NET INCOME PER UNIT

9 Months Ended

Sep. 30, 2011

We include restricted units granted under our long-term incentive plan as participating securities in computing net income per unit pursuant to the two-class method.

Unit amounts used in the computation of basic and diluted net income per unit were as follows:



	Three Months Ended September 30,		Nine Months Ended September 30,
	2011	2010	2011	2010
Basic units outstanding:
Weighted-average number of basic units outstanding	42,544,659	42,514,494	42,544,659	42,514,494
Diluted units outstanding:
Weighted-average number of basic units outstanding	42,544,659	42,514,494	42,544,659	42,514,494
Effect of dilutive securities	25,612	—	35,459	—
Weighted-average number of diluted units outstanding	42,570,271	42,514,494	42,580,118	42,514,494

The computation of diluted net income per unit for each of the three and nine-month periods ended September 30, 2010 excludes 324,100 outstanding options to purchase NuStar GP Holdings units, as the exercise price for such options exceeded the average market price and their effect would have been anti-dilutive.