 2008 included $19.4 million in non-cash, equity-based
  incentive compensation recognized under our long-term incentive
  plan.  General and administrative expenses (exclusive of non-cash
  compensation expense related to the vesting of the units under the Plan)
  increased by approximately $6.9 million and $7.5 million, or approximately 300%
  and 326%, to approximately $9.2 million for the third quarter of 2008 and $9.8
  million for the fourth quarter of 2008, respectively, compared to $2.3 million
  in the second quarter of 2008.  This increase is due to increased
  costs related to legal and financial advisors as well as other related costs in
  connection with events related to the Bankruptcy Filings, the securities
  litigation and governmental investigations, and our efforts to enter into
  storage contracts with third party customers and pursue other
  strategic opportunities.  We expect this increased level of
  general and administrative expenses to continue into 2009.
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  Table of Contents
  Interest expense
  . 
  Interest expense represents interest on capital lease obligations and long-term
  borrowings under our credit facility and the impact of our interest rate swap
  agreements.  Interest expense increased by $12.5 million to $15.9
  million for the nine months ended September 30, 2008 compared to $3.4 million
  for the nine months ended September 30, 2007. The increase was primarily due to
  an increase in the average long-term borrowings outstanding during the nine
  months ended September 30, 2008 compared to the nine months ended September 30,
  2007, which accounted for approximately $14.1 million of an increase in interest
  expense, net of capitalized interest.  This increase was partially
  offset by the two interest rate swap agreements entered into during the third
  quarter of 2007 and three additional interest rate swap agreements entered into
  in February 2008, the fair value accounting of which resulted in $2.1 million in
  interest income for the nine months ended September 30, 2008.  Due to
  events related to the Bankruptcy Filings, all of these interest rate swap
  positions were terminated in the third quarter of 2008, and we have recorded a
  $1.5 million liability as of September 30, 2008 with respect to these
  positions.
  Effects
  of Inflation
  In recent
  years, inflation has been modest and has not had a material impact upon the
  results of the Partnership's operations.
  Off
  Balance Sheet Arrangements
  We do not
  have any off-balance sheet arrangements.
  Liquidity
  and Capital Resources
  Cash
  Flows and Capital Expenditures
  Cash
  generated from operations and borrowings under our credit facility have
  historically been the primary sources of our liquidity. Due to the events
  related to the Bankruptcy Filings, including uncertainties related to future
  revenues and cash flows, we do not expect our historical cash flows to be
  indicative of our future financial cash flows.
  As of May 22, 2009, we
  had $423.4 million in outstanding borrowings under our credit facility
  (including $23.4 million under our revolving credit facility and $400.0 million
  under our term loan facility) with an aggregate unused credit availability under
  our revolving credit facility and cash on hand of approximately $27.2 million.
  Pursuant to the Credit Agreement Amendment (as defined below), our revolving
  credit facility is limited to $50.0 million.
  If we
  are unable
  to sustain our sources of revenue generation and reestablish
  our relationships within the credit markets, this cash position may not be
  sufficient to operate our business over the long-term.
  Historically,
  our predecessor's sources of liquidity included cash generated from operations
  and funding from the Private Company.  The following table summarizes
  our sources and uses of cash for the nine months ended September 30, 2007 and
  2008:
  Nine
        Months Ended
  September
        30,
  2007
  2008
  (in
        millions)
  Net
        cash provided by (used in) operating activities
  (11.7
  )
  42.9
  Net
        cash used in investing activities
  (18.6
  )
  (519.8
  )
  Net
        cash provided by financing activities
  31.5
  493.0
  Operating
  Activities
  . Net cash provided by operating activities was $42.9
  million for the nine months ended September 30, 2008 as compared to the $11.7
  million used in operating activities for the nine months ended September 30,
  2007.  The increase in net cash provided by operating activities is
  primarily due to a $39.7 million increase in our net income for the nine months
  ended September 30, 2008 compared to the nine months ended September 30,
  2007.  In addition, cash provided by our operating activities
  increased due to a $8.8 million increase in depreciation and amortization, a
  $17.4 million increase in equity based incentive compensation and a $0.5 million
  increase in allowance for doubtful accounts.  The increase was offset
  by a decrease in our cash provided by changes in working capital of $9.4
  million, a decrease in our interest rate swap liability of $2.2 million and a
  decrease in our unrealized loss related to interest rate swap agreements of $0.6
  million.
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  Table of Contents
  Investing
  Activities
  . Net cash used in investing activities was $519.8 million
  for the nine months ended September 30, 2008 compared to $18.6 million for the
  nine months ended September 30, 2007. This increase is primarily attributable to
  the purchase of our Acquired Asphalt Assets in February 2008 for approximately
  $380 million, our purchase of our Acquired Storage Assets in May 2008 for
  approximately $90 million, and our purchase of our Acquired Pipeline Assets in
  May 2008 for approximately $45 million.  The increase due to the above
  mentioned purchases were offset by a reduction in capital expenditures primarily
  resulting from the timing of construction projects in our terminalling and
  storage segment and gathering and transportation segment.
  Financing
  Activities
  . Net cash provided by financing activities was $493.0
  million for the nine months ended September 30, 2008 as compared to $31.5
  million for the nine months ended September 30, 2007.  Net cash
  provided by financing activities for the nine months ended September 30, 2008 is
  primarily comprised of the change in our net borrowings under our credit
  facility of $266.0 million and proceeds from the February 2008 public offering,
  net of offering fees, of $161.2 million, and is offset by distributions paid of
  $23.7 million for the nine months ended September 30, 2008.  Prior to
  our initial public offering our net cash provided by financing activities
  primarily comprised of capital contributions received from the Private
  Company.  The capital contributions served to fund our working capital
  needs and both maintenance and expansion capital expenditure projects that are
  reflected in net cash used in investing activities for the nine months ended
  September 30, 2007.
  Our
  Liquidity and Capital Resources
  Cash flow
  from operations and our credit facility are our primary sources of liquidity. At
  September 30, 2008, we had approximately $101.9 million of availability under
  our revolving credit facility.
  As of May 22, 2009, we had
  an aggregate unused credit availability under our revolving credit facility and
  cash on hand of approximately $27.2 million.
  Usage of
  our revolving credit facility is subject to ongoing compliance with covenants.
  If we are unable to sustain our sources of revenue generation and reestablish
  our relationships within the credit markets, this cash position may not be
  sufficient to operate our business over the long-term. Historically, we have
  derived a substantial majority of our revenues from services provided to the
  Private Company, and as such, our liquidity was affected by the liquidity and
  credit risk of the Private Company.  Due to the events related to the
  Bankruptcy Filings described herein, including the uncertainty relating to
  future cash flows, we face substantial doubt as to our ability to continue
  as a going concern.
  Capital Requirements
  . Our
  operations are capital intensive, requiring significant investment to maintain
  and upgrade existing operations. Our capital requirements consist of the
  following:
  ·
  maintenance
        capital expenditures, which are capital expenditures made to maintain the
        existing integrity and operating capacity of our assets and related cash
        flows further extending the useful lives of the assets;
    and
  ·
  expansion
        capital expenditures, which are capital expenditures made to expand or to
        replace partially or fully depreciated assets or to expand the operating
        capacity or revenue of existing or new assets, whether through
        construction, acquisition or
  modification.
  No
  assurance can be given that we will not be required to restrict our operations
  because of possible limitations on our ability to obtain financing for our
  maintenance capital expenditures and our expansion capital expenditures due to
  restrictions under our credit agreement and the uncertainty related to the
  Bankruptcy Filings.  For example, due to the continuing impact of the
  Bankruptcy Filing discussed below, we have suspended capital expenditures
  related to Acquired Pipeline Assets and are evaluating future use of such
  pipeline.
  Our Ability to Grow Depends on Our
  Ability to Access External Expansion Capital
  . Our partnership agreement
  provides that we distribute all of our available cash to our unitholders.
  Available cash is reduced by cash reserves established by our general partner to
  provide for the proper conduct of our business (including for future capital
  expenditures) and to comply with the provisions of our credit facility. However,
  we expect that we will continue to rely primarily upon external financing
  sources, including commercial bank borrowings and the issuance of debt and
  equity securities, rather than cash reserves established by our general partner,
  to fund our acquisitions and expansion capital expenditures that we may make in
  the future.  We do not expect to make acquisitions or expansion
  capital expenditures in the near term.  Capital expenditures are
  limited under our credit agreement to $12.5 million in 2009, $8.0 million in
  2010 and $4.0 million in 2011.  To the extent we are unable to finance
  growth externally and we are unwilling to establish cash reserves to fund future
  acquisitions, our cash distribution policy will significantly impair our ability
  to grow. In addition, because we distribute all of our available cash, we may
  not grow as quickly as businesses that reinvest their available cash to expand
  ongoing operations.  Pursuant to the Credit Agreement Amendment, we
  are prohibited from making distributions to our unitholders if our leverage
  ratio (as defined in the credit agreement) exceeds 3.50 to 1.00.  As
  of September 30, 2008 and December 31, 2008, our leverage ratio was 4.34 to 1.00
  and 4.83 to 1.00, respectively. If our leverage ratio does not improve, we
  may not make quarterly distributions to our unitholders in the
  future.  To the extent we issue additional units in connection with
  any acquisitions or expansion capital expenditures, the payment of distributions
  on those additional units may increase the risk that we will be unable to
  maintain or increase our per unit distribution level, which in turn may impact
  the available cash that we have to distribute on each unit. There are no
  limitations in our partnership agreement on our ability to issue additional
  units, including units ranking senior to the common units.
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  Table of Contents
  Description of Credit
  Facility
  . In July 2007 we entered into a $250.0 million five-year
  credit facility with a syndicate of financial institutions. In connection with
  our acquisition of our asphalt assets, we amended this credit facility to
  increase the total amount we may borrow to $600.0 million.
  The
  credit facility is available for general partnership purposes, including working
  capital, capital expenditures, distributions and repayment of indebtedness that
  is assumed in connection with acquisitions. Due to events related to the
  Bankruptcy Filings, events of default occurred under our credit
  agreement.  Effective on September 18, 2008, we and the requisite
  lenders under our credit facility entered into a Forbearance Agreement and
  Amendment to Credit Agreement (the "Forbearance Agreement") under which the
  lenders agreed, subject to specified limitations and conditions, to forbear from
  exercising their rights and remedies arising from the defaults and events of
  default described therein for the period commencing on September 18, 2008 and
  ending on the earliest of (i) December 11, 2008, (ii) the occurrence of any
  default or event of default under the credit agreement other than certain
  defaults and events of default indicated in the Forbearance Agreement, or (iii)
  the failure of us to comply with any of the terms of the Forbearance Agreement
  (the "Forbearance Period").  On December 11, 2008, the lenders agreed
  to extend the Forbearance Period until December 18, 2008 pursuant to a First
  Amendment to Forbearance Agreement and Amendment to Credit Agreement (the "First
  Forbearance Amendment"), on December 18, 2008, the lenders agreed to extend the
  Forbearance Period until March 18, 2009 pursuant to a Second Amendment to
  Forbearance Agreement and Amendment to Credit Agreement (the "Second Forbearance
  Amendment"), and on March 18, 2009, the lenders agreed to further extend the
  Forbearance Period until April 8, 2009 pursuant to a Third Amendment to
  Forbearance Agreement and Amendment to Credit Agreement (the "Third Forbearance
  Amendment").
  We, our
  subsidiaries that are guarantors of the obligations under the credit facility,
  Wachovia Bank, National Association, as Administrative Agent, and the requisite
  lenders under our credit agreement entered into the Consent, Waiver and
  Amendment to Credit Agreement (the "Credit Agreement Amendment"), dated as of
  April 7, 2009, under which, among other things, the lenders consented to
  the Settlement and waived all existing defaults and events of default described
  in the Forbearance Agreement and amendments thereto.
  Prior to
  the execution of the Forbearance Agreement, the credit agreement was comprised
  of a $350 million revolving credit facility and a $250 million term loan
  facility.  The Forbearance Agreement permanently reduced our revolving
  credit facility under the credit agreement from $350 million to $300 million and
  prohibited us from borrowing additional funds under our revolving credit
  facility during the Forbearance Period.   Under the Forbearance
  Agreement, we agreed to pay the lenders executing the Forbearance Agreement a
  fee equal to 0.25% of the aggregate commitments under the credit agreement after
  giving effect to the above described commitment reduction.  The Second
  Forbearance Amendment further permanently reduced our revolving credit facility
  under the credit agreement from $300 million to $220 million.  In
  addition, under the Second Forbearance Amendment, we agreed to pay the lenders
  executing the Second Forbearance Amendment a fee equal to 0.375% of the
  aggregate commitments under the credit agreement after the above described
  commitment reduction.  Under the Third Forbearance Amendment, we
  agreed to pay a fee equal to 0.25% of the aggregate commitments under the credit
  agreement after the above described commitment reduction.  The amendments
  to the Forbearance Agreement prohibited us from borrowing additional funds under
  our revolving credit facility during the extended Forbearance
  Period.
  The
  Credit Agreement Amendment subsequently further permanently reduced our
  revolving credit facility under the credit agreement from $220 million to $50
  million, and increased the term loan facility from $250 million to $400
  million.  Upon the execution of the Credit Agreement Amendment, $150
  million of our outstanding revolving loans were converted to term loans and we
  became able to borrow additional funds under our revolving credit
  facility.  Pursuant to the Credit Agreement Amendment, the credit
  facility and all obligatinos thereunder will mature on June 30,
  2011.  Under the Credit Agreement Amendment, we agreed to pay the
  lenders executing the Credit Agreement Amendment a fee equal to 2.00% of the
  aggregate commitments under the credit agreement after the above described
  commitment reduction, offset by the fee paid pursuant to the Third Forbearance
  Amendment.
  As of May 22, 2009, we
  had $423.4 million in outstanding borrowings under our credit facility
  (including $23.4 million under our revolving credit facility and $400.0 million
  under our term loan facility) with an aggregate unused credit availability under
  our revolving credit facility and cash on hand of approximately $27.2 million.
  Pursuant to the Credit Agreement Amendment, our revolving credit facility
  is limited to $50.0 million.
  If any of
  the financial institutions that support our revolving credit facility were to
  fail, we may not be able to find a replacement lender, which could negatively
  impact our ability to borrow under our revolving credit facility.  For
  instance, Lehman Brothers Commercial Bank is one of the lenders under our $50.0
  million revolving credit facility, and Lehman Brothers Commercial Bank has
  agreed to fund approximately $2.5 million (approximately 5%) of the revolving
  credit facility.  On several occasions Lehman Brothers Commercial Bank has
  failed to fund revolving loan requests under our revolving credit facility,
  effectively limiting the aggregate amount of our revolving credit facility to
  $47.5 million.
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  Table of Contents
  Prior to
  the events of default, indebtedness under the credit agreement bore interest at
  our option, at either (i) the higher of the administrative agent's prime
  rate or the federal funds rate plus 0.5% (the "Base rate"), plus an applicable
  margin that ranges from 0.50% to 1.75%, depending on our total leverage ratio
  and senior secured leverage ratio, or (ii) LIBOR plus an applicable margin
  that ranges from 1.50% to 2.75%, depending upon our total leverage ratio and
  senior secured leverage ratio.  During the Forbearance Period
  indebtedness under the credit agreement bore interest at our option, at either
  (i) the Base rate, plus an applicable margin that ranges from 2.75% to
  3.75%, depending upon our total leverage ratio, or (ii) LIBOR plus an
  applicable margin that ranges from 4.25% to 5.25%, depending upon our total
  leverage ratio.  Pursuant to the Second Forbearance Amendment,
  commencing on December 12, 2008, indebtedness under the credit agreement bore
  interest at our option, at either (i) the Base rate plus 5.0% per annum,
  with a Base rate floor of 4.0% per annum, or (ii) LIBOR plus 6.0% per
  annum, with a LIBOR floor of 3.0% per annum.
  After
  giving effect to the Credit Agreement Amendment, amounts outstanding under our
  credit facility bear interest at either the LIBOR rate plus 6.50% per annum,
  with a LIBOR floor of 3.00%, or the Base rate plus 5.50% per annum, with a Base
  rate floor of 4.00% per annum.  We now pay a fee of 1.50% on unused
  commitments under our revolving credit facility.  After giving effect
  to the Credit Agreement Amendment, interest on amounts outstanding under our
  credit facility must be paid monthly.  Our credit facility, as amended
  by the Credit Agreement Amendment, now requires us to pay additional interest on
  October 6, 2009, April 6, 2010, October 6, 2010 and April 6, 2011, equal to the
  product of (i) the sum of the total amount of term loans then outstanding plus
  the aggregate commitments under the revolving credit facility and (ii) 0.50%,
  0.50%, 1.00% and 1.00%, respectively.
  During
  the three months ended September 30, 2008, the weighted average interest rate
  incurred by us was 7.04% resulting in interest expense of approximately $8.2
  million.  During the three months ended December 31, 2008, the
  weighted average interest rate incurred by us was 7.72% resulting in interest
  expense of approximately $8.9 million.
  Among
  other things, our credit facility, as amended by the Credit Agreement Amendment,
  now requires us to make (i) minimum quarterly amortization payments on March 31,
  2010 in the amount of $2.0 million, June 30, 2010 in the amount of $2.0 million,
  September 30, 2010 in the amount of $2.5 million, December 31, 2010 in the
  amount of $2.5 million and March 31, 2011 in the amount of $2.5 million, (ii)
  mandatory prepayments of amounts outstanding under the revolving credit facility
  (with no commitment reduction) whenever cash on hand exceeds $15.0 million,
  (iii) mandatory prepayments with 100% of asset sale proceeds, (iv) mandatory
  prepayment with 50% of the proceeds raised through equity sales and (v)
  annual prepayments with 50% of excess cash flow (as defined in the Credit
  Agreement Amendment).  Our credit facility, as amended by the Credit
  Agreement Amendment, prohibits us from making draws under the revolving credit
  facility if we would have more than $15.0 million of cash on hand after making
  the draw and applying the proceeds thereof.
  Under the
  credit agreement, we are subject to certain limitations, including limitations
  on our ability to grant liens, incur additional indebtedness, engage in a
  merger, consolidation or dissolution, enter into transactions with affiliates,
  sell or otherwise dispose of our assets (other than the sale or other
  disposition of the assets of the asphalt business, provided that such
  disposition is at arm's length to a non-affiliate for fair market value in
  exchange for cash and the proceeds of the disposition are used to pay down
  outstanding loans), businesses and operations, materially alter the character of
  our business, and make acquisitions, investments and capital
  expenditures.  The credit agreement prohibits us from making
  distributions of available cash to our unitholders if any default or event of
  default (as defined in the credit agreement) exists.  The credit
  agreement, as amended by the Credit Agreement Amendment, requires us to maintain
  a leverage ratio (the ratio of our consolidated funded indebtedness to our
  consolidated adjusted EBITDA, in each case as defined in the credit agreement),
  determined as of the last day of each
  month for the twelve
  month period ending on the date of determination, that ranges on a monthly
  basis from not more than 5.50 to 1.00 to not more than 9.75 to
  1.00.  In addition, pursuant to the Credit Agreement Amendment, our
  ability to make acquisitions and investments in unrestricted subsidiaries is
  limited and we may only make distributions if our leverage ratio is less than
  3.50 to 1.00 and certain other conditions are met.  As of September
  30, 2008 and December 31, 2008, our leverage ratio was 4.34 to 1.00 and 4.83 to
  1.00, respectively. If our leverage ratio does not improve, we may not make
  quarterly distributions to our unitholders in the future.
  The
  credit agreement, as amended by the Credit Agreement Amendment, also requires us
  to maintain an interest coverage ratio (the ratio of our consolidated EBITDA to
  our consolidated interest expense, in each case as defined in the credit
  agreement) that ranges on a monthly basis from not less than 2.50 to 1.00 to not
  less than 1.00 to 1.00. As of September 30, 2008 and December 31, 2008, our
  interest coverage ratio was 4.95 to 1.00 and 3.60 to 1.00,
  respectively.
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  Table of Contents
  Further,
  we are required to maintain a minimum monthly consolidated adjusted EBITDA for
  the prior twelve months ranging from $45.4 million to $82.9 million as
  determined at the end of each month.  In addition, capital
  expenditures are limited to $12.5 million in 2009, $8.0 million in 2010 and $4.0
  million in the six months ending June 30, 2011.
  The
  credit agreement specifies a number of events of default (many of which are
  subject to applicable cure periods), including, among others, failure to pay any
  principal when due or any interest or fees within three business days of the due
  date, failure to perform or otherwise comply with the covenants in the credit
  agreement, failure of any representation or warranty to be true and correct in
  any material respect, failure to pay debt, a change of control of us or our
  general partner, and other customary defaults.
  In
  addition, it is an event of default under the credit agreement if we do not file
  our delinquent quarterly and annual reports with the SEC by September 30, 2009,
  unless we retain new auditors, in which case such deadline is extended to
  December 31, 2009.
  If an event of default exists under the credit
  agreement, the lenders will be able to accelerate the maturity of the credit
  agreement and exercise other rights and remedies, including taking available
  cash in our bank accounts.  If an event of default exists and we are
  unable to obtain forbearance from our lenders or a waiver of the events of
  default under our credit agreement, we may be forced to sell assets, make a
  bankruptcy filing or take other action that could have a material adverse effect
  on our business, the price of our common units and our results of
  operations.  We are also prohibited from making cash distributions to
  our unitholders while the events of default exist.
  Contractual
  Obligations
  . In addition to the credit facility described above, we
  entered into the Amended Omnibus Agreement with the Private Company pursuant to
  which the Private Company provided all employees and support services necessary
  to run our business prior to the Settlement. The services included, without
  limitation, operations, marketing, maintenance and repair, legal, accounting,
  treasury, insurance administration and claims processing, risk management,
  health, safety and environmental, information technology, human resources,
  credit, payroll, internal audit, taxes and engineering.  The events
  related to the Bankruptcy Filings terminated the Private Company's obligations
  to provide services to us under the Amended Omnibus Agreement.  The
  Private Company continued to provide such services to us until the effective
  date of the Settlement at which time the Private Company rejected the Amended
  Omnibus Agreement and we and the Private Company entered into the Shared
  Services Agreement and the Transition Services Agreement relating to the
  provision of such services (see "Item 2. Management's Discussion and Analysis of
  Financial Condition and Results of Operations
  —Impact
  of the Bankruptcy of the Private Company and Certain of its Subsidiaries and
  Related Events
  —Settlement with the Private Company").  In
  addition, in connection with the Settlement, we made offers of employment to
  certain individuals associated with our crude oil operations and expect to make
  additional offers of employment to certain individuals associated with our
  asphalt operations.  The costs to directly employ these individuals as
  well as the costs under the Shared Services Agreement, the Transition Services
  Agreement may be higher than those previously paid by us under the Amended
  Omnibus Agreement, which could have a material adverse effect on our business,
  financial condition, results of operations, cash flows, ability to make
  distributions to our unitholders, the trading price of our common units and our
  ability to conduct our business.
  A summary
  of our contractual cash obligations over the next several fiscal years, as of
  September 30, 2008, was as follows:
  Payments
        Due by Period
  Contractual
        Obligations
  Total
  Less
        than 1 year
  1-3
        years
  4-5
        years
  More
        than 5 years
  (in
        millions)
  Omnibus
        Agreement obligations (1)
  $
  1.2
  $
  1.2
  $
  -
  $
  -
  $
  -
  Debt
        obligations (2)
  448.1
  -
  448.1
  -
  -
  Capital
        lease obligations
  1.4
  1.0
  0.4
  -
  -
  Operating
        lease obligations
  13.4
  3.9
  6.5
  2.7
  0.3
  (1)
  As
        of September 30, 2008, the Private Company still provided services to us
        under the Amended Omnibus Agreement and we still paid our general partner
        and the Private Company a fixed administrative fee, in the amount of $7.0
        million per year, for the provision by our general partner and the Private
        Company of various general and administrative services pursuant to the
        Amended Omnibus Agreement.  The events related to the Bankruptcy
        Filings terminated the Private Company's obligations to provide services
        to us under the Amended Omnibus Agreement.  The Private Company
        continued to provide such services to us until the effective date of the
        Settlement at which time the Private Company rejected the Amended Omnibus
        Agreement and we and the Private Company entered into the Shared Services
        Agreement and the Transition Services Agreement relating to the provision
        of such services (see "Item 2. Management's Discussion and Analysis of
        Financial Condition and Results of Operations
  —Impact
        of the Bankruptcy of the Private Company and Certain of its Subsidiaries
        and Related Events
  —Settlement with the Private
        Company").
  (2)
  Represents
        required future principal repayments of borrowings under our credit
        facility, all of which is variable rate debt. All amounts outstanding
        under the credit facility mature in June 2011.  See Note 4 of
        the Notes to the Consolidated Financial Statements included in Item 1 of
        this Quarterly Report.
  54
  Table of Contents
  Recent
  Accounting Pronouncements
  For
  information regarding recent accounting developments that may affect our future
  financial statements, see Note 12 of the Notes to the Consolidated Financial
  Statements included in Item 1 of this Quarterly Report.
  Item 3.
  Quantitative
        and Qualitative Disclosures about Market
  Risk
  We are
  exposed to market risk due to variable interest rates under our credit
  facility.
  As of May 22, 2009 we had
  $423.4 million outstanding under our credit facility that was subject to a
  variable interest rate
  .  Interest
  rate swap agreements
  were used to manage a portion of the exposure related to changing interest rates
  by converting floating-rate debt to fixed-rate debt. In August 2007 we entered
  into interest rate swap agreements with an aggregate notional value of $80.0
  million that mature on August 20, 2010. Under the terms of the interest
  rate swap agreements, we were to pay fixed rates of 4.9% and receive three-month
  LIBOR with quarterly settlement.  In March 2008 we entered into
  interest rate swap agreements with an aggregate notional value of $100.0 million
  that mature on March 31, 2011.  Under the terms of the interest rate
  swap agreements, we were to pay fixed rates of 2.6% to 2.7% and receive
  three-month LIBOR with quarterly settlement.  The interest rate swaps
  do not receive hedge accounting treatment under Statement of Financial
  Accounting Standard ("SFAS") SFAS No. 133, "
  Accounting for Derivative
  Instruments and Hedging Activities
  " ("SFAS 133"). Changes in the fair
  value of the interest rate swaps are recorded in interest expense in the
  statements of operations.  In addition, the interest rate swap
  agreements contain cross-default provisions to events of default under the
  credit agreement.  Due to events related to the Bankruptcy Filings,
  all of these interest rate swap positions were terminated in the third quarter
  of 2008, and we have recorded a $1.5 million liability as of September 30, 2008
  with respect to these positions.
  Prior to
  the events of default, indebtedness under the credit agreement bore interest at
  our option, at either (i) the Base rate, plus an applicable
  margin that ranges from 0.50% to 1.75%, depending on our total leverage ratio
  and senior secured leverage ratio, or (ii) LIBOR plus an applicable margin
  that ranges from 1.50% to 2.75%, depending upon our total leverage ratio and
  senior secured leverage ratio.  During the Forbearance Period
  indebtedness under the credit agreement bore interest at our option, at either
  (i) the Base rate, plus an applicable margin that ranges from 2.75% to
  3.75%, depending upon our total leverage ratio, or (ii) LIBOR plus an
  applicable margin that ranges from 4.25% to 5.25%, depending upon our total
  leverage ratio.  Pursuant to the Second Forbearance Amendment,
  commencing on December 12, 2008, indebtedness under the credit agreement bore
  interest at our option, at either (i) the Base rate plus 5.0% per
  annum, with a Base rate floor of 4.0% per annum, or (ii) LIBOR plus 6.0%
  per annum, with a LIBOR floor of 3.0% per annum.
  After
  giving effect to the Credit Agreement Amendment, amounts outstanding under our
  credit facility bear interest at either the LIBOR rate plus 6.50% per annum,
  with a LIBOR floor of 3.00%, or the Base rate plus 5.50% per annum, with a Base
  rate floor of 4.00% per annum.  We now pay a fee of 1.50% on unused
  commitments under our revolving credit facility.  After giving effect
  to the Credit Agreement Amendment, interest on amounts outstanding under our
  credit facility must be paid monthly.  Our credit facility, as amended
  by the Credit Agreement Amendment, now requires us to pay additional interest on
  October 6, 2009, April 6, 2010, October 6, 2010 and April 6, 2011, equal to the
  product of (i) the sum of the total amount of term loans then outstanding plus
  the aggregate commitments under the revolving credit facility and (ii) 0.50%,
  0.50%, 1.00% and 1.00%, respectively.
  During
  the three months ended September 30, 2008, the weighted average interest rate
  incurred by us was 7.04% resulting in interest expense of approximately $8.2
  million.  During the three months ended December 31, 2008, the
  weighted average interest rate incurred by us was 7.72% resulting in interest
  expense of approximately $8.9 million.
  Due to
  the Forbearance Agreement, the Second Forbearance Amendment and the Credit
  Agreement Amendment, we expect our interest expense to continue to increase as
  compared to our interest expense prior to the Bankruptcy
  Filings.  Changes in economic conditions could result in higher
  interest rates, thereby increasing our interest expense and reducing our funds
  available for capital investment, operations or distributions to our
  unitholders. Additionally, if domestic interest rates continue to increase, the
  interest rates on any of our future credit facilities and debt offerings could
  be higher than current levels, causing our financing costs to increase
  accordingly.
  Based
  on current borrowings, an increase or decrease of 100 basis points in the
  interest rate will result in increased or decreased, respectively, annual
  interest expenses of $4.2 million.
  55
  Table of Contents
  Item 4T.
  Controls
        and Procedures
  Evaluation of disclosure controls
  and procedures.
  Our general partner's management, including the Chief
  Executive Officer and Chief Financial Officer of our general partner, evaluated
  as of the end of the period covered by this report, the effectiveness of our
  disclosure controls and procedures as defined in Rule 13a-15(e) under the
  Securities Exchange Act of 1934. Based on that evaluation, the Chief
  Executive Officer and Chief Financial Officer of our general partner concluded
  that our disclosure controls and procedures, as of September 30, 2008, were
  effective.
  Changes in internal control over
  financial reporting.
  There were no changes in our internal control over
  financial reporting that occurred during the quarter ended September 30, 2008
  that have materially affected, or are reasonably likely to materially affect,
  our internal control over financial reporting.  However, since the
  beginning of the third quarter of 2008, the Private Company has made the
  Bankruptcy Filings, and a subcommittee of our Board conducted an internal
  review, both as discussed elsewhere in this report.  One of the
  findings by counsel for such subcommittee was that certain senior executive
  officers of our general partner, who were also senior executive officers of the
  Private Company, showed at least some indifference to known or easily
  discoverable facts and had access to and reviewed financial information from
  which they could have developed an earlier understanding of the nature and
  significance of the trading activities that led to the Private Company's
  liquidity problems.  For a discussion of the internal review, please
  see "Item 2. Management's Discussion and Analysis of Financial Condition and
  Results of Operations − Impact of the Bankruptcy of the Private Company and
  Certain of its Subsidiaries and Related Events − Internal Review."
  After
  completion of the internal review, a plan was developed with the advice of the
  Audit Committee of the Board to further strengthen our processes and
  procedures.  This plan includes, among other things, reevaluating
  executive officers and accounting and finance personnel (including a realignment
  of officers as described elsewhere in this report) and hiring, as deemed
  necessary, additional accounting and finance personnel or consultants;
  reevaluating our internal audit function and determining whether to expand the
  duties and responsibilities of such group; evaluating the comprehensive training
  programs for all management personnel covering, among other things, compliance
  with controls and procedures, revising the reporting structure so that the Chief
  Financial Officer reports directly to the Audit Committee, and increasing the
  business and operational oversight role of the Audit Committee.
  We and
  our general partner rely upon the Private Company for our personnel, including
  those related to designing and implementing internal controls and disclosure
  controls and procedures.  Staff reductions by the Private Company or
  other departures by the Private Company's employees that provide services to us
  could have a material adverse effect on internal controls and the effectiveness
  of disclosure controls and procedures.  Management is in the process
  of evaluating any such potential impact and is preparing a transition plan that
  may include, among other items, hiring additional personnel and the redesign and
  implementation of internal controls and disclosure controls and procedures as
  needed.
  Pursuant
  to the Amended Omnibus Agreement with the Private Company, the Private Company
  operated our assets and performed other administrative services for us such as
  accounting, legal, regulatory, development, finance, land and
  engineering.  The events related to the Bankruptcy Filings terminated
  the Private Company's obligations to provide services to us under the Amended
  Omnibus Agreement.  The Private Company continued to provide such
  services to us until the effective date of the Settlement at which time the
  Private Company rejected the Amended Omnibus Agreement and we and the Private
  Company entered into the Shared Services Agreement and the Transition Services
  Agreement relating to the provision of such services.  If the Private
  Company stops providing these services we may incur increased costs to replace
  these services and our financial results may suffer.  In addition, in
  connection with the Settlement, we made offers of employment to certain
  individuals associated with our crude oil operations and expect to make
  additional offers of employment to certain individuals associated with our
  asphalt operations.  The costs to directly employ these individuals as
  well as the costs under the Shared Services Agreement and the Transition
  Services Agreement may be higher than those previously paid by us under the
  Amended Omnibus Agreement, which could have a material adverse effect on our
  business, financial condition, results of operations, cash flows, ability to
  make distributions to our unitholders, the trading price of our common units and
  our ability to conduct our business.
  56
  Table of Contents
  PART II.
  OTHER INFORMATION
  Item 1.
  Legal
        Proceedings
  On July 21, 2008, we received a letter
  from the staff of the SEC giving notice that the SEC is conducting an inquiry
  relating to us and requesting, among other things, that we voluntarily preserve,
  retain and produce to the SEC certain documents and information relating
  primarily to our disclosures respecting the Private Company's liquidity issues,
  which were the subject of our July 17, 2008 press release.  On October
  22, 2008, we received a subpoena from the SEC pursuant to a formal order of
  investigation requesting certain documents relating to, among other things, the
  Private Company's liquidity issues.  We have been cooperating, and
  intend to continue cooperating, with the SEC in its investigation.
  On July
  23, 2008, we and our general partner each received a Grand Jury subpoena from
  the United States Attorney's Office in Oklahoma City, Oklahoma, requiring, among
  other things, that we and our general partner produce financial and other
  records related to our July 17, 2008 press release.  We have been
  informed that the U.S. Attorneys' Offices for the Western District of Oklahoma
  and the Northern District of Oklahoma are in discussions regarding the
  subpoenas, and no date has been set for a response to the
  subpoenas.  We and our general partner intend to cooperate fully with
  this investigation if and when it proceeds.
  Between
  July 21, 2008 and September 4, 2008, the following class action complaints were
  filed:
  1.
  Poelman v. SemGroup Energy
  Partners, L.P., et al
  ., Civil Action No. 08-CV-6477, in the United States
  District Court for the Southern District of New York (filed July 21,
  2008).  The plaintiff voluntarily dismissed this case on August 26,
  2008;
  2.
  Carson v. SemGroup Energy Partners,
  L.P. et al
  .
  ,
  Civil Action No. 08-cv-425, in the Northern District of Oklahoma (filed July 22,
  2008);
  3.
  Charles D. Maurer SIMP Profit
  Sharing Plan f/b/o Charles D. Maurer v. SemGroup Energy Partners, L.P. et
  al.
  , Civil Action No. 08-cv-6598, in the United States District Court for
  the Southern District of New York (filed July 25, 2008);
  4.
  Michael Rubin v. SemGroup Energy
  Partners, L.P. et al.
  , Civil Action No. 08-cv-7063, in the United States
  District Court for the Southern District of New York (filed August 8,
  2008);
  5.
  Dharam V. Jain v. SemGroup Energy
  Partners, L.P. et al.
  , Civil Action No. 08-cv-7510, in the United States
  District Court for the Southern District of New York  (filed August 25,
  2008); and
  6.
  William L. Hickman v. SemGroup
  Energy Partners, L.P. et al.
  , Civil Action No. 08-cv-7749, in the United
  States District Court for the Southern District of New York (filed September 4,
  2008).
  57
  Table of Contents
  Pursuant
  to a motion filed with the MDL Panel, the
  Maurer
  case has been transferred to the Northern District of Oklahoma and
  consolidated with the
  Carson
  case.  The
  Rubin, Jain,
  and
  Hickman
  cases have also been transferred to the Northern District of
  Oklahoma.
  A hearing on motions for appointment as lead plaintiff was held in the
  Carson
  case on October 17, 2008.  At that hearing, the court granted
  a motion to consolidate the
  Carson
  and
  Maurer
  cases for pretrial proceedings, and the consolidated litigation is now pending
  as
  In Re: SemGroup Energy Partners, L.P. Securities Litigation
  , Case No.
  08-CV-425-GKF-PJC. The court entered an order on October 27, 2008, granting the
  motion of Harvest Fund Advisors LLC to be appointed lead plaintiff in the
  consolidated litigation.  On January 23, 2009, the court entered a
  Scheduling Order providing, among other things, that the lead plaintiff may file
  a consolidated amended complaint within 70 days of the date of the order, and
  that defendants may answer or otherwise respond within 60 days of the date of
  the filing of a consolidated amended complaint.
  On
  January 30, 2009, the lead plaintiff filed a motion to modify the stay of
  discovery provided for under the Private Securities Litigation Reform Act. The
  court granted Plaintiff's motion, and we and certain other defendants filed a
  Petition for Writ of Mandamus in the Tenth Circuit Court of Appeals
  that was denied after oral argument on April 24,
  2009.
  The
  lead plaintiff obtained an extension to file its consolidated amended complaint
  until May 4, 2009; defendants have 60 days from that date to answer or otherwise
  respond to the complaint.
  The
  lead plaintiff filed a consolidated amended complaint on May 4, 2009.  In
  that complaint, filed as a putative class action on behalf of all purchasers of
  our units from July 17, 2007 to July 17, 2008 (the "class period"), lead
  plaintiff asserts claims under the federal securities laws against us, our
  general partner, certain of our current and former officers and directors,
  certain underwriters in our initial and secondary public offerings, and certain
  entities who were investors in the Private Company and their individual
  representatives who served on the Private Company's management committee. Among
  other allegations, the amended complaint alleges that our financial condition
  throughout the class period was dependent upon speculative commodities trading
  by the Private Company and its Chief Executive Officer, Thomas L. Kivisto, and
  that Defendants negligently and intentionally failed to disclose this
  speculative trading in our public filings during the class period. Specifically,
  the amended complaint alleges claims for violations of sections 11, 12(a)(2),
  and 15 of the Securities Act of 1933 for damages and rescission with respect to
  all persons who purchased our units in the initial and secondary offerings, and
  also asserts claims under section 10b, Rule 10b-5, and section 20(a) of the
  Securities and Exchange Act of 1934. The amended complaint seeks certification
  as a class action under the Federal Rules of Civil Procedure, compensatory and
  rescissory damages for class members, pre-judgment interest, costs of court, and
  attorneys' fees.
  We intend to vigorously defend these actions.  There can be no assurance
  regarding the outcome of the litigation.  An estimate of possible
  loss, if any, or the range of loss cannot be made and therefore we have not
  accrued a loss contingency related to these actions.  However, the
  ultimate resolution of these actions could have a material adverse effect on our
  business, financial condition, results of operations, cash flows, ability to
  make distributions to our unitholders, the trading price of the our common units
  and our ability to conduct our business.
  In March
  and April 2009, nine current or former executives of the Private Company and
  certain of its affiliates filed wage claims with the Oklahoma Department of
  Labor against our general partner.  Their claims arise from our
  general partner's Long-Term Incentive Plan, Employee Phantom Unit Agreement
  ("Phantom Unit Agreement").  Most claimants allege that phantom
  units previously awarded to them vested upon the Change of Control that
  occurred in July 2008.  One claimant alleges that his phantom units
  vested upon his termination.  The claimants contend our general
  partner's failure to deliver certificates for the phantom units within 60 days
  after vesting has caused them to be damaged, and they seek recovery of
  approximately $2 million in damages and penalties.
  On April 30, 2009,
  all of the wage claims were dismissed on jurisdictional grounds by the
  Department of Labor.
  Our general partner intends to vigorously
  defend these claims.
  We may
  become the subject of additional private or government actions regarding these
  matters in the future.  Litigation may be time-consuming, expensive
  and disruptive to normal business operations, and the outcome of litigation is
  difficult to predict.  The defense of these lawsuits may result in the
  incurrence of significant legal expense, both directly and as the result of our
  indemnification obligations.  The litigation may also divert
  management's attention from our operations which may cause our business to
  suffer.  An unfavorable outcome in any of these matters may have a
  material adverse effect on our business, financial condition, results of
  operations, cash flows, ability to make distributions to our unitholders, the
  trading price of the our common units and our ability to conduct our business.
  All or a portion of the defense costs and any amount we may be required to pay
  to satisfy a judgment or settlement of these claims may not be covered by
  insurance.
  58
  Table of Contents
  Item 1A.
  Risk
        Factors
  Limited
  partner interests are inherently different from the capital stock of a
  corporation, although many of the business risks to which we are subject are
  similar to those that would be faced by a corporation engaged in a similar
  business. You should carefully consider the following risk factors together with
  all of the other information included in this report. If any of the following
  risks were actually to occur, our business, financial condition, or results of
  operations could be materially adversely affected. In that case, we might not be
  able to pay distributions on our common units, the trading price of our common
  units could decline and our unitholders could lose all or part of their
  investment.
  Risks
  Related to the Bankruptcy Filings
  The
  Bankruptcy Filings may have a material adverse effect on our results of
  operations and our ability to make distributions to our
  unitholders.
  On July
  22, 2008, the Private Company made the Bankruptcy Filings.  The
  Private Company and its subsidiaries continue to operate their businesses and
  own and manage their properties as debtors-in-possession under the jurisdiction
  of the Bankruptcy Court and in accordance with the applicable provisions of the
  Bankruptcy Code.  None of we, our general partner, our subsidiaries
  nor our general partner's subsidiaries are debtors in the Bankruptcy
  Cases.
  As of the
  date of the Bankruptcy Filings, we were party to various agreements with the
  Private Company and its subsidiaries, including subsidiaries that are debtors in
  the Bankruptcy Cases.  Under the Throughput Agreement, we provided
  certain crude oil gathering, transportation, terminalling and storage services
  to a subsidiary of the Private Company that is a debtor in the Bankruptcy
  Cases.  Under the Terminalling Agreement, we provided certain liquid
  asphalt cement terminalling and storage services to a subsidiary of the Private
  Company that is a debtor in the Bankruptcy Cases.  For the nine months
  ended September 30, 2008 and the year ended December 31, 2008, we derived
  approximately 81% and approximately 73%, respectively, of our revenues,
  excluding fuel surcharge revenues related to fuel and power consumed to operate
  our liquid asphalt cement storage tanks, from services we provided to the
  Private Company and its subsidiaries.  Prior to the Order and the
  Settlement, the Private Company was obligated to pay us minimum monthly fees
  totaling $76.1 million annually and $58.9 million annually in respect of the
  minimum commitments under the Throughput Agreement and the Terminalling
  Agreement, respectively, regardless of whether such services were actually used
  by the Private Company.  The Order required the Private Company to
  make certain payments under the Throughput Agreement and Terminalling Agreement
  during a portion of the third quarter of 2008,  including the contractual
  minimum payments under the Terminalling Agreement.  In connection with
  the Settlement, we waived the fees due under the Terminalling Agreement during
  March 2009.  In addition, the Private Company rejected the Throughput
  Agreement and the Terminalling Agreement and we and the Private Company entered
  into the New Throughput Agreement and the New Terminalling
  Agreement.  We expect revenues from services provided to the Private
  Company under the New Throughput Agreement and New Terminalling Agreement to be
  substantially less than prior revenues from services provided to the Private
  Company as the new agreements are based upon actual volumes gathered,
  transported, terminalled and stored instead of certain minimum volumes and are
  at reduced rates when compared to the Throughput Agreement and Terminalling
  Agreement.  See "─The Private Company has rejected certain contracts
  it has with us as part of the Bankruptcy Cases, which could have a material
  adverse effect on our results of operations, cash flows and ability to make
  distributions to our unitholders."
  We have
  been pursuing opportunities to provide crude oil terminalling and storage
  services and crude oil gathering and transportation services to third
  parties.  Although average rates for the new third-party crude oil
  terminalling and storage and transportation and gathering contracts are
  comparable with those previously received from the Private Company, the volumes
  being terminalled, stored, transported and gathered have decreased as compared
  to periods prior to the Bankruptcy Filings, which has negatively impacted total
  revenues.  As an example, fourth quarter 2008 total revenues are
  approximately $8.2 million less than third quarter 2008 total revenues, in each
  case excluding fuel surcharge revenues related to fuel and power consumed to
  operate our liquid asphalt cement storage tanks.
  In
  addition, we have recently entered into leases and storage agreements with third
  parties relating to certain of our asphalt facilities.  The revenues
  that we will receive pursuant to these leases and storage agreements will be
  less than the revenues received under the Terminalling Agreement with the
  Private Company.
  59
  Table of Contents
  There can
  be no assurance that our efforts to increase the third party revenue will
  be successful.  In addition, certain third parties may be less likely
  to enter into business transactions with us due to the Bankruptcy
  Filings.  The Private Company may also choose to curtail its
  operations or liquidate its assets as part of the Bankruptcy
  Cases.  As a result, unless we are able to generate additional third
  party revenues, we will continue to experience lower volumes in our system
  which could have a material adverse effect on our results of operations and cash
  flows.
  We
  may not be able to continue as a going concern.
  The
  financial statements included in this Form 10-Q have been prepared assuming we
  will continue as a going concern, though such an assumption may not be
  true.  We earned 81% of our revenues, excluding fuel surcharge
  revenues related to fuel and power consumed to operate our liquid asphalt cement
  storage tanks, for the nine months ended September 30, 2008 from the Private
  Company, which commenced the Bankruptcy Cases in July 2008, the effects of which
  are more fully described herein.  The Bankruptcy Cases, as well as
  other events and uncertainties related to the Bankruptcy Filings, raise
  substantial doubt about our ability to continue as a going
  concern.  While it is not feasible to predict the ultimate outcome of
  the events surrounding the Bankruptcy Cases, we have been and could continue to
  be materially and adversely affected by such events and we may be forced to make
  a bankruptcy filing or take other action that could have a material adverse
  effect on our business, the price of our common units and our results of
  operations.  See "Item 2. Management's Discussion and Analysis of
  Financial Condition and Results of Operations" and Note 2 to the unaudited
  consolidated financial statements.
  The
  Private Company has rejected certain contracts it has with us as part of the
  Bankruptcy Cases, which could have a material adverse effect on our results of
  operations, cash flows and ability to make distributions to our
  unitholders.
  In
  connection with the Settlement, among other things, the Private Company rejected
  certain agreements, including the Terminalling Agreement, the Throughput
  Agreement and the Amended Omnibus Agreement (see "Item 2. Management's
  Discussion and Analysis of Financial Condition and Results of Operations—Impact
  of the Bankruptcy of the Private Company and Certain of its Subsidiaries and
  Related Events—Settlement with the Private Company").  We may not be
  able to replace the volumes provided by the Private Company under these
  agreements and any contracts we make with third parties may be for prices that
  are less than those charged the Private Company under the Throughput Agreement
  and the Terminalling Agreement, which could have a material adverse effect on
  our results of operations, cash flows and ability to make distributions to our
  unitholders.
  We have
  recently entered into leases and storage agreements with third parties relating
  to 39 of our 46 asphalt facilities.  The revenues that we will
  receive pursuant to these leases and storage agreements will be less than the
  revenues received under the Terminalling Agreement with the Private
  Company.
  Without sufficient revenues from our asphalt assets,
  we may be unable to meet the covenants, including the minimum liquidity, minimum
  EBITDA and minimum receipt requirements, under our credit
  agreement.  Any significant decrease in the amount of revenues that we
  receive from our liquid asphalt cement terminalling and storage operations could
  have a material adverse effect on our cash flows, financial condition and
  results of operations.
  The
  Private Company may assert claims against us in the Bankruptcy Cases which could
  have a material adverse effect on our cash flows and ability to make
  distributions to our unitholders.
  Pursuant
  to the Settlement, the Private Company released certain of its claims against
  us.  However, there may be other claims against us, that have not been
  released in connection with the Settlement.  If claims are identified,
  such claims may prompt the filing of lawsuits in the Bankruptcy Cases to seek
  monetary damages or to challenge or to seek to unwind transactions with us under
  the bankruptcy laws.  Such litigation may be expensive and, if
  successful, would have a material adverse effect on our business, financial
  condition, results of operations, ability to make distributions to our
  unitholders and the trading price of our common units.
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  We
  did not make a distribution for the second quarter, third quarter or fourth
  quarter of 2008 and the first quarter of 2009, do not expect to make a
  distribution for the second quarter of 2009 at this time and may not make
  distributions in the future.
  We did
  not make a distribution to our common unitholders, subordinated unitholders or
  general partner attributable to the results of operations for the quarters ended
  June 30, 2008, September 30, 2008, December 31, 2008 or March 31, 2009 due to
  the events of default under our credit agreement and the uncertainty of our
  future cash flows relating to the Bankruptcy Filings.  Our unitholders
  will be required to pay taxes on their share of our taxable income even though
  they did not receive a cash distribution for such periods.  In
  addition, we do not currently expect to make a distribution relating to the
  second quarter of 2009.  See "—Tax Risks to Common Unitholders—Our
  unitholders have been and will be required to pay taxes on their share of our
  taxable income even if they have not or do not receive any cash distributions
  from us."  We distributed approximately $14.3 million to our unitholders
  for the three months ended March 31, 2008.  Pursuant to the Credit
  Agreement Amendment, we are prohibited from making distributions to our
  unitholders if our leverage ratio (as defined in the credit agreement) exceeds
  3.50 to 1.00.  As of September 30, 2008 and December 31, 2008, our
  leverage ratio was 4.34 to 1.00 and 4.83 to 1.00, respectively.  We
  are uncertain as to when, if ever, our leverage ratio will be below 3.50 to 1.00
  and therefore we are uncertain as to when or if we may again make
  distributions to our unitholders.  Our partnership agreement provides
  that, during the subordination period, which we are currently in, our common
  units have the right to receive distributions of available cash from operating
  surplus in an amount equal to the minimum quarterly distribution of $0.3125 per
  common unit per quarter, plus any arrearages in the payment of the minimum
  quarterly distribution on the common units from prior quarters, before any
  distributions of available cash from operating surplus may be made on the
  subordinated units.
  We
  are exposed to the credit risk of the Private Company and the material
  nonperformance by the Private Company could reduce our ability to make
  distributions to our unitholders.
  In
  connection with the Settlement we entered into the New Terminalling Agreement,
  the New Throughput Agreement, the Shared Services Agreement and the Transition
  Services Agreement.  Pursuant to such agreements we continue to rely
  upon the Private Company for a portion of our revenues and to perform certain
  operational and administrative services for us.  The Private Company
  has defaulted under its credit facilities and its indenture relating to its
  senior notes.  Moody's and Fitch Ratings have withdrawn their ratings
  of the Private Company due to the Bankruptcy Filings.  Any material
  nonperformance under the New Throughput Agreement, the New Terminalling
  Agreement, the Shared Services Agreement or the Transition Services Agreement by
  the Private Company could materially and adversely impact our results of
  operations and our ability to operate and make distributions to our
  unitholders. See "─The Private Company has rejected certain contracts
  it has with us as part of the Bankruptcy Cases, which could have a material
  adverse effect on our results of operations, cash flows and ability to make
  distributions to our unitholders."
  Though we
  have no indebtedness rated by any credit rating agency, we may have rated debt
  in the future. Credit rating agencies such as Moody's and Fitch Ratings may
  consider the Private Company's debt ratings when assigning ours, because of the
  Private Company's ownership interest in us, the strong operational links between
  the Private Company and us, and our reliance on the Private Company for a
  portion of our revenues. Due to the Private Company's default of its
  indebtedness and the uncertainty related to the Bankruptcy Filings, we could
  experience an increase in our borrowing costs or difficulty accessing capital
  markets if we are able to access them at all. Such a development could adversely
  affect our ability to grow our business and to make distributions to
  unitholders.
  Prior
  to the Settlement, we did not have employees and relied solely on the employees
  of the Private Company.  We continue to rely upon the Private Company
  for certain operational and administrative services and may experience increased
  costs as we begin employing individuals directly associated with our
  operations.
  As is the
  case with many publicly traded partnerships, we have not historically directly
  employed any persons responsible for managing or operating us or for providing
  services relating to day-to-day business affairs.  Pursuant to the
  Amended Omnibus Agreement, the Private Company operated our assets and performed
  other administrative services for us such as accounting, legal, regulatory,
  development, finance, land and engineering.  The events related to the
  Bankruptcy Filings terminated the Private Company's obligations to provide
  services to us under the Amended Omnibus Agreement.  The Private
  Company continued to provide such services to us until the effective date of the
  Settlement at which time the Private Company rejected the Amended Omnibus
  Agreement and we and the Private Company entered into the Shared Services
  Agreement and the Transition Services Agreement relating to the provision of
  such services.  In addition, in connection with the Settlement, we
  made offers of employment to certain individuals associated with our crude oil
  operations and expect to make additional offers of employment to certain
  individuals associated with our asphalt operations.  The costs to
  directly employ these individuals as well as the costs under the Shared Services
  Agreement and the Transition Services Agreement may be higher than those
  previously paid by us under the Amended Omnibus Agreement, which could have a
  material adverse effect on our business, financial condition, results of
  operations, cash flows, ability to make distributions to our unitholders, the
  trading price of our common units and our ability to conduct our
  business.
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  In
  addition, in connection with the Settlement, we agreed to not solicit the
  Private Company's employees for a year from the time of the
  Settlement.  In connection with the Bankruptcy Cases, the Private
  Company may reduce a substantial number of its employees or some of the Private
  Company's employees may choose to terminate their employment with the Private
  Company, some of whom may currently be providing general and administrative and
  operating services to us under the Shared Services Agreement or the Transition
  Services Agreement.  Any reductions in critical personnel who provide
  services to us and any increased costs to replace such personnel could have a
  material adverse effect on our ability to conduct our business and our results
  of operations.
  Certain
  of our officers are also officers of the Private Company.
  Prior to
  the events surrounding the Bankruptcy Filings, the officers of our general
  partner were also employees and officers or directors of the Private
  Company.  Messrs. Foxx and Stallings resigned the positions each
  officer held with SemGroup, L.P. in July 2008.  Mr. Brochetti had
  previously resigned from his position with SemGroup, L.P. in March
  2008.  Mr. Parsons left the employment of SemGroup, L.P. in March
  2009.  Messrs. Foxx, Brochetti, Stallings, and Parsons remain as
  officers of our general partner.  Mr. Schwiering continues to serve as
  an officer of the Private Company and may have conflicts of interest and may
  favor the Private Company's interests over our interests when conducting our
  operations.
  Our
  interests may be adverse to the Private Company's interests due to the
  Bankruptcy Filings.
  If the
  Private Company fails to make its payments under the New Throughput Agreement or
  the New Terminalling Agreement or otherwise fails to perform under the contracts
  we have with the Private Company, we may have potential claims against the
  Private Company's bankruptcy estate.  In addition, we may also have
  additional claims against the Private Company that were not released in
  connection with the Settlement.  Any claims made by us against the
  Private Company in the Bankruptcy Cases will be subject to the claim allowance
  procedure provided in the Bankruptcy Code and Bankruptcy Rules.  If an
  objection is filed, the Bankruptcy Court would determine the extent to which any
  claim that is objected to is allowed and the priority of such
  claims.  We are uncertain regarding the ultimate amount of any
  potential damages for breaches of contract or other claims that we may be able
  to establish in the bankruptcy proceedings and we cannot predict the amounts, if
  any, that we will collect or the timing of any such collection, but such losses
  could be substantial and could have a material adverse effect on our ability to
  conduct our business and our results of operations.
  In
  connection with the Settlement, the Private Company has rejected the
  Terminalling Agreement and the Throughput Agreement.  We have a $35
  million unsecured claim relating to rejection of the Terminalling Agreement in
  the Bankruptcy Cases.  In addition, we have a $20 million unsecured
  claim against the Private Company relating to rejection of the Throughput
  Agreement (see "Item 2. Management's Discussion and Analysis of Financial
  Condition and Results of Operations—Impact of the Bankruptcy of the Private
  Company and Certain of its Subsidiaries and Related Events—Settlement with the
  Private Company").
  As a
  result of these items, our interests may be adverse to the Private Company's
  interests.  The Private Company provides various administrative and
  operational services for us pursuant to the Shared Services Agreement and the
  Transition Services Agreement.  In addition, we rely upon the Private
  Company's personnel for the implementation of certain of our internal
  controls.  The progress of the Bankruptcy Cases may influence the
  Private Company's decision to continue providing any of these services, which
  could have a material adverse effect on our ability to conduct our business and
  results of operations.
  We
  may experience significant costs in changing our name and
  trademark.
  In
  connection with the Settlement, we and the Private Company entered into the
  Trademark Agreement, pursuant to which the Private Company granted us a
  non-exclusive, worldwide license to use certain trade names, including the name
  "SemGroup" and the corresponding mark, until December 31, 2009, and the Private
  Company waived claims for infringement relating to such trade names and mark
  prior to the effective date of such Trademark Agreement (see "Item 2.
  Management's Discussion and Analysis of Financial Condition and Results of
  Operations—Impact of the Bankruptcy of the Private Company and Certain of its
  Subsidiaries and Related Events—Settlement with the Private
  Company").  As such, we will be required to change our name and
  trademark upon or prior to the expiration of the Trademark
  Agreement.  The expenses associated with such a change may be
  significant, which could have a material adverse effect on our business,
  financial condition, results of operations, cash flows, ability to make
  distributions to our unitholders, the trading price of our common units and our
  ability to conduct our business.
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  Without
  sufficient revenues from our asphalt assets, we may be unable to meet the
  covenants under our credit agreement.
  Historically,
  we provided liquid asphalt cement terminalling and storage services to the
  Private Company pursuant to the Terminalling Agreement.  In connection
  with the Settlement, the Private Company rejected the Terminalling Agreement and
  we and the Private Company entered into the New Terminalling Agreement whereby
  we provide liquid asphalt cement terminalling and storage services to the
  Private Company in connection with its remaining asphalt
  inventory.  The New Terminalling Agreement has an initial term that
  ends on October 31, 2009 and the Private Company has agreed to remove all of its
  existing asphalt inventory no later than such date, and we expect that the
  Private Company may remove it much earlier than such date.  Also in
  connection with the Settlement, the Private Company transferred certain asphalt
  assets to us that were connected to our existing asphalt
  assets.
  The
  asphalt industry in the United States is characterized by a high degree of
  seasonality. Much of this seasonality is due to the impact that weather
  conditions have on road construction schedules, particularly in cold weather
  states. Refineries produce liquid asphalt cement year round, but the peak
  asphalt demand season is during the warm weather months when most of the road
  construction activity in the United States takes place. As a result, liquid
  asphalt cement is typically purchased from refineries at low prices in the low
  demand winter months and then processed and sold at higher prices in the peak
  summer demand season.  Any significant decrease in the amount of
  revenues that we receive from our liquid asphalt cement terminalling and storage
  operations could have a material adverse effect on our cash flows, financial
  condition and results of operations.
  We
  have recently entered into leases and storage agreements with third parties
  relating to certain of our asphalt facilities.  The revenues that we
  will receive pursuant to these leases and storage agreements will be less than
  the revenues received under the Terminalling Agreement with the Private
  Company.
  Without sufficient revenues from our asphalt assets, we
  may be unable to meet the covenants, including the minimum liquidity, minimum
  EBITDA and minimum receipt requirements, under our credit agreement (see "Item
  2. Management's Discussion and Analysis of Financial Condition and Results of
  Operations—Impact of the Bankruptcy of the Private Company and Certain of its
  Subsidiaries and Related Events—Settlement with the Private
  Company").
  Our
  future operations and cash flows are uncertain and may cause events of default
  under our credit agreement.
  Our future operations and
  cash flows, especially those related to our asphalt operations, are
  uncertain.  The covenants and other requirements under our credit
  facility were designed using certain projections and assumptions relating to
  revenues, EBITDA and cash flows.  In addition, our interest expense
  has increased due to our entering into the Forbearance Agreement, as amended,
  and the Credit Agreement Amendment.  For example, the weighted average
  interest rate incurred by us during the three months ended September 30, 2008
  was 7.04% resulting in interest expense of approximately $8.2 million as
  compared to a weighted average interest rate incurred by us of 7.72% during the
  three months ended December 31, 2008 resulting in interest expense of
  approximately $8.9 million.  This increased interest expense may have
  a material adverse effect on our cash flows and results of operations.
  In
  addition, it is an event of default under the credit agreement if we do not file
  our delinquent quarterly and annual reports with the SEC by September 30, 2009,
  unless we retain new auditors, in which case such deadline is extended to
  December 31, 2009.
  If an
  event of default exists under the credit agreement, the lenders will be able to
  accelerate the maturity of the credit agreement and exercise other rights and
  remedies, including taking the available cash in our bank
  accounts.  If an event of default exists and we are unable to obtain
  forbearance from our lenders or a waiver of the events of default under our
  credit agreement, we may be forced to sell assets, make a bankruptcy filing or
  take other action that could have a material adverse effect on our business, the
  price of our common units and our results of operations.  We are also
  prohibited from making cash distributions to our unitholders while the events of
  default exist.  Certain lenders under our credit facility are also
  lenders under the Private Company's credit facility.  The progress of
  the Private Company's bankruptcy proceedings may influence the decisions of
  these lenders relating to our credit facility which could adversely affect
  us.
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  We
  are subject to an SEC inquiry and a Federal Grand Jury subpoena.
  On July
  21, 2008, we received a letter from the staff of the SEC giving notice that the
  SEC is conducting an inquiry relating to us and requesting, among other things,
  that we voluntarily preserve, retain and produce to the SEC certain documents
  and information relating primarily to our disclosures respecting the Private
  Company's liquidity issues, which were the subject of our July 17, 2008 press
  release.  On October 22, 2008, we received a subpoena from the SEC
  pursuant to a formal order of investigation requesting certain documents
  relating to, among other things, the Private Company's liquidity
  issues.  We have been cooperating, and intend to continue cooperating,
  with the SEC in its investigation.
  On July
  23, 2008, we and our general partner each received a Grand Jury subpoena from
  the United States Attorney's Office in Oklahoma City, Oklahoma, requiring, among
  other things, that we and our general partner produce financial and other
  records related to our July 17, 2008 press release.  We have been
  informed that the U.S. Attorneys' Offices for the Western District of Oklahoma
  and the Northern District of Oklahoma are in discussions regarding the
  subpoenas, and no date has been set for a response to the
  subpoenas.  We and our general partner intend to cooperate fully with
  this investigation if and when it proceeds.
  In the
  event that either the SEC inquiry or the Grand Jury investigation leads to
  action against any of our current or former directors or officers, or the
  Partnership itself, the trading price of our common units may be adversely
  impacted.  In addition, the SEC inquiry and the Grand Jury
  investigation may result in the incurrence of significant legal expense, both
  directly and as the result of our indemnification
  obligations.   These matters may also divert management's
  attention from our operations which may cause our business to
  suffer.  If we are subject to adverse findings in either of these
  matters, we could be required to pay damages or penalties or have other remedies
  imposed upon us which could have a material adverse effect on our business,
  financial condition, results of operations, cash flows and ability to make
  distributions to our unitholders.  All or a portion of the defense
  costs and any amount we may be required to pay in connection with the resolution
  of these matters may not be covered by insurance.
  We
  have been named as a party in lawsuits and may be named in additional litigation
  in the future, all of which could result in an unfavorable outcome and have a
  material adverse effect on our business, financial condition, results of
  operations, cash flows, ability to make distributions to our unitholders, the
  trading price of our common units and our ability to conduct our
  business.
  Between
  July 21, 2008 and September 4, 2008, the following class action complaints were
  filed:
  1.
  Poelman v. SemGroup Energy
  Partners, L.P., et al
  ., Civil Action No. 08-CV-6477, in the United States
  District Court for the Southern District of New York (filed July 21,
  2008).  The plaintiff voluntarily dismissed this case on August 26,
  2008;
  2.
  Carson v. SemGroup Energy Partners,
  L.P. et al
  .
  ,
  Civil Action No. 08-cv-425, in the Northern District of Oklahoma (filed July 22,
  2008);
  3.
  Charles D. Maurer SIMP Profit
  Sharing Plan f/b/o Charles D. Maurer v. SemGroup Energy Partners, L.P. et
  al.
  , Civil Action No. 08-cv-6598, in the United States District Court for
  the Southern District of New York (filed July 25, 2008);
  4.
  Michael Rubin v. SemGroup Energy
  Partners, L.P. et al.
  , Civil Action No. 08-cv-7063, in the United States
  District Court for the Southern District of New York (filed August 8,
  2008);
  5.
  Dharam V. Jain v. SemGroup Energy
  Partners, L.P. et al.
  , Civil Action No. 08-cv-7510, in the United States
  District Court for the Southern District of New York  (filed August 25,
  2008); and
  6.
  William L. Hickman v. SemGroup
  Energy Partners, L.P. et al.
  , Civil Action No. 08-cv-7749, in the United
  States District Court for the Southern District of New York (filed September 4,
  2008).
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  Pursuant
  to a motion filed with the MDL Panel, the
  Maurer
  case has been
  transferred to the Northern District of Oklahoma and consolidated with the
  Carson
  case.  The
  Rubin, Jain,
  and
  Hickman
  cases have also been
  transferred to the Northern District of Oklahoma.
  A hearing
  on motions for appointment as lead plaintiff was held in the
  Carson
  case on October 17,
  2008.  At that hearing, the court granted a motion to consolidate the
  Carson
  and
  Maurer
  cases for pretrial
  proceedings, and the consolidated litigation is now pending as
  In Re: SemGroup Energy Partners,
  L.P. Securities Litigation
  , Case No. 08-CV-425-GKF-PJC. The court entered
  an order on October 27, 2008, granting the motion of Harvest Fund Advisors LLC
  to be appointed lead plaintiff in the consolidated litigation.  On
  January 23, 2009, the court entered a Scheduling Order providing, among other
  things, that the lead plaintiff may file a consolidated amended complaint within
  70 days of the date of the order, and that defendants may answer or otherwise
  respond within 60 days of the date of the filing of a consolidated amended
  complaint.
  On
  January 30, 2009, the lead plaintiff filed a motion to modify the stay of
  discovery provided for under the Private Securities Litigation Reform Act. The
  court granted Plaintiff's motion, and we and certain other defendants filed a
  Petition for Writ of Mandamus in the Tenth Circuit Court of Appeals that was
  denied after oral argument on April 24, 2009.
  The lead
  plaintiff obtained an extension to file its consolidated amended complaint until
  May 4, 2009; defendants have 60 days from that date to answer or otherwise
  respond to the complaint.
  The lead plaintiff
  filed a consolidated amended complaint on May 4, 2009.  In that complaint,
  filed as a putative class action on behalf of all purchasers of our units from
  July 17, 2007 to July 17, 2008 (the "class period"), lead plaintiff asserts
  claims under the federal securities laws against us, our general partner,
  certain of our current and former officers and directors, certain underwriters
  in our initial and secondary public offerings, and certain entities who were
  investors in the Private Company and their individual representatives who served
  on the Private Company's management committee. Among other allegations, the
  amended complaint alleges that our financial condition throughout the class
  period was dependent upon speculative commodities trading by the Private Company
  and its Chief Executive Officer, Thomas L. Kivisto, and that Defendants
  negligently and intentionally failed to disclose this speculative trading in our
  public filings during the class period. Specifically, the amended complaint
  alleges claims for violations of sections 11, 12(a)(2), and 15 of the Securities
  Act of 1933 for damages and rescission with respect to all persons who purchased
  our units in the initial and secondary offerings, and also asserts claims under
  section 10b, Rule 10b-5, and section 20(a) of the Securities and Exchange Act of
  1934. The amended complaint seeks certification as a class action under the
  Federal Rules of Civil Procedure, compensatory and rescissory damages for class
  members, pre-judgment interest, costs of court, and attorneys' fees.
  We intend
  to vigorously defend these actions.  There can be no assurance regarding
  the outcome of the litigation.
  In March
  and April 2009, nine current or former executives of the Private Company and
  certain of its affiliates filed wage claims with the Oklahoma Department of
  Labor against our general partner.  Their claims arise from our
  general partner's Long-Term Incentive Plan, Employee Phantom Unit Agreement
  ("Phantom Unit
  Agreement").  Most claimants allege that phantom units previously
  awarded to them vested upon the Change of Control that occurred in July
  2008.  One claimant alleges that his phantom units vested upon his
  termination.  The claimants contend our general partner's failure to
  deliver certificates for the phantom units within 60 days after vesting has
  caused them to be damaged, and they seek recovery of approximately $2 million in
  damages and penalties
  .
  On April 30, 2009, all of
  the wage claims were dismissed on jurisdictional grounds by the Department of
  Labor.
  Our general partner intends to vigorously defend these
  claims.
  We may
  become the subject of additional private or government actions regarding these
  matters in the future.  Litigation may be time-consuming, expensive
  and disruptive to normal business operations, and the outcome of litigation is
  difficult to predict.  The defense of these lawsuits may result in the
  incurrence of significant legal expense, both directly and as the result of our
  indemnification obligations.  The litigation may also divert
  management's attention from our operations which may cause our business to
  suffer.  An unfavorable outcome in any of these matters may have a
  material adverse effect on our business, financial condition, results of
  operations, cash flows, ability to make distributions to our unitholders, the
  trading price of the our common units and our ability to conduct our business.
  All or a portion of the defense costs and any amount we may be required to pay
  to satisfy a judgment or settlement of these claims may not be covered by
  insurance.
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  We
  may experience increased losses as a result of waivers relating to the Private
  Company's indemnification obligations.
  In the
  Amended Omnibus Agreement and other agreements with the Private Company, the
  Private Company agreed to indemnify us for certain environmental and other
  claims relating to the crude oil and liquid asphalt cement assets that have been
  contributed to us.  In connection with the Settlement, we waived these
  claims and the Amended Omnibus Agreement and other relevant agreements,
  including the indemnification provisions therein, were rejected as part of the
  Bankruptcy Proceedings.  If we experience an environmental or other
  loss, we would experience increased losses which may have a material adverse
  effect on our business, financial condition, results of operations, cash flows,
  ability to make distributions to our unitholders, the trading price of our
  common units and the ability to conduct our business.
  Our
  common units were delisted from the Nasdaq and are currently quoted on the
  Pink Sheets, which may make buying or selling our common units more
  difficult.
  Effective
  at the opening of business on February 20, 2009, our common units were delisted
  from Nasdaq due to our failure to timely file this Quarterly Report as well as
  our Quarterly Report on Form 10-Q for the quarter ended June 30,
  2008.  We filed our Quarterly Report on Form 10-Q for the quarter
  ended June 30, 2008 on March 23, 2008.  Our common units are currently
  traded on the Pink Sheets, which is an over-the-counter securities market, under
  the symbol SGLP.PK.  The fact that our common units are not listed on
  a national securities exchange is likely to make trading such common units more
  difficult for broker-dealers, unitholders and investors, potentially leading to
  further declines in the price of our common units.  In addition, it
  may limit the number of institutional and other investors that will consider
  investing in our common units, which may have an adverse effect on the price of
  our common units.  It may also make it more difficult for us to raise
  capital in the future.
  We
  continue to work to become compliant with our SEC reporting obligations and
  intend to promptly seek the relisting of our common units on Nasdaq as soon as
  practicable after we have become compliant with such reporting
  obligations.  However, there can be no assurances that we will be able
  to relist our common units on Nasdaq or any other national securities exchange
  and we may face a lengthy process to relist our common units if we are able to
  relist them at all.
  If
  our general partner fails to develop or maintain an effective system of internal
  controls, then we may not be able to accurately report our financial results or
  prevent fraud. As a result, current and potential unitholders could lose
  confidence in our financial reporting, which would harm our business and the
  trading price of our common units.
  SemGroup
  Energy Partners G.P., L.L.C., our general partner, has sole responsibility for
  conducting our business and for managing our operations. Effective internal
  controls are necessary for our general partner, on our behalf, to provide
  reliable financial reports, prevent fraud and operate us successfully as a
  public company. If our general partner's efforts to develop and maintain its
  internal controls are not successful, it is unable to maintain adequate controls
  over our financial processes and reporting in the future or it is unable to
  assist us in complying with our obligations under Section 404 of the
  Sarbanes-Oxley Act of 2002, our operating results could be harmed or we may fail
  to meet our reporting obligations.
  We and
  our general partner rely upon the Private Company for our personnel, including
  those related to implementation of ceratin of our internal controls
  and our disclosure controls and procedures.  Staff reductions by the
  Private Company or other departures by the Private Company's employees that
  provide services to us could have a material adverse effect on
  internal controls and the effectiveness of our disclosure controls and
  procedures.  Ineffective internal controls could cause us to report
  inaccurate financial information or cause investors to lose confidence in our
  reported financial information, which would likely have a negative effect on the
  trading price of our common units.
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  We
  may incur substantial costs as a result of events related to the Bankruptcy
  Filings and we may be unsuccessful in our efforts in effecting a sale of all or
  a portion of our assets.
  Events
  related to the Bankruptcy Filings, the securities litigation and governmental
  investigations, and our efforts to enter into storage contracts with third party
  customers and pursue other strategic opportunities has resulted in
  increased expense and we expect it to continue to result in increased expense
  due to the costs related to legal and financial advisors as well as other
  related costs.  General and administrative expenses (exclusive of
  non-cash compensation expense related to the vesting of the units under the
  Plan) increased by approximately $6.9 million and $7.5 million, or approximately
  300% and 326%, to approximately $9.2 million for the third quarter of 2008 and
  $9.8 million for the fourth quarter of 2008, respectively, compared to $2.3
  million in the second quarter of 2008.  We expect this increased level
  of general and administrative expenses to continue into 2009.  These
  increased costs may be substantial and could have a material adverse effect on
  our cash flows and results of operations.
  In
  addition, we are currently pursuing various strategic alternatives for our
  business and assets including the possibility of entering into storage contracts
  with third party customers and the sale of all or a portion of our
  assets.  The uncertainty relating to the Bankruptcy Filings and the
  recent global market and economic conditions may make it more difficult to
  pursue other strategic opportunities or enter into storage contracts
  with third party customers.  If we are unable to contract with third
  parties or if our efforts to sell all or a portion of our assets are
  unsuccessful, it could have a material adverse effect on our cash flows, results
  of operations and ability to conduct our business.
  We may not be
  able to raise sufficient capital to operate or grow our business.
  As of May 22, 2009, we had
  an aggregate unused credit availability under our revolving credit facility and
  cash on hand of
  approximately $27.2
  million
  .
  Pursuant
  to the Credit
  Agreement
  Amendment, our revolving credit facility is limited to $50.0
  million.
  In
  addition, if any of the financial institutions that support our revolving credit
  facility were to fail, we may not be able to find a replacement lender, which
  could negatively impact our ability to borrow under our revolving credit
  facility.  For instance, Lehman Brothers Commercial Bank is one of the
  lenders under our $50.0 million revolving credit facility, and Lehman Brothers
  Commercial Bank has agreed to fund approximately $2.5 million (approximately 5%)
  of the revolving credit facility.  On several occasions Lehman Brothers
  Commercial Bank has failed to fund revolving loan requests under our revolving
  credit facility, effectively limiting the aggregate amount of our revolving
  credit facility to $47.5 million.
  Our ability to access capital
  markets may also be limited due to the Bankruptcy Filings and the related
  uncertainty of our future cash flows.  In addition, we may have
  difficulty obtaining a credit rating or any credit rating that we do obtain may
  be lower that it otherwise would be due to our relationships with the Private
  Company.  The lack of a credit rating or a low credit rating may also
  adversely impact our ability to access capital markets.  If we fail to
  raise additional capital or an event of default exists under our credit
  agreement, we may be forced to sell assets, make a bankruptcy filing or take
  other action that could have a material adverse effect on our business, the
  price of our common units and our results of operations.  In addition,
  if we are unable to access the capital markets for acquisitions or expansion
  projects, it will have a material adverse effect on our results of operations
  and ability to conduct our business and may adversely effect the trading price
  of our common units.
  We
  are not fully insured against all risks incident to our business, and could
  incur substantial liabilities as a result.
  We may
  not be able to maintain or obtain insurance of the type and amount we desire at
  reasonable rates. As a result of changing market conditions, premiums and
  deductibles for certain of our insurance policies may increase substantially in
  the future. In some instances, certain insurance could become unavailable or
  available only for reduced amounts of coverage. If we were to incur a
  significant liability for which we were not fully insured, it could have a
  material adverse effect on our financial position and ability to make
  distributions to unitholders.
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  Risks
  Related to Our Business
  We
  depend upon the Private Company for a portion of our revenues and are therefore
  indirectly subject to the business risks of the Private Company.
  Because
  we depend upon the Private Company for a portion of our revenues, we are
  indirectly subject to the business risks of the Private Company, many of which
  are similar to the business risks we face. In particular, these business risks
  include the following:
  ·
  the
        inability of the Private Company to generate adequate gross margins from
        the purchase, transportation, storage and marketing of petroleum
        products;
  ·
  material
        reductions in the supply of crude oil, liquid asphalt cement and petroleum
        products;
  ·
  a
        material decrease in the demand for crude oil, finished asphalt and
        petroleum products in the markets served by the Private
        Company;
  ·
  the
        inability of the Private Company to manage its commodity price risk
        resulting from its ownership of crude oil, liquid asphalt cement and
        petroleum products;
  ·
  contract
        non-performance by the Private Company's customers;
    and
  ·
  various
        operational risks to which the Private Company's business is
        subject.
  In
  addition, as a result of the Bankruptcy Filings, we are also currently subject
  to the risks described above under "—Risks Related to the Bankruptcy
  Filings."
  We
  may not be able to obtain funding or obtain funding on acceptable terms because
  of the deterioration of the credit and capital markets. This may hinder or
  prevent us from meeting our future capital needs.
  Global
  financial markets and economic conditions have been, and continue to be,
  disrupted and volatile. The debt and equity capital markets have been
  exceedingly distressed. These issues, along with significant write-offs in the
  financial services sector, the re-pricing of credit risk and the current weak
  economic conditions have made, and will likely continue to make, it difficult to
  obtain funding.
  In
  particular, the cost of raising money in the debt and equity capital markets has
  increased substantially while the availability of funds from those markets
  generally has diminished significantly. Also, as a result of concerns about the
  stability of financial markets generally and the solvency of counterparties
  specifically, the cost of obtaining money from the credit markets generally has
  increased as many lenders and institutional investors have increased interest
  rates, enacted tighter lending standards, refused to refinance existing debt at
  maturity at all or on terms similar to our current debt and reduced and, in some
  cases, ceased to provide funding to borrowers.  These factors may have
  a material adverse effect on our ability to refinance our outstanding debt or,
  in the event we fail to comply with the covenants of the credit facility, to
  obtain a waiver of events of default under our credit agreement or to negotiate
  forbearance with our lenders.
  Due to
  these factors, we cannot be certain that funding will be available if needed and
  to the extent required, on acceptable terms or at all. If funding is not
  available when needed, or is available only on unfavorable terms, we may be
  unable to operate or grow our existing business, make future acquisitions, or
  otherwise take advantage of business opportunities or respond to competitive
  pressures any of which could have a material adverse effect on our financial
  condition and results of operations.  In addition, such financing, if
  available, may be at higher interest rates or result in substantial equity
  dilution.
  We
  require a significant amount of cash to service our indebtedness. Our ability to
  generate cash depends on many factors beyond our control.
  Our
  ability to make payments on and to refinance our indebtedness and to fund any
  future capital expenditures depends on our ability to generate cash in the
  future. This, to a certain extent, is subject to general economic, financial,
  competitive, legislative, regulatory and other factors that are beyond our
  control. We cannot assure you that we will generate sufficient cash flow from
  operations or that future borrowings will be available to us under our credit
  agreement or otherwise at all or in an amount sufficient to enable us to pay our
  indebtedness or to fund our other liquidity needs.
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  We
  may not have sufficient cash from operations following the establishment of cash
  reserves and payment of fees and expenses, including cost reimbursements to our
  general partner, to enable us to make cash distributions to holders of our
  common units and subordinated units.
  Pursuant
  to the Credit Agreement Amendment, we are prohibited from making distributions
  to our unitholders if our leverage ratio (as defined in the credit agreement)
  exceeds 3.50 to 1.00.  As of September 30, 2008 and December 31, 2008,
  our leverage ratio was 4.34 to 1.00 and 4.83 to 1.00, respectively. If our
  leverage ratio does not improve, we may not make quarterly distributions to our
  unitholders in the future.  Even if we are permitted to make
  distributions under our credit agreement, we may not have sufficient available
  cash from operating surplus each quarter to enable us to make cash
  distributions. The amount of cash we can distribute on our units principally
  depends upon the amount of cash we generate from our operations, which will
  fluctuate from quarter to quarter based on, among other things, the risks
  described in this section, including the Bankruptcy Filings.
  In
  addition, the actual amount of cash we will have available for distribution will
  depend on other factors, including:
  ·
  the
        level of capital expenditures we
  make;
  ·
  the
        cost of acquisitions;
  ·
  our
        debt service requirements and other
  liabilities;
  ·
  fluctuations
        in our working capital needs;
  ·
  our
        ability to borrow funds and access capital
    markets;
  ·
  restrictions
        contained in our credit facility or other debt agreements, including the
        ability to make distributions while events of default exist under our
        credit facility; and
  ·
  the
        amount of cash reserves established by our general
    partner.
  The
  amount of cash we have available for distribution to holders of our common units
  and subordinated units depends primarily on our cash flow and not solely on
  earnings reflected in our financial statements. Consequently, even if we are
  profitable, we may not be able to make cash distributions to holders of our
  common units and subordinated units.
  Our
  unitholders should be aware that the amount of cash we have available for
  distribution depends primarily upon our cash flow and not solely on earnings
  reflected in our financial statements, which will be affected by non-cash items.
  As a result, we may make cash distributions during periods when we record losses
  for financial accounting purposes and may not make cash distributions during
  periods when we record net earnings for financial accounting
  purposes.
  A
  significant decrease in demand for crude oil and/or finished asphalt products in
  the areas served by our storage facilities and pipelines could reduce our
  ability to make distributions to our unitholders.
  A
  sustained decrease in demand for crude oil and/or finished asphalt products in
  the areas served by our storage facilities and pipelines could significantly
  reduce our revenues and, therefore, reduce our ability to make or increase
  distributions to our unitholders. Factors that could lead to a decrease in
  market demand for crude oil and finished asphalt products include:
  ·
  lower
        demand by consumers for refined products, including finished asphalt
        products, as a result of recession or other adverse economic conditions or
        due to high prices caused by an increase in the market price of crude oil
        or higher fuel taxes or other governmental or regulatory actions that
        increase, directly or indirectly, the cost of gasolines or other refined
        products;
  ·
  a
        shift by consumers to more fuel-efficient or alternative fuel vehicles or
        an increase in fuel economy of vehicles, whether as a result of
        technological advances by manufacturers, governmental or regulatory
        actions or otherwise; and
  ·
  fluctuations
        in demand for crude oil, such as those caused by refinery downtime or
        shutdowns, could also significantly reduce our revenues and, therefore,
        reduce our ability to make distributions to our
      unitholders.
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  Certain
  of our field and pipeline operating costs and expenses are fixed and do not vary
  with the volumes we gather and transport. These costs and expenses may not
  decrease ratably or at all should we experience a reduction in our volumes
  gathered or transmitted by our gathering and transportation operations. As a
  result, we may experience declines in our margin and profitability if our
  volumes decrease.  Due to events related to the Bankruptcy Filings,
  the volumes being terminalled, stored, transported and gathered have decreased
  as compared to periods prior to the Bankruptcy Filings, which has negatively
  impacted total revenues.  As an example, fourth quarter 2008 total revenues
  are approximately $8.2 million less than third quarter 2008 total
  revenues, in each case excluding fuel surcharge revenues related to fuel and
  power consumed to operate our liquid asphalt cement storage tanks.  Our
  future total revenues may be further impacted because, in connection with the
  Settlement, the Private Company rejected the Terminalling Agreement and the
  Throughput Agreement and we and the Private Company entered into the New
  Throughput Agreement and the New Terminalling Agreement.  We expect
  revenues from services provided to the Private Company under the New Throughput
  Agreement and New Terminalling Agreement to be substantially less than prior
  revenues from services provided to the Private Company as the new agreements are
  based upon actual volumes gathered, transported, terminalled and stored instead
  of certain minimum volumes and are at reduced rates when compared to the
  Throughput Agreement and Terminalling Agreement (see "Item 2. Management's
  Discussion and Analysis of Financial Condition and Results of Operations—Impact
  of the Bankruptcy of the Private Company and Certain of its Subsidiaries and
  Related Events—Settlement with the Private Company").
  A
  material decrease in the production of crude oil from the oil fields served by
  our pipelines could materially reduce our ability to make distributions to our
  unitholders.
  The
  throughput on our crude oil pipelines depends on the availability of
  attractively priced crude oil produced from the oil fields served by such
  pipelines, or through connections with pipelines owned by third parties. Crude
  oil production may decline for a number of reasons, including natural declines
  due to depleting wells, a material decrease in the price of crude oil, or the
  inability of producers to obtain necessary drilling or other permits from
  applicable governmental authorities. If we are unable to replace volumes lost
  due to a temporary or permanent material decrease in production from the oil
  fields served by our crude oil pipelines, our throughput could decline, reducing
  our revenue and cash flow and adversely affecting our ability to make
  distributions to our unitholders. The Private Company may also have difficulty
  attracting producers while it is in bankruptcy.  In addition, it is
  difficult to attract producers to a new gathering system if the producer is
  already connected to an existing system. As a result, the Private Company or
  third-party shippers on our pipeline systems may experience difficulty acquiring
  crude oil at the wellhead in areas where there are existing relationships
  between producers and other gatherers and purchasers of crude oil.
  A
  material decrease in the production of liquid asphalt cement could materially
  reduce our ability to make distributions to our unitholders.
  The
  throughput at our liquid asphalt cement terminalling and storage facilities
  depends on the availability of attractively priced liquid asphalt cement
  produced from the various liquid asphalt cement producing refineries. Liquid
  asphalt cement production may decline for a number of reasons, including
  refiners processing more light, sweet crude oil or refiners installing coker
  units that further refine heavy residual fuel oil bottoms such as liquid asphalt
  cement. If we are unable to replace volumes lost due to a temporary or permanent
  material decrease in production from the suppliers of liquid asphalt cement, our
  throughput could decline, reducing our revenue and cash flow and adversely
  affecting our ability to make distributions to our unitholders.
  Our
  debt levels under the credit agreement may limit our ability to make
  distributions and our flexibility in obtaining additional financing and in
  pursuing other business opportunities.
  Our level
  of debt under the credit facility could have important consequences for us,
  including the following:
  ·
  our
        ability to obtain additional financing, if necessary, for working capital,
        capital expenditures, acquisitions or other purposes may be impaired or
        such financing may not be available on favorable
    terms;
  ·
  we
        will need a substantial portion of our cash flow to make principal and
        interest payments on our debt, reducing the funds that would otherwise be
        available for operations, future business opportunities and distributions
        to unitholders;
  ·
  our
        debt level will make us more vulnerable to competitive pressures or a
        downturn in our business or the economy generally;
    and
  ·
  our
        debt level may limit our flexibility in responding to changing business
        and economic conditions.
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  Our
  ability to service our debt will depend upon, among other things, our future
  financial and operating performance, which will be affected by prevailing
  economic conditions and financial, business, regulatory and other factors. Our
  ability to service debt under our credit facility also will depend on market
  interest rates, since the interest rates applicable to our borrowings will
  fluctuate with the London Interbank Offered Rate, or LIBOR, or the prime rate,
  and are higher due to the Forbearance Agreement, as amended, and the Credit
  Agreement Amendment. If our operating results are not sufficient to service our
  current or future indebtedness, we will be forced to take actions such as
  reducing distributions, reducing or delaying our business activities,
  acquisitions, investments or capital expenditures, selling assets, restructuring
  or refinancing our debt, or seeking additional equity capital. We may not be
  able to effect any of these actions on satisfactory terms, or at
  all.
  Restrictions
  in our credit facility may prevent us from engaging in some beneficial
  transactions or paying distributions to our unitholders.
  Our
  credit facility contains covenants limiting our ability to make distributions to
  unitholders so long as an event of default exists under the credit agreement or
  if our leverage ratio exceeds 3.50 to 1.00. In addition, our credit facility
  contains various covenants that limit, among other things, our ability to incur
  indebtedness, make capital expenditures, grant liens or enter into a merger,
  consolidation or sale of assets. Furthermore, our credit facility contains
  covenants requiring us to maintain certain financial ratios and tests. Any
  subsequent refinancing of our current debt may have similar or greater
  restrictions. Please see "—Risks Related to the Bankruptcy Filings—
  Our future operations and
  cash flows are uncertain and may cause events of default under our credit
  agreement" and "Item 2. Management's Discussion and Analysis of Financial
  Condition and Results of Operations—Liquidity and Capital
  Resources."
  If we borrow funds to make our
  quarterly distributions, our ability to pursue acquisitions and other business
  opportunities may be limited and our operations may be materially
  and
  adversely
  a
  ffected
  .
  Available
  cash for the purpose of making distributions to unitholders includes working
  capital borrowings. If we borrow funds to pay one or more quarterly
  distributions, such amounts will incur interest and must be repaid in accordance
  with the terms of our credit facility. Currently we are prohibited from paying
  distributions to our unitholders due to our failure to maintain a leverage
  ratio that is less than 3.50 to 1.00, as required by our credit
  agreement.  In addition, any amounts borrowed for distributions to our
  unitholders will reduce the funds available to us for other purposes under our
  credit facility, including amounts available for use in connection with
  acquisitions and other business opportunities.  If we are unable to
  pursue our growth strategy due to our limited ability to borrow funds, our
  operations may be materially and adversely affected.
  We
  face intense competition in our gathering, transportation, terminalling and
  storage activities. Competition from other providers of crude oil gathering,
  transportation, terminalling and storage services that are able to supply
  our customers with those services at a lower price could reduce our ability
  to make distributions to our unitholders.
  We are
  subject to competition from other crude oil gathering, transportation,
  terminalling and storage operations that may be able to supply the Private
  Company and our other customers with the same or comparable services on a more
  competitive basis. We compete with national, regional and local gathering,
  storage, terminalling and pipeline companies, including the major integrated oil
  companies, of widely varying sizes, financial resources and experience. Some of
  these competitors are substantially larger than us, have greater financial
  resources, and control substantially greater storage capacity than we do. With
  respect to our gathering and transportation services, these competitors include
  TEPPCO Partners, L.P., Plains All American Pipeline, L.P., ConocoPhillips,
  Sunoco Logistics Partners L.P. and National Cooperative Refinery Association,
  among others. With respect to our storage and terminalling services, these
  competitors include BP plc, Enbridge Energy Partners, L.P. and Plains All
  American Pipeline, L.P.  Several of our competitors conduct portions of
  their operations through publicly traded partnerships with structures similar to
  ours, including Plains All American Pipeline, L.P., TEPPCO Partners, L.P.,
  Sunoco Logistics Partners L.P. and Enbridge Energy Partners, L.P. Our ability to
  compete could be harmed by numerous factors, including:
  ·
  price
        competition;
  ·
  the
        perception that another company can provide better
    service,
  ·
  the
        uncertainty relating to the Private Company having filed bankruptcy;
        and
  ·
  the
        availability of alternative supply points, or supply points located closer
        to the operations of the Private Company's
    customers.
  In
  addition, the Private Company owns midstream assets and may engage in
  competition with us. If we are unable to compete with services offered by other
  midstream enterprises, including the Private Company, our ability to make
  distributions to our unitholders may be adversely affected.
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  Some
  of our pipeline systems are dependent upon their interconnections with other
  crude oil pipelines to reach end markets.
  Some of
  our pipeline systems are dependent upon their interconnections with other crude
  oil pipelines to reach end markets. Reduced throughput on
  these
  interconnecting pipelines as a result of testing, line repair, reduced operating
  pressures or other causes could result in reduced throughput on our
  pipeline
  systems that would adversely affect our revenue and cash flow and our ability to
  make distributions to our unitholders.
  Prior
  to the Bankruptcy Filings, a principal focus of our business strategy was to
  grow and expand our business through acquisitions. If we are able to pursue this
  strategy in the future but are unable to make acquisitions on economically
  acceptable terms, our future growth may be limited.
  Prior to
  the Bankruptcy Filings, a principal focus of our business strategy was to grow
  and expand our business through acquisitions.  If we are able to
  stabilize our business, we may be able to again pursue this
  strategy.  Our ability to grow depends, in part, on our ability to
  make acquisitions that result in an increase in the cash generated per unit from
  operations. If we are unable to make these accretive acquisitions, either
  because we are (1) unable to identify attractive acquisition candidates or
  negotiate acceptable purchase contracts with them, (2) unable to obtain
  financing for these acquisitions on economically acceptable terms or (3) outbid
  by competitors, then our future growth and ability to increase distributions
  will be limited. Furthermore, even if we do make acquisitions that we believe
  will be accretive, these acquisitions may nevertheless result in a decrease in
  the cash generated from operations per unit.
  Any
  acquisition involves potential risks, including, among other
  things:
  ·
  mistaken
        assumptions about volumes, revenues and costs, including
        synergies;
  ·
  an
        inability to integrate successfully the businesses we
      acquire;
  ·
  an
        inability to hire, train or retain qualified personnel to manage and
        operate our business and assets;
  ·
  the
        assumption of unknown liabilities;
  ·
  limitations
        on rights to indemnity from the
  seller;
  ·
  mistaken
        assumptions about the overall costs of equity or
    debt;
  ·
  the
        diversion of management's and employees' attention from other business
        concerns;
  ·
  unforeseen
        difficulties operating in new product areas or new geographic areas;
        and
  ·
  customer
        or key employee losses at the acquired
    businesses.
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  If we
  consummate any future acquisitions, our capitalization and results of operations
  may change significantly, and our unitholders will not have the opportunity to
  evaluate the economic, financial and other relevant information that we will
  consider in determining the application of these funds and other
  resources.
  Our
  acquisition strategy is based, in part, on our expectation of ongoing
  divestitures of energy assets by industry participants. A material decrease in
  such divestitures would limit our opportunities for future acquisitions and
  could adversely affect our operations and cash flows available for distribution
  to our unitholders.
  Prior
  to the Bankruptcy Filings, our growth strategy included acquiring midstream
  entities or assets that are distinct and separate from our existing
  terminalling, storage, gathering and transportation operations.  If we
  are able to pursue this strategy in the future, it could subject us to
  additional business and operating risks.
  We may
  acquire midstream assets that have operations in new and distinct lines of
  business from our crude oil or our liquid asphalt cement operations. Integration
  of a new business is a complex, costly and time-consuming process. Failure to
  timely and successfully integrate acquired entities' new lines of business with
  our existing operations may have a material adverse effect on our business,
  financial condition or results of operations. The difficulties of integrating a
  new business with our existing operations include, among other
  things:
  ·
  operating
        distinct businesses that require different operating strategies and
        different managerial expertise;
  ·
  the
        necessity of coordinating organizations, systems and facilities in
        different locations;
  ·
  integrating
        personnel with diverse business backgrounds and organizational cultures;
        and
  ·
  consolidating
        corporate and administrative
  functions.
  In
  addition, the diversion of our attention and any delays or difficulties
  encountered in connection with the integration of a new business, such as
  unanticipated liabilities or costs, could harm our existing business, results of
  operations, financial conditions and prospects. Furthermore, new lines of
  business will subject us to additional business and operating risks. For
  example, we may in the future determine to acquire businesses that are subject
  to significant risks due to fluctuations in commodity prices. These new business
  and operating risks could have a material adverse effect on our financial
  condition or results of operations.
  Expanding
  our business by constructing new assets subjects us to risks that projects may
  not be completed on schedule, and that the costs associated with projects may
  exceed our expectations, which could cause our cash available for distribution
  to our unitholders to be less than anticipated.
  The
  construction of additions or modifications to our existing assets, and the
  construction of new assets, involves numerous regulatory, environmental,
  political, legal and operational uncertainties and requires the expenditure of
  significant amounts of capital. If we undertake these types of projects, they
  may not be completed on schedule or at all or at the budgeted cost. In addition,
  our revenues may not increase immediately upon the expenditure of funds on a
  particular project. Moreover, we may construct facilities to capture anticipated
  future growth in demand in a market in which such growth does not
  materialize.  We acquired certain pipeline and related assets,
  including a 130-mile, 8-inch pipeline that originates in Ardmore, Oklahoma and
  terminates in Drumright, Oklahoma from the Private Company in May
  2008.  We have suspended capital expenditures on this pipeline due to
  the continuing impact of the Bankruptcy Filings.  Management currently
  intends to put the asset into service by late 2009 or early 2010 and is
  exploring various alternatives to complete the project.
  We
  are exposed to the credit risks of our third-party customers in the ordinary
  course of our gathering activities. Any material nonpayment or nonperformance by
  our third-party customers could reduce our ability to make distributions to our
  unitholders.
  In
  addition to our dependence on the Private Company, we are subject to risks of
  loss resulting from nonpayment or nonperformance by our third-party customers.
  Some of our customers may be highly leveraged and subject to their own operating
  and regulatory risks. In addition, any material nonpayment or nonperformance by
  our customers could require us to pursue substitute customers for our affected
  assets or provide alternative services. Any such efforts may not be successful
  or may not provide similar fees. These events could reduce our ability to make
  distributions to our unitholders.
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  Our
  revenues from third-party customers are generated under contracts that must be
  renegotiated periodically and that allow the customer to reduce or suspend
  performance in some circumstances, which could cause our revenues from those
  contracts to decline and reduce our ability to make distributions to our
  unitholders.
  Some of
  our contract-based revenues from customers are generated under contracts with
  terms which allow the customer to reduce or suspend performance under the
  contract in specified circumstances, such as the occurrence of a catastrophic
  event to our or the customer's operations. The occurrence of an event which
  results in a material reduction or suspension of our customer's performance
  could reduce our ability to make distributions to our unitholders.
  Many of
  our contracts with customers for producer field services have terms of one year
  or less. As these contracts expire, they must be extended and renegotiated or
  replaced. We may not be able to extend, renegotiate or replace these contracts
  when they expire, and the terms of any renegotiated contracts may not be as
  favorable as the contracts they replace. In particular, our ability to extend or
  replace contracts could be harmed by numerous competitive factors, such as those
  described above under "—We face intense competition in our gathering,
  transportation, terminalling and storage activities. Competition from other
  providers of crude oil gathering, transportation, terminalling and storage
  services that are able to supply our customers with those services at a
  lower price could reduce our ability to make distributions to our unitholders."
  Additionally, we may incur substantial costs if modifications to our terminals
  are required in order to attract substitute customers or provide alternative
  services. If we cannot successfully renew significant contracts or must renew
  them on less favorable terms, or if we incur substantial costs in modifying our
  terminals, our revenues from these arrangements could decline and our ability to
  make distributions to our unitholders could suffer.
  We
  may incur significant costs and liabilities as a result of pipeline integrity
  management program testing and any necessary pipeline repair, or preventative or
  remedial measures, which could have a material adverse effect on our results of
  operations.
  The DOT
  has adopted regulations requiring pipeline operators to develop integrity
  management programs for transportation pipelines located where a leak or rupture
  could do the most harm in "high consequence areas", including high population
  areas, areas that are sources of drinking water, ecological resource areas that
  are unusually sensitive to environmental damage from a pipeline release and
  commercially navigable waterways, unless the operator effectively demonstrates
  by risk assessment that the pipeline could not affect the area. The regulations
  require operators of covered pipelines to:
  ·
  perform
        ongoing assessments of pipeline
  integrity;
  ·
  identify
        and characterize threats to pipeline segments that could impact a high
        consequence area;
  ·
  improve
        data collection, integration and
  analysis;
  ·
  repair
        and remediate the pipeline as necessary;
  and
  ·
  implement
        preventive and mitigating actions.
  In
  addition to these adopted regulations, in September 2006, the DOT proposed
  amendment of existing pipeline safety standards including its integrity
  management programs to broaden the scope of coverage to include certain rural
  onshore hazardous liquid and low-stress pipeline systems found near "unusually
  sensitive areas," including non-populated areas requiring extra protection
  because of the presence of sole source drinking water resources, endangered
  species, or other ecological resources. Also, in December 2006, the Pipeline
  Inspection, Protection, Enforcement and Safety Act of 2006 was enacted. This act
  reauthorizes and amends the DOT's pipeline safety programs and includes a
  provision eliminating the regulatory exemption for hazardous liquid pipelines
  operated at low stress. Adoption of new or more stringent pipeline safety
  regulations affecting our gathering or low-stress pipelines could result in more
  rigorous and costly integrity management planning requirements being imposed on
  those lines, which could have a material adverse effect on our results of
  operations. Please read "Item 1. Business—Regulation—Pipeline Safety" in
  our 2007 Form 10-K for more information.
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  Our
  operations are subject to environmental and worker safety laws and regulations
  that may expose us to significant costs and liabilities. Failure to comply with
  these laws and regulations could adversely affect our ability to make
  distributions to our unitholders.
  Our
  midstream crude oil gathering, transportation, terminalling and storage
  operations, together with the liquid asphalt cement terminalling and storage
  assets that we acquired from the Private Company, are subject to stringent
  federal, state and local laws and regulations relating to the protection of the
  environment. Various governmental authorities, including the EPA, have the power
  to enforce compliance with these laws and regulations and the permits issued
  under them, and violators are subject to administrative, civil and criminal
  penalties, including civil fines, injunctions or both. Joint and several strict
  liability may be incurred without regard to fault or the legality of the
  original conduct under CERCLA, RCRA and analogous state laws for the remediation
  of contaminated areas. Private parties, including the owners of properties
  located near our terminalling and storage facilities or through which our
  pipeline systems pass, also may have the right to pursue legal actions to
  enforce compliance, as well as seek damages for non-compliance with
  environmental laws and regulations or for personal injury or property damage.
  Moreover, new stricter laws, regulations or enforcement policies could be
  implemented that significantly increase our compliance costs and the cost of any
  remediation that may become necessary, some of which may be
  material.
  In
  performing midstream operations and liquid asphalt cement terminalling services,
  we incur environmental costs and liabilities in connection with the handling of
  hydrocarbons and solid wastes. We currently own, operate or lease properties
  that for many years have been used for midstream activities, including
  properties in and around the Cushing Interchange, and with respect to our
  asphalt assets, for liquid asphalt cement terminalling and storage activities.
  Activities by us or prior owners, lessees or users of these properties over whom
  we had no control may have resulted in the spill or release of hydrocarbons or
  solid wastes on or under them. Additionally, some sites we own or operate are
  located near current or former storage, terminal and pipeline operations, and
  there is a risk that contamination has migrated from those sites to ours.
  Increasingly strict environmental laws, regulations and enforcement policies as
  well as claims for damages and other similar developments could result in
  significant costs and liabilities, and our ability to make distributions to our
  unitholders could suffer as a result. Please see "Item
  1—Business—Regulation" in our 2007 Form 10-K for more
  information.
  In
  addition, the workplaces associated with the storage facilities and pipelines we
  operate are subject to OSHA requirements and comparable state statutes that
  regulate the protection of the health and safety of workers. The OSHA hazard
  communication standard requires that we maintain information about hazardous
  materials used or produced in our operations and that we provide this
  information to employees, state and local government authorities, and local
  residents. Failure to comply with OSHA requirements, including general industry
  standards, recordkeeping requirements and monitoring of occupational exposure to
  regulated substances, could subject us to fines or significant compliance costs
  and adversely affect our ability to make distributions to our
  unitholders.
  Our
  business involves many hazards and operational risks, including adverse weather
  conditions, which could cause us to incur substantial liabilities.
  Our
  operations are subject to the many hazards inherent in the transportation and
  storage of crude oil and the storage of liquid asphalt cement,
  including:
  ·
  explosions,
        fires, accidents, including road and highway accidents involving our
        tanker trucks;
  ·
  extreme
        weather conditions, such as hurricanes which are common in the
        Gulf Coast and tornadoes and flooding which are common in the
        Midwest;
  ·
  damage
        to our pipelines, storage tanks, terminals and related
        equipment;
  ·
  leaks
        or releases of crude oil into the environment;
    and
  ·
  acts
        of terrorism or vandalism.
  If any of
  these events were to occur, we could suffer substantial losses because of
  personal injury or loss of life, severe damage to and destruction of property
  and equipment, and pollution or other environmental damage resulting in
  curtailment or suspension of our related operations. In addition, mechanical
  malfunctions, faulty measurement or other errors may result in significant costs
  or lost revenues.
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  We
  do not own all of the land on which our pipelines and facilities are located,
  which could disrupt our operations.
  We do not
  own all of the land on which our pipelines and facilities have been constructed,
  and we are therefore subject to the possibility of more onerous terms and/or
  increased costs to retain necessary land use if we do not have valid
  rights-of-way or if such rights-of-way or any material real property leases
  lapse or terminate. We obtain the rights to construct and operate our pipelines
  and some of our terminals and storage facilities on land owned by third parties
  and governmental agencies for a specific period of time. Our loss of these
  rights, through our inability to renew leases, right-of-way contracts or
  otherwise, could have a material adverse effect on our business, results of
  operations and financial condition and our ability to make cash distributions to
  you.
  Terrorist
  attacks, and the threat of terrorist attacks, have resulted in increased costs
  to our business. Continued hostilities in the Middle East or other sustained
  military campaigns may adversely impact our results of operations.
  The
  long-term impact of terrorist attacks, such as the attacks that occurred on
  September 11, 2001, and the threat of future terrorist attacks on our industry
  in general, and on us in particular, is not known at this time. Increased
  security measures taken by us as a precaution against possible terrorist attacks
  have resulted in increased costs to our business. Uncertainty surrounding
  continued hostilities in the Middle East or other sustained military campaigns
  may affect our operations in unpredictable ways, including disruptions of crude
  oil supplies and markets for our services, and the possibility that
  infrastructure facilities could be direct targets of, or indirect casualties of,
  an act of terror.
  Changes
  in the insurance markets attributable to terrorist attacks may make certain
  types of insurance more difficult for us to obtain. Moreover, the insurance that
  may be available to us may be significantly more expensive than our existing
  insurance coverage. Instability in the financial markets as a result of
  terrorism or war could also affect our ability to raise capital.
  Risks
  Inherent in an Investment in Us
  Some
  of our general partner's directors are affiliates of certain creditors of the
  Private Company; therefore, such creditors may have different business interests
  than the common unitholders.
  Manchester
  is a creditor under a loan agreement with SemGroup Holdings, which is a
  subsidiary of the Private Company.  This loan is secured by our
  subordinated units and incentive distribution rights and the membership
  interests in our general partner, owned by SemGroup Holdings.  On July
  18, 2008, Manchester and Alerian declared an event of default under the loan
  agreement and exercised their right under a pledge agreement with SemGroup
  Holdings to direct the vote of the membership interests of our general
  partner.  Manchester and Alerian exercised these voting rights to
  reconstitute our general partner's board of directors.  On March 20,
  2009, Alerian transferred its interest in the Holdings Credit Agreements to
  Manchester.  Manchester may have business interests that are different
  from the business interests of our common unitholders.
  Our
  general partner has sole responsibility for conducting our business and managing
  our operations.  Our general partner has conflicts of interest with us
  and limited fiduciary duties, which may permit it to favor its own interests to
  the detriment of our unitholders.
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  Conflicts
  of interest may arise between our general partner, on the one hand, and us and
  our unitholders, on the other hand.  In resolving those conflicts of
  interest, our general partner may favor its own interests and the interests of
  its affiliates over the interests of our unitholders. Although the conflicts
  committee of our general partner's board of directors may review such conflicts
  of interest, our general partner's board of directors is not required to submit
  such matters to the conflicts committee. These conflicts include, among others,
  the following situations:
  ·
  neither
        our partnership agreement nor any other agreement requires the general
        partner or any person who controls the general partner to pursue a
        business strategy that favors us.  Such persons may make these
        decisions in their best interest, which may be contrary to our
        interests;
  ·
  our
        general partner is allowed to take into account the interests of parties
        other than us, such as creditors and the Private Company and their
        affiliates, in resolving conflicts of
  interest;
  ·
  if
        we do not have sufficient available cash from operating surplus, our
        general partner could cause us to use cash from non-operating sources,
        such as asset sales, issuances of securities and borrowings, to pay
        distributions, which means that we could make distributions that
        deteriorate our capital base and that our general partner could receive
        distributions on its subordinated units and incentive distribution rights
        to which it would not otherwise be entitled if we did not have sufficient
        available cash from operating surplus to make such
        distributions;
  ·
  our
        general partner has limited its liability and reduced its fiduciary
        duties, and has also restricted the remedies available to our unitholders
        for actions that, without the limitations, might constitute breaches of
        fiduciary duty;
  ·
  our
        general partner determines the amount and timing of asset purchases and
        sales, borrowings, issuance of additional partnership securities and
        reserves, each of which can affect the amount of cash that is distributed
        to unitholders;
  ·
  our
        general partner determines the amount and timing of any capital
        expenditures and whether a capital expenditure is a maintenance capital
        expenditure, which reduces operating surplus, or an expansion capital
        expenditure, which does not reduce operating surplus. This determination
        can affect the amount of cash that is distributed to our unitholders and
        the ability of the subordinated units to convert to common
        units;
  ·
  our
        general partner may make a determination to receive a quantity of our
        Class B units in exchange for resetting the target distribution levels
        related to its incentive distribution rights without the approval of the
        conflicts committee of our general partner or our
      unitholders;
  ·
  our
        general partner determines which costs incurred by it and its affiliates
        are reimbursable by us and the Private Company determines the allocation
        of shared overhead expenses;
  ·
  our
        partnership agreement does not restrict our general partner from causing
        us to pay it or its affiliates for any services rendered to us or entering
        into additional contractual arrangements with any of these entities on our
        behalf;
  ·
  our
        general partner intends to limit its liability regarding our contractual
        and other obligations and, in some circumstances, is entitled to be
        indemnified by us;
  ·
  our
        general partner may exercise its limited right to call and purchase common
        units if it and its affiliates own more than 80% of the common
        units;
  ·
  our
        general partner controls the enforcement of obligations owed to us by our
        general partner and its affiliates;
  and
  ·
  our
        general partner decides whether to retain separate counsel, accountants or
        others to perform services for us.
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  Our
  partnership agreement limits our general partner's fiduciary duties to holders
  of our common units and subordinated units and restricts the remedies available
  to holders of our common units and subordinated units for actions taken by our
  general partner that might otherwise constitute breaches of fiduciary
  duty.
  Our
  partnership agreement contains provisions that reduce the fiduciary standards to
  which our general partner would otherwise be held by state fiduciary duty laws.
  For example, our partnership agreement:
  ·
  permits
        our general partner to make a number of decisions in its individual
        capacity, as opposed to in its capacity as our general partner. This
        entitles our general partner to consider only the interests and factors
        that it desires, and it has no duty or obligation to give any
        consideration to any interest of, or factors affecting, us, our affiliates
        or any limited partner. Examples include the exercise of its right to
        receive a quantity of our Class B units in exchange for resetting the
        target distribution levels related to its incentive distribution rights,
        the exercise of its limited call right, the exercise of its rights to
        transfer or vote the units it owns, the exercise of its registration
        rights and its determination whether or not to consent to any merger or
        consolidation of the partnership or amendment to the partnership
        agreement;
  ·
  provides
        that our general partner will not have any liability to us or our
        unitholders for decisions made in its capacity as a general partner so
        long as it acted in good faith, meaning it believed the decision was in
        the best interests of our
  partnership;
  ·
  generally
        provides that affiliated transactions and resolutions of conflicts of
        interest not approved by the conflicts committee of the board of directors
        of our general partner acting in good faith and not involving a vote of
        unitholders must be on terms no less favorable to us than those generally
        being provided to or available from unrelated third parties or must be
        "fair and reasonable" to us, as determined by our general partner in good
        faith. In determining whether a transaction or resolution is "fair and
        reasonable," our general partner may consider the totality of the
        relationships between the parties involved, including other transactions
        that may be particularly advantageous or beneficial to
    us;
  ·
  provides
        that our general partner and its officers and directors will not be liable
        for monetary damages to us, our limited partners or assignees for any acts
        or omissions unless there has been a final and non-appealable judgment
        entered by a court of competent jurisdiction determining that the general
        partner or its officers and directors acted in bad faith or engaged in
        fraud or willful misconduct or, in the case of a criminal matter, acted
        with knowledge that the conduct was criminal;
    and
  ·
  provides
        that in resolving conflicts of interest, it will be presumed that in
        making its decision the general partner acted in good faith, and in any
        proceeding brought by or on behalf of any limited partner or us, the
        person bringing or prosecuting such proceeding will have the burden of
        overcoming such presumption.
  By
  purchasing a common unit, a common unitholder will become bound by the
  provisions in the partnership agreement, including the provisions discussed
  above.
  The
  Private Company may compete with us, which could adversely affect our existing
  business and limit our ability to acquire additional assets or
  businesses.
  Neither
  our partnership agreement nor any other agreement with the Private Company
  prohibits the Private Company or any successor to the Private Company or
  acquirer of its assets from owning assets or engaging in businesses that compete
  directly or indirectly with us. In addition, the Private Company or any
  successor to the Private Company or acquirer of its assets may acquire,
  construct or dispose of additional midstream or other assets in the future,
  without any obligation to offer us the opportunity to purchase or construct any
  of those assets.  As a result, competition from the Private Company or
  any successor to the Private Company or acquirer of its assets could adversely
  impact our results of operations and cash available for
  distribution.
  Cost
  reimbursements due to our general partner and its affiliates for services
  provided, which are determined by our general partner, may be substantial and
  will reduce our cash available for distribution to our unitholders.
  Pursuant
  to our partnership agreement, the Private Company receives reimbursement for the
  payment of operating expenses related to our operations and for the provision of
  various general and administrative services for our benefit. Payments for these
  services may be substantial and reduce the amount of cash available for
  distribution to unitholders. In addition, under Delaware partnership law, our
  general partner has unlimited liability for our obligations, such as our debts
  and environmental liabilities, except for our contractual obligations that are
  expressly made without recourse to our general partner. To the extent our
  general partner incurs obligations on our behalf, we are obligated under our
  partnership agreement to reimburse or indemnify our general partner. If we are
  unable or unwilling to reimburse or indemnify our general partner, our general
  partner may take actions to cause us to make payments of these obligations and
  liabilities. Any such payments would reduce the amount of cash otherwise
  available for distribution to our unitholders. Please see "Item 13—Certain
  Relationships and Related Party Transactions, and Director
  Independence—Agreements Related to Our Acquisition of the Asphalt Assets—Amended
  Omnibus Agreement" in our 2007 Form 10-K.
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  Holders
  of our common units have limited voting rights and are not entitled to elect our
  general partner or its directors.
  Unlike
  the holders of common stock in a corporation, unitholders have only limited
  voting rights on matters affecting our business and, therefore, limited ability
  to influence management's decisions regarding our business. Unitholders did not
  elect our general partner or our general partner's board of directors, and have
  no right to elect our general partner or our general partner's board of
  directors on an annual or other continuing basis. The present board of directors
  of our general partner was chosen by Manchester pursuant to its rights
  under the Holdings Credit Agreements to direct the vote of the membership
  interests of our general partner.  Furthermore, if the unitholders are
  dissatisfied with the performance of our general partner, they have little
  ability to remove our general partner. Amendments to our partnership agreement
  may be proposed only by or with the consent of our general partner. As a result
  of these limitations, the price at which the common units will trade could be
  diminished because of the absence or reduction of a takeover premium in the
  trading price.
  Removal
  of our general partner without its consent will dilute and adversely affect our
  common unitholders.
  If our
  general partner is removed without cause during the subordination period and
  units held by our general partner and its affiliates are not voted in favor of
  that removal, all remaining subordinated units will automatically convert into
  common units and any existing arrearages on our common units will be
  extinguished. A removal of our general partner under these circumstances would
  adversely affect our common units by prematurely eliminating their distribution
  and liquidation preference over our subordinated units, which would otherwise
  have continued until we had met certain distribution and performance tests.
  Cause is narrowly defined to mean that a court of competent jurisdiction has
  entered a final, non-appealable judgment finding the general partner liable for
  actual fraud or willful or wanton misconduct in its capacity as our general
  partner. Cause does not include most cases of charges of poor management of the
  business, so the removal of the general partner because of the unitholders'
  dissatisfaction with our general partner's performance in managing our
  partnership will most likely result in the termination of the subordination
  period and conversion of all subordinated units to common units.
  Control
  of our general partner may be transferred to a third party without unitholder
  consent.
  Our
  general partner may transfer its general partner interest to a third party in a
  merger or in a sale of all or substantially all of its assets without the
  consent of the unitholders. Furthermore, our partnership agreement does not
  restrict the ability of the Private Company, the owner of our general partner,
  from transferring all or a portion of its ownership interest in our general
  partner to a third party, or Manchester from transferring all or a portion of
  its loan interest voting rights in the general partner, to a third party. The
  new owner of our general partner would then be in a position to replace the
  board of directors and officers of our general partner with its own choices and
  thereby influence the decisions made by the board of directors and
  officers.
  We
  may issue additional units without approval of our unitholders, which would
  dilute our unitholders' ownership interests.
  Our
  partnership agreement does not limit the number or price of additional limited
  partner interests (including any securities of equal or senior rank to our
  common units, and options, rights, warrants and appreciation rights relating to
  any such securities) that we may issue at any time without the approval of our
  unitholders. In addition, because we are a limited partnership, we will not be
  subject to the shareholder approval requirements relating to the issuance of
  securities contained in Nasdaq Marketplace Rule 4350(i). The issuance by us of
  additional common units or other equity securities of equal or senior rank will
  have the following effects:
  ·
  our
        unitholders' proportionate ownership interest in us will
        decrease;
  ·
  the
        amount of cash available for distribution on each unit may
        decrease;
  ·
  because
        a lower percentage of total outstanding units will be subordinated units,
        the risk that a shortfall in the payment of the minimum quarterly
        distribution will be borne by our common unitholders will
        increase;
  ·
  the
        ratio of taxable income to distributions may
    increase;
  ·
  the
        relative voting strength of each previously outstanding unit may be
        diminished; and
  ·
  the
        market price of the common units may
  decline.
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  Our
  partnership agreement restricts the voting rights of unitholders, other than our
  general partner and its affiliates, including the Private Company, owning 20% or
  more of our common units.
  Unitholders'
  voting rights are further restricted by the partnership agreement provision
  providing that any units held by a person that owns 20% or more of any class of
  units then outstanding, other than our general partner, its affiliates, their
  transferees and persons who acquired such units with the prior approval of the
  board of directors of our general partner, cannot vote on any matter. Our
  partnership agreement also contains provisions limiting the ability of
  unitholders to call meetings or to acquire information about our operations, as
  well as other provisions.
  Affiliates
  of our general partner may sell common units in the public markets, which sales
  could have an adverse impact on the trading price of the common
  units.
  Executive
  officers and directors of our general partner beneficially own an aggregate of
  575,970 common units and the Private Company indirectly owns 12,570,504
  subordinated units, although such units are collateral to a loan between
  SemGroup Holdings and Manchester. All of the subordinated units will convert
  into common units at the end of the subordination period and may convert
  earlier. The sale of these units in the public markets could have an adverse
  impact on the price of the common units or on any trading market that may
  develop.
  Our
  general partner has a limited call right that may require our unitholders to
  sell their common units at an undesirable time or price.
  If at any
  time our general partner and its affiliates own more than 80% of the common
  units, our general partner will have the right, but not the obligation, which it
  may assign to any of its affiliates or to us, to acquire all, but not less than
  all, of the common units held by unaffiliated persons at a price not less than
  their then-current market price. As a result, our unitholders may be required to
  sell their common units at an undesirable time or price and may not receive any
  return on their investment. Our unitholders also may incur a tax liability upon
  a sale of their units. At the end of the subordination period, assuming no
  additional issuances of common units and no sales of subordinated units, our
  general partner and its affiliates will own 36.8% of the common
  units.
  Common
  units held by persons who are not Eligible Holders will be subject to the
  possibility of redemption.
  The
  Longview system is, and any additional interstate pipelines that we acquire or
  construct may be, subject to the rate regulation of the FERC. Our general
  partner has the right under our partnership agreement to institute procedures,
  by giving notice to each of our unitholders, that would require transferees of
  common units and, upon the request of our general partner, existing holders of
  our common units to certify that they are Eligible Holders. The purpose of these
  certification procedures would be to enable us to utilize a federal income tax
  expense as a component of the pipeline's cost of service upon which tariffs may
  be established under FERC rate-making policies applicable to entities that pass
  through their taxable income to their owners. Eligible Holders are individuals
  or entities subject to United States federal income taxation on the income
  generated by us or entities not subject to United States federal income taxation
  on the income generated by us, so long as all of the entity's owners are subject
  to such taxation. If these tax certification procedures are implemented, we will
  have the right to redeem the common units held by persons who are not Eligible
  Holders at the lesser of the holder's purchase price and the then-current market
  price of the units. The redemption price would be paid in cash or by delivery of
  a promissory note, as determined by our general partner.
  Our
  unitholders' liability may not be limited if a court finds that unitholder
  action constitutes control of our business.
  A general
  partner of a partnership generally has unlimited liability for the obligations
  of the partnership, except for those contractual obligations of the partnership
  that are expressly made without recourse to the general partner. Our partnership
  is organized under Delaware law and we conduct business in a number of other
  states. The limitations on the liability of holders of limited partner interests
  for the obligations of a limited partnership have not been clearly established
  in some of the other states in which we do business.
  Our
  unitholders could be liable for our obligations as if they were a general
  partner if:
  ·
  a
        court or government agency determined that we were conducting business in
        a state but had not complied with that particular state's partnership
        statute; or
  ·
  a
        unitholder's right to act with other unitholders to remove or replace the
        general partner, to approve some amendments to our partnership agreement
        or to take other actions under our partnership agreement constitute
        "control" of our business.
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  Unitholders
  may have liability to repay distributions that were wrongfully distributed to
  them.
  Under
  certain circumstances, unitholders may have to repay amounts wrongfully returned
  or distributed to them. Under Section 17-607 and 17-804 of the Delaware Revised
  Uniform Limited Partnership Act, we may not make a distribution to our
  unitholders if the distribution would cause our liabilities to exceed the fair
  value of our assets. Delaware law provides that for a period of three years from
  the date of the impermissible distribution, limited partners who received the
  distribution and who knew at the time of the distribution that it violated
  Delaware law will be liable to the limited partnership for the distribution
  amount. Substituted limited partners are liable for the obligations of the
  assignor to make contributions to the partnership that are known to the
  substituted limited partner at the time it became a limited partner and for
  unknown obligations if the liabilities could be determined from the partnership
  agreement. Liabilities to partners on account of their partnership interests and
  liabilities that are non-recourse to the partnership are not counted for
  purposes of determining whether a distribution is permitted.
  Tax
  Risks to Common Unitholders
  Our
  unitholders have been and will be required to pay taxes on their share of our
  taxable income even if they have not or do not receive any cash distributions
  from us.
  Because
  our unitholders are treated as partners to whom we will allocate taxable income
  which could be different in amount than the cash we distribute, they will be
  required to pay any federal income taxes and, in some cases, state and local
  income taxes on their share of our taxable income, even if our unitholders
  receive no cash distributions from us. In this regard, we did not pay a
  distribution to our unitholders for the quarters ended June 30, 2008, September
  30, 2008, December 31, 2008 or March 31, 2009.  In addition, we do not
  expect to make a distribution relating to the second quarter of 2009 and may not
  be able to make distributions in the future.  Thus, our unitholders
  may not receive cash distributions from us equal to their share of our taxable
  income or even equal to the actual tax liability that results from their share
  of our taxable income.
  Our
  tax treatment depends on our status as a partnership for federal income tax
  purposes, as well as our not being subject to a material amount of entity-level
  taxation by individual states. If the IRS were to treat us as a corporation or
  if we were to become subject to a material amount of entity-level taxation for
  state tax purposes, then our cash available for distribution to our unitholders
  would be substantially reduced.
  The
  anticipated after-tax economic benefit of an investment in our common units
  depends largely on us being treated as a partnership for federal income tax
  purposes.  If less than 90% of the gross income of a publicly traded
  partnership, such as us, for any taxable year is "qualifying income" from
  sources such as the transportation, marketing (other than to end users), or
  processing of crude oil, natural gas or products thereof, interest, dividends or
  similar sources, that partnership will be taxable as a corporation under Section
  7704 of the Internal Revenue Code for federal income tax purposes for that
  taxable year and all subsequent years.  In this regard, because the
  income we earn from the Private Company is "qualifying income" any material
  reduction or elimination of that income, or any amendment to certain contracts
  with the Private Company which change the nature of the services provided or the
  income generated thereunder, may cause our remaining "qualifying income" to
  constitute less than 90% of our gross income.  As a result, we could
  become taxable as a corporation for federal income tax purposes, unless we were
  to transfer the businesses that generate non-qualifying income to one or more
  subsidiaries taxed as corporations and pay entity level income taxes on such
  non-qualifying income.  The IRS has not provided any ruling to us on
  this matter.
  If we
  were treated as a corporation for federal income tax purposes, then we would pay
  federal income tax on our income at the corporate tax rate, which is currently a
  maximum of 35%, and would likely pay state income tax at varying
  rates.  Distributions would generally be taxed again to unitholders as
  corporate distributions and none of our income, gains, losses, deductions or
  credits would flow through to our unitholders.  Because a tax would be
  imposed upon us as an entity, cash available for distribution to our unitholders
  would be substantially reduced.  Treatment of us as a corporation
  would result in a material reduction in the anticipated cash flow and after-tax
  return to unitholders and thus would likely result in a substantial reduction in
  the value of our common units.
  Current
  law may change, so as to cause us to be treated as a corporation for federal
  income tax purposes or otherwise subject us to entity-level taxation. In
  addition, because of widespread state budget deficits and other reasons, several
  states are evaluating ways  to subject partnerships to entity-level
  taxation through the imposition of state income, franchise and other forms of
  taxation. For example, beginning in 2008 we will be required to pay annually a
  Texas franchise tax at a maximum effective rate of 0.7% of our gross income
  apportioned to Texas with respect to the prior year.  As of September
  30, 2008, we paid $141,000 representing our estimated tax liability related
  to our 2007 gross income apportioned to Texas.  Imposition of such a
  tax on us by Texas and, if applicable, by any other state will reduce the cash
  available for distribution to our unitholders. The partnership agreement
  provides that if a law is enacted or existing law is modified or interpreted in
  a manner that subjects us to taxation as a corporation or otherwise subjects us
  to entity-level taxation for federal, state or local income tax purposes, the
  minimum quarterly distribution amount and the target distribution amounts will
  be adjusted to reflect the impact of that law on us.
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  The
  tax treatment of publicly traded partnerships or an investment in our common
  units could be subject to potential legislative, judicial or administrative
  changes and differing interpretations, possibly on a retroactive
  basis.
  The
  present federal income tax treatment of publicly traded partnerships, including
  us, or an investment in our common units may be modified by administrative,
  legislative or judicial interpretation at any time. For example, members of
  Congress are considering substantive changes to the existing federal income tax
  laws that affect certain publicly traded partnerships. Any modification to the
  federal income tax laws and interpretations thereof may or may not be applied
  retroactively. Although the currently proposed legislation would not appear to
  affect our tax treatment as a partnership, we are unable to predict whether any
  of these changes, or other proposals, will ultimately be enacted. Any such
  changes could negatively impact the value of an investment in our common
  units.
  If
  the IRS contests any of the federal income tax positions we take, the market for
  our common units may be adversely affected, and the costs of any contest will
  reduce our cash available for distribution to our unitholders.
  We have
  not requested a ruling from the IRS with respect to our treatment as a
  partnership for federal income tax purposes or any other matter affecting us.
  The IRS may adopt positions that differ from the conclusions of our counsel. It
  may be necessary to resort to administrative or court proceedings to sustain
  some or all of our counsel's conclusions or the positions we take. A court may
  not agree with some or all of our counsel's conclusions or the positions we
  take. Any contest with the IRS may materially and adversely impact the market
  for our common units and the price at which they trade. In addition, the costs
  of any contest with the IRS will be borne indirectly by our unitholders and our
  general partner because the costs will reduce our cash available for
  distribution.
  Tax
  gain or loss on the disposition of our common units could be more or less than
  expected.
  If our
  unitholders sell their common units, they will recognize a gain or loss equal to
  the difference between the amount realized and their tax basis in those common
  units. Prior distributions to our unitholders in excess of the total net taxable
  income our unitholders were allocated for a common unit, which decreased their
  tax basis in that common unit, will, in effect, become taxable income to our
  unitholders if the common unit is sold at a price greater than their tax basis
  in that common unit, even if the price our unitholders receive is less than
  their original cost. A substantial portion of the amount realized, whether or
  not representing gain, may be ordinary income. In addition, if our unitholders
  sell their units, they may incur a tax liability in excess of the amount of cash
  our unitholders receive from the sale.
  Tax-exempt
  entities, regulated investment companies and foreign persons face unique tax
  issues from owning common units that may result in adverse tax consequences to
  them.
  Investment
  in common units by tax-exempt entities, such as individual retirement accounts
  (known as IRAs), regulated investment companies (known as mutual funds), and
  non-U.S. persons raises issues unique to them. For example, virtually all of our
  income allocated to organizations exempt from federal income tax, including
  individual retirement accounts and other retirement plans, will be unrelated
  business taxable income and will be taxable to them. Distributions to non-U.S.
  persons will be reduced by withholding taxes at the highest applicable effective
  tax rate, and non-U.S. persons will be required to file United States federal
  income tax returns and pay tax on their share of our taxable income. If a
  potential unitholder is a tax-exempt entity or a foreign person, it should
  consult its tax advisor before investing in our common units.
  We
  will treat each purchaser of units as having the same tax benefits without
  regard to the units purchased. The IRS may challenge this treatment, which could
  adversely affect the value of the common units.
  Because
  we cannot match transferors and transferees of common units and because of other
  reasons, we will adopt depreciation and/or amortization positions that may not
  conform with all aspects of existing Treasury regulations and, as a result, our
  counsel, Baker Botts L.L.P., is unable to opine as to the validity of these
  positions. A successful IRS challenge to those positions could adversely affect
  the amount of tax benefits available to our unitholders. It also could affect
  the timing of these tax benefits or the amount of gain from their sale of common
  units and could have a negative impact on the value of our common units or
  result in audit adjustments to our unitholders' tax returns.
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  The
  sale or exchange of 50% or more of our capital and profits interests during any
  twelve-month period will result in the termination of our partnership for
  federal income tax purposes.
  We will
  be considered to have terminated for federal income tax purposes if there are
  one or more transfers of interests in our partnership that together represent a
  sale or exchange of 50% or more of the total interests in our capital and
  profits within a twelve-month period. For these purposes,
  ·
  multiple
        transfers of the same interest within a twelve month period will be
        counted only once;
  ·
  if
        the Private Company sells or exchanges its interests in SemGroup Holdings
        or our general partner, the interests held by SemGroup Holdings or our
        general partner, as the case may be, in us will be deemed to have been
        sold or exchanged; and
  ·
  if
        50% or more of the total interests in the Private Company's capital and
        profits are sold or exchanged within a twelve month period, the Private
        Company, SemGroup Holdings and the general partner will be deemed to have
        sold or exchanged all of their interests in
  us.
  Our
  termination would, among other things, result in the closing of our taxable year
  for all unitholders, which would result in us filing two tax returns (and our
  unitholders could receive two Schedules K-1) for one fiscal year and could
  result in a deferral of depreciation deductions allowable in computing our
  taxable income. In the case of a unitholder reporting on a taxable year other
  than a fiscal year ending December 31, the closing of our taxable year may also
  result in more than twelve months of our taxable income or loss being includable
  in his taxable income for the year of termination. Our termination currently
  would not affect our classification as a partnership for federal income tax
  purposes, but instead, we would be treated as a new partnership for tax
  purposes. If treated as a new partnership, we must make new tax elections and
  could be subject to penalties if we are unable to determine that a termination
  occurred.
  Our
  unitholders likely will be subject to state and local taxes and return filing or
  withholding requirements as a result of investing in our common
  units.
  In
  addition to federal income taxes, our unitholders will likely be subject to
  other taxes, such as state and local income taxes, unincorporated business taxes
  and estate, inheritance, or intangible taxes that are imposed by the various
  jurisdictions in which we do business or own property. Our unitholders likely
  will be required to file state and local income tax returns and pay state and
  local income taxes in some or all of these various jurisdictions. Further, our
  unitholders may be subject to penalties for failure to comply with those
  requirements. We own property and conduct business in Texas, Oklahoma, Kansas,
  Colorado, New Mexico, Arkansas, California, Georgia, Idaho, Illinois, Indiana,
  Missouri, Michigan, Montana, Nebraska, Nevada, New Jersey, North Carolina, Ohio,
  Pennsylvania, Tennessee, Utah, Virginia and Washington. Of these states, Texas
  does not currently impose a state income tax on individuals. We may own property
  or conduct business in other states or foreign countries in the future. It is
  each unitholder's responsibility to file all federal, state and local tax
  returns. Under the tax laws of some states where we will conduct business, we
  may be required to withhold a percentage from amounts to be distributed to a
  unitholder who is not a resident of that state. For example, in the case of
  Oklahoma, we are required to either report detailed tax information about our
  non-Oklahoma resident unitholders with an income in Oklahoma in excess of $500
  to the taxing authority, or withhold an amount equal to 5% of the portion of our
  distributions to unitholders which is deemed to be the Oklahoma share of our
  income. Similarly, we are required to withhold Kansas income tax at a rate of
  6.45% on each non-Kansas resident unitholder's share of our taxable income that
  is attributable to Kansas (regardless of whether such income is distributed),
  unless the non-Kansas resident unitholder files a tax reporting affidavit with
  us which we, in turn, are required to file with the Kansas Department of
  Revenue. Our counsel has not rendered an opinion on the state and local tax
  consequences of an investment in our common units.
  83
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  We
  prorate our items of income, gain, loss and deduction between transferors and
  transferees of our units each month based upon the ownership of our units on the
  first day of each month, instead of on the basis of the date a particular unit
  is transferred. The IRS may challenge this treatment, which could change the
  allocation of items of income, gain, loss and deduction among our
  unitholders.
  We
  prorate our items of income, gain, loss and deduction between transferors and
  transferees of our units each month based upon the ownership of our units on the
  first day of each month, instead of on the basis of the date a particular unit
  is transferred. The use of this proration method may not be permitted under
  existing Treasury Regulations, and, accordingly, our counsel is unable to opine
  as to the validity of this method. If the IRS were to challenge this method or
  new Treasury regulations were issued, we may be required to change the
  allocation of items of income, gain, loss and deduction among our
  unitholders.
  A
  unitholder whose units are loaned to a "short seller" to cover a short sale of
  units may be considered as having disposed of those units. If so, he would no
  longer be treated for tax purposes as a partner with respect to those units
  during the period of the loan and may recognize gain or loss from the
  disposition.
  Because a
  unitholder whose units are loaned to a "short seller" to cover a short sale of
  units may be considered as having disposed of the loaned units, he may no longer
  be treated for tax purposes as a partner with respect to those units during the
  period of the loan to the short seller and the unitholder may recognize gain or
  loss from such disposition. Moreover, during the period of the loan to the short
  seller, any of our income, gain, loss or deduction with respect to those units
  may not be reportable by the unitholder and any cash distributions received by
  the unitholder as to those units could be fully taxable as ordinary income. Our
  counsel has not rendered an opinion regarding the treatment of a unitholder
  where common units are loaned to a short seller to cover a short sale of common
  units; therefore, unitholders desiring to assure their status as partners and
  avoid the risk of gain recognition from a loan to a short seller are urged to
  modify any applicable brokerage account agreements to prohibit their brokers
  from borrowing their units.
  We
  will adopt certain valuation methodologies that may result in a shift of income,
  gain, loss and deduction between the general partner and the unitholders. The
  IRS may challenge this treatment, which could adversely affect the value of the
  common units.
  When we
  issue additional units or engage in certain other transactions, we determine the
  fair market value of our assets and allocate any unrealized gain or loss
  attributable to our assets to the capital accounts of our unitholders and our
  general partner. Our methodology may be viewed as understating the value of our
  assets. In that case, there may be a shift of income, gain, loss and deduction
  between certain unitholders and the general partner, which may be unfavorable to
  such unitholders. Moreover, under our valuation methods, subsequent purchasers
  of common units may have a greater portion of their Internal Revenue Code
  Section 743(b) adjustment allocated to our tangible assets and a lesser portion
  allocated to our intangible assets. Because the determination of value and the
  allocation of value are factual matters, rather than legal matters, our counsel
  is unable to opine as to these matters. The IRS may challenge our valuation
  methods, or our allocation of the Section 743(b) adjustment attributable to our
  tangible and intangible assets, and  allocations of income, gain, loss
  and deduction between the general partner and certain of our
  unitholders.
  A
  successful IRS challenge to these methods or allocations could adversely affect
  the amount of taxable income or loss being allocated to our unitholders. It also
  could affect the amount of gain from our unitholders' sale of common units and
  could have a negative impact on the value of the common units or result in audit
  adjustments to our unitholders' tax returns without the benefit of additional
  deductions.
  Item 3
  .
  Defaults
        Upon Senior Securities
  Due to
  events related to the Bankruptcy Filings, events of default occurred under our
  credit agreement.  Effective on September 18, 2008, we and the
  requisite lenders under our credit facility entered into the Forbearance under
  which the lenders agreed, subject to specified limitations and conditions, to
  forbear from exercising their rights and remedies arising from the defaults and
  events of default described therein for the Forbearance Period, which was
  subsequently extended pursuant to the First Forbearance Amendment, the Second
  Forbearance Amendment and the Third Forbearance Amendment.
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  We, our
  subsidiaries that are guarantors of the obligations under the credit facility,
  Wachovia Bank, National Association, as Administrative Agent, and the requisite
  lenders under our credit agreement entered into the Credit Agreement Amendment
  under which, among other things, the lenders consented to the Settlement
  and waived all existing defaults and events of default described in the
  Forbearance Agreement and amendments thereto.
  Prior to
  the execution of the Forbearance Agreement, the credit agreement was comprised
  of a $350 million revolving credit facility and a $250 million term loan
  facility.  The Forbearance Agreement permanently reduced our revolving
  credit facility under the credit agreement from $350 million to $300 million and
  prohibited us from borrowing additional funds under our revolving credit
  facility during the Forbearance Period.   Under the Forbearance
  Agreement, we agreed to pay the lenders executing the Forbearance Agreement a
  fee equal to 0.25% of the aggregate commitments under the credit agreement after
  giving effect to the above described commitment reduction.  The Second
  Forbearance Amendment further permanently reduced our revolving credit facility
  under the credit agreement from $300 million to $220 million.  In
  addition, under the Second Forbearance Amendment, we agreed to pay the lenders
  executing the Second Forbearance Amendment a fee equal to 0.375% of the
  aggregate commitments under the credit agreement after the above described
  commitment reduction.  Under the Third Forbearance Amendment, we
  agreed to pay a fee equal to 0.25% of the aggregate commitments under the credit
  agreement after the above described commitment reduction.  The amendments
  to the Forbearance Agreement prohibited us from borrowing additional funds under
  our revolving credit facility during the extended Forbearance
  Period.
  The
  Credit Agreement Amendment subsequently further permanently reduced our
  revolving credit facility under the credit agreement from $220 million to $50
  million, and increased the term loan facility from $250 million to $400
  million.  Upon the execution of the Credit Agreement Amendment, $150
  million of our outstanding revolving loans were converted to term loans and we
  became able to borrow additional funds under our revolving credit
  facility.  Pursuant to the Credit Agreement Amendment, the credit
  facility and all obligations thereunder will mature on June 30,
  2011.  Under the Credit Agreement Amendment, we agreed to pay the
  lenders executing the Credit Agreement Amendment a fee equal to 2.00% of the
  aggregate commitments under the credit agreement after the above described
  commitment reduction, offset by the fee paid pursuant to the Third Forbearance
  Amendment.
  As of May 22, 2009, we
  had $423.4 million in outstanding borrowings under our credit facility
  (including $23.4 million under our revolving credit facility and $400.0
  million under our term loan facility) with an aggregate unused credit
  availability under our revolving credit facility and cash on hand of
  approximately $27.2 million. Pursuant to the Credit Agreement Amendment, our
  revolving credit facility is limited to $50.0 million.
  If any of
  the financial institutions that support our revolving credit facility were to
  fail, we may not be able to find a replacement lender, which could negatively
  impact our ability to borrow under our revolving credit facility.  For
  instance, Lehman Brothers Commercial Bank is one of the lenders under our $50.0
  million revolving credit facility, and Lehman Brothers Commercial Bank has
  agreed to fund approximately $2.5 million (approximately 5%) of the revolving
  credit facility.  On several occasions Lehman Brothers Commercial Bank has
  failed to fund revolving loan requests under our revolving credit facility,
  effectively limiting the aggregate amount of our revolving credit facility to
  $47.5 million.
  Prior to
  the events of default, indebtedness under the credit agreement bore interest at
  our option, at either (i) the higher of the Base rate, plus an
  applicable margin that ranges from 0.50% to 1.75%, depending on our total
  leverage ratio and senior secured leverage ratio, or (ii) LIBOR plus an
  applicable margin that ranges from 1.50% to 2.75%, depending upon our total
  leverage ratio and senior secured leverage ratio.  During the
  Forbearance Period indebtedness under the credit agreement bore interest at our
  option, at either (i) the Base rate, plus an applicable margin that ranges
  from 2.75% to 3.75%, depending upon our total leverage ratio, or (ii) LIBOR
  plus an applicable margin that ranges from 4.25% to 5.25%, depending upon our
  total leverage ratio.  Pursuant to the Second Forbearance Amendment,
  commencing on December 12, 2008, indebtedness under the credit agreement bore
  interest at our option, at either (i) the Base rate plus 5.0% per annum,
  with a Base rate floor of 4.0% per annum, or (ii) LIBOR plus 6.0% per
  annum, with a LIBOR floor of 3.0% per annum.
  After
  giving effect to the Credit Agreement Amendment, amounts outstanding under our
  credit facility bear interest at either the LIBOR rate plus 6.50% per annum,
  with a LIBOR floor of 3.00%, or the base rate plus 5.50% per annum, with a base
  rate floor of 4.00% per annum.  We now pay a fee of 1.50% on unused
  commitments under our revolving credit facility.  After giving effect
  to the Credit Agreement Amendment, interest on amounts outstanding under our
  credit facility must be paid monthly.  Our credit facility, as amended
  by the Credit Agreement Amendment, now requires us to pay additional interest on
  October 6, 2009, April 6, 2010, October 6, 2010 and April 6, 2011, equal to the
  product of (i) the sum of the total amount of term loans then outstanding plus
  the aggregate commitments under the revolving credit facility and (ii) 0.50%,
  0.50%, 1.00% and 1.00%, respectively.
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  During
  the three months ended September 30, 2008, the weighted average interest rate
  incurred by us was 7.04% resulting in interest expense of approximately $8.2
  million.  During the three months ended December 31, 2008, the
  weighted average interest rate incurred by us was 7.72% resulting in interest
  expense of approximately $8.9 million.
  Among
  other things, our credit facility, as amended by the Credit Agreement Amendment,
  now requires us to make (i) minimum quarterly amortization payments on March 31,
  2010 in the amount of $2.0 million, June 30, 2010 in the amount of $2.0 million,
  September 30, 2010 in the amount of $2.5 million, December 31, 2010 in the
  amount of $2.5 million and March 31, 2011 in the amount of $2.5 million, (ii)
  mandatory prepayments of amounts outstanding under the revolving credit facility
  (with no commitment reduction) whenever cash on hand exceeds $15.0 million,
  (iii) mandatory prepayments with 100% of asset sale proceeds, (iv) mandatory
  prepayment with 50% of the proceeds raised through equity raises and (v) annual
  prepayments with 50% of excess cash flow.  Our credit facility, as
  amended by the Credit Agreement Amendment, prohibits us from making draws under
  the revolving credit facility if we would have more than $15.0 million of cash
  on hand after making the draw and applying the proceeds thereof.
  Under the
  credit agreement, we are subject to certain limitations, including limitations
  on our ability to grant liens, incur additional indebtedness, engage in a
  merger, consolidation or dissolution, enter into transactions with affiliates,
  sell or otherwise dispose of our assets (other than the sale or other
  disposition of the assets of the asphalt business, provided that such
  disposition is at arm's length to a non-affiliate for fair market value in
  exchange for cash and the proceeds of the disposition are used to pay down
  outstanding loans), businesses and operations, materially alter the character of
  our business, and make acquisitions, investments and capital
  expenditures.  The credit agreement prohibits us from making
  distributions of available cash to our unitholders if any default or event of
  default (as defined in the credit agreement) exists.  The credit
  agreement, as amended by the Credit Agreement Amendment, requires us to maintain
  a leverage ratio (the ratio of our consolidated funded indebtedness to our
  consolidated adjusted EBITDA, in each case as defined in the credit agreement),
  determined as of the last day of each
  month for the twelve month
  period ending on the date of determination, that ranges on a monthly basis from
  not more than 5.50 to 1.00 to not more than 9.75 to 1.00.  In
  addition, pursuant to the Credit Agreement Amendment, our ability to make
  acquisitions and investments in unrestricted subsidiaries is limited and we may
  only make distributions if our leverage ratio is less than 3.50 to 1.00 and
  certain other conditions are met.  As of September 30, 2008 and
  December 31, 2008, our leverage ratio was 4.34 to 1.00 and 4.83 to 1.00,
  respectively. If our leverage ratio does not improve, we may not make
  quarterly distributions to our unitholders in the
  future.
  The
  credit agreement, as amended by the Credit Agreement Amendment, also requires us
  to maintain an interest coverage ratio (the ratio of our consolidated EBITDA to
  our consolidated interest expense, in each case as defined in the credit
  agreement) that ranges on a monthly basis from not less than 2.50 to 1.00 to not
  less than 1.00 to 1.00. As of September 30, 2008 and December 31, 2008, our
  interest coverage ratio was 4.95 to 1.00 and 3.60 to 1.00,
  respectively.
  Further,
  we are required to maintain a minimum monthly consolidated adjusted EBITDA for
  the prior twelve months ranging from $45.4 million to $82.9 million as
  determined at the end of each month.  In addition, capital
  expenditures are limited to $12.5 million in 2009, $8.0 million in 2010 and $4.0
  million in the six months ending June 30, 2011.
  The
  credit agreement specifies a number of events of default (many of which are
  subject to applicable cure periods), including, among others, failure to pay any
  principal when due or any interest or fees within three business days of the due
  date, failure to perform or otherwise comply with the covenants in the credit
  agreement, failure of any representation or warranty to be true and correct in
  any material respect, failure to pay debt, a change of control of us or our
  general partner, and other customary defaults.
  In
  addition, it is an event of default under the credit agreement if we do not file
  our delinquent quarterly and annual reports with the SEC by September 30, 2009,
  unless we retain new auditors, in which case such deadline is extended to
  December 31, 2009.
  If an event of default exists under the credit
  agreement, the lenders will be able to accelerate the maturity of the credit
  agreement and exercise other rights and remedies, including taking available
  cash in our bank accounts.  If an event of default exists and we are
  unable to obtain forbearance from our lenders or a waiver of the events of
  default under our credit agreement, we may be forced to sell assets, make a
  bankruptcy filing or take other action that could have a material adverse effect
  on our business, the price of our common units and our results of
  operations.  We are also prohibited from making cash distributions to
  our unitholders while the events of default exist.
  We used
  interest rate swap agreements to manage a portion of the exposure related to
  changing interest rates by converting floating-rate debt to fixed-rate debt. See
  Note 4
  of the
  Notes to the Consolidated Financial Statements included in Item 1 of this
  Quarterly Report
  for a description of these interest rate
  swaps.   The interest rate swap agreements contain cross-default
  provisions to events of default under the credit agreement.  Due to
  events related to the Bankruptcy Filings, all of these interest rate swap
  positions were terminated in the third quarter of 2008, and we have recorded a
  $1.5 million liability as of September 30, 2008 with respect to these
  positions.
  Item
  6.
  Exhibits
  The
  information required by this Item 6 is set forth in the Index to Exhibits
  accompanying this quarterly report and is incorporated herein by
  reference.
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  SIGNA
  TURES
  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.
  SemGroup
        Energy Partners, L.P.
  By:
  SemGroup
        Energy Partners G.P., L.L.C.
  its
        General Partner
  Date: May
        27, 2009
  By:
  /s/
        Alex G. Stallings
  Alex
        G. Stallings
  Chief
        Financial Officer and Secretary
  Date:
        May 27, 2009
  By:
  /s/
        James R. Griffin
  James
        R. Griffin
  Chief
        Accounting Officer
  Table of Contents
  INDEX
  TO EXHIBITS
  Exhibit
  Number
  Exhibit
        Name
  3.1
  Certificate
        of Limited Partnership of SemGroup Energy Partners, L.P. (the
        "Partnership"), dated February 22, 2007 (filed as Exhibit 3.1 to the
        Partnership's Registration Statement on Form S-1 (Reg. No. 333-141196),
        filed March 9, 2007, and incorporated herein by
    reference).
  3.2
  First
        Amended and Restated Agreement of Limited Partnership of the Partnership,
        dated July 20, 2007 (filed as Exhibit 3.1 to the Partnership's Current
        Report on Form 8-K, filed July 25, 2007, and incorporated herein by
        reference).
  3.3
  Amendment
        No. 1 to First Amended and Restated Agreement of Limited Partnership of
        the Partnership, effective as of July 20, 2007 (filed as Exhibit 3.1 to
        the Partnership's Current Report on Form 8-K, filed on April 14, 2008, and
        incorporated herein by reference).
  3.4
  Amendment
        No. 2 to First Amended and Restated Agreement of Limited Partnership of
        the Partnership, dated June 25, 2008 (filed as Exhibit 3.1 to the
        Partnership's Current Report on Form 8-K, filed on June 30, 2008, and
        incorporated herein by reference).
  3.5
  Certificate
        of Formation of SemGroup Energy Partners G.P., L.L.C. (the "General
        Partner"), dated February 22, 2007 (filed as Exhibit 3.3 to the
        Partnership's Registration Statement on Form S-1 (Reg. No. 333-141196),
        filed March 9, 2007, and incorporated herein by
    reference).
  3.6
  Amended
        and Restated Limited Liability Company Agreement of the General Partner,
        dated July 20, 2007 (filed as Exhibit 3.2 to the Partnership's Current
        Report on Form 8-K, filed July 25, 2007, and incorporated herein by
        reference).
  3.7
  Amendment
        No. 1 to Amended and Restated Limited Liability Company Agreement of the
        General Partner, dated June 25, 2008 (filed as Exhibit 3.2 to the
        Partnership's Current Report on Form 8-K, filed on June 30, 2008, and
        incorporated herein by reference).
  3.8
  Amendment
        No. 2 to Amended and Restated Limited Liability Company Agreement of the
        General Partner, dated July 18, 2008 (filed as Exhibit 3.1 to the
        Partnership's Current Report on Form 8-K, filed on July 22, 2008, and
        incorporated herein by reference).
  4.1
  Specimen
        Unit Certificate (included in Exhibit 3.2).
  10.1
  Agreed
        Order of the United States Bankruptcy Court for the District of Delaware
        Regarding Motion by SemGroup Energy Partners, L.P. (i) to Compel Debtors
        to Provide Adequate Protection and (ii) to Modify the Automatic Stay
        (filed as Exhibit 99.1 to the Partnership's Current Report on Form 8-K,
        filed on September 9, 2008, and incorporated herein by
        reference).
  10.2
  Forbearance
        Agreement and Amendment to Credit Agreement, dated September 12, 2008 but
        effective as of September 18, 2008, by and among SemGroup Energy Partners,
        L.P., Wachovia Bank, National Association, as Administrative Agent, L/C
        Issuer and Swing Line Lender, and the Lenders party thereto (filed as
        Exhibit 10.1 to the Partnership's Current Report on Form 8-K, filed on
        September 22, 2008, and incorporated herein by
    reference).
  10.3
  First
        Amendment to Forbearance Agreement and Amendment to Credit Agreement,
        dated as of December 11, 2008, by and among SemGroup Energy Partners,
        L.P., Wachovia Bank, National Association, as Administrative Agent, L/C
        Issuer and Swing Line Lender, and the Lenders party thereto (filed as
        Exhibit 10.1 to the Partnership's Current Report on Form 8-K, filed on
        December 12, 2008, and incorporated herein by
    reference).
  10.4
  Second
        Amendment to Forbearance Agreement and Amendment to Credit Agreement,
        dated as of December 18, 2008, by and among SemGroup Energy Partners,
        L.P., Wachovia Bank, National Association, as Administrative Agent, L/C
        Issuer and Swing Line Lender, and the Lenders party thereto (filed as
        Exhibit 10.1 to the Partnership's Current Report on Form 8-K, filed on
        December 19, 2008, and incorporated herein by
    reference).
  10.5
  Third
        Amendment to Forbearance Agreement and Amendment to Credit Agreement,
        dated as of March 17, 2009, by and among SemGroup Energy Partners, L.P.,
        Wachovia Bank, National Association, as Administrative Agent, L/C Issuer
        and Swing Line Lender, and the Lenders party thereto (filed as Exhibit
        10.1 to the Partnership's Current Report on Form 8-K, filed on March 19,
        2009, and incorporated herein by reference).
  10.6
  Consent,
        Waiver and Amendment to Credit Agreement, dated as of April 7, 2009, by
        and among SemGroup Energy Partners, L.P., as Borrower, SemGroup Energy
        Partners G.P., L.L.C., SemGroup Energy Partners Operating, L.L.C.,
        SemMaterials Energy Partners, L.L.C., SemGroup Energy Partners, L.L.C.,
        SemGroup Crude Storage, L.L.C., SemPipe, L.P., SemPipe G.P., L.L.C. and
        SGLP Management, Inc., as Guarantors, Wachovia Bank, National Association,
        as Administrative Agent, L/C Issuer and Swing Line Lender, and the Lenders
        party thereto (filed as Exhibit 10.14 to the Partnership's Current Report
        on Form 8-K, filed on April 10, 2009, and incorporated herein by
        reference).
  10.7
  Amendment
        to the SemGroup Energy Partners G.P., L.L.C. Long Term Incentive Plan
        (filed as Exhibit 10.1 to the Partnership's Current Report on Form 8-K,
        filed on December 23, 2008, and incorporated herein by
        reference).
  10.8
  Form
        of Director Restricted Common Unit Agreement (filed as Exhibit 10.2 to the
        Partnership's Current Report on Form 8-K, filed on December 23, 2008, and
        incorporated herein by reference).
  10.9
  Form
        of Director Restricted Subordinated Unit Agreement (filed as Exhibit 10.3
        to the Partnership's Current Report on Form 8-K, filed on December 23,
        2008, and incorporated herein by reference).
  10.10
  Term
        Sheet, dated as of March 6, 2009 (filed as Exhibit 10.1 to the
        Partnership's Current Report on Form 8-K, filed on March 10, 2009, and
        incorporated herein by reference).
  10.11
  Master
        Agreement, dated as of April 7, 2009 to be effective as of 11:59 PM CDT
        March 31, 2009, by and among by and among SemGroup, L.P., SemManagement,
        L.L.C., SemOperating G.P., L.L.C., SemMaterials, L.P., K.C. Asphalt,
        L.L.C., SemCrude, L.P., Eaglwing, L.P., SemGroup Holdings, L.P., SemGroup
        Energy Partners, L.P., SemGroup Energy Partners G.P., L.L.C., SemGroup
        Energy Partners Operating, L.L.C., SemGroup Energy Partners, L.L.C.,
        SemGroup Crude Storage, L.L.C., SemPipe, L.P., SemPipe G.P., L.L.C., SGLP
        Management, Inc. and SemMaterials Energy Partners, L.L.C. (filed as
        Exhibit 10.1 to the Partnership's Current Report on Form 8-K, filed on
        April 10, 2009, and incorporated herein by reference).
  10.12
  Shared
        Services Agreement, dated as of April 7, 2009 to be effective as of 11:59
        PM CDT March 31, 2009, by and among SemGroup Energy Partners, L.P.,
        SemGroup Energy Partners, L.L.C., SemGroup Crude Storage, L.L.C., SemPipe
        G.P., L.L.C., SemPipe, L.P., SemCrude, L.P. and SemManagement, L.L.C.
        (filed as Exhibit 10.2 to the Partnership's Current Report on Form 8-K,
        filed on April 10, 2009, and incorporated herein by
        reference).
  10.13
  Transition
        Services Agreement, dated as of April 7, 2009 to be effective as of 11:59
        PM CDT March 31, 2009, by and among SemGroup Energy Partners, L.P.,
        SemGroup Energy Partners, L.L.C., SemGroup Crude Storage, L.L.C., SemPipe
        G.P., L.L.C., SemPipe, L.P., SemMaterials Energy Partners, L.L.C., SGLP
        Asphalt L.L.C., SemCrude, L.P., SemGroup, L.P., SemMaterials, L.P. and
        SemManagement, L.L.C. (filed as Exhibit 10.3 to the Partnership's Current
        Report on Form 8-K, filed on April 10, 2009, and incorporated herein by
        reference).
  10.14
  Contribution,
        Conveyance, Assignment and Assumption Agreement, dated as of April 7, 2009
        to be effective as of 11:59 PM CDT March 31, 2009, by and among
        SemMaterials, L.P., K.C. Asphalt, L.L.C., SGLP Asphalt, L.L.C. and
        SemMaterials Energy Partners, L.L.C. (filed as Exhibit 10.4 to the
        Partnership's Current Report on Form 8-K, filed on April 10, 2009, and
        incorporated herein by reference).
  10.15
  Membership
        Interest Transfer Agreement, dated as of April 7, 2009 to be effective as
        of 11:59 PM CDT March 31, 2009, by and between SemMaterials, L.P. and
        SemMaterials Energy Partners, L.L.C. (filed as Exhibit 10.5 to the
        Partnership's Current Report on Form 8-K, filed on April 10, 2009, and
        incorporated herein by reference).
  10.16
  Throughput
        Agreement, dated as of April 7, 2009 to be effective as of 11:59 PM CDT
        March 31, 2009, by and among SemGroup Energy Partners, L.L.C. and
        SemCrude, L.P. (filed as Exhibit 10.6 to the Partnership's Current Report
        on Form 8-K, filed on April 10, 2009, and incorporated herein by
        reference).
  10.17
  Terminalling
        and Storage Agreement, dated as of April 7, 2009 to be effective as of
        11:59 PM CDT March 31, 2009, by and between SemMaterials Energy Partners,
        L.L.C. and SemMaterials, L.P. (filed as Exhibit 10.7 to the Partnership's
        Current Report on Form 8-K, filed on April 10, 2009, and incorporated
        herein by reference).
  10.18
  Access
        and Use Agreement, dated as of April 7, 2009 to be effective as of 11:59
        PM CDT March 31, 2009, by and between SemMaterials, L.P. and SemMaterials
        Energy Partners, L.L.C. (filed as Exhibit 10.8 to the Partnership's
        Current Report on Form 8-K, filed on April 10, 2009, and incorporated
        herein by reference).
  10.19
  Trademark
        License Agreement, dated as of April 7, 2009 to be effective as of 11:59
        PM CDT March 31, 2009, by and among SemGroup, L.P., SemMaterials, L.P. and
        SemGroup Energy Partners, L.P. (filed as Exhibit 10.9 to the Partnership's
        Current Report on Form 8-K, filed on April 10, 2009, and incorporated
        herein by reference).
  10.20
  Office
        Lease, dated as of April 7, 2009 to be effective as of 11:59 PM CDT March
        31, 2009, by and between SemGroup Energy Partners, L.L.C. and SemCrude,
        L.P. (filed as Exhibit 10.10 to the Partnership's Current Report on Form
        8-K, filed on April 10, 2009, and incorporated herein by
        reference).
  10.21
  Building
        Lease, dated as of April 7, 2009 to be effective as of 11:59 PM CDT March
        31, 2009, by and between SemGroup Energy Partners, L.L.C. and SemCrude,
        L.P. (filed as Exhibit 10.11 to the Partnership's Current Report on Form
        8-K, filed on April 10, 2009, and incorporated herein by
        reference).
  10.22
  Mutual
        Easement Agreement, dated as of April 7, 2009 to be effective as of 11:59
        PM CDT March 31, 2009, among SemCrude, L.P., SemGroup Energy Partners,
        L.L.C., and SemGroup Crude Storage, L.L.C. (filed as Exhibit 10.12 to the
        Partnership's Current Report on Form 8-K, filed on April 10, 2009, and
        incorporated herein by reference).
  10.23
  Pipeline
        Easement Agreement, dated as of April 7, 2009 to be effective as of 11:59
        PM CDT March 31, 2009, by and among White Cliffs Pipeline, L.L.C.,
        SemGroup Energy Partners, L.L.C., and SemGroup Crude Storage, L.L.C.
        (filed as Exhibit 10.13 to the Partnership's Current Report on Form 8-K,
        filed on April 10, 2009, and incorporated herein by
        reference).
  31.1*
  Certifications
        of Chief Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley
        Act of 2002.
  31.2*
  Certifications
        of Chief Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley
        Act of 2002.
  32.1*
  Certification
        of Chief Executive Officer and Chief Financial Officer pursuant to 18
        U.S.C., Section 1350, as adopted pursuant to Section 906 of the
        Sarbanes-Oxley Act of 2002. Pursuant to SEC Release 34-47551, this Exhibit
        is furnished to the SEC and shall not be deemed to be
      "filed."
  *
  Filed
        herewith.