Blackwater Midstream Corp.’s 2nd Quarter 2010 Results: Total Revenues Increased by 73%, Gross Profit Increased by 76%, and Storage Capacity Utilization Increased by 14%

NEW ORLEANS--(BUSINESS WIRE)-- Blackwater Midstream Corp., (OTCBB: BWMS) announces results for its quarter ended September 30, 2010.

Total Revenues (storage and ancillary) increased by 73% over the comparable 2009 period and increased by 33.5% from the previous quarter:
- 2^nd Quarter 2009 = $1,016,867
- 1^st Quarter 2010 = $1,316,974
- 2^nd Quarter 2010 = $1,759,175
- Total Revenue for the 6 months ending September 30, 2010 was $3,076,149 or 74% more than the 6 month period ending September 30, 2009.

Gross Profit showed a 76% increase over the comparable 2^nd quarter 2009 period and increased by 20% over the 1^st quarter of 2010:
- 2^nd Quarter 2009 = $ 665,637
- 1^st Quarter 2010 = $ 975,617
- 2^nd Quarter 2010 = $1,170,639
- Gross Profit for the 6 months ending September 30, 2010 was $2,146,256 or 97% more than the 6 month period ending September 30, 2009.

Leasable Barrel Utilization went from 71.8% as of September 30, 2009 - to 77% as of June 30, 2010 – to 82% as of September 30, 2010; an increase in 14% over the comparable annual period and 6.5% over the previous quarter.

Michael Suder, CEO, attributed the Company’s continued improvement in its quarter-to-quarter and six-month-to-six month operational results to management’s focus on increasing each of its terminal’s storage utilization, attracting additional “blue chip” customers; offering more ancillary services to existing customers; and bettering its overall operational efficiencies.

Mr. Suder stated, “We are in an industry where demand for storage outstrips supply, allowing for generous gross profit margins. As an independent developer, operator, and third party provider of bulk liquid storage terminals, we take no commodity price risk and obtain favorable, long-term customer contracts.” Suder went on to say that, “Management’s focus now is to improve its balance sheet. A major step in this direction was the Company’s ability to recently convert short-term debt incurred for capital improvements into long-term financing. Our partnership with JP Morgan Chase Bank has been instrumental in our past achievements and will be in our future successes.”

Today, the Company has two terminals, one located in Westwego, LA and the other in Brunswick, GA; still its vision is much larger. The Company’s vision and strategy is for a continuing program of acquiring under-achieving, under-utilized storage terminals, and applying its proven management formula and results to those operations.

Mr. Suder said, “We have the management and corporate infrastructure in place to create increased revenues and profits, and at the same time build major asset value for our shareholders. We are a young company, with seasoned management, with the goal to become an important industry player.”

The information in this press release includes certain “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, including statements relating to prospective acquisitions or anticipated future results. Forward-looking statements relate to expectations or forecasts of future events. Blackwater Midstream Corp. does not assume the obligation to update any forward-looking statement. Many factors could cause actual results to differ materially from Blackwater Midstream’s forward-looking statements, including market forces, economic factors, the availability of capital and credit, current and future competition and other uncertainties. For further details about these and other factors that may impact the forward-looking statements, see Blackwater Midstream Corp.’s Securities and Exchange Commission filings, including the “Risk Factors” in the Annual Report on Form 10-K. This discussion and analysis should be read in conjunction with our unaudited consolidated financial statements and related notes included in our Quarterly Report on Form 10-Q as of September 30, 2010 and our audited financial statements and notes included in our Annual Report on Form 10-K as of and for the year ended March 31, 2010. For more information, please reference our website at www.BlackwaterMidstream.com.






BLACKWATER MIDSTREAM CORP.
CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)

		Three Months			Three Months			Six Months			Six Months
		Ended			Ended			Ended			Ended
		September 30, 2010			September 30, 2009			September 30, 2010			September 30, 2009

Revenue
	Storage	$	1,480,817		$	907,317		$	2,730,864		$	1,607,894
	Other Services		278,358			109,550			345,285			161,621

Total Revenue			1,759,175			1,016,867			3,076,149			1,769,515

Cost of revenue
	Labor		(186,238	)		(119,609	)		(324,829	)		(237,348	)
	General materials		(221,308	)		(44,949	)		(277,002	)		(69,032	)
	Subcontractors		(2,311	)		(30,225	)		(26,098	)		(130,571	)
	Depreciation		(134,413	)		(75,267	)		(230,181	)		(147,254	)
	Other costs of revenue		(44,266	)		(81,180	)		(71,783	)		(93,820	)

Total cost of revenue			(588,536	)		(351,230	)		(929,893	)		(678,025	)

GROSS PROFIT			1,170,639			665,637			2,146,256			1,091,490

OTHER OPERATING EXPENSES:
	Selling, general and administrative		1,129,702			1,102,458			1,842,047			2,484,423
	Loss on disposal of assets		150,105			-			173,976			-
	Depreciation		11,790			9,693			22,118			19,177

Total other operating expenses			1,291,597			1,112,151			2,038,141			2,503,600

Income (Loss) from operations			(120,958	)		(446,514	)		108,115			(1,412,110	)

Net interest expense			(262,624	)		(27,895	)		(380,094	)		(65,843	)
Gain on bargain purchase of assets			100,000			-			100,000			-
Gain on insurance settlement			-			252,292			-			130,494

Net loss		$	(283,582	)	$	(222,117	)	$	(171,979	)	$	(1,347,459	)

NET LOSS PER COMMON SHARE, BASIC AND DILUTED		$	(0.01	)	$	(0.00	)	$	0.00		$	(0.03	)

Weighted average number of shares outstanding:
	BASIC AND DILUTED		54,515,420			52,425,969			54,462,574			52,261,252

The accompanying notes are an integral part of these unaudited consolidated financial statements.