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LA Salt Cavern Project Concludes Open Season

Arcadia Gas Storage LLC (AGS) concluded its nonbinding open season for salt cavern gas storage capacity in Bienville Parish in North Louisiana. Project backer Martin Resource Management Corp. (MRMC) of Kilgore, TX, said Wednesday that interest exceeds project capacity.

AGS received nonbinding commitments from energy industry participants in excess of the 15.5 Bcf of working capacity to be constructed. AGS will now work with the potential customers to negotiate definitive terms and execute precedent agreements, while it continues to seek the remaining necessary regulatory approvals from the State of Louisiana. The open season responses have further confirmed the unique strategic location of AGS in the emerging North Louisiana gas transportation corridor, the company said.

The open season began in December (see Daily GPI, Dec. 18, 2006).

AGS is a high-deliverability salt cavern storage project to be developed through conversion of existing caverns and creation of new caverns. The facility will have interconnects with two intrastate pipelines and up to seven existing and four proposed interstate pipelines.

The intrastates are PanEnergy Intrastate (Pelico) and Regency Intrastate Gas Pipeline, both in Bienville Parish. The existing interstates are CenterPoint Energy Gas Transmission Inc., Bienville Parish; Gulf South, Bienville Parish; CenterPoint Energy MRT, Claiborne Parish; Southern Natural Gas Co., Bienville Parish; Tennessee Gas Pipeline, 43A-100; Texas Eastern, Castor Lateral; and Texas Gas, Sharon. The four proposed intrastates are CenterPoint's East Texas to Perryville line, Gulf South's East Texas to Mississippi line, Gulf South's Gulf Crossing and Kinder Morgan/Energy Transfer's Mid Continent Express.

Additional information on AGS can be found at www.arcadiagasstorage.com. MRMC provides transportation, terminaling, marketing and logistics management for hydrocarbons and byproducts, chemicals and other bulk liquids. MRMC owns 100% of the general partner interest and approximately 39% of the limited partner interest in Martin Midstream Partners LP.

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