<SUBMISSION>
<ACCESSION-NUMBER>0000950134-07-005054
<TYPE>8-K
<PUBLIC-DOCUMENT-COUNT>2
<PERIOD>20070306
<ITEMS>7.01
<ITEMS>9.01
<FILING-DATE>20070307
<DATE-OF-FILING-DATE-CHANGE>20070307
<FILER>
<COMPANY-DATA>
<CONFORMED-NAME>MARTIN MIDSTREAM PARTNERS LP
<CIK>0001176334
<ASSIGNED-SIC>5171
<IRS-NUMBER>050527861
<STATE-OF-INCORPORATION>DE
<FISCAL-YEAR-END>1231
</COMPANY-DATA>
<FILING-VALUES>
<FORM-TYPE>8-K
<ACT>34
<FILE-NUMBER>000-50056
<FILM-NUMBER>07677976
</FILING-VALUES>
<BUSINESS-ADDRESS>
<STREET1>4200 STONE ROAD
<CITY>KILGORE
<STATE>TX
<ZIP>75662
<PHONE>9039836200
</BUSINESS-ADDRESS>
</FILER>
<DOCUMENT>
<TYPE>8-K
<SEQUENCE>1
<FILENAME>d44312be8vk.htm
<DESCRIPTION>FORM 8-K
<TEXT>
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<DIV style="width: 100%; border-bottom: 2pt solid black; font-size: 1pt">&nbsp;</DIV>
<DIV style="width: 100%; border-bottom: 1pt solid black; font-size: 1pt">&nbsp;</DIV>




<DIV align="center" style="font-size: 14pt; margin-top: 12pt"><B>UNITED STATES SECURITIES AND EXCHANGE COMMISSION</B>
</DIV>

<DIV align="center" style="font-size: 12pt"><B>Washington, D.C. 20549</B>
</DIV>

<DIV align="center" style="font-size: 18pt; margin-top: 12pt"><B>FORM 8-K</B>
</DIV>


<DIV align="center" style="font-size: 12pt; margin-top: 12pt"><B>CURRENT REPORT<BR>
Pursuant to Section&nbsp;13 or 15(d) of the<BR>
Securities Exchange Act of 1934</B>
</DIV>

<DIV align="center" style="font-size: 10pt; margin-top: 12pt"><B>Date of report (date of earliest event reported): March&nbsp;6, 2007</B></DIV>

<DIV align="center" style="font-size: 24pt; margin-top: 12pt"><B>MARTIN MIDSTREAM PARTNERS L.P.</B>
</DIV>

<DIV align="center" style="font-size: 10pt">(Exact name of Registrant as specified in its charter)</DIV>


<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="31%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="31%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="31%">&nbsp;</TD>
</TR>
<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom">
    <TD align="center" valign="top"><B>DELAWARE</B>
</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top"><B>000-50056</B>
</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top"><B>05-0527861</B></TD>
</TR>
<TR valign="bottom">
    <TD align="center" valign="top">(State of incorporation
</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">(Commission file number)
</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">(I.R.S. employer identification number)</TD>
</TR>
<TR valign="bottom">
    <TD align="center" valign="top">or organization)</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD colspan="3" valign="top" align="center"><B>4200 STONE ROAD</B><BR></TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD colspan="3" valign="top" align="center"><B>KILGORE, TEXAS </B><BR></TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top"><B>75662</B></TD>
</TR>
<TR valign="bottom">
    <TD colspan="3" valign="top" align="center">(Address of principal executive offices)<BR></TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">(Zip code)</TD>
</TR>
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</TABLE>
</DIV>


<DIV align="Center" style="font-size: 10pt; margin-top: 6pt">Registrant&#146;s telephone number, including area code: (903)&nbsp;983-6200

</DIV>

<DIV align="Center" style="font-size: 10pt; margin-top: 6pt">(Former name or former address, if changed since last report)

</DIV>
<DIV align="left" style="font-size: 10pt; margin-top: 6pt">Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the
filing obligation of the registrant under any of the following provisions (<I>see </I>General Instruction
A.2. below):
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt"><FONT face="Wingdings">&#111;</FONT> &nbsp;&nbsp;&nbsp; Written communications pursuant to Rule&nbsp;425 under the Securities Act (17 CFR 230.425)
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt"><FONT face="Wingdings">&#111;</FONT> &nbsp;&nbsp;&nbsp; Soliciting material pursuant to Rule&nbsp;14a-12 under the Exchange Act (17 CFR 240.14a-12)
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt"><FONT face="Wingdings">&#111;</FONT> &nbsp;&nbsp;&nbsp; Pre-commencement communications pursuant to Rule&nbsp;14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt"><FONT face="Wingdings">&#111;</FONT> &nbsp;&nbsp;&nbsp; Pre-commencement communications pursuant to Rule&nbsp;13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
</DIV>


<DIV style="width: 100%; border-bottom: 1pt solid black; margin-top: 10pt; font-size: 1pt">&nbsp;</DIV>
<DIV style="width: 100%; border-bottom: 2pt solid black; font-size: 1pt">&nbsp;</DIV>






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<DIV align="left" style="margin-top: 12pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; background: transparent; color: #000000">
<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD></TD>
</TR>
<TR valign="top">
    <TD nowrap align="left"><B>Item&nbsp;7.01</B></TD>
    <TD>&nbsp;</TD>
    <TD><B>Regulation&nbsp;FD Disclosure.</B></TD>
</TR>
</TABLE>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;On March&nbsp;6, 2007, Martin Midstream Partners L.P. (the &#147;Partnership&#148;) held an investors&#146;
conference call. Furnished as Exhibit&nbsp;99.1 is a copy of the transcript of the Partnership&#146;s
presentation during that call and the questions and answers following the presentation.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In accordance with General Instruction B.2 of Form 8-K, the information set forth in this Item
7.01 and in the attached Exhibit is deemed to be &#147;furnished&#148; and shall not be deemed to be &#147;filed&#148;
for purposes of the Securities Exchange Act of 1934, as amended (the &#147;Exchange Act&#148;).
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Statements about the Partnership&#146;s outlook and all other statements contained in the Exhibit
other than historical facts are forward-looking statements within the meaning of the Private
Securities Litigation Reform Act of 1995. These forward-looking statements and all references to
financial estimates rely on a number of assumptions concerning future events and are subject to a
number of uncertainties and other factors, many of which are outside of the Partnership&#146;s control,
which could cause actual results to differ materially from such statements. While the Partnership
believes that the assumptions concerning future events are reasonable, it cautions that there are
inherent difficulties in anticipating or predicting certain important factors. A discussion of
these factors, including risks and uncertainties, is set forth in the Partnership&#146;s annual and
quarterly reports filed from time to time with the Securities and Exchange Commission. The
Partnership disclaims any intention or obligation to revise any forward-looking statements,
including financial estimates, whether as a result of new information, future events, or otherwise.
</DIV>

<DIV align="left" style="margin-top: 12pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; background: transparent; color: #000000">
<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD></TD>
</TR>
<TR valign="top">
    <TD nowrap align="left"><B>Item&nbsp;9.01.</B></TD>
    <TD>&nbsp;</TD>
    <TD><B>Financial Statements and Exhibits.</B></TD>
</TR>
</TABLE>
</DIV>

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="4%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>(c)</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD><U><B>Exhibits</B></U></TD>
</TR>

</TABLE>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In accordance with General Instruction B.2 of Form 8-K, the information set forth in the
attached Exhibit is deemed to be &#147;furnished&#148; and shall not be deemed to be &#147;filed&#148; for purposes of
the Exchange Act.
</DIV>
<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="15%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="78%">&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD nowrap align="left" style="border-bottom: 1px solid #000000">EXHIBIT NUMBER</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left" style="border-bottom: 1px solid #000000">DESCRIPTION</TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">99.1
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&#151;
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Transcript of the Investors&#146; Conference Call held on March&nbsp;6, 2007.</TD>
</TR>
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</TABLE>
</DIV>


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<DIV align="center" style="font-size: 10pt; margin-top: 18pt"><B>SIGNATURES</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly
caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
</DIV>

<TABLE width="100%" border="0" cellspacing="0" cellpadding="0" style="font-size: 10pt">
<TR>
    <TD width="48%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="35%">&nbsp;</TD>
    <TD width="15%">&nbsp;</TD>
</TR>
<TR>
    <TD valign="top" align="left">&nbsp;</TD>
    <TD colspan="3" align="left">MARTIN MIDSTREAM PARTNERS L.P.<BR>
&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD align="left">&nbsp;</TD>
    <TD valign="top">By:&nbsp;&nbsp;</TD>
    <TD colspan="2" align="left">Martin Midstream GP LLC
&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD align="left">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="2" align="left">Its General Partner&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD align="left">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="2" align="left">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR>
    <TD colspan="5">&nbsp;</TD>
</TR>
</TABLE>

<TABLE width="100%" border="0" cellspacing="0" cellpadding="0" style="font-size: 10pt">
<TR>
    <TD width="48%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="35%">&nbsp;</TD>
    <TD width="15%">&nbsp;</TD>
</TR>
<TR>
    <TD valign="top" align="left">&nbsp;</TD>
    <TD colspan="3" align="left">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD align="left">Date:  March 6, 2007 &nbsp;</TD>
    <TD valign="top">By:&nbsp;&nbsp;</TD>
    <TD colspan="2" style="border-bottom: 1px solid #000000" align="center">/s/&nbsp;Robert D. Bondurant</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD align="left">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="2" align="center">Robert D. Bondurant,&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD align="left">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="2" align="center">Executive Vice President and<br>
Chief Financial Officer&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR>
    <TD colspan="5">&nbsp;</TD>
</TR>
</TABLE>


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<DIV align="center" style="font-size: 10pt; margin-top: 18pt"><B>INDEX TO EXHIBITS</B>
</DIV>

<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="10%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="85%">&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD nowrap align="left">Exhibit</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center">&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD nowrap align="left" style="border-bottom: 1px solid #000000">Number</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left" style="border-bottom: 1px solid #000000">Description</TD>
</TR>

<!-- End Table Head -->
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<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">99.1
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Transcript of the Investors&#146; Conference Call held on March&nbsp;6, 2007.</TD>
</TR>
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<SEQUENCE>2
<FILENAME>d44312bexv99w1.htm
<DESCRIPTION>TRANSCRIPT OF THE INVESTORS' CONFERENCE CALL
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<DIV align="right" style="font-size: 10pt; margin-top: 12pt">Exhibit&nbsp;99.1
</DIV>



<DIV align="center" style="font-size: 10pt; margin-top: 18pt"><B>Martin Midstream Partners<BR>
Q4 2006 Earnings Conference Call<BR>
March&nbsp;6, 2007<BR>
9:30 a.m. ET</B>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt"><U><B>Operator:</B></U><BR>
Greetings, ladies and gentlemen, and welcome to the Martin Midstream Partners quarterly analyst
conference call. At this time all participants are in a listen-only mode. A brief question-and-answer
session will follow the formal presentation. If anyone should require operator assistance during
the conference please press * 0 on your telephone keypad. As a reminder this conference is being
recorded. I would now like to turn the conference over to your host Mr.&nbsp;Bob Bondurant, Chief
Financial Officer, of Martin Midstream Partners. Thank you, sir, you may begin.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt"><U><B>Robert Bondurant &#151; EVP and CFO:</B></U><BR>
Thank you, Diego, and thank you for everybody joining today. And just to let everyone know who
else is on the call we have Ruben Martin, Chief Executive Officer and Director of the company and
Scott Martin, also a Director and Executive Vice President of the company.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">Before we get started with my business comments I need to make this disclaimer. Certain statements
made during this call may be forward-looking statements relating to financial forecasts, future
performances, our ability to make distributions to unitholders, as well as any other statements
that are not historical fact. The words &#147;anticipate,&#148; &#147;estimate,&#148; &#147;expect&#148; and similar expressions
are intended to be among the statements that identify forward-looking statements made during the
call.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">We report our financial results in accordance with Generally Accepted Accounting Principles and use
certain non-GAAP financial measures within the meaning of the SEC Regulation&nbsp;G, such as
distributable cash flow and EBITDA. We use these measures because management believes it might
provide users of our financial information with meaningful comparisons between current results and
prior reported results and it might be a meaningful measure of our cash flow after we have
satisfied the capital and related requirements of our operations. Distributable cash flow is not a
measure of financial performance or liquidity under GAAP or a substitute for comparable measures
provided in accordance with GAAP and should not be considered in isolation as an indicator of our
performance. We also included in our press release issued yesterday a reconciliation of
distributable cash flow to the most direct comparable GAAP financial measure. Both the earnings
press release and our 2006 10-K are available at our website
<U>www.martinmidstream.com</U>.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">Now with that out of the way I&#146;d like to comment on our fourth quarter performance. For the fourth
quarter we had net income of $8.4&nbsp;million or $0.63 per limited partner unit, compared to $4.3
million or $0.32 per limited partner unit for the third quarter of 2006.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">We experienced an unusual gain on involuntary conversion of assets and a gain on sale of property,
plant and equipment that added earnings of $2.5&nbsp;million or $0.20 per limited partner unit. Our
distributable cash flow was $9.6&nbsp;million for the fourth quarter of &#145;06 compared to $7.3&nbsp;million for
the third quarter of &#145;06, an increase of 32%.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">Now I&#146;d like to discuss in greater detail our performance by segment comparing the fourth quarter
to the third quarter. For the fourth quarter our Terminal operating income was $5&nbsp;million. This
included the gain on the involuntary conversion of assets of $2.3&nbsp;million. This involuntary
conversion gain reflects our insurance receipts, greater than the book value of terminal assets
destroyed by Hurricanes Katrina and Rita. Without
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<DIV align="left" style="font-size: 10pt; margin-top: 6pt">this gain our fourth quarter terminal operating income was $2.8&nbsp;million compared to $2.4&nbsp;million in
the third quarter. This increase was primarily driven by the acquisition of our Marine terminal in
Corpus Christi, as well as asphalt terminal assets in Houston and Beaumont.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">In our Natural Gas services segment operating income in the fourth quarter was $2.3&nbsp;million,
compared to $714,000 in the third quarter. This increase was primarily driven by improved NGL
margins and increased NGL volumes in the fourth quarter compared to the third. In addition to
operating income we also have earnings from unconsolidated entities, which is primarily our 50%
owned Waskom gas processing plant. During the fourth quarter these earnings were $1.1&nbsp;million
compared to third quarter earnings of $2.7&nbsp;million. This decrease was a result of having the Waskom gas plant down during the majority of October in
order to facilitate our plant and fractionation expansion. Currently our fractionation expansion
has been completed and our expansion of the plant to 180&nbsp;million cubic feet per day will be
completed in March. Our final expansion to 250&nbsp;million cubic feet per day should be completed by
the end of June.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">In our Marine Transportation segment operating income in fourth quarter was $2.8&nbsp;million compared
to $1.2&nbsp;million in the third quarter. Our revenue increased $1.7&nbsp;million in the fourth quarter
when compared to the third quarter. The revenue increase was driven by increased utilization of
our fleet, as we operated at full capacity in the fourth quarter. Facilitating this utilization
increase was the fact we had our boats fully accrued in the fourth quarter. We also renewed
several inland contracts in the fourth quarter at higher rates primarily as a result of the tight
supply of Marine equipment on the Gulf Coast.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">Moving to our Sulfur segment. We had operating income of $350,000 in the fourth quarter compared
to a million dollars in the third quarter. We had an improved gross margin in the fourth quarter,
but this was more than offset by a $1.6&nbsp;million increase in Sulfur&#146;s operating expenses. In the
fourth quarter we experienced down time on our primary Sulfur off-shore tug boat, the Martin
Explorer, as result of a broken deeper box. We had to charter outside equipment from late October
through January&nbsp;30. This one-time outside Marine Transportation operating expense charge
negatively impacted fourth quarter earnings by $1.6&nbsp;million. Again this extra outside charter cost
impacted the Sulfur segment through January, but since that time operations have been normal.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">In our Fertilizer segment fourth quarter operating income was $541,000 compared to $206,000 in the
third quarter. This performance was better than what we had talked in the third quarter call as we
were able to obtain more sulfuric acid supply than we anticipated. As a result we were able to run
our West Texas ammonium sulfate plant at higher utilization rates than previously discussed.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">To give you an update on our Sulfuric acid plant, which will benefit our Fertilizer segment, we are
in the final stages of completion and expect the plant to begin operations by May 1. As of
December&nbsp;31, we had spent $18.2&nbsp;million on the project. Our current forecast for construction
costs are anticipated to be $25&nbsp;million, which is higher than the $21&nbsp;million we had previously
disclosed. This increase was primarily caused by scope changes to the project and continued
inflationary pressures. Although our investment in this project has increased, we still believe
the investment will yield cash flow in the 5 to 6 multiple range.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">Our depreciation expense continues to grow, which of course negatively impacts earnings, but not
distributable cash flow. Depreciation expense was $4.8&nbsp;million in the fourth quarter compared to
$4.6&nbsp;million in the third quarter. This non-cash expense will continue to increase as we are
constantly growing our property, plant and equipment through acquisitions and organic growth
projects.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">In the fourth quarter we added $70&nbsp;million of three-year interest rate hedges at approximately 4.8%
plus our LIBOR spread. This LIBOR spread will be 250 basis points in the first quarter, dropping
to 200 basis points in the second quarter. We also have an additional $75&nbsp;million of interest rate
hedges that were put in place
</DIV>


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<DIV align="left" style="font-size: 10pt; margin-top: 6pt">earlier in 2006. This hedge has a 5.25% fixed rate plus our LIBOR spread. As a result of these
hedges we have fixed $145&nbsp;million of our debt out of $194&nbsp;million currently outstanding.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">I&#146;d like to also make a comment about the Texas margin tax that begins in 2007. This tax is based
upon our earnings in the State of Texas and we believe that in 2007 it will impact our earnings and
cash flow by approximately $400,000 to $500,000.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">Finally in the fourth quarter we issued $15&nbsp;million of additional LP units to our general partner.
This was done in order to achieve our continued goal of maintaining our conservative leverage
balance sheet. As a result, we own approximately 39% limited partner interest and we continue our
commitment to the alignment of our general partner with our limited partners.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">Now I&#146;d like to open the phone lines for any questions you might have.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt"><U><B>Operator:</B></U><BR>
Thank you. Ladies and gentlemen, at this time we will be conducting a question-and-answer session.
If you would like to ask a question please press * 1 on your telephone keypad. A confirmation
tone will indicate your line is in the question queue. You may press * 2 if you would like to
remove your question from the queue. For participants using speaker equipment it may be necessary
to pick up your handset before pressing the * keys. One moment please while we poll for questions.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">Our first question comes from Ted Gardner with Raymond James. Please state your question.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&#060;Q&#062;: Good morning, guys. Got a
 couple quick questions for you actually. Kinder Morgan again
at the end of the year had purchased some sulfur prilling assets. I was just wondering if you guys
could comment on what kind of impact that would have on you from a competitive landscape?
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&#060;A&#062;: Yes, this is Ruben. You know of
 course our GP, Martin Resource Management Corp, has been
in the sulfur business since the mid-50s. We&#146;ve got a lot of experience and a lot of long-term
history of handling, of building and operating sulfur assets, transporting and logistics in the
sulfur business. It comes as no surprise to us. We had known that Kinder had been working on this
acquisition for a while. We are setting up at our general partner an operation to build and design
sulfur handling of equipment also. So we will be in there with the competition. The market is not
big enough to be an impact on &#151; definitely not Kinder Morgan&#146;s and not even ours. Our existing
contracts, we have already have contracts in place for expansion and so forth. So I would say the
effect is very, very minimal for both Kinder Morgan&#146;s finances and competition-wise to us.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&#060;Q&#062;: Okay. Do you think it will cap any kind of upside growth down the road or do you think
that the contracts you guys have will facilitate plenty of growth?
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&#060;A&#062;: No, the contracts we have will facilitate the growth and so forth and we will be
competing head-to-head, too. Our experience in the business speaks for itself.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&#060;Q&#062;: Okay. Secondly, we&#146;ve known that you guys had some terminal operations and we&#146;ve seen a
lot of MLPs out there, talk about the impacts of ethanol and opportunities there. Are you guys
looking at anything like that or is that outside the scope of what you&#146;re after and is there any
impact to the business as a whole, I guess from the ethanol trend?
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&#060;A&#062;: Well, I tell you, of course our Fertilizer
 segment, it is already benefiting from the
ethanol pricing, the pricing that is caused on corn pricing and so forth and so
the Fertilizer business is definitely benefiting. We have no plans at this time. Of course
ethanol is non-qualifying product and we have no
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<DIV align="left" style="font-size: 10pt; margin-top: 6pt">plans on entering the ethanol market. But I think we will reap the benefits of the acreage that is
being planted. There is a lot more acreage being planted than the pricing so I think our
Fertilizer segment will reap those benefits.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&#060;Q&#062;: Okay. And final question. Bob just
 mentioned the Texas margin tax for 2007. Is that a
net impact? Because most of the guys that we&#146;ve talked to said that yes, obviously there
is a tax on the margin, but the rollback on the real estate taxes tends to offset it. So is 400 to
500 a net number based you know after accounting for the real estate tax improvement?
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&#060;A&#062;: You bring up a very good point, Ted. That number I gave you will be kind of a new line
item on our income statement showing as income taxes. It will be disclosed. But it will be offset
by our property taxes. So net-net, you are correct in your assumption that the impact will be
really a push.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&#060;Q&#062;: Okay. That&#146;s all I had. Thanks, guys.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt"><U><B>Operator:</B></U><BR>
Just a reminder to ask a question at this please press * 1 on your touchtone phone. To remove
yourself from the queue press * 2. We will pause for a moment to poll for questions.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">Our next question comes from Shawn Wells with RBC Capital Markets. Please state your question.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&#060;Q&#062;: Good morning, guys.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&#060;A&#062;: Morning.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&#060;Q&#062;: Yeah, the question that I had for you was &#151; I don&#146;t know if you mentioned it during
your discussion this morning, but could you elaborate on the timing of the storage conversions?
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&#060;A&#062;: Ruben, do you want to discuss that?
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&#060;A&#062;: Yeah, the storage &#151; you&#146;re talking about the natural gas storage project that&#146;s being
developed at our general partner?
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&#060;Q&#062;: Yeah, that&#146;s correct.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&#060;A&#062;: Yeah. Right now we will &#151; we&#146;re actually converting some of the LPG caverns that we
have that are full of salt water now and that will probably be in service hopefully by late this
year, if not early next year. The major dome will not be completed until 2009 I believe in service
and then another in 2011; isn&#146;t that right, Wes? So this project is ongoing. We should be in
service. We are drilling disposal wells and doing a lot of the work. But remember that is at the
general partner at Martin Resource Corporation. And we have not contracted with the MLP to sell it
into the MLP at this time, but it is certainly an option.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&#060;Q&#062;: So did you say that you would have some storage capability by the end of the year?
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&#060;A&#062;: Yes.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&#060;Q&#062;: Okay.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&#060;A&#062;: Very small amount.
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<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&#060;A&#062;:
Yeah, just &#151; the total will be about 1.5 Bs really .8 coming on in late &#145;07 and another .8 or .9 coming on in early &#145;08 and then the next five Bs would come on line &#151; excuse me, the next
seven Bs would come online in 2009 and another seven Bs in 2011.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&#060;Q&#062;: Okay. I was wondering if I could follow-up with one more question.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&#060;A&#062;: Sure.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&#060;Q&#062;: Do you guys see anything going forward with potential drop-downs from the partnership
for this year?
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&#060;A&#062;: Bob, go ahead and answer that. I don&#146;t think we have anything.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&#060;A&#062;: At this time we don&#146;t for 2007, but you know we&#146;ve &#151; the underground storage is up for
a question of if and when it would drop-down and we&#146;re discussing that and debating it internally
about the best way to approach that.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&#060;Q&#062;: Okay. Thank you.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt"><U><B>Operator:</B></U><BR>
Our next question comes from Ted Gardner with Raymond James. Please state your question.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&#060;Q&#062;: Hey, guys just wanted to follow up on that.
 I know the project is at the private
company level, but I was wondering if you guys might be comfortable talking the economics
surrounding that project yet?
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&#060;A&#062;: Bob, go ahead.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&#060;A&#062;: Okay. Roughly overall we&#146;re talking about all three phases investment roughly $200
million and we believe that it will be roughly about a five multiple. Of course that will come in
different stages, but that is the grand total project from beginning to end.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&#060;Q&#062;: Okay. Yeah, I know that just smaller amounts come online. You can you kind of pro rate
the I guess the 15.5 Bcf type project. I mean are the costs and the cash flows pro rata for the
portions coming on the next couple year
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&#060;A&#062;: You got, the first phase is roughly an investment of $25&nbsp;million that has about a five
multiple. The second phase is a larger investment of about $114&nbsp;million. But we have to lay
pipelines to the various pipelines coming across from the Barnet Shell to East Texas that are
heading to the Prairieville hub. We have additional cost in there to lay roughly 17 miles of
pipeline to hook into these pipelines coming across North Louisiana. So the multiple on that is a
little bit less, it&#146;s about a seven time, but when you finish it out the last phase is roughly
about 55 to 60&nbsp;million and that&#146;s roughly where your big pop is. It&#146;s about a three multiple,
three to three and-a-half multiple that last base because you are not having to lay the extra
pipeline
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&#060;Q&#062;: Phase I, does that include through 2008 or is part of that Phase II as well? I know
that there is like .8 in August of &#145;07 and another .7 in August of &#145;08. Is that Phase I?
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&#060;A&#062;:That&#146;s Phase I.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&#060;Q&#062;: Okay. All right, guys, appreciate that.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&#060;A&#062;: Remember, I want to repeat that is at the private
 company just so everybody understands
that.
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<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&#060;Q&#062;: Right. I understand.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&#060;A&#062;: I know, I just want to be sure everybody else did.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&#060;Q&#062;: Thanks.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt"><U><B>Operator:</B></U><BR>
Gentlemen there are no further questions at this time. I will turn the conference back over to you
to conclude.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&#060;A&#062;: Well, I want to thank everyone for joining today and I just want to make a comment that
we will be presenting at the MLP Conference tomorrow in New York at the Essex House. Our
presentation is 10:40 Eastern. The people on the phone today will all be there presenting and look
forward to seeing you there. And if you can&#146;t make it there, it will be &#151; we&#146;ll have a link on
our website you can listen into the presentation and we will also have the slides of our
presentation posted on our website, as well. So thank you very much for joining, we appreciate it.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&#060;A&#062;: Thank you.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt"><U><B>Operator:</B></U><BR>
Thank you. This concludes today&#146;s conference. Thank you all for your participation, all parties
may disconnect now.
</DIV>




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