MGG Announces Higher Fourth-Quarter Earnings

TULSA, Okla. – Magellan Midstream Holdings, L.P. (NYSE: MGG) today reported fourth-quarter 2008 operating profit of $96.1 million compared to $80.9 million for fourth quarter 2007. Net income was $19.5 million during fourth quarter 2008 versus $14.9 million in fourth quarter 2007.

MGG owns the general partner interest and incentive distribution rights of Magellan Midstream Partners, L.P. (NYSE: MMP) and reports its financial results on a consolidated basis with the financial results of MMP. The partnership currently has no separate operating activities apart from those conducted by MMP, and its distributable cash flow is derived from cash distributions received from MMP.

Related to fourth quarter 2008, MGG will receive distributions of $23.5 million from its ownership interest in MMP, almost all of which is available for distribution to MGG unitholders.

“MGG benefited from MMP’s strong performance in the quarter despite a weak economy and the impact of Hurricane Ike on Oct. throughput volumes,” said Don Wellendorf, chief executive officer. “In fact, MGG’s quarterly cash distribution has increased each quarter since its early 2006 initial public offering, for total distribution growth of 84% since that time.”

Operating profit increased between quarters primarily due to contributions from MMP’s growth projects, rate increases and higher commodity margin, more than offsetting reduced petroleum products volumes resulting from adverse economic conditions and hurricanes during the 2008 period.

Non-controlling owners’ interest in income of consolidated subsidiaries, which represents limited partner interests in MMP that MGG does not own, increased between quarters due to higher net income generated by MMP in 2008.

Basic and diluted net income per limited partner unit was 32 cents in fourth quarter 2008 and 28 cents in fourth quarter 2007.

An analyst call with management regarding fourth-quarter 2008 financial results for the partnership and MMP is scheduled today at 1:30 p.m. Eastern. To participate, dial (888) 596-2581 and provide code 2344675. Investors also may listen to the call via the partnership’s web site at http://www.mgglp.com/webcasts.asp.

Audio replays of the conference call will be available from 4:30 p.m. Eastern today through midnight on Feb. 9. To access the replay, dial (888) 203-1112 and provide code 2344675. The replay also will be available at http://www.mgglp.com.

About Magellan Midstream Holdings, L.P.
Magellan Midstream Holdings, L.P. (NYSE: MGG) is a publicly traded partnership formed to own the general partner interest and 100% of the incentive distribution rights in Magellan Midstream Partners, L.P. (NYSE: MMP), which primarily transports, stores and distributes refined petroleum products. More information is available at http://www.mgglp.com.

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Portions of this document may constitute forward-looking statements as defined by federal law. Although management believes any such statements are based on reasonable assumptions, there is no assurance that actual outcomes will not be materially different. Additional information about issues that could lead to material changes in performance is contained in the partnership's filings with the Securities and Exchange Commission.

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