Crestwood Midstream Partners LP (CMLP) reported today its second quarter 2012 financial results and confirmed that the acquisition of gathering and processing assets from certain subsidiaries of Devon Energy Corporation is expected to be completed in the third quarter 2012 as previously announced.

Crestwood's adjusted earnings before interest, taxes, depreciation, amortization and accretion ("Adjusted EBITDA") for the second quarter and six months ended June 30, 2012, was $28.5 million and $56.9 million, compared to $29.8 million and $50.4 million, respectively, for the same periods in 2011. Second quarter 2012 performance was approximately flat with first quarter 2012 Adjusted EBITDA of $28.4 million. Crestwood's total 100% owned gathering system volumes for the recent quarter averaged 561 million cubic feet per day ("MMcf/d"), down 8% from 611 MMcf/d gathered in the first quarter 2012 and flat to 560 MMcf/d gathered in the second quarter 2011. Approximately 90% of the volume decline from the first quarter 2012 occurred in the Barnett segment (45 MMcf/d), with the remaining 10% of the decline in the Fayetteville segment (5 MMcf/d). The majority of the Barnett volume reduction occurred on Crestwood's Alliance and Lake Arlington dry gas gathering systems due to delayed completions of new wells, modest amounts of economic shut-ins and the temporary shut-in of nearby wells for producer fracking operations.

Crestwood expects to close the recently announced acquisition of Devon's West Johnson County pipeline system and processing plant located in the liquids-rich area of the Barnett Shale during the third quarter 2012. Crestwood expects the acquisition to be accretive to distributable cash flow per unit by approximately 5% in 2013. Devon has already connected 30 wells to the system in 2012, and post-close, Crestwood expects to connect an additional 15 to 18 wells through year-end. Current volumes through the Devon gathering system are approximately 95 MMcf/d, and are expected to increase as additional wells are connected throughout the remainder of 2012. Upon closing, Crestwood plans to consolidate the West Johnson system with its existing Cowtown gathering system and will process all of Devon's West Johnson County natural gas production at Crestwood's existing Cowtown and Corvette processing plants.

Segment Performance
Operating revenues in the Barnett segment totaled $31.5 million in the second quarter 2012, compared with $34.7 million in the second quarter 2011. Gathering volumes totaled 401 MMcf/d in 2012, compared with 450 MMcf/d in 2011. The decrease of 49 MMcf/d was primarily due to lower volumes in the Alliance and Lake Arlington areas noted above. Processing volumes totaled 129 MMcf/d in the second quarter 2012, compared to 144 MMcf/d in the prior year. Operating and maintenance expenses totaled $5.3 million, a decrease of $0.2 million from the second quarter 2011, due primarily to lower volume activity in the second quarter 2012.

Operating revenues in the Fayetteville segment, net of product purchases, totaled $6.2 million in the second quarter 2012, compared with $6.5 million in the second quarter 2011. Gathering volumes totaled 78 MMcf/d during the second quarter 2012, compared to 81 MMcf/d in the second quarter 2011. Operating and maintenance expenses totaled $2.2 million for the second quarter 2012, a decrease of $0.2 million from the prior year.

Operating revenues in the Granite Wash segment, net of product purchases, totaled $1.0 million in the second quarter 2012, compared to $2.1 million in the second quarter 2011. The decrease reflects lower margins realized on the sale of NGLs related to percent-of-proceeds contracts on processing volumes. Operating and maintenance expenses totaled $0.5 million in both the second quarter of 2012 and 2011.

Other operating revenues include the Sabine gathering system in the Haynesville/Bossier Shale, which was acquired in the fourth quarter 2011, and the Las Animas system in the emerging Avalon Shale trend acquired in the first quarter 2011. Gathering volumes on the Sabine and Las Animas systems totaled 57 MMcf/d and 9 MMcf/d, respectively, during the second quarter 2012. Gathering volumes on the Las Animas system totaled 12 MMcf/d in the second quarter 2011.