Crestwood Midstream Partners and Crestwood Equity Partners Provide 2014 Financial and Operating Guidance

  Crestwood Midstream Partners and Crestwood Equity Partners Provide 2014
  Financial and Operating Guidance

Conference call with management to be held today at 10:00 a.m. Central

Business Wire

HOUSTON -- December 5, 2013

Crestwood Midstream Partners LP (NYSE: CMLP) (“Crestwood Midstream”) and
Crestwood Equity Partners LP (NYSE: CEQP) (“Crestwood Equity,” and together
with Crestwood Midstream, “Crestwood”) today provided preliminary financial
and operating guidance for 2014. Crestwood’s 2014 strategic plan includes
estimates for the combined operations of the legacy Inergy Midstream, L.P. and
legacy Crestwood Midstream Partners LP businesses which merged on October 7,
2013.

“We are excited about Crestwood’s opportunities in 2014, and pleased to
provide guidance that we believe demonstrates the merits of the
transformational merger we completed this year,” stated Robert G. Phillips,
Chairman, President and Chief Executive Officer of Crestwood’s general
partner. “Since announcing our business combination in May, we have focused on
executing our strategy to leverage our operational critical mass in
liquids-rich and crude oil shale plays to accelerate growth. We remain focused
on our commitment to deliver distribution growth and value creation for
Crestwood unit holders in 2014.”

Crestwood operates a diversified portfolio of midstream assets located in
every premier shale play in the United States. With substantial segment
operations in gathering and processing, storage and transportation and natural
gas liquids (“NGLs”) and crude services, Crestwood’s activities span the
entire midstream value chain connecting fundamental energy supply with energy
demand centers across North America through a best-in-class midstream network.
Crestwood serves many of the leading producers and consumers of natural gas,
NGLs and crude oil with more than 80% of its operating margin from fixed-fee
and take-or-pay contracts.

Crestwood’s 2014 strategic plan, which continues to focus on liquids-rich and
crude oil shale plays, is supported by a substantial backlog of internally
generated capital projects in the Marcellus Shale, Bakken Shale and Powder
River Basin (“PRB”) Niobrara Shale. Additionally, Crestwood’s 2014 results are
expected to benefit significantly from expansion projects and acquisitions
completed in 2013 including acquisitions of the Arrow gathering system in the
Bakken Shale, and the Douglas crude rail facility and Jackalope gathering
system in the PRB Niobrara. With more than $1.2 billion of identified
multi-year growth projects in the current portfolio, Crestwood has clear
visibility to long-term growth.

Crestwood Midstream 2014 Outlook

The following projections for 2014 results are based on management’s current
estimates and assumptions and are subject to risks and uncertainties as
described in the “Forward-Looking Statements” section at the end of this
release.

  *Adjusted EBITDA in the range of $465 million to $510 million, a 34%
    increase from anticipated 2013 performance assuming the mid-point of 2014
    guidance;
  *Distributable cash flow in the range of $330 million to $360 million,
    resulting in targeted distribution growth of 6% to 10% and coverage of
    1.05 to 1.10 times cash distributions paid; and
  *Growth capital spending in the range of $400 million to $425 million is
    largely supported by fee-based contracts. Capital spending next year will
    focus primarily on expanding our gathering system in the Marcellus Shale,
    building out the Arrow system in the Bakken Shale, completing the current
    COLT Hub expansion in the Bakken Shale, and constructing a 120 million
    cubic feet per day (“MMcf/d”) processing facility on the Jackalope system
    in the PRB Niobrara Shale. The Marcellus expansion is supported by
    long-term, fixed-fee gathering and compression agreements and will provide
    additional system capacity for expected growth in gathering volumes from
    approximately 500 MMcf/d to approximately 750 MMcf/d by year-end 2014. The
    Arrow system is being expanded to a total design capacity of 125,000
    barrels per day (“Bbls/d”) of crude oil gathering, 100 MMcf/d of gas
    gathering and 40,000 Bbls/d of produced water gathering. The COLT Hub
    expansion, which is expected to be completed in the first quarter of 2014,
    will increase crude oil rail loading capacity to 160,000 Bbls/d and is
    supported by take-or-pay contracts. The Jackalope system is expected to
    commence processing volumes through its facility in the third quarter
    2014, and is supported by long-term contracts that provide for fixed rates
    of return on invested capital.

“As we discussed on our last earnings call, our fourth-quarter 2013 and
full-year 2014 capital spending has ramped up significantly to facilitate
increased production forecasts. Anticipating this ramp-up, we took steps
earlier this year – issuing almost $1.6 billion of equity and debt securities
– to substantially prefund our 2014 growth capital program,” commented
Phillips.

Crestwood Equity 2014 Outlook

The following projections for 2014 results are based on management’s current
estimates and assumptions and are subject to risks and uncertainties as
described in the “Forward-Looking Statements” section at the end of this
release.

  *Adjusted EBITDA, including Crestwood Midstream, is estimated to be in the
    range of $520 million to $570 million. Adjusted EBITDA from operational
    assets owned by Crestwood Equity is estimated to be in the range of $55
    million to $60 million in 2014; and
  *Adjusted distributable cash flow is estimated to be in the range of $85
    million to $95 million, resulting in targeted distribution growth of 5% to
    10% and coverage of 1.00 to 1.05 times cash distributions paid.

“In 2014, Crestwood Equity is poised for growth from incentive cash
distributions received from Crestwood Midstream attributable to forecasted
distribution growth, as well as growth in its NGL and crude oil logistics
business,” said Phillips. “Although 2014 performance will be challenged by
ongoing weakness in Gulf Coast natural gas storage fundamentals, we believe
the long-term fundamentals remain positive and expect to mitigate weak storage
fundamentals impacting our Tres Palacios facility through cost reduction and
asset optimization.”

Conference Call

Management will host a conference call for investors and analysts of Crestwood
today at 11:00 a.m. Eastern Time (10:00 a.m. Central Time) which will be
broadcast live over the Internet. Investors may participate in the call either
by phone or audio webcast. An accompanying slide presentation can be accessed
and downloaded approximately 30 minutes before the call starts by going to
www.crestwoodlp.com.

              Dial 480-629-9692 at least 10 minutes before the call and ask
By Phone:    for the Crestwood Guidance Call. A replay will be available for
              one week by dialing 303-590-3030 and using the access code
              4653568#.
              
              Connect to the webcast via the “Presentations and Webcasts” page
              in the Investor Relations section of Crestwood’s website at
By Webcast:   www.crestwoodlp.com. Please log in at least 10 minutes in
              advance to register and download any necessary software. A
              replay will be available shortly after the call for 90 days.
              

Basis of Presentation and Non-GAAP Financial Measures

Adjusted EBITDA and distributable cash flow are non-GAAP financial measures.
The accompanying schedules of this news release provide reconciliations of
these non-GAAP financial measures to their most directly comparable financial
measures calculated and presented in accordance with GAAP. Our non-GAAP
financial measures should not be considered as alternatives to GAAP measures
such as net income or operating income or any other GAAP measure of liquidity
or financial performance.

Forward-Looking Statements

The statements in this news release regarding future events, occurrences,
circumstances, activities, performance, outcomes and results are
forward-looking statements. Although these statements reflect the current
views, assumptions and expectations of Crestwood’s management, the matters
addressed herein are subject to numerous risks and uncertainties which could
cause actual activities, performance, outcomes and results to differ
materially from those indicated. Such forward-looking statements include, but
are not limited to, statements about the future financial and operating
results, objectives, expectations and intentions and other statements that are
not historical facts. Factors that could result in such differences or
otherwise materially affect Crestwood’s financial condition, results of
operations and cash flows include, without limitation, the possibility that
expected synergies will not be realized, or will not be realized within the
expected timeframe; fluctuations in crude oil, natural gas and NGL prices; the
extent and success of drilling efforts, as well as the extent and quality of
natural gas volumes produced within proximity of Crestwood assets; failure or
delays by customers in achieving expected production in their natural gas
projects; competitive conditions in the industry and their impact on our
ability to connect natural gas supplies to Crestwood gathering and processing
assets or systems; actions or inactions taken or non-performance by third
parties, including suppliers, contractors, operators, processors, transporters
and customers; the ability of Crestwood to consummate acquisitions,
successfully integrate the acquired businesses, realize any cost savings and
other synergies from any acquisition; changes in the availability and cost of
capital; operating hazards, natural disasters, weather-related delays,
casualty losses and other matters beyond Crestwood’s control; timely receipt
of necessary government approvals and permits, the ability of Crestwood to
control the costs of construction, including costs of materials, labor and
right-of-way and other factors that may impact Crestwood’s ability to complete
projects within budget and on schedule; the effects of existing and future
laws and governmental regulations, including environmental and climate change
requirements; the effects of existing and future litigation; and risks related
to the substantial indebtedness, of either company, as well as other factors
disclosed in Crestwood Equity’s and Crestwood Midstream’s filings with the
U.S. Securities and Exchange Commission. You should read filings made by
Crestwood with the U.S. Securities and Exchange Commission, including Annual
Reports on Form 10-K and the most recent Quarterly Reports and Current Reports
for a more extensive list of factors that could affect results. Readers are
cautioned not to place undue reliance on forward-looking statements, which
reflect management’s view only as of the date made. Crestwood does not assume
any obligation to update these forward-looking statements.

About Crestwood Midstream Partners LP

Houston, Texas, based Crestwood Midstream (NYSE: CMLP) is a master limited
partnership that owns and operates midstream businesses in multiple
unconventional shale resource plays across the United States. Crestwood
Midstream is engaged in the gathering, processing, treating and compression of
natural gas; transportation and storage of natural gas; transportation,
fractionation, storage, and terminalling of NGLs; and gathering, storage and
terminalling of crude oil. Prior to the merger of Crestwood Midstream Partners
LP into Inergy Midstream, L.P., which was completed on October 7, 2013, the
partnership was named Inergy Midstream, L.P. and was traded on the New York
Stock Exchange under the ticker symbol “NRGM.”

About Crestwood Equity Partners LP

Houston, Texas, based Crestwood Equity Partners LP (NYSE: CEQP) is a master
limited partnership that owns the general partner interest, the incentive
distribution rights and an approximate 4% limited partner interest of
Crestwood Midstream. In addition, Crestwood Equity’s operations include a
natural gas storage business in Texas and an NGL and crude oil supply and
logistics business that serves customers in the United States and Canada.
Prior to October 7, 2013, Crestwood Equity Partners LP was named Inergy, L.P.
and was traded on the New York Stock Exchange under the ticker symbol “NRGY.”

                                                
                                                
  CRESTWOOD MIDSTREAM PARTNERS LP
  Full Year 2014 Adjusted EBITDA and Distributable Cash Flow Guidance
  Reconciliation to Net Income
  ($ In millions)
                                                     
  Net income                                         $105 - $138
                                                     
  Interest expense, net                              $130 - $142
                                                     
  Depreciation, amortization and accretion           $230
                                                     
  Adjusted EBITDA                                    $465 - $510
                                                     
  Cash interest expense^1                            ($115) - ($127)
                                                     
  Maintenance capital expenditures^1                 ($20) - ($23)
                                                     
  Adjusted distributable cash flow                   $330 - $360
                                                     

^1  We define cash interest expense as interest expense, net, adjusted for
     the amortization of debt
     issue costs, premiums, discounts and other non-cash debt-related items.
     We define maintenance
     capital expenditures as capital expenditures related to maintaining our
     assets and operations.

                                                          
                                                            
  CRESTWOOD EQUITY PARTNERS LP
  Full Year 2014 Adjusted EBITDA and Distributable Cash Flow Guidance
  Reconciliation to Net Income
  ($ In millions)
                                                               
  Net income                                                   $135 - $173
                                                               
  Interest expense, net                                        $145 - $157
                                                               
  Depreciation, amortization and accretion                     $240
                                                               
  Adjusted EBITDA                                              $520 - $570
                                                               
  Cash interest expense^1                                      ($130) - ($142)
                                                               
  Maintenance capital expenditures^1                           ($25) - ($28)
                                                               
  Proportionate Adjusted DCF Attributable to Public CMLP       ($280) - ($305)
  Unitholders^2
                                                               
  Adjusted distributable cash flow                             $85 - $95
                                                               

^1  We define cash interest expense as interest expense, net, adjusted for
     the amortization of debt
     issue costs, premiums, discounts and other non-cash debt-related items.
     We define maintenance
     capital expenditures as capital expenditures related to maintaining our
     assets and operations.
     
^2   Represents proportionate amount of DCF attributable to public unitholders
     after taking into
     account CEQP's ownership interest in CMLP's incentive distribution rights
     and common units.

Contact:

Crestwood
Mark Stockard
Vice President, Investor Relations
832-519-2207
mstockard@crestwoodlp.com
 
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