Magellan Midstream Increases Earnings Guidance for Quarter, Year

Based on operating results so far this year, management of Magellan Midstream Partners, L.P. is increasing its second-quarter 2008 net income per unit guidance to 76 cents from 66 cents and its annual guidance to $3.13 from $3.03, which would be record annual financial results for the partnership.

While pipeline volumes are expected to be lower than previously forecasted, management currently expects them to be in-line with 2007 volumes for both second quarter and full-year 2008. Higher shipments of liquefied petroleum gases are expected to offset lower refined products volumes, which are projected to decline about 3 percent during second quarter and 1 percent for the year compared to the related 2007 period primarily due to high fuel prices, the potential impact of recent wet conditions in the Midwest that could reduce farming diesel demand and higher ethanol blending. However, increases in transportation tariffs and higher profits from commodity-related activities are expected to benefit the quarter and year.

“While recent high petroleum prices are currently having a negative impact on our pipeline volumes, the favorable impact of high prices on our commodity-driven activities is more than offsetting the impact on volumes, allowing us to increase our earnings guidance for the year,” said Don Wellendorf, president and chief executive officer. “We remain committed to our stated goal of increasing distributions by 8% to 10% per year through 2010.”

Magellan Midstream Partners, L.P. has also confirmed that its refined petroleum products terminal and pipeline assets remain fully operational, despite flooding in certain Midwest areas.



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