Blue Dolphin Pipeline to Deliver Gas from Galveston Block 348

Blue Dolphin Energy Company, an independent oil and gas company with operations in the Gulf of Mexico, stated that its wholly owned subsidiary, Blue Dolphin Pipe Line Company, has entered into gas and condensate transportation agreements with a new shipper to deliver production from two wells into its Blue Dolphin Pipeline System.

Production will be delivered into the system in Galveston Area state tract 348. The Company expects transportation services for this shipper to commence during the third quarter 2007. Throughput volumes are not yet known.

This is the second new shipper that Blue Dolphin Pipe Line Company has contracted with in the past thirty days. The earlier announced agreement was for shipments through the Company's Galveston Area 350 Pipeline. Blue Dolphin Pipe Line Company owns an 83% undivided interest in both the Blue Dolphin Pipeline System and the Galveston Area 350 Pipeline.