HOUSTON -- TEPPCO Partners, L.P. (NYSE:TPP) today reported record second-quarter net income of $14.0 million, or $0.38 per unit. This compares with 1998 second-quarter net income of $12.5 million, or $0.39 per unit.

"The continued strength of the economy in the second quarter helped TEPPCO achieve record results," said William L. Thacker, chairman, president and chief executive officer. "Distillate and jet transportation revenues and volumes set new Partnership records, and total refined products volumes were a second-quarter record. Additionally, TEPPCO’s crude oil segment continued to perform well as crude prices rebounded during the quarter."

Transportation revenues for the products segment for the 1999 second quarter were $43.4 million, compared with $42.5 million for the 1998 quarter. The increase was due primarily to the record deliveries of distillate and jet fuel. Offsetting these increases somewhat were decreased revenues and deliveries of motor fuels and MTBE.

Mont Belvieu operations and Other revenues were $10.9 million for the second quarter of 1999, compared with $9.1 million for the 1998 second quarter. The increase was due to higher product sales as a result of favorable pricing, and higher storage and shuttle revenues at Mont Belvieu.

Gross margin for the crude oil segment was $9.7 million for the second quarter on crude marketing volumes of approximately 253,000 barrels per day, transportation volumes of crude and natural gas liquids (NGLs) of approximately 108,000 barrels per day, and lube oil volumes of approximately 717,000 gallons per month.

Operating expenses for the 1999 second quarter totaled $34.8 million, compared with $26.0 million for the 1998 second quarter, which did not include any expenses for the crude oil segment. The products segment operating expenses were $28.8 million, including fuel and power. The increase was due to higher costs associated with increased throughput and increased costs for outside services and rentals. The crude oil segment operating expenses were $6.0 million.

Other income-net for the 1999 second quarter was $0.4 million, compared with $0.8 million for the same quarter in 1998. The decrease was due primarily to $0.4 million of gain in the 1998 quarter from the disposition of assets.

Net income for the six months ended June 30, was $37.4 million, or $1.02 per unit, compared with $25.7 million, or $0.80 per unit for the same period in 1998, before loss on early extinguishment of debt. The 1998 year-to-date loss after the charge of $72.8 million for early extinguishment of debt was $47.1 million or $1.48 per unit.

Transportation revenues for the products segment for the 1999 first six months were $95.6 million, compared with $86.8 million for the 1998 first six months. The increase was due primarily to increased deliveries of LPGs, distillate, jet fuel and motor fuels, offset somewhat by decreased deliveries of natural gasoline and MTBE.

Mont Belvieu operations and Other revenues were $19.8 million for the 1999 first half, compared with $15.0 million for the 1998 first half The increase was primarily attributable to higher product sales, improved Mont Belvieu storage and shuttle activity, and six months of revenue from the fractionators in 1999 compared with three months in 1998.

Gross margin for the crude oil segment was $18.0 million for the first six months of 1999 on crude marketing volumes of approximately 246,000 barrels per day, transportation volumes of crude and natural gal liquids (NGLs) of approximately 105,000 barrels per day, and lube oil volumes of approximately 685,000 gallons per month.

Operating expenses for the six months ended June 30, 1999 totaled $65.6 million, compared with $50.6 million for the same period in 1998, which did not include any expenses for the crude oil assets. The products segment operating expenses were $55.0 million, including fuel and power. The increase was due to higher costs associated with increased throughput and increased outside services and rentals. The crude oil segment operating expenses were $10.6 million.

Interest expense - net increased $0.6 million, to $14.8 million, during the first six months of 1999 compared with $14.2 million for the first six months of 1998, due to the debt related to the purchase of the fractionators on March 31, 1998.

Other income-net for the first six months of 1999 was $0.7 million compared with $1.4 million for the first six months of 1998. The decrease was due primarily to the previously mentioned gain on the disposition of assets and lower interest income earned on cash investments.

TEPPCO Partners, L.P. is a publicly owned master limited partnership which conducts business through two operating partnerships. TE Products Pipeline Company, Limited Partnership is one of the largest common carrier pipelines of refined petroleum products and liquefied petroleum gases in the United States. TCTM, L.P. is a crude oil gathering, transportation, storage and marketing company operating primarily in Texas and Oklahoma.

Except for the historical information contained herein, the matters discussed in this news release are forward looking statements that involve certain risks and uncertainties. These risks and uncertainties include, among other things, market conditions, governmental regulations and other factors discussed in TEPPCO’s filings with the Securities and Exchange Commission.

Duke Energy (NYSE:DUK) is a global energy company with more than $26 billion in assets. Headquartered in Charlotte, N.C., the company reaches into more than 50 countries, producing energy, transporting energy, marketing energy and providing energy services. In the United States, Duke Energy companies provide electric service to approximately two million customers in North Carolina and South Carolina; operate interstate pipelines that deliver natural gas to various regions of the country; and are leading marketers of electricity, natural gas and natural gas liquids. Additional information about the company is available on the Internet at: www.duke-energy.com