NuStar GP Holdings, LLC Increases Fourth Quarter 2011 Distribution

A conference call with management is scheduled for 10:00 a.m. ET (9:00 a.m. CT) today, January 27, 2012, to discuss the financial results for the fourth quarter of 2011. Investors interested in listening to the presentation may call 800/622-7620, passcode 39023181. International callers may access the presentation by dialing 706/645-0327, passcode 39023181. The company intends to have a playback available following the presentation, which may be accessed by calling 800/642-1687, passcode 39023181. A live broadcast of the conference call will also be available on the company’s Web site at www.nustargpholdings.com.

NuStar GP Holdings, LLC is a publicly traded limited liability company that owns the two percent general partner interest, a 14.3 percent limited partner interest and the incentive distribution rights in NuStar Energy L.P., one of the largest asphalt refiners and marketers in the U.S. and the second largest independent liquids terminal operator in the nation with operations in the United States, Canada, Mexico, the Netherlands, including St. Eustatius in the Caribbean, the United Kingdom and Turkey. For more information, visit NuStar GP Holdings, LLC’s Web site at www.nustargpholdings.com.

This release serves as qualified notice to nominees under Treasury Regulation Sections 1.1446-4(b)(4) and (d). Please note that 100% of NuStar’s distributions to foreign investors are attributable to income that is effectively connected with a United States trade or business. Accordingly, all of NuStar’s distributions to foreign investors are subject to federal income tax withholding at the highest effective tax rate for individuals and corporations, as applicable. Nominees, and not NuStar, are treated as the withholding agents responsible for withholding on the distributions received by them on behalf of foreign investors.

Cautionary Statement Regarding Forward-Looking Statements

This press release includes forward-looking statements regarding future events. All forward-looking statements are based on the company's beliefs as well as assumptions made by and information currently available to the company. These statements reflect the company's current views with respect to future events and are subject to various risks, uncertainties and assumptions. These risks, uncertainties and assumptions are discussed in NuStar Energy L.P. and NuStar GP Holdings, LLC’s 2009 annual reports on Form 10-K and subsequent filings with the Securities and Exchange Commission.

NuStar GP Holdings, LLC
Consolidated Financial Information
(Unaudited, Thousands of Dollars, Except Unit and Per Unit Data)
	Three Months Ended								Year Ended
	December 31,								December 31,
		2011				2010				2011				2010
Statement of Income Data:
Equity in earnings of NuStar Energy L.P.	$	12,526			$	15,416			$	65,783			$	66,859
General and administrative expenses		(1,063	)			(1,063	)			(3,298	)			(3,184	)
Other income, net		7,877				1,440				7,320				9,475
Interest expense, net		(111	)			(204	)			(570	)			(1,106	)
Income before income tax (expense) benefit		19,229				15,589				69,235				72,044
Income tax (expense) benefit		(199	)			(282	)			401				419
Net income	$	19,030			$	15,307			$	69,636			$	72,463
Basic and diluted net income per unit	$	0.45			$	0.35			$	1.64			$	1.70
Equity in Earnings of NuStar Energy L.P.:
General partner interest	$	409			$	859			$	3,703			$	4,113
General partner incentive distribution		9,816				8,568				36,319				33,304
General partner's interest in earnings and incentive distributions of NuStar Energy L.P.		10,225				9,427				40,022				37,417
Limited partner interest in earnings of NuStar Energy L.P.		3,022				6,710				28,645				32,326
Amortization of step-up in basis related to NuStar Energy L.P.'s assets and liabilities		(721	)			(721	)			(2,884	)			(2,884	)
Equity in earnings of NuStar Energy L.P.	$	12,526			$	15,416			$	65,783			$	66,859
Distributable Cash Flow (Note 1):
Cash distributions from NuStar Energy L.P. associated with:
General partner interest	$	1,782			$	1,592			$	6,630			$	6,227
General partner incentive distribution		9,816				8,568				36,326				33,304
Limited partner interest - common units		11,292				11,038				44,842				43,924
Total distributions from NuStar Energy L.P.		22,890				21,198				87,798				83,455
Deduct expenses of NuStar GP Holdings, LLC:
General and administrative expenses		(1,063	)			(1,063	)			(3,298	)			(3,184	)
Income tax (expense) benefit		(199	)			(282	)			401				419
Interest expense, net		(111	)			(204	)			(570	)			(1,106	)
Distributable cash flow	$	21,517			$	19,649			$	84,331			$	79,584
Weighted average number of common units outstanding		42,550,358				42,526,518				42,546,096				42,517,525
Distributable cash flow per unit	$	0.51			$	0.46			$	1.98			$	1.87
Cash distributions to be paid to the unitholders of
NuStar GP Holdings, LLC:
Distribution per unit	$	0.51			$	0.48			$	1.98			$	1.87
Total distribution	$	21,708			$	20,422			$	84,252			$	79,517

NuStar GP Holdings, LLC
Consolidated Financial Information - Continued
(Unaudited, Thousands of Dollars)
Notes:
	1.	NuStar GP Holdings, LLC utilizes distributable cash flow as a financial measure, which is not defined in United States generally accepted accounting principles. Management uses this financial measure because it is a widely accepted financial indicator used by investors to compare general partner performance. In addition, management believes that this measure provides investors an enhanced perspective of the ability to make a minimum quarterly distribution. Distributable cash flow is not intended to represent cash flows for the period, nor is it presented as an alternative to net income. It should not be considered in isolation or as a substitute for a measure of performance prepared in accordance with United States generally accepted accounting principles.
		The following is a reconciliation of net income to distributable cash flow and net cash provided by operating activities:
				Three Months Ended								Year Ended
				December 31,								December 31,
					2011				2010				2011				2010
		Net Income		$	19,030			$	15,307			$	69,636			$	72,463
		Less equity in earnings of NuStar Energy L.P.			(12,526	)			(15,416	)			(65,783	)			(66,859	)
		Plus cash distributions from NuStar Energy L.P.			22,890				21,198				87,798				83,455
		Other income, net			(7,877	)			(1,440	)			(7,320	)			(9,475	)
		Distributable cash flow			21,517				19,649				84,331				79,584
		Less cash distributions from NuStar Energy L.P.			(22,890	)			(21,198	)			(87,798	)			(83,455	)
		Plus distributions of equity in earnings of NuStar Energy L.P.			12,526				15,416				65,783				66,859
		Net effect of changes in operating accounts			215				6				2,014				8,837
		Net cash provided by operating activities		$	11,368			$	13,873			$	64,330			$	71,825

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