97452--3/16/2006--TEXAS_GAS_TRANSMISSION

related topics

{operation, natural, condition}

{gas, price, oil}

{cost, regulation, environmental}

{cost, contract, operation}

{customer, product, revenue}

{stock, price, operating}

{competitive, industry, competition}

{loss, insurance, financial}

Our natural gas transportation and storage operations are subject to FERC rate-making policies that could have an adverse impact on our ability to establish rates that would allow us to recover the full cost of operating our pipelines. Our natural gas transportation and storage operations are subject to extensive regulation by FERC in addition to FERC rules and regulations related to the rates we can charge for our services. We are subject to laws and regulations relating to the environment which may expose us to significant costs, liabilities and loss of revenues. Any changes in such regulations or their application could negatively affect our results of operations. Our operations are subject to operational hazards and unforeseen interruptions for which we may not be adequately insured. Pipeline safety integrity programs and repairs may impose significant costs and liabilities on us. We are subject to strict regulations at many of our facilities regarding employee safety, and failure to comply with these regulations could adversely affect our financial condition. Increased competition could have a significant financial impact on us. Because of the natural decline in gas production from existing wells, our success depends on our ability to obtain access to new sources of natural gas, which is dependent on factors beyond our control. Any decrease in supplies of natural gas could adversely affect our business and operating results. Offtake capacity at our Lebanon, Ohio terminus is limited. Successful development of LNG import terminals in the eastern or northeastern United States could reduce the demand for our services. We may not be able to maintain or replace expiring gas transportation and storage contracts at favorable rates. We depend on certain key customers for a significant portion of our revenues. The loss of any of these key customers could result in a decline in our revenues. We are exposed to credit risk relating to nonperformance by our customers. If third-party pipelines and other facilities interconnected to our pipelines and facilities become unavailable to transport natural gas, our revenues could be adversely affected. Significant changes in natural gas prices could affect supply and demand, reducing system throughput and adversely affecting our revenues and available cash. Expansion projects involve risks that may adversely affect our business. We do not own all of the land on which our pipelines and facilities are located, which could disrupt our operations. Mergers among our customers and/or competitors could result in lower volumes being shipped on our pipelines, thereby reducing the amount of cash we generate. Possible terrorist activities or military actions could adversely affect our business.

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97452--3/16/2006--TEXAS_GAS_TRANSMISSION_LLC