HOUSTON–(EMWNews)–Genesis Energy, L.P. (AMEX:GEL) reported today net income for the second

quarter of 2008 of $7.3 million, or $0.17 per unit. This compares to a

loss in the 2007 period of $1.4 million, or $0.09 per unit.

Net income for the first six months of 2008 was $9.0 million, or $0.21

per unit. Net income was $0.2 million, or $0.02 per unit, for the first

six months of 2007.

Grant Sims, CEO said, “We are very pleased

with the solid performance reported by all of our business segments and

the contributions of our dedicated employees. For the second quarter of

2008, we generated total Available Cash before reserves, a non-GAAP

measure, of $26.2 million.” Available Cash

before reserves is a non-GAAP measure that is defined and reconciled

later in this press release to its most directly comparable GAAP

financial measure, net cash provided by operating activities. Net cash

provided by operating activities was $5.3 million for the second quarter

of 2008.

“The second quarter results reflect our

continuing integration of the assets and businesses we acquired in the

third quarter of 2007 from the Davison family with Genesis’

historic operations. On May 30, 2008, we completed two transactions

representing an aggregate $250 million investment in two CO₂

pipelines with Denbury Resources Inc. (NYSE: DNR), the indirect owner of

our general partner. We believe those investments will significantly

contribute in future periods to our total fee based margins. In July, we

completed the acquisition of the inland marine transportation business

of Grifco Transportation, Ltd., through a 49% owned joint venture with

certain members of the Davison family, and closed a $75 million credit

facility at the joint venture level in an otherwise challenging market

for new bank credits. While we clearly believe the inland marine joint

venture is an outstanding stand-alone investment, we are confident those

operations should significantly enhance the utilization and stability of

our other assets and operations,” Mr. Sims

added.

“For meaningful comparative purposes, we

focused on the change in our performance from the first quarter of 2008

rather than the second quarter of 2007 since the Davison businesses were

not reported therein. Segment margin for the second quarter of 2008 was

$37.0 million; an increase of $9.7 million as compared to the first

quarter of 2008. The increase in segment margin resulted from increased

contribution from all segments of our business, with the drop down

transactions with Denbury adding $2.1 million to our pipeline

transportation segment margin, reflecting only one month of reported

financial results.”

Mr. Sims concluded, “On August 14, 2008, we

will pay a total distribution of $13.3 million, comprised of $12.4

million or $0.315 per unit with respect to our limited partner units and

$0.9 million to our general partner including its incentive

distribution, attributable to the second quarter of 2008. This is the

twelfth consecutive quarter with an increase in the per unit

distribution. Given the $26.2 million of total Available Cash before

reserves generated during the second quarter, our total distribution

coverage ratio is approximately 1.97 times.”

Financial Results

Quarterly Comparison – 2008 Second Quarter to

2007 Second Quarter

Net income for the 2008 second quarter was $7.3 million or $0.17 per

unit. For the 2007 second quarter, we sustained a loss of $1.4 million,

or $0.09 per unit.

Segment margin is defined and reconciled later in this press release to

income before income taxes and minority interest. The following table

presents selected financial information by segment for the three month

reporting periods:

		Pipeline			Refinery			Industrial			Supply &
		Transportation			Services			Gases			Logistics			Total
Three Months Ended June 30, 2008
Segment margin excluding depreciation and amortization (a)		$	6,828		$	17,616		$	3,043		$	9,492		$	36,979
Capital expenditures		$	77,246		$	559		$	–		$	–		$	77,805
Maintenance capital expenditures		$	–		$	208		$	–		$	–		$	208
Revenues:
External customers		$	8,885		$	55,727		$	4,450		$	569,477		$	638,539
Intersegment			2,001			–			–			–			2,001
Total revenues of reportable segments		$	10,886		$	55,727		$	4,450		$	569,477		$	640,540
Three Months Ended June 30, 2007
Segment margin excluding depreciation and amortization (a)		$	2,227		$	–		$	2,958		$	1,427		$	6,612
Capital expenditures		$	337		$	–		$	–		$	42		$	379
Maintenance capital expenditures		$	337		$	–		$	–		$	42		$	379
Revenues:
External customers		$	5,347		$	–		$	3,946		$	190,735		$	200,028
Intersegment			988			–			–			–			988
Total revenues of reportable segments		$	6,335		$	–		$	3,946		$	190,735		$	201,016

(a) Segment margin was calculated as revenues less cost of sales and

operating expenses. It includes our share of the operating income of our

investment in joint ventures. A reconciliation of segment margin to

income before income taxes is presented for periods in the table at the

end of this release.

Pipeline transportation segment margin increased by $4.6 million between

the second-quarter periods. Throughput increases on all three of our

crude oil pipeline systems, combined with higher tariff rates

contributed $0.5 million of the increased segment margin, with $1.4

million of the remainder primarily due to the effects of higher crude

oil market prices on volumetric gains. The CO₂

pipelines acquired from Denbury contributed $2.1 million to segment

margin for the one month since the acquisition. Decreased operating

costs contributed to the improved segment margin, although this decline

was related to a non-cash credit for our stock appreciation rights plan

in 2008.

Our refinery services segment was acquired in the transaction with the

Davison family, therefore it is not included in the second quarter of

2007.

Segment margin from industrial gases activities showed a slight increase

primarily related to volumes sold to our CO₂

industrial customers. Volumes sold increased 6.6%, and the average sales

price of CO₂ increased 5.8%, primarily due to

variations in the volumes sold under contracts with different pricing

terms.

Segment margin from supply and logistics activities reflects an increase

between the second quarters of 2008 and 2007 of $8.1 million, with

approximately $7.0 million of that amount due to the Davison

acquisition. Our historical crude oil related supply and logistics

operations showed an improvement of $1.1 million compared to the 2007

second quarter. Much of that improvement resulted from favorable

fluctuations in crude oil price differentials for grades of crude oil.

General and administrative expenses increased $3.6 million when

comparing the second quarter periods. Approximately $2.8 million of that

increase related to the administrative personnel and costs at the

Davison locations, with the remainder attributable to increased

professional service fees, headcount increases at our headquarters

office and bonus plan expense totaling a combined $3.2 million.

Offsetting some of these higher costs was a decrease in the expense for

our stock appreciation rights plan of $2.4 million between the quarters

due to the decrease in our unit price.

The $14.7 million increase in our depreciation and amortization expenses

between 2008 and 2007 second quarters is substantially all attributable

to our acquisition of the assets in the Davison transaction.

Interest costs in the 2008 second quarter were $1.7 million higher than

in the prior year. This increase is due partly to the rise in our

average outstanding borrowings of $154.8 million, offset in part by a

reduction of 4.4% in our average interest rate. The increase in our

outstanding debt at June 30, 2008 is primarily a function of borrowing

$225 million to fund the acquisition of CO₂

pipelines from Denbury.

Quarterly Comparison – 2008 Second Quarter to

2008 First Quarter

Genesis has owned the Davison businesses for three full quarters as of

June 30, 2008. As shown in the table below, segment margin increased in

all segments between the first and second quarters of 2008.

		Second			First			Six Months
		Quarter			Quarter			Ended
		2008			2008			June 30, 2008
Segment Margin:
Pipeline Transportation		$	6,828		$	4,643		$	11,471
Refinery Services			17,616			13,588			31,204
Industrial Gases			3,043			2,776			5,819
Supply & Logistics			9,492			6,261			15,753
Total Segment Margin		$	36,979		$	27,268		$	64,247

Pipeline transportation segment margin includes $2.1 million related to

the CO₂ pipelines acquired from Denbury on May

30, 2008, accounting for the majority of the increase in that segment’s

contribution. Refinery services segment margin improved as a result of a

12% increase in sodium hydrosulfide (NaHS) sales volumes and a 32%

increase in the contribution margin per unit from those sales. The

improvement in industrial gases segment between the first two quarters

of 2008 resulted from normal seasonal fluctuations in our CO₂

sales to industrial customers. Lastly, the supply and logistics segment

experienced significant improvement in segment margin due to increased

availability of products for blending and an improvement in the

availability of barges and their ability, given river levels, to access

our terminals to move product out of our facilities. Operational

difficulties at some of the refineries from whom we purchase refined

products resulted in reduced volumes being available to us during the

first quarter.

Year-to-Date Comparison

Segment margin for the six months ended June 30, 2008 increased $50.6

million when compared to the same period in 2007. As illustrated in the

table below, approximately $31.2 million of this increase is

attributable to the refinery services segment acquired in the Davison

transaction that was completed in July 2007. Approximately $10.6 million

of the increase in segment margin in the supply and logistics segment is

attributable to the operations acquired from the Davison family. Of the

remaining $8.8 million increase in total segment margin, $6.4 million is

attributable to pipeline transportation, $0.2 million to industrial

gases and the remaining $2.2 million to the supply and logistics

operations that existed before the Davison acquisition.

		Pipeline			Refinery			Industrial			Supply &
		Transportation			Services			Gases (a)			Logistics			Total
Six Months Ended June 30, 2008
Segment margin excluding depreciation and amortization (a)		$	11,471		$	31,204		$	5,819		$	15,753		$	64,247
Capital expenditures		$	78,524		$	1,710		$	2,210		$	4,603		$	87,047
Maintenance capital expenditures		$	165		$	489		$	–		$	330		$	984
Net fixed and other long-term assets		$	286,593		$	449,637		$	46,387		$	143,980		$	926,597
Revenues:
External customers		$	15,673		$	Genesis Energy, L.P. Ross A. Benavides, 713-860-2528 Chief Financial Officer Major Newsire & Press Release Distribution with Basic Starting at only $19 and Complete OTCBB / Financial Distribution only $89 Get Unlimited Organic Website Traffic to your Website  TheNFG.com now offers Organic Lead Generation & Traffic Solutions