MarkWest Energy Partners Reports Record Quarterly Distributable Cash Flow

MarkWest Energy Partners, L.P. (NYSE: MWE) (the Partnership) today reported cash available for distribution to common unitholders, or distributable cash flow (DCF), of $63.2 million for the three months ended December 31, 2009, and $192.4 million for the year ended December 31, 2009. DCF for the three months and year ended December 31, 2009, represents 148 percent and 120 percent coverage, respectively, of the cash distributions declared for those periods. A reconciliation of DCF to net income (loss), the most directly comparable GAAP financial measure, is provided within the financial tables of this press release.

The Partnership reported Adjusted EBITDA of $76.9 million for the three months ended December 31, 2009, and $279.2 million for the year ended December 31, 2009. MarkWest believes the presentation of Adjusted EBITDA is useful to investors because it is commonly used by master limited partnerships in the midstream natural gas industry to gauge the performance of ongoing business operations. A reconciliation of Adjusted EBITDA to net income (loss), the most directly comparable GAAP financial measure, is provided within the financial tables of this press release.

The Partnership reported income (loss) before provision for income tax for the three months and year ended December 31, 2009, of $(40.2) million and $(155.4) million, respectively. Income (loss) before provision for income tax includes non-cash costs associated with the mark-to-market of derivative instruments of $(76.3) million and $(223.6) million for the three months and year ended December 31, 2009, respectively. Excluding non-cash costs associated with the mark-to-market of derivative instruments, income before provision for income tax for the three months and year ended December 31, 2009, would have been $36.1 million and $68.2 million, respectively.

"Our record distributable cash flow in the fourth quarter was driven by the performance of our core assets and the growing contribution from our Marcellus expansion projects,” said Frank Semple, Chairman, President and Chief Executive Officer of MarkWest. "We ended 2009 in a strong financial position with $410 million of availability liquidity to fully fund our 2010 growth capital program, which we estimate will be approximately $300 million to $350 million. The 2010 capital program is comprised primarily of fee-based midstream projects to support the expansion of our producer customers’ drilling programs in the Marcellus, Woodford, Haynesville, and Granite Wash resource plays. In addition, we have increased our 2010 DCF guidance to a range of $180 million to $220 million as a result of the improved outlook for commodity prices and the continued performance of our producer customers’ drilling programs.”

FOURTH QUARTER 2009 HIGHLIGHTS

Business Development

• Liberty – in December 2009, MarkWest placed into service an incremental 120 million cubic feet per day (MMcf/d) of cryogenic natural gas processing capacity at its Houston processing complex in Southwest Pennsylvania. With the completion of the new cryogenic gas processing plant, MarkWest currently has 155 MMcf/d of cryogenic processing capacity dedicated to Marcellus Shale producers. In the third quarter of 2010, MarkWest is scheduled to place into service an additional 120 MMcf/d of cryogenic processing capacity at a newly commissioned processing complex in Majorsville, West Virginia. An additional 200 MMcf/d of cryogenic processing capacity and a 37,000 barrel per day fractionator are expected to come online in the first half of 2011 at the Houston, Pennsylvania complex.
• Gulf Coast – MarkWest announced the sale of its 50 percent limited liability company interest in Starfish Pipeline Company, L.L.C. to Enbridge Offshore (Gas Transmission) L.L.C., an Enbridge Inc. company, effective December 31, 2009. The proceeds from the Starfish divestiture will be used to further develop infrastructure to serve the Partnership’s producer customers in onshore resource plays.

Financial Results

Balance Sheet

• At December 31, 2009, the Partnership’s available liquidity was $413.2 million comprised of $74.4 million of cash and cash equivalents in wholly owned subsidiaries and $338.8 million available for borrowing under its $435.6 million revolving credit facility after consideration of $37.5 million of outstanding letters of credit.

Operating Results

• Segment operating income for the three months ended December 31, 2009, was $110.5 million, an increase of $80.7 million when compared to segment operating income of $29.8 million in the same period in 2008. This increase is primarily attributable to significantly higher commodity prices compared to the prior year quarter, the benefit of processing capacity expansions and upgrades in the Southwest and Northeast segments that were completed in 2008, and the contribution from the Liberty segment. These benefits were offset, in part, by lower volumes in the Southwest and Northeast segments.
• Segment operating income does not include realized gains (losses) on derivative instruments. Realized losses on derivative instruments were $(6.9) million in the fourth quarter of 2009 compared to realized gains on derivative instruments of $40.8 million in the fourth quarter of 2008.

Growth Capital Expenditures

• For the three months and twelve months ended December 31, 2009, growth capital expenditures, including equity investments, were $89.9 million and $479.5 million, respectively. Growth capital expenditures for the year ended December 31, 2009, were funded, in part, through net proceeds of approximately $310 million related to capital contributions from the Partnership’s joint venture partners and proceeds from the divestiture of the steam methane reformer plant at its Javelina facility.

2010 DCF AND GROWTH CAPITAL FORECAST

For 2010, the Partnership forecasts DCF in a range of $180 million to $220 million based on forecasted operational volumes, derivative instruments currently outstanding, three-year historical price correlation between crude oil and NGLs throughout 2010, and a reasonable range of price estimates for crude oil and natural gas. This range of estimated DCF provides for approximately 106 percent to 129 percent coverage of the Partnership’s full-year distribution based on current quarterly distributions and common units outstanding. A sensitivity analysis for forecasted 2010 DCF is provided within the tables of this press release.

Growth capital expenditures for 2010 are forecasted in a range of $300 million to $350 million and maintenance capital for 2010 is currently forecasted in a range of $10 million to $15 million.

CONFERENCE CALL

The Partnership will host a conference call and webcast on Tuesday, March 2, 2010, at 4:00 p.m. Eastern Time to review its fourth quarter and full year 2009 financial results. Interested parties can participate in the call by dialing (888) 469-1569, passcode "MarkWest”, approximately ten minutes prior to the scheduled start time. To access the webcast, please visit the Investor Relations section of the Partnership’s website at www.markwest.com. A replay of the conference call will be available on the MarkWest website or by dialing (866) 485-0040 (no passcode required).

MarkWest Energy Partners, L.P. is a master limited partnership engaged in the gathering, transportation, and processing of natural gas; the transportation, fractionation, marketing, and storage of natural gas liquids; and the gathering and transportation of crude oil. MarkWest has extensive natural gas gathering, processing, and transmission operations in the southwest, Gulf Coast, and northeast regions of the United States, including the Marcellus Shale, and is the largest natural gas processor in the Appalachian region.

This press release includes "forward-looking statements.” All statements other than statements of historical facts included or incorporated herein may constitute forward-looking statements. Actual results could vary significantly from those expressed or implied in such statements and are subject to a number of risks and uncertainties. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we can give no assurance that such expectations will prove to be correct. The forward-looking statements involve risks and uncertainties that affect our operations, financial performance, and other factors as discussed in our filings with the Securities and Exchange Commission. Among the factors that could cause results to differ materially are those risks discussed in the periodic reports we file with the SEC, including our Annual Report on Form 10-K for the year ended December 31, 2009. You are urged to carefully review and consider the cautionary statements and other disclosures made in those filings, specifically those under the heading "Risk Factors.” We do not undertake any duty to update any forward-looking statement except as required by law.

MarkWest Energy Partners, L.P.
Distributable Cash Flow Sensitivity Analysis
(unaudited, in millions)

MarkWest periodically estimates the effect on DCF resulting from its hedge program, changes in crude oil and natural gas prices, and the correlation of natural gas liquids (NGL) prices to crude oil. The table below reflects MarkWest’s estimate of the range of DCF for 2010 at the noted crude oil prices. The analysis assumes various combinations of crude oil prices and the ratio of crude oil to gas based on three NGL correlation scenarios, including:

a. The historical average NGL correlation to crude over the past three years.

b. One standard deviation above the historical average NGL correlation to crude over the past three years.

c. One standard deviation below the historical average NGL correlation to crude over the past three years.

The analysis further assumes derivative instruments outstanding as of February 22, 2010, and production volumes estimated through December 31, 2010.

The range of stated hypothetical changes in commodity prices considers current and historic market performance. During the past 10 years, the annual average NGL correlation has ranged between one standard deviation below the historical average and one standard deviation above the historical average.

The table is based on current information, expectations, and beliefs concerning future developments and their potential effects, and does not consider actions MarkWest management may take to mitigate exposure to changes. Nor does the table consider the effects that such hypothetical adverse changes may have on overall economic activity. Historical prices and correlations do not guarantee future results.

Although MarkWest believes the expectations reflected in this analysis are reasonable, MarkWest can give no assurance that such expectations will prove to be correct and readers are cautioned that projected performance, results, or distributions may not be achieved. Actual changes in market prices, and the correlation between crude oil and NGL prices, may differ from the assumptions utilized in the analysis. Actual results, performance, distributions, volumes, events, or transactions could vary significantly from those expressed, considered, or implied in this analysis. All results, performance, distributions, volumes, events, or transactions are subject to a number of uncertainties and risks. Those uncertainties and risks may not be factored into or accounted for in this analysis. Readers are urged to carefully review and consider the cautionary statements and disclosures made in MarkWest’s periodic reports filed with the SEC, specifically those under the heading "Risk Factors.”