Profile: Genesis Energy LP (GEL)

Genesis Energy, L.P. (Genesis) is a limited partnership focused on the midstream segment of the oil and gas industry in the Gulf Coast region of the United States, primarily Texas, Louisiana, Arkansas, Mississippi, Alabama and Florida. The Company has four business segments: Pipeline Transportation, Refinery Services, Supply and Logistics and Industrial Gases. The Pipeline Transportation division transport crude oil, CO2 and, to a lesser extent, natural gas for others for a fee in the Gulf Coast region of the United States through approximately 590 miles of pipeline. The Refinery Services division provides services to eight refining operations located predominantly in Texas, Louisiana and Arkansas. Supply and Logistics division provides terminaling, blending, storing, marketing, gathering and transporting (by trucks and barges), and other supply and logistics services to third parties, as well as to support its other businesses. The Industrial Gases division supplies CO2 to industrial customers. On July 18, 2008, Genesis acquired an interest in DG Marine Transportation, LLC (DG Marine), which acquired the inland marine transportation business of Grifco Transportation, Ltd. (Grifco) and two of Grifco’s affiliates.

The Company has a portfolio of customers, operations and assets, including refinery-related plants, pipelines, storage tanks and terminals, barges, and trucks and truck terminals. Genesis provides services to refinery owners; oil, natural gas and carbon dioxide (CO2) producers; industrial and commercial enterprises that use CO2 and other industrial gases, and individuals and companies that use its trucking services. Substantially all of its revenues are derived from providing services to integrated oil companies, large independent oil and gas or refinery companies, and large industrial and commercial enterprises.

Pipeline Transportation

Through the pipeline systems Genesis owns and operates, it transports crude oil for its gathering and marketing operations and for other shippers pursuant to tariff rates regulated by the Federal Energy Regulatory Commission (FERC), or the Railroad Commission of Texas. Accordingly, it offers transportation services to any shipper of crude oil, if the products tendered for transportation satisfy the conditions and specifications contained in the applicable tariff. The Company owns and operates three common carrier crude oil pipeline systems. Its 235-mile Mississippi System provides shippers of crude oil in Mississippi indirect access to refineries, pipelines, storage, terminaling and other crude oil infrastructure located in the Midwest. Its 100-mile Jay System originates in southern Alabama and the panhandle of Florida and extends to a point near Mobile, Alabama. Its 90-mile Texas System extends from West Columbia to Webster, Webster to Texas City and Webster to Houston.

The Company’s Mississippi System extends from Soso, Mississippi to Liberty, Mississippi and includes tankage at various locations with an aggregate owned storage capacity of 247,500 barrels. This System is adjacent to several oil fields operated by Denbury, which is the sole shipper (other than us) on its Mississippi System. It provides transportation services on its Mississippi pipeline to Denbury under an incentive tariff. Its Jay System begins near oil fields in southern Alabama and the panhandle of Florida and extends to a point near Mobile, Alabama. Its Jay System includes tankage with 230,000 barrels of storage capacity, primarily at Jay station. The active segments of the Texas System extend from West Columbia to Webster, Webster to Texas City and Webster to Houston. Those segments include approximately 90 miles of pipeline.

Genesis also transports CO2 for a fee. The Free State Pipeline is an 86-mile, 20 inch pipeline that extends from Denbury’s CO2 source fields at Jackson Dome, near Jackson, Mississippi, to Denbury’s oil fields in east Mississippi. In addition, the NEJD Pipeline System, a 183-mile, 20 inch CO2 pipeline that it leases to Denbury extends from the Jackson Dome, near Jackson, Mississippi, to near Donaldsonville, Louisiana, being used by Denbury for its tertiary operations in southwest Mississippi.

Refinery Services

The Company’s refinery services business generates revenue by providing a service for which it receives NaHS as consideration and by selling the NaHS, the by-product of its process, to approximately 100 customers. Its refinery service contracts typically has an initial term from 2 to 10 years. Its sulfur removal facilities consist of NaHS units that are located at sites leased at five refineries, primarily in the southeastern United States. As of December 31, 2008, it provided services to eight refining operations. It sells its NaHS to customers in a variety of industries, with the largest customers involved in copper mining and the production of paper. It sells to customers in the copper mining industry in the western United States, as well as customers who export the NaHS to South America for mining in Peru and Chile.

Industrial Gases

The Company supplies CO2 to industrial customers; processes raw CO2 and sells that processed CO2, and manufactures and sells syngas, a combination of carbon monoxide and hydrogen. It supplies CO2 to industrial customers under seven long-term CO2 sales contracts. It owns a 50% partnership interest in Sandhill. Reliant Processing Ltd. owns the remaining 50% of Sandhill. Sandhill owns a CO2 processing facility located in Brandon, Mississippi. Sandhill is engaged in the production and distribution of liquid carbon dioxide for use in the food, chemicals and oil industries. It owns a 50% partnership interest in T&P Syngas. T&P Syngas is a partnership which owns a facility located in Texas City, Texas that manufactures syngas and high-pressure steam. The sole customer of T&P Syngas is Praxair, a worldwide provider of industrial gases. Sandhill sells to approximately 20 customers, with sales to three of those customers representing approximately 67% of Sandhill’s total revenues during the year ended December 31, 2008.

Supply and Logistics

Genesis supply and logistics segment has the capabilities and assets to provide an array of services to oil producers and refiners in the Gulf Coast region. These services include gathering of crude oil at the wellhead, marketing of crude oil to refiners and other supply companies, transporting crude oil by truck to pipeline injection points or directly to the refiners, and acquiring the resulting petroleum products from the refiners for transportation by truck and barge primarily to third parties in fuels markets and some end-users. Its crude oil gathering and marketing operations are concentrated in Texas, Louisiana, Alabama, Florida and Mississippi.