1411583--2/29/2008--WILLIAMS_PIPELINE_PARTNERS

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Risks Related to Our Business We may not have sufficient cash from operations to enable us to pay the minimum quarterly distribution following the establishment of cash reserves and payment of fees and expenses, including cost reimbursements to our general partner. The amount of cash we have available for distribution to holders of our common units and subordinated units depends primarily on our cash flow and not solely on profitability, which may prevent us from making cash distributions during periods when we record net income. We and Williams jointly control Northwest. As a result, we cannot independently control the amount of cash we will receive from Northwest, and we may be required to contribute significant cash to fund Northwest s operations. Northwest s natural gas transportation and storage activities involve numerous risks that might result in accidents and other operating risks and hazards. Compliance with the Pipeline Safety Improvement Act of 2002 may adversely impact Northwest s cost of conducting its business. Northwest s current pipeline infrastructure is aging, which may adversely affect its business and our ability to make distributions to you. Increased competition from alternative natural gas transportation and storage options and alternative fuel sources could have a significant financial impact on us. Northwest may not be able to maintain or replace expiring natural gas transportation and storage contracts at favorable rates or on a long-term basis. Northwest s natural gas transportation and storage operations are subject to regulation by FERC, which could have an adverse impact on its ability to establish transportation and storage rates that would allow it to recover the full cost of operating its pipeline, including a reasonable return, and on our ability to make distributions to you. Northwest could be subject to penalties and fines if it fails to comply with FERC regulations. The outcome of certain FERC proceedings regarding income tax allowances in rate calculations is uncertain and could affect Northwest s ability to include an income tax allowance in its cost-of-service based rates, which would in turn impact our cash available for distribution. The outcome of certain FERC proceedings involving FERC policy statements is uncertain and could affect the level of return on equity that Northwest may be able to achieve in any future rate proceeding. The outcome of future rate cases to set the rates Northwest can charge customers on its pipeline might result in rates that will not fully compensate Northwest for its ongoing expenses and provide an adequate return on the capital that Northwest has invested in its pipeline. Any significant decrease in supplies of natural gas in Northwest s areas of operation could adversely affect its business and operating results and reduce our cash available for distribution to unitholders. Significant prolonged changes in natural gas prices could affect supply and demand, cause a reduction in or termination of the long-term transportation and storage contracts or throughput on Northwest s system, and adversely affect our cash available to make distributions to you. The failure of Liquid Natural Gas (LNG) import terminals to be successfully developed in the United States could increase natural gas prices and reduce the demand for Northwest s services. Northwest depends on certain key customers for a significant portion of its revenues. The loss of any of these key customers or the loss of any contracted volumes could result in a decline in cash available for us to make distributions to you. If third-party pipelines and other facilities interconnected to Northwest s pipeline and facilities become unavailable to transport natural gas, Northwest s revenues and our ability to make distributions to you could be adversely affected. Northwest s debt agreements impose restrictions on it that may adversely affect its ability to operate its business. Although Northwest s debt instruments may contain limitations on additional indebtedness, Northwest s general partnership agreement does not prohibit it from incurring indebtedness, which may affect our ability to make distributions to you. If we or Northwest do not complete expansion projects or make and integrate acquisitions, our future growth may be limited. Acquisitions or expansion projects may reduce our cash from operations on a per unit basis. Northwest s operations are subject to governmental laws and regulations relating to the protection of the environment, which may expose us to significant costs and liabilities. Northwest does not own all of the land on which its pipeline and facilities are located, which could disrupt its operations. We and Northwest do not insure against all potential losses and could be seriously harmed by unexpected liabilities. Acts of terrorism could have a material adverse effect on Northwest s and our financial condition, results of operations and cash flows. Potential changes in accounting standards might cause us to revise our financial results and disclosures in the future, which might change the way analysts measure our business or financial performance. If we fail to develop or maintain an effective system of internal controls, we may not be able to report our financial results accurately or prevent fraud, which could have an adverse effect on our business and would likely cause the market price of our common units to decline materially. Risks Inherent in an Investment in Us Williams controls our general partner, which has sole responsibility for conducting our business and managing our operations. Williams, our general partner, and their respective affiliates have conflicts of interest with us and limited fiduciary duties, and they may favor their own interests to the detriment of our unitholders. The credit and risk profile of our general partner and its owner, Williams, could adversely affect our or Northwest s credit ratings, which could increase our or Northwest s borrowing costs or hinder our or Northwest s ability to raise capital. Our partnership agreement limits our general partner s fiduciary duties to holders of our common units and subordinated units and restricts the remedies available to holders of our common units and subordinated units for actions taken by our general partner that might otherwise constitute breaches of fiduciary duty. Holders of our common units have limited voting rights and are not entitled to elect our general partner or its directors, which could reduce the price at which the common units will trade. If you are not an Eligible Holder, you will not be entitled to receive distributions or allocations of income or loss on your common units, and your common units will be subject to redemption at a price that may be below the then-current market price. Our general partner may elect to cause us to issue Class B common units and additional general partner units to it in connection with a resetting of the target distribution levels related to its incentive distribution rights without the approval of the conflicts committee of its board of directors or the holders of our common units. This may result in lower distributions to holders of our common units in certain situations. Cost reimbursements to our general partner and its affiliates for services provided to us, which will be determined by our general partner, will be substantial and will reduce our cash available for distribution to you. Even if unitholders are dissatisfied, they cannot initially remove our general partner without its consent. We have a holding company structure in which our subsidiaries conduct our operations and own our operating assets, which may affect our ability to make distributions to you. The control of our general partner may be transferred to a third party without unitholder consent. Increases in interest rates may cause the market price of our common units to decline. We may issue additional units without your approval, which would dilute your ownership interests. Our general partner may sell units in the public or private markets, which sales could have an adverse impact on the trading price of the common units. Our general partner has a limited call right that may require you to sell your common units at an undesirable time or price. Our partnership agreement restricts the voting rights of unitholders owning 20% or more of our common units. Your liability may not be limited if a court finds that unitholder action constitutes control of our business. Unitholders may have liability to repay distributions that were wrongfully distributed to them. If we are deemed an investment company under the Investment Company Act of 1940, it would adversely affect the market price of our common units and could have a material adverse effect on our business. Tax Risks to Common Unitholders Our tax treatment depends on our status as a partnership for federal income tax purposes, as well as our not being subject to a material amount of entity-level taxation by states and localities. If the IRS were to treat us as a corporation for federal income tax purposes or if we were to become subject to a material amount of entity-level taxation for state or local tax purposes, the amount of cash available for distribution to our unitholders would be substantially reduced. The tax treatment of publicly traded partnerships or an investment in our common units could be subject to potential legislative, judicial or administrative changes and differing interpretations, possibly on a retroactive basis. We prorate our items of income, gain, loss and deduction between transferors and transferees of the units each month based upon the ownership of the units on the first day of each month, instead of on the basis of the date a particular unit is transferred. The IRS may challenge this treatment, which could change the allocation of items of income, gain, loss and deduction among our unitholders. You will be required to pay taxes on your share of our income even if you do not receive any cash distributions from us. The tax gain or loss on the disposition of our common units could be more or less than expected. We will treat each purchaser of common units as having the same tax benefits without regard to the actual common units purchased. The IRS may challenge this treatment, which could adversely affect the value of our common units. An IRS contest of the federal income tax positions we take may adversely affect the market for our common units, and the cost of any IRS contest will reduce our cash available for distribution to our unitholders. Tax-exempt entities and foreign persons face unique tax issues from owning common units that may result in adverse tax consequences to them. We may adopt certain valuation methodologies that may result in a shift of income, gain, loss and deduction between the general partner and the unitholders. The IRS may challenge this treatment, which could adversely affect the value of our common units.

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1411583--2/29/2008--WILLIAMS_PIPELINE_PARTNERS_L.P.