http://www.morningstar.com/earnings/51350590-nustar-energy-lp-ns-q1-2013.aspx

NuStar Energy, L.P. NS
Q1 2013 Earnings Call Transcript

Transcript Call Date 04/24/2013

Operator: Good morning. My name is Regina, and I will be your conference operator today. At this time, I’d like to welcome everyone to the NuStar Energy L.P. and to NuStar GP Holdings LLC First Quarter 2013 Earnings Conference Call. All lines have been placed on mute to prevent any background noise. After the speakers' remarks, there will be a question-and-answer session. Thank you.

I would now like to turn the conference over to Mr. Chris Russell, Vice President of Investor Relations. Please go ahead, sir.

Chris Russell - VP, IR: Thank you Regina. Good morning, everyone and welcome to our conference call to discuss NuStar’s first quarter 2013 earnings results. With me today is Curt Anastasio, President and CEO of NuStar Energy L.P., and NuStar GP Holdings LLC; Steve Blank, Executive Vice President and CFO; and other members of our management team.

Before we get started, we'd like to remind you that during the course of this call, NuStar management will make statements about our current views concerning the future performance of NuStar that are forward-looking statements within the meaning of the federal securities laws. These statements are subject to the various uncertainties and assumptions described in our filings with the Securities and Exchange Commission, and will not be updated to conform to actual results or revised expectations.

During the course of this call, we'll also make reference to certain non-GAAP financial measures. Our non-GAAP financial measures should not be considered as alternatives to GAAP measures. Reconciliation of these non-GAAP financial measures to U.S. GAAP may be found either in our earnings press release or on our website.

Now, let me turn the call over to Curt.

Curt Anastasio - CEO and President: Good morning, and thanks for joining us on the call this morning. As a result of the September 2012 sale of 50% of the Asphalt Operations and the January 1st sale of the San Antonio Refinery beginning in the first quarter of 2013, NuStar had less exposure to margin based operations than we’ve had in several years. These reduced margin base exposure will lead to less volatile and increased distributable cash flow in the future.

As expected, our pipeline segment performed well in the first quarter, but storage and fuels marketing both fell short of our initial expectations. EBITDA on the pipeline segment increased to $56 million, $6 million higher than in the first quarter last year. Higher volumes on our Eagle Ford pipeline assets and longer haul higher tariff producing pipelines plus high pipeline tariffs from the 2012 FERC adjustment contributed to the improved results.

These positive factors were partially offset by lower throughputs from some other pipelines as a result of turnaround at some of our customers’ refineries.

Total pipeline segment throughputs were comparable to last year's first quarter. Crude oil pipeline throughputs were 6% or 21,000 barrels a day higher than the first quarter of 2012 due to the 2012 completion of two Eagle Ford shale projects and the December 2012 crude oil asset acquisition from TexStar Midstream. Throughputs on our Eagle Ford crude oil pipeline systems increased by 55% or about 55,000 barrels per day compared to the first quarter of 2012. However, those increases were partially offset by the impact of the turnarounds that I just mentioned.

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