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01/18/2011

Copano Energy to Increase NGL Handling Capability for Growing Eagle Ford Shale Production

Long-Term Fractionation and Product Sales Agreement with Formosa Hydrocarbons Joint Venture with Energy Transfer for NGL Pipeline

Copano Energy, L.L.C. (Nasdaq: CPNO) today announced execution of agreements increasing Copano's capability to handle natural gas liquids (NGLs) associated with growing natural gas volumes from the Eagle Ford Shale. Copano has entered into a long-term fractionation and product sales agreement with Formosa Hydrocarbons Company, Inc. and, to facilitate deliveries of mixed NGLs to Formosa, Copano has formed a 50/50 joint venture with a subsidiary of Energy Transfer Partners to construct, own and operate a 12-inch NGL pipeline ("Liberty Pipeline"). The Liberty Pipeline will extend approximately 83 miles, from Copano's Houston Central Complex in Colorado County, Texas, first to Formosa's leased NGL product storage facility in Matagorda County, Texas and then to Formosa's petrochemical facility in Calhoun County, Texas.

The agreement provides Copano with up to 37,500 barrels per day of firm fractionation services beginning in the first quarter of 2013 for a term of 15 years. The agreement also provides that Formosa will purchase the resulting NGL products and make product storage available to Copano for operational reliability. Following the completion of Liberty Pipeline, which is expected by the summer of 2011, and until additional facility improvements at Formosa are complete, Copano will have access to a minimum of 5,000 barrels per day of existing Formosa fractionation capacity, as well as additional capacity on a "space available" basis.

Liberty Pipeline will have initial capacity of 75,000 barrels per day, which will be committed to Copano and Energy Transfer (50% each) under firm throughput agreements. Copano and Energy Transfer will together invest approximately $52 million for the pipeline and related facilities. A detailed map of Liberty Pipeline is included with this press release on the Investor Relations page of Copano's website.

"We look forward to a long-term relationship with Formosa and to working with Energy Transfer on the Liberty Pipeline project," said R.Bruce Northcutt, President and Chief Executive Officer of Copano Energy. "The Formosa agreement and Liberty Pipeline, together with our other recently announced projects, are important steps in executing Copano's overall Eagle Ford Shale strategy and will increase our total NGL handling capability to over 80,000 barrels per day. These developments provide an additional market for NGLs extracted at our Houston Central Complex and help support Formosa's fractionation, storage, and olefins production operations."

Houston-based Copano Energy, L.L.C. (NASDAQ: CPNO) is a midstream natural gas company with operations in Oklahoma, Texas, Wyoming and Louisiana. Its assets include approximately 6,400 miles of active natural gas gathering and transmission pipelines, 250 miles of NGL pipelines and eight natural gas processing plants, with over one Bcf per day of combined processing capacity and 22,000 barrels per day of fractionation capacity. For more information please visit http://www.copanoenergy.com/.

This press release includes "forward-looking statements," as defined by the Securities and Exchange Commission. Statements that address activities or events that Copano believes will or may occur in the future are forward-looking statements. These statements include, but are not limited to, statements about future producer activity and Copano's total distributable cash flow and distribution coverage. These statements are based on management's experience and perception of historical trends, current conditions, expected future developments and other factors management believes are reasonable. Important factors that could cause actual results to differ materially from those in the forward-looking statements include the following risks and uncertainties, many of which are beyond Copano's control: price volatility and market demand for natural gas and natural gas liquids; Copano's ability to continue to obtain new sources of natural gas supply and retain its key customers; the impact on volumes, and resulting cash flow, of technological, economic and other uncertainties inherent in estimating future production, producers' ability to drill and successfully complete and attach new natural gas supplies, the availability of downstream transportation systems and other facilities for natural gas and NGLs, and higher construction costs or project delays due to inflation, limited availability of required resources or the effects of environmental, legal or other uncertainties; general economic conditions; the effects of government regulations and policies; and other financial, operational and legal risks and uncertainties detailed from time to time in Copano's filings with the Securities and Exchange Commission.

Contact:

Carl A. Luna, Senior Vice President and CFO
Copano Energy, L.L.C.
713-621-9547
or
Jack Lascar / jlascar@drg-l.com
Anne Pearson / apearson@drg-l.com
DRG&L / 713-529-6600

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