Analyst Conference April 1, 2010 1 Forward Looking Statements - - PowerPoint PPT Presentation

Analyst Conference April 1, 2010

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Forward Looking Statements

This presentation contains forward looking statements within the meaning of the federal securities laws. Forward looking statements are not guarantees of performance. They involve risks, uncertainties and assumptions. The future results of Crosstex Energy, L.P. and its affiliates (collectively known as “Crosstex”) may differ materially from those expressed in the forward-looking statements contained throughout this presentation and in documents filed with the SEC. Many of the factors that will determine these results are beyond Crosstex’s ability to control or predict. These statements are necessarily based upon various assumptions involving judgments with respect to the future, including, among others, the ability to achieve synergies and revenue growth; national, international, regional and local economic, competitive and regulatory conditions and developments; technological developments; capital markets conditions; inflation rates; interest rates; the political and economic stability of oil producing nations; energy markets; weather conditions; business and regulatory or legal decisions; the pace of deregulation of retail natural gas and electricity; the timing and success of business development efforts; and other uncertainties. You are cautioned not to put undue reliance on any forward looking statement. Crosstex has no obligation to publicly update or revise any forward looking statement, whether as a result of new information, future events or otherwise.

Bill Davis

Executive Vice President and Chief Financial Officer

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Welcome and Introduction

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Agenda

I.

Welcome and Introduction

II.

Strategic Vision and Industry Trends

III.

North Texas

IV.

10 Minute Break

V.

LIG

VI.

Processing and NGLs

VII.

10 Minute Break

• VIII. Finance

IX.

Closing Remarks

X.

Q&A

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• Barry Davis- President and Chief Executive Officer
• Bill Davis- EVP, Chief Financial Officer
• Joe Davis- EVP, General Counsel
• Michael Garberding- SVP, Finance and Corporate Development
• Stan Golemon- SVP, Engineering and Operations
• Scott Williams- SVP, Commercial
• Jennifer Johnson- SVP, Human Resources
• Mike Burdett- VP, North Texas
• John Knight- VP, LIG
• Terry Brown- VP, Commercial Services
• Suzie Boyd- VP, Processing and NGL’s

Management Team

Strategic Vision & Industry Trends Barry Davis President and Chief Executive Officer

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Strategically Positioned for Performance and Growth

• Strategically positioned assets
• Strategically positioned organizationally
• Strategically positioned financially
• Strategically positioned for the macro environment
• Strategically positioned for long-term growth

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We Delivered on Our Promises

• Sold non-core assets
• De-levered significantly
• Completed high return capital projects
• Reduced operating costs
• Accessed the equity market
• Re-financed all debt
• Clear path to restoring distributions and dividends

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2009: We Navigated the Storm

$0 $2 $4 $6 $8 $10 $12

Mar-09 Mar-09 Apr-09 May-09 Jun-09 Jun-09 Jul-09 Aug-09 Aug-09 Sep-09 Oct-09 Oct-09 Nov-09 Dec-09 Dec-09 Jan-10 Feb-10 Mar-10

Sale of South Texas and Miss./Ala. assets for $220 MM Sale of Treating assets for $266 MM

Crosstex Energy LP (XTEX)

Acquisition of Intracoastal and sale of ETX assets Completion of long term re-financing ($725 MM bonds & $420 MM Credit Facility) $125 MM of Equity from GSO/Blackstone Acquisition of Eunice Facility for $42 MM

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• Refinancing has eliminated financial pressures
• Total Leverage reduced, continued reduction in 2010
• Relationship with Blackstone/GSO strengthens capabilities
• Disciplined financial guidelines
• Clear path to restoring distributions and dividends

We Are Well Positioned Today

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Strategically Positioned Assets

North Texas

~780 miles of pipeline 3 processing plants

LIG

~2,100 miles of pipeline 2 processing plants

Processing & NGLs

~440 miles of NGL pipeline 4 processing plants 2 fractionation facilities

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• Midstream energy services company focused
• n full value chain
• Assets strategically located in key producing

areas and market regions

• Focus on Barnett and Haynesville shale plays

Focused Midstream Company Diversity of Services

• Over 3,300 miles of natural gas gathering

and transmission pipeline

• 9 natural gas processing plants
• 2 fractionators
• Over 400 miles of NGL pipeline
• 2.4 MM barrels of NGL storage capacity

Wellhead Gathering, Dehydration & Compression Processing , Conditioning & Treating Transmission Lines NGL Transportation & Fractionation Natural Gas Consumers NGL Markets

We Span the Value Chain

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Strategically Positioned Organizationally

• Successful execution has created momentum
• Lean, focused organization
• Board of directors provides strong support
• Front line management focused on continued execution
• Significant acquisition and organic growth experience

Strategically Positioned Financially

• Strong balance sheet
• Disciplined financial guidelines
• Continue to de-leverage, de-risk Business
• Use highly predictable cash flows to set distributions
• Allocate capital to high-return projects

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Crosstex Energy GP, L.P. Public/Other Shareholders 100% Public Unitholders 51%

• 2% GP Interest
• 100% IDRs

Crosstex Energy, Inc. (NASDAQ: XTXI) Directors / Executive Officers 87% 13% 2% 25%

Crosstex Energy Services, L.P. All Assets and Operations

Crosstex Energy, L.P. (NASDAQ: XTEX) 22%

GSO Crosstex Holdings

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Crosstex Corporate Structure

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• Wide gas to crude relationship is expected to continue
• EIA predicts demand will grow from 53 Bcf/d in 2010 to 70 Bcf/d in 2025
• Unconventional gas basins will fill this gap
• Shift in supply will drive need for new infrastructure
• XTEX is well positioned to take advantage of this trend

Strategically Positioned for the Macro Environment

Source: Modified from Morgan Stanley Jan. 13, 2010 E&P Research Report * Goldman Sachs as of 03/12/10

Shales will Provide Significant Opportunities

17 $3.50 $3.50 $3.50 $3.70 $3.90 $4.00 $4.20 $5.00 $5.40 $7.00 $2.0 $3.0 $4.0 $5.0 $6.0 $7.0 $8.0 Deep Bossier (E. Texas) Granite Wash (Horizontal) Haynesville Fayetteville (2.6 Bcf) Marcellus Woodford (Anadarko) Barnett (Core/Tier 1) Eagleford Powder River (CBM) Piceance (Highlands) * Current 2010 NYMEX Strip NYMEX Prices Needed to Achieve 10% IRR

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10 20 30 40 50 60 70 80 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2020 2025

Conventional BCf/d Unconventional BCf/d Source: EIA

Unconventional Gas Resources Drive Supply

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Source: INGAA

Future Shale Infrastructure Investment Requirements

Projected Infrastructure Needed Over Next 20 Years

Base High Low Case Case Case Transmission Pipe (miles) 33,300 54,400 25,800 Gathering Pipeline (miles) 15,600 23,400 13,500 Processing Plant (capacity in Bcf/d) 23.6 35.7 20

Total Infrastructure Expenditures (in billions) $125.8 $172.1 $102.2

• Oct. 2009 study by the Interstate Natural Gas Association reviewed projected infrastructure

requirements for (2009-2030) based on three cases:

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• Capitalize on strategic positions around core assets
• Focus on high-return projects
• Continue to reduce risk in the business
• Organization is well positioned
• Disciplined financial guidelines will guide growth
• Macro environment will provide opportunities

Strategically Positioned for Long-Term Growth

North Texas Mike Burdett VP North Texas

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Well Positioned Assets (current capacity) :

• NTPL – 375 MMcfd
• NTX Gathering Assets ~ 1 Bcfd
• Azle plant – 50 MMcfd
• Goforth plant – 30 MMcfd
• Silvercreek plant – 200 MMcfd

North Texas Gathering Systems North Texas Pipeline Processing Plant

NTX: Strategically Positioned in the Barnett Shale

Plant Descriptions North Texas Pipeline Gathering System Description Processing Contract Mix (as of YE 2009)

• Processing Capacity- 3 plants with 280 MMcf/d Capacity
• Current plant inlet ~ 210,000 MMbtu/d
• NGL raw make is transported by Crosstex NGL to:
• Chevron West Texas Pipeline
• Louis Dreyfus
• Oneok Arbuckle
• Utilizes in-house NGL Marketing company
• ~ 144 miles of 24” pipeline with 375 MMcfd capacity
• Current transmission volume ~ 332,000 MMBtu/d
• Major interconnects:
• NGPL
• Kinder Morgan
• HPL
• Gulf Crossing
• Atmos
• > 700 miles of pipeline with ~ 1 Bcfd gathering capacity
• Current gathered volume ~ 770,000 MMbtu/d
• Systems / County location:
• Goforth – Parker & Tarrant counties
• Jarvis – Tarrant & Denton counties
• DC/Ponder/Tour 18 – Denton county
• North Johnson County – Johnson county
• South Johnson County – Johnson & Hill counties

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NTX: Asset Overview

NTX: Volumes 2007 - 2010

Note: 2010 represents mid-point of guidance

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• 200,000

400,000 600,000 800,000 1,000,000 1,200,000 1,400,000 1,600,000 2007 2008 2009 2010 North Texas - Gathering North Texas - Transmission North Texas- Processing

NTX: Operating Income 2007 - 2010

Note: 2010 represents mid-point of guidance

25 $- $20,000,000 $40,000,000 $60,000,000 $80,000,000 $100,000,000 $120,000,000 $140,000,000 2007 2008 2009 2010 NTX G&T Op Income NTX Processing Op Income

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• E&P companies have the liquidity and economics needed to develop the Barnett
• Chesapeake’s JV with Total
• Devon pivots away from offshore/international to onshore shale plays
• Exxon’s acquisition of XTO
• Quicksilver’s JV with Eni
• Technological breakthroughs continue to have an impact on the play
• EUR’s and Practical IP rates are at all time highs
• Producers drilling longer laterals with more effective fracs
• We have over 400,000 dedicated acres with 85% located in Core and Tier I

Barnett Shale a Leading Unconventional Resource

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Diverse Customer Base

NTX: Drilling Rigs Running

Total by Operator December 2008 Total by Operator March 2010

Devon 42 Chesapeake 26 Chesapeake 38 Devon 20 XTO 20 XTO 7 EOG 18 Quicksilver 4 Quicksilver 10 EOG 3 Carrizo 6 Range 4 Encana 6 Carrizo 3 Burlington (CP) 5 Aruba Range 5 Burlington (CP) Williams 5 Williams 4 Aruba 3 Talon 1 RimRock 3 Swan 1 Chief 2 EnCana 3 David H. Arrington 2 Titan 2 Denbury 2 Braden 1 Others 18 Others 5

185 Total 87

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• Crosstex initiated an expansion into heart of

the Barnett Shale

• Project was supported by two major Barnett

Shale producers

• ~15 miles of pipe and additional

compression

• Project came in on time and under budget
• Well positioned to leverage existing

infrastructure for additional growth in the core

Case Study: West Tarrant County Expansion

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Independent Analysis Reinforces Barnett Shale is Tremendous Resource

• Crosstex hired Netherland, Sewell & Associates Inc. (“NSAI”) to study the

Barnett Shale’s future

• Engagement – NSAI provided volume forecast for the following three cases

using market based commodity price forecast

• Overall Barnett
• Crosstex currently dedicated acreage
• 3-mile acreage (drillable acreage within 3-miles of Crosstex gathering system)
• NSAI’s Methodology
• Reviewed over 12,000 active wells
• Profiled rig count to NYMEX price history
• Correlated well starts to rig-count
• Formulated type curves based on productivity
• Analyzed Crosstex acreage

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NSAI’s Barnett Shale Volume Projections

• 2,000

4,000 6,000 8,000 10,000 12,000 J-90 J-91 J-93 J-94 J-96 J-97 J-99 J-00 J-02 J-03 J-05 J-06 J-08 J-09 J-11 J-12 J-14 J-15 J-17 J-18 MMCFD

Barnett Volume Projection

(Goldman 7/09 Fcst) High Base Low

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NSAI: Crosstex Strategically Positioned for Growth

• Range and timing of ultimate peak production from Barnett driven by

pace of drilling and density assumptions

• Low Peak ~ 6 Bcfd in 2012
• Base Peak ~ 8 Bcfd in 2015
• High Peak ~ 10 Bcfd in 2018
• Existing infrastructure in Barnett should be able to handle peak

production in base case

• >50% of future production will occur within three miles of our existing

infrastructure

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NTX: Competitive Landscape

Gathering Core/Tier I Gathering Tier II Processing Transmission

Crosstex Energy Transfer Devon Gas Services Chesapeake Midstream DCP JW Gathering Enterprise Quicksilver Gas Services Barnett Gathering (XTO)

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• Majors have moved into the Barnett Shale
• To date over 12,000 successful wells have been drilled
• ~85% of Crosstex dedicated acres are in Core/Tier 1
• NSAI study projects that over 50% of future production will occur

within 3 miles of our existing infrastructure

• Major infrastructure already in place to provide service for base case

volumes

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We Are Strategically Located in Barnett for Long-Term Growth

LIG John Knight VP LIG

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LIG: Strategically Located Assets

LIG System NGL System Processing Plant

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Well Positioned Assets (current capacity) :

• LIG – 1Bcfd+
• Gibson Plant – 145 MMcfd
• Plaquemine Plant – 225 MMcfd

LIG Summary Haynesville Exposure Plaquemine Contract Mix (as of YE 2009) Gibson Contract Mix (as of YE 2009)

• 2,100 miles of pipeline
• 910,000 MMBtu/d as of Dec. 2009
• Processing Capacity- 2 plants with 370 MMcf/d Capacity
• Current plant inlet ~ 281,000 MMBtu/d as of Dec. 2009
• Primarily sell NGL’s to Dow and CF Industries
• ~ 450 miles of pipeline with 440 MMcfd FT capacity
• All N.LIG gas under FT agreements
• Major interconnects:
• Columbia
• ANR
• Texas Gas
• Trunkline

Fee, 12% POL, 42% Proc Margin, 46% POL, 60%

Proc Margin, 40%

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LIG Asset Overview

LIG: Strategically Positioned

• Positioned in heart of Haynesville
• Connected to 7 major interstate pipelines
• Access to river markets in the south
• System optionality creates high-return bolt-on projects

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LIG: Volumes 2007-2010

Note: 2010 represents mid-point of guidance

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• 200,000

400,000 600,000 800,000 1,000,000 1,200,000 1,400,000 2007 2008 2009 2010 LIG- Mktg. & Transport LIG- Processing

MMBtu/d

LIG: Operating Income 2007 - 2010

Note: 2010 represents mid-point of guidance

40 $- $10,000,000 $20,000,000 $30,000,000 $40,000,000 $50,000,000 $60,000,000 $70,000,000 $80,000,000 $90,000,000 2007 2008 2009 2010 LIG Mktg. & Transport Op Income LIG Processing Op Income

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Diverse Customer Base

• Red River Phase IV, part 1

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Increased capacity by 30 MMcfd

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Project 100% underwritten with FT volumes from major Haynesville producer

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$7 MM capital requirement

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Only Compression (no pipe needed)

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Additional bolt-on projects currently under review to take advantage of N. LIG’s optionality

Case Study: Red River Expansion Phase IV

Original Red River Project Black Lake Interconnect Phase III North LIG Expansion Phase I/II Phase IV

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• N. LIG: Drilling Rigs Running

Total by Operator March 2010 Total by Operator March 2010

Exco 13 Encore 1 Chesapeake 31 SWEPI 7 Goodrich 1 Samson 2 EOG 5 BEUSA 1 Camterra 1 El Paso 6 Petrohawk 10 Comstock 7 Encana 21 Forest 2 Questar 1 Other 8

Numbers include De Soto, Caddo, Red River and Sabine parishes only

Total 117

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Independent Analysis Confirms Crosstex’s Franchise Position in Haynesville

• Crosstex hired W.D. Von Gonten & Co. to study the Haynesville
• Most prolific wells are located in Red River, Bossier, Desoto & Caddo

parish

• Near term N. LIG expansions provide immediate impact
• Future drilling provides for long-term pipe capacity utilization with

limited capital outlay

• Crosstex’s pipelines in core of LA Haynesville acreage
• Conclusion – production will grow by 1 Bcf/d/year for next 10 years

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Haynesville Provides Abundant Near- Term Opportunities

Haynesville Projects

Capacity MMcf/d Contract In Service Total Contracted Term

• N. LIG Contracted Projects

Red River Project Q3 2007 240 240 7 yr North LIG Expansion Phase I Q4 2008 35 35 10 yr North LIG Expansion Phase II Q2 2009 100 100 10 yr Black Lake Interconnect Phase III Q4 2009 35 35 3 yr Red River Amine Unit (120 MMcf/d Capacity) Q4 2009 3yr LIG Phase IV Expansion- Part 1 Q3 2010 30 30 5 yr Total Contracted 440 440 Current Expansion Project – Partial System Loop; Phase IV Expansion Part II Q4 2010 est 115 Working All Projects 555 440

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NLA: Competitive Landscape

Gathering Treating Processing Transmission

Crosstex Energy Transfer Hawk Field Services Chesapeake Midstream Momentum JW Gathering Enterprise Centerpoint Regency

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Haynesville Competition

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LIG System Energy Transfer Acadian (EPD) Regency

• Franchise position
• Exceptional connectivity to interstate markets
• Access to river market on S. LIG
• Substantially all N. LIG volumes are firm transport
• Highly attractive inventory of growth projects

LIG: Strategically Located for Long-Term Growth

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Processing and NGL’s Suzie Boyd VP PNGL’s

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PNGL: Strategically Located Assets

LIG System NGL System Processing Plant Intracoastal

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• Focused on gas processing, NGL fractionation,

transportation, storage, and marketing

• Processing plants straddle ANR, Tennessee Gas

Pipeline and Texas Gas Transmission pipelines

• NGL raw-mix gathering pipeline in South Louisiana
• NGL Marketing group

Focused Team Strong Asset Base

• 4 natural gas processing plants
• 2.5 BCF processing capacity
• 2 fractionation plants
• 66,000 bbl/day capacity
• Truck, rail and barge terminals
• Over 400 miles of NGL pipeline
• 2.5 MM barrels of NGL storage capacity

Wellhead Gas Processing & NGL Fractionation NGL Storage; truck, rail and barge terminals Petrochemical Plants NGL Markets Process gas from Interstate Pipelines (ANR, Tennessee, Texas Gas) NGL Pipelines

PNGL: Asset Overview

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PNGL: 2009 Gross Margin by Type

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46% 10% 44% Fee Proc Margin POL

PNGL: Strategically Positioned

• Favorable processing environment
• Improved GOM drilling and recent lease sales encouraging
• Potential consolidation opportunities
• Fractionation capacity constraints
• Recent Acquisitions:

₋ Eunice ⁻ Intracoastal pipeline

• Increased rich gas production creates opportunities

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PNGL: Volumes 2007 - 2010

Note: 2010 represents mid-point of guidance

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• 200,000

400,000 600,000 800,000 1,000,000 1,200,000 1,400,000 2007 2008 2009 2010

1) Hurricanes Ike and Gustav impacted PNGL volumes in 2nd half 2008 and throughout 2009 2) Early 2009 ANR line segregation caused a reduction in lean volumes being processed at Eunice by up to 300,000 MMcf/d

PNGL: Operating Income 2007 - 2010

Note: 2010 represents mid-point of guidance

57 $- $5,000,000 $10,000,000 $15,000,000 $20,000,000 $25,000,000 $30,000,000 $35,000,000 $40,000,000 $45,000,000 2007 2008 2009 2010

• Purchased Philip Morris’s equity in

Eunice lease

• $23.5 MM in cash and assumed $18.1

MM in debt

• Secures future of asset ownership
• Elimination of lease increases EBITDA

by $12 MM annually

• Frac re-start
• Additional fuel efficiency projects

Case Study: Eunice Lease Buyout Benefits Bottom Line

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Diverse Customer Base

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Commodity Environment

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$(0.30) $(0.20) $(0.10) $- $0.10 $0.20 $0.30 $0.40 $0.50 $0.60 $0.70

99 00 01 02 03 04 05 06 07 08 09 10

Ethane Processing Margins

Napoleonville NGL v. Henry Hub NYMEX Gas

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Encouraging Trends in Gulf of Mexico

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NYMEX Settlement Price $0 $2 $4 $6 $8 $10 $12 $14 10 20 30 40 50 60 70 80

Rig Count

Gulf of Mexico Rig Count & NYMEX Settlement Prices

GOM Rigs NYMEX

New Business Model

• Historically NGL assets viewed as supporting assets
• Now focused on NGL business across the US
• Near term opportunities:
• Eunice specialty trucks
• Truck & rail supply
• Eunice frac re-start
• Recent acquisitions support growth strategy

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PNGL: Growth Opportunities

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PNGL: Growth Opportunities

• New supply opportunities
• LNG processing
• Plant efficiency projects

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• Well positioned for current commodity environment
• Consolidation opportunities
• Positioned to capitalize on growth in rich gas regions
• Asset base provides competitive alternatives

PNGL: Strategically Positioned for Long-Term Growth

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Financial Overview Bill Davis- EVP & Chief Financial Officer Michael Garberding- SVP Finance & Corp Development

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Successful Execution of 2009 Plan

• Sold non-core assets
• De-levered significantly
• Transacted on high return capital projects
• Reduced operating costs
• Accessed the equity market
• Re-financed all debt
• Clear path to restoring distributions and dividends

Historical Performance

Financial Metrics Twelve Months Ended Twelve Months Ended ($MM) December 31, 2008 December 31, 2009

Adjusted Cash Flow (2) $245 $204 Distributable Cash Flow $141 (3) $68 Debt $1,264 $874 Debt/ Adjusted Cash Flow 5.2 x 4.9x (4)

Twelve Months Ended Twelve Months Ended Volume and Prices December 31, 2008 December 31, 2009

Gathering & Trans. Volume (MMBtu/d) (1) 2,002,000 2,004,000 Processing Volume (MMBtu/d) (1) 1,608,000 1,235,000 Realized Wt. Avg. NGL Price ($/gallon) $1.36 $0.81 Avg Daily Henry Hub Price ($/MMBtu) $8.89 $3.94

(1) All volumes exclude contribution of STX/Miss. during those periods (2) Adjusted Cash Flow and Distributable Cash Flow are non-GAAP financial measures; See appendix for reconciliation to non-GAAP measures (3) 2008 reported DCF of $180 mm adjusted due to proceeds in excess of invested capital from the sale of the partnerships interest in Seminole (4) Pro Forma for asset sales and preferred equity in Jan. 2010

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Gross Margin By Contract Type Ex Discontinued Ops 2008-2010

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58% 10% 17% 15%

2008

G& T Fee POL Proc Margin 66% 12% 13% 9%

2009

G& T Fee POL Proc Margin 71% 16% 11% 2%

2010

G& T Fee POL Proc Margin

• Non-commodity based margins have increased from ~68% in 2008 to ~87% in 2010

Summary Operating Income

Operating Income ($ MM) 2008 2009 2010 (3) North Texas $103 $113 $111 LIG $82 $80 $74 PNGL (1) $12 $23 $35 Shared Operating Exp. & Other ($14) ($14) ($13) Total Continuing Operations $183 $202 $207(4) Discontinued Operations(2) $91 $50 $0 Total $274 $252 $207

(1) Includes impact of Eunice lease buy-out in 2009 and Intracoastal acquisition-- $2 MM impact in 2009 and $13 MM impact in 2010 (2) Includes contributions from sold assets (STX, Miss, Ala, Treating, Seminole interest, Arkoma, and ETX) (3) 2010 represents mid-point of guidance (4) 2010 continuing operations includes ~$8MM in LC Fee’s that are re-classed as interest expense

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71 71

2009 to 2010 G&A Walk

2009 G&A Bridge

($MM) (1) One time items includes estimated Harwood lease termination, severance expenses, Sem Group bad debt write -off, and one-time bonuses (2) Estimated G&A associated with South Texas, Mississippi/Alabama, and Treating assets sold

$54 $40 $9

$6 $40 $20 $25 $30 $35 $40 $45 $50 $55

2009 Actual 2009 One Time Items (1) Asset Sales & Other Reductions (2) 2009 Pro Forma G&A 2010 Mid-point of guidance

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Growth & Maintenance Capital

Historical and Projected Growth Capital Expenditures

($ in millions)

Historical and Projected Maintenance Capital Expenditures

($ in millions)

• Crosstex has significantly scaled back growth capital spending

⁻

Focused on execution of projects within the operating footprint

⁻

Scalable nature of current asset base generates high-return projects

• Low maintenance requirements on existing assets

72 $404 $259 $95 $25 $- $100 $200 $300 $400 $500 2007 2008 2009 2010 $11 $18 $11 $15 $- $4 $8 $12 $16 $20 2007 2008 2009 2010

* *

* Represents low end of 2010 guidance

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Total Year 2010 Low High

Net income

$ (41) $ (10)

Depreciation and amortization

113 113

Stock-based compensation

6 6

LOC Fees & Interest

80 79

Taxes and other

2 2

Adjusted cash flow

$ 160 $ 190

Taxes and other

$ (3) $ (3)

LOC Fees & Interest

$ (80) $ (79)

Maintenance capital expenditures

$ (15) $ (12)

Distributable cash flow

$ 62 $ 96

Growth Capital

$ 25 $ 30

Key Assumptions for Forecast Weighted Average Liquids Price ($/gallon)

$ 0.80 $ 1.09

Crude ($/Bbl)

$ 69.37 $ 94.52

Natural Gas ($/MMBtu)

$ 6.00 $ 5.00

Natural Gas Liquids to Gas Ratio

149.9% 245.0%

XTEX Distribution per Unit

$ 0.30

XTXI Dividends per Share

$ 0.10 73

Guidance for 2010

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• Maintain a conservative capital structure and leverage ratios
• Maintain adequate liquidity
• Fund organic growth and strategic opportunities with internal

cash flows and a balanced mix of debt and equity

• Maintain a balanced contract mix and an active commodity

price hedging program

Conservative Financial Guidelines

Hedging Process and Policy

• Committee meets on regular basis to assess exposure and

hedge consistent with our policies

⁻

Hedge no more than 80% of hedgeable exposure

⁻

Same product as the underlying commodity being hedged

⁻

Can only be executed to close an open physical position

• Certain POL contracts structured by setting a floor fee to

further eliminate risk

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Commodity Sensitivity

• Annual Impacts
• ± $.10 NGL Pricing (POL)- $3.0 MM (Net of Hedges)
• ± 5% NGL- Gas Ratios(Proc Margin)- $1.7 MM (Net of Hedges)

Note: all volumes are in millions of gallons Hedged Volume as a % of Hedgeable Volume 2010 Q1 Q2 Q3 Q4

POL Total VAR Volumes 10.27 10.08 9.40 10.13 Total Hedgeable Volumes 3.89 3.76 3.69 3.99 Total Hedged Volumes 3.64 3.08 2.02 1.79 Hedged Percentage 94% 82% 55% 45% Proc Margin Total VAR Volumes 12.89 12.17 12.66 12.50 Total Hedgeable Volumes 6.80 6.90 7.00 7.03 Total Hedged Volumes 5.74 5.20 3.22 3.06 Hedged Percentage 84% 75% 46% 44%

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New Senior Credit Facility

Borrower: Crosstex Energy, L.P. Facility: $420 MM Senior Secured Revolving Credit Facility Maturity: 4 Years Pricing: Financial Covenants: Maximum Total Leverage Ratio of 5.75x with step-downs to 4.50x Maximum Senior Secured Leverage Ratio of 2.50x Minimum Interest Coverage Ratio of 1.50x with step-ups to 2.50x Current Liquidity:

Applicable Margin Funded Debt/ Commit EBITDA Fee ≥ 5.0x 4.25% 3.25% 0.50% ≥ 4.5x 4.00% 3.00% 0.50% ≥ 4.0x 3.75% 2.75% 0.50% ≥ 3.5x 3.50% 2.50% 0.50% < 3.5x 3.25% 2.25% 0.50% LIBOR+ ABR+

Borrowing LC Outstanding Available 26-Mar-10 26-Mar-10 Liquidity $30 MM $179 MM $211 MM

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Issue: Senior Unsecured Notes Amount: $725 million Coupon: 8.875% Maturity: 8 years Issuance Ratings: B3 / B+ Optional Redemption: Make whole- first 4 years; Callable at a declining premium thereafter Equity Clawback: 3 years, up to 35% Change of Control: 101% plus accrued interest Covenants: Usual and customary midstream MLP covenants

New Senior Unsecured Notes

Strategically Positioned Financially

• Strong balance sheet
• Disciplined financial guidelines
• Continue to de-leverage, de-risk Business
• Use highly predictable cash flows to set distributions
• Allocate capital to high-return projects
• Clear path to restoring dividends and distribution

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Closing Remarks Barry Davis President and Chief Executive Officer

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• Capitalize on strategic positions around core assets
• Focus on high-return projects
• Continue to reduce risk in the business
• Organization is well positioned
• Disciplined financial guidelines will guide growth
• Macro environment will provide opportunities

What’s Next?

Q & A

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Appendix

84 84

Reconciliation to Net Income

Net Income to DCF Reconciliation:

Years Ended

($ in millions)

December 31 2009 2008 (Unaudited) Net income (loss) attributable to Crosstex Energy, L.P. $ 104 $ 11 Depreciation, amortization and impairments (1) 132 163 Stock-based compensation 9 11 Interest expense, net (2) 130 105 Loss on extinguishment of debt 5

• Gain on sale of property

(184) (51) Taxes and other 8 6 Adjusted cash flow 204 245

• Interest (2)(3)(4)

(121) (83) Cash taxes and other (5) (3) (3) Maintenance capital expenditures (11) (18) Distributable cash flow $ 68 $ 141

(1) Excludes minority interest share of depreciation and amortization of $290 and $286K for the year ended 2009 and the year ended 2008 respectively. Includes depreciation, amortization and impairments related to discontinued operations of $10.7 and $26.4 million for the year ended 2009 and the year ended 2008 respectively. (2) Includes interest expense allocated to discontinued operations of $34.9 and $30.0 million for the year ended 2009 and the year ended 2008, respectively. (3) Excludes $4.3 million of debt issuance cost amortization, and $5.2 million of senior secured note make-whole and call premium paid-in-kind interest resulting from repayment of such notes from the proceeds of asset sales, for the year ended 2009. (4) Excludes noncash interest rate swap mark to market of ($797K) for the year ended 2009, and $22.1 million for the year ended 2008. (5) Includes Seminole Adjustment of $39 million for the year ended 2008.