Convention for excerpting from the middle of a paragraph in another work? A project of mine involves meticulously tracing the source material for a work of literature constructed from an author's unpublished notes. I have established a system for referencing the notes themselves, but to precisely trace the material that constitutes the finished work, I'm following the format:

[ Note # ] [ Page(s) ]
[ Headwords of first paragraph ]
"Lorem ipsum dolor sit amet..."
[ Footwords of paragraph, either the same one or the end of the last if the passage spans multiple paragraphs ]
"...fermentum eu velit quis iaculis."

However, there are some instances where the material was taken from the middle of a paragraph, continues unbroken through several subsequent paragraphs, and stops in the middle of another paragraph. In order to proceed with my work, I've been using this format:

If the source begins in the middle of a paragraph, include the headwords to that paragraph then include the beginning of the actual excerpt:
"Lorem ipsum dolor [...] Maecenas mattis erat in metus..."

If the source ends in the middle, include headwords in addition to the conclusion of the excerpt itself:
"Lorem ipsum dolor [...] tincidunt dui urna nec diam."

This example supposes material is taken from a single paragraph, so another example spanning multiple paragraphs might look like:
"Lorem ipsum dolor [...] Maecenas mattis erat in metus..."
"Vivamus nec sodales neque [...] quis lobortis nibh porttitor."

Essentially I'm wondering if this system is too confusing, or if there is an existing standard already in use that I can adopt. Including the headwords serves as a way to navigate through the material using paragraphs as an easy visual reference. I've considered assigning each paragraph a section number and referencing them by section marks (§) which would serve as an alternative to including the headwords ("§52 Lorem ipsum dolor..." through "§55 ...nunc sollicitudin lectus."), but I'd like to avoid that if possible.

Any suggestions are appreciated!
I don't do this sort of research, so I can't answer if there is a 'standard approach'.  I have read analytic works on the writings people such as Charles Sanders Peirce, who was notorious for having both a vast and an unorganized body of writing, including personal letters.  Yours might be similar, though in your case it seems even more important to be very precise about what source material you are referencing and quoting.  To my eye, it resembles Biblical analysis in this way.

I like the idea of assigning paragraph numbers to all your source material, but I would suggest using them differently.  In your quotes, I suggest quoting only the relevant words, using ellipses as appropriate to indicate omitted text, and also new lines or paragraph marks to indicate a break in paragraph. But at the end of each quote, in square brackets, you could add the paragraph numbers of the sources, plus any qualifying remarks, such as "spanning both paragraphs" or what ever.

Using your example:


  "... Maecenas mattis erat in metus ..." [citation, starting mid-pargraph in §52 "Lorem ipsum dolor..." and ending mid-pargraph in §55 "...nunc sollicitudin lectus."]


This approach has two advantages. First, your quote includes only the text relevant to your exposition and analysis.  This will make it easier to read and understand.  Second, exact and detailed context information is given in the square brackets following, including the citation if needed.  This will serve you as researcher or a reader who needs to follow along in the source documents.