UNITED STATES SECURITIES AND EXCHANGE
                                   COMMISSION
                             WASHINGTON, D.C. 20549
                                   FORM 10-Q/A




[X]    QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES
       EXCHANGE ACT OF 1934

       For the quarterly period ended September 30, 2004

                             OR

[ ]    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE
       SECURITIES EXCHANGE ACT OF 1934

       For the transition period from _____ to _____


                 Commission File Number 333-42578
                 IROQUOIS GAS TRANSMISSION SYSTEM, L.P.
     (Exact name of registrant as specified in its charter)


           Delaware                          06-1285387
(State or other jurisdiction of     (I.R.S. Employer Identification
incorporation or organization)                Number)


        One Corporate Drive
            Suite 600
       Shelton, Connecticut                  06484-6211
(Address of principal executive              (Zip code)
           offices)


                                 (203) 925-7200
              (Registrant's telephone number, including area code)


     Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days.
Yes [X]     No [ ]

     Indicate by check mark whether the registrant is an accelerated filer (as
defined in Rule 12b-2 of the Exchange Act).
Yes [ ]     No [X]


<PAGE>

EXPLANATORY PARAGRAPH

Iroquois or "the Partnership" is filing this second amendment on Form 10-Q/A to
its Quarterly Report on Form 10-Q to restate the Partnership's consolidated
financial statements for the nine months ended September 30, 2004 and 2003. (For
an explanation of the factors surrounding the first amendment on Form 10-Q/A,
see Note 1 to the Consolidated Financial Statements. The following material
weaknesses were identified by management as of September 30, 2004:

1. Management reexamined the accounting for and presentation of its provision
for income taxes on the Consolidated Statements of Income and the corresponding
accounting for and presentation related to income taxes on the Consolidated
Balance Sheets and related financial statements. After additional research and
evaluation by management, the Partnership concluded that, as a partnership, it
should present the Consolidated Statements of Income without the provision for
income taxes and should present the Consolidated Balance Sheets without the
amounts equivalent to deferred income taxes or regulatory assets-income tax
related. In addition, the presentation of these items on the Consolidated
Statements of Cash Flows, the Consolidated Statement of Changes in Partners'
Equity and the related disclosures in the Notes to the Consolidated Financial
Statements are also incorrect.

2. Management determined that it had incorrectly presented its Consolidated
Statements of Income for the three and nine month periods ended September 30,
2003 by not adjusting for the cumulative effect of a change in accounting
principle related to municipal property taxes. This change in accounting
principle occurred in the fourth quarter of 2003 and was disclosed in Note 2 to
the Company's Form 10-K/A for the year ended December 31, 2003. In preparing the
Partnership's amended 2004 quarterly reports, management determined that the
cumulative effect adjustment should have been presented retroactively as of
January 1, 2003, rather than as of December 31, 2003. In restating the
Partnership's September 30, 2004 Form 10-Q as a result of the income tax error
discussed above, the Partnership will also restate its net income for the nine
month period ended September 30, 2003 to correct the accounting error in its
application of the cumulative effect of the change in accounting principle.

Restatement of previously issued financial statements to reflect the correction
of a misstatement is a strong indicator of the existence of a "material
weakness" in the design or operation of internal control over financial
reporting. The restatement of the Partnership's consolidated financial
statements as a result of the errors described above has led management to
conclude that a material weakness existed in the Partnership's internal control
over financial reporting as of September 30, 2004. In accordance with the rules
of the SEC, the affected items of the Form 10-Q/A, Items 1, 2 and 4 of Part I,
are being amended.

No attempt has been made in this Form 10-Q/A to update other disclosures
presented in the original report on Form 10-Q, except as required to reflect the
effects of the restatement. This Form 10-Q/A does not reflect events occurring
after the filing of the original Form 10-Q or modify or update those
disclosures, including the exhibits to the Form 10-Q affected by subsequent
events; however, this Form 10-Q/A includes as exhibits 31.1, 31.2 and 32 new
certifications by the Partnership's principal executive officer and principal
financial officer as required by Rule 12b-15 promulgated under the Securities
Exchange Act of 1934, as amended. Accordingly, this Form 10-Q/A should be read
in conjunction with the Partnership's filings made with the SEC subsequent to
the filing of the original Form 10-Q, including any amendments to those filings.
The following items have been amended as a result of the restatement:

     Part I - Item 1 - Financial

     Part I - Item 2 - Management's Discussion and Analysis of Financial
     Condition and Results of Operations.

     Part I - Item 4 - Controls and Procedures

<PAGE>




         IROQUOIS GAS TRANSMISSION SYSTEM, L.P. AND SUBSIDIARY

                        TABLE OF CONTENTS




                                                                         Page
                                                                          No.
PART I.   FINANCIAL INFORMATION

   ITEM 1.  Financial Statements

       Consolidated Statements of Income -
          Three Months Ended September 30, 2004 and 2003 (RESTATED) and
          Nine Months Ended September 30, 2004 and 2003 (RESTATED)         3
       Consolidated Balance Sheets - September 30, 2004
          and December 31, 2003 (RESTATED)                                 4
       Consolidated Statements of Cash Flows -
          Nine Months Ended September 30, 2004 and 2003 (RESTATED)         5
       Consolidated Statement of Changes in Partners'
          Equity - Nine Months Ended September 30, 2004 (RESTATED)         6
       Notes to Consolidated Financial Statements                          7

   ITEM 2.  Management's Discussion and Analysis of
             Financial Condition and Results of Operations                 8

   ITEM 3.  Quantitative and Qualitative Disclosures About
             Market Risk                                                   9

   ITEM 4.  Controls and Procedures                                       10


PART II.  OTHER INFORMATION

   ITEM 1.  Legal Proceedings                                             11
   ITEM 6.  Exhibits and Reports on Form 8-K                              11
   Signatures                                                             12



<PAGE>



<TABLE>
                  PART I. FINANCIAL INFORMATION

                  ITEM 1. FINANCIAL STATEMENTS

         IROQUOIS GAS TRANSMISSION SYSTEM, L.P. AND SUBSIDIARY
                CONSOLIDATED STATEMENTS OF INCOME
                        (In Thousands)
                          (Unaudited)

<CAPTION>
                                  Three Months Ended       Nine Months Ended
                                     September 30             September 30
                                   2004      2003           2004      2003
                                  RESTATED  RESTATED      RESTATED   RESTATED


                             <c>        <c>           <c>        <c>
OPERATING REVENUES, NET           $36,072   $29,628       $111,679   $98,156

OPERATING EXPENSES
 Operation and maintenance          7,250     6,232         19,966    18,301
 Depreciation and amortization      8,067     6,024         23,548    18,045
 Taxes other than income taxes      4,058     3,281         10,499     9,295

   Operating expenses              19,375    15,537         54,013    45,641

OPERATING INCOME                   16,697    14,091         57,666    52,515

OTHER INCOME/(EXPENSES)
Interest Income                       132        56            259       176
Allowance for equity funds
  used during construction             --     2,466          1,123     5,926
 Other, net                          (100)       --           (146)      (36)
    Other income/(expenses)            32     2,522          1,236     6,066

INTEREST EXPENSE
Interest Expense                    8,384     8,463         25,047    24,995
 Allowance for borrowed funds
  used during construction             --    (2,350)        (1,070)   (5,951)
 Interest Expense, Net              8,384     6,113         23,977    19,044

INCOME BEFORE CUMULATIVE EFFECT     8,345    10,500         34,925    39,537
 OF CHANGE IN ACCOUNTING PRINCIPLE

CUMULATIVE EFFECT OF CHANGE IN         --        --             --     6,196
 ACCOUNTING PRINCIPLE

NET INCOME                          8,345    10,500         34,925    45,733

<FN>
The accompanying notes are an integral part of these consolidated financial
statements.
</FN>
</TABLE>





<PAGE>

<TABLE>

            PART I. FINANCIAL INFORMATION (Continued)
             ITEM 1. FINANCIAL STATEMENTS (Continued)

         IROQUOIS GAS TRANSMISSION SYSTEM, L.P. AND SUBSIDIARY
                   CONSOLIDATED BALANCE SHEETS
                         (In Thousands)
                           (Unaudited)
<CAPTION>
                                           September 30,   December 31,
ASSETS                                        2004             2003
                                             RESTATED        RESTATED

                                          <c>           <c>
CURRENT ASSETS
 Cash and temporary cash investments          $  42,953      $  36,344
 Accounts receivable - trade, net                 5,811          7,080
 Accounts receivable - affiliates                 5,643          5,495
 Other current assets                            12,545          6,413
   Total Current Assets                          66,952         55,332

NATURAL GAS TRANSMISSION PLANT
 Natural gas plant in service                 1,097,304        802,220
 Construction work in progress                    8,988        280,528
                                              1,106,292      1,082,748
 Accumulated depreciation and amortization     (346,552)      (323,405)
   Natural Gas Transmission Plant, Net          759,740        759,343

OTHER ASSETS AND DEFERRED CHARGES
 Regulatory assets                                1,332          1,473
 Other assets and deferred charges               12,284         13,383

   Total Other Assets and Deferred Charges       13,616         14,856

   TOTAL ASSETS                               $ 840,308      $ 829,531

LIABILITIES AND PARTNERS' EQUITY

CURRENT LIABILITIES
 Accounts payable                             $   8,375      $  21,424
 Accrued interest                                11,561          4,626
 Current portion of long-term debt               32,222         32,222
 Other current liabilities                        5,996          7,425
   Total Current Liabilities                     58,154         65,697

LONG-TERM DEBT                                  431,111        447,778

OTHER NON-CURRENT LIABILITIES
 Unrealized loss-interest rate hedge              2,197          3,263
 Other                                            1,883          1,821
   Total Other Non-Current Liabilities            4,080          5,084

Commitments and Contingencies                       -              -
Total Liabilities                               493,345        518,559
Partners' Equity                                346,963        310,972

   TOTAL LIABILITIES AND PARTNERS' EQUITY     $ 840,308      $ 829,531

<FN>
The accompanying notes are an integral part of these consolidated financial
statements.
</FN>

</TABLE>

<PAGE>

<TABLE>


            PART I. FINANCIAL INFORMATION (Continued)

            ITEM 1. FINANCIAL STATEMENTS (Continued)

         IROQUOIS GAS TRANSMISSION SYSTEM, L.P. AND SUBSIDIARY
              CONSOLIDATED STATEMENTS OF CASH FLOWS
                         (In Thousands)
                          (Unaudited)
<CAPTION>
                                                         Nine Months Ended
                                                           September 30,
                                                           2004       2003
                                                         RESTATED    RESTATED


                                                     <c>        <c>
OPERATING ACTIVITIES:
 Net Income                                             $ 34,925    $ 45,733
 Adjusted for the following:
   Depreciation and amortization                          23,548      18,045
   Allowance for equity funds used during construction    (1,123)     (5,926)
   Other assets and deferred charges                       1,027         964
   Other non-current liabilities                              62        (324)

   CHANGES IN WORKING CAPITAL:
      Accounts receivable                                  1,121       1,222
      Other current assets                                (6,132)     (5,984)
      Accounts payable                                       (46)       (446)
      Accrued interest                                     6,935       4,718
      Other current liabilities                           (1,429)     (2,639)

NET CASH PROVIDED BY OPERATING ACTIVITIES                 58,888      55,363

INVESTING ACTIVITIES:
  Capital expenditures                                   (35,612)   (125,162)
     NET CASH USED IN INVESTING ACTIVITIES               (35,612)   (125,162)

FINANCING ACTIVITIES:
  Partner contributions                                       --      10,000
  Long-term debt borrowings                                   --      85,000
  Repayments of long-term debt                           (16,667)    (16,667)
     NET CASH (USED FOR)/PROVIDED BY
        FINANCING ACTIVITIES                             (16,667)     78,333

NET INCREASE IN CASH AND TEMPORARY
    CASH INVESTMENTS                                       6,609       8,534

CASH AND TEMPORARY CASH INVESTMENTS AT
    BEGINNING OF YEAR                                     36,344      21,620

CASH AND TEMPORARY CASH INVESTMENTS AT
    END OF PERIOD                                       $ 42,953    $ 30,154

Supplemental Disclosures of Cash Flow Information:
  Cash paid for interest                                $ 16,890    $ 19,055

  Accounts payable accruals for capital expenditures    $  7,594    $  9,102

<FN>
The accompanying notes are an integral part of these consolidated financial
statements.
</FN>


</TABLE>

<PAGE>

<TABLE>
            PART I. FINANCIAL INFORMATION (Continued)

            ITEM 1. FINANCIAL STATEMENTS (Continued)

         IROQUOIS GAS TRANSMISSION SYSTEM, L.P. AND SUBSIDIARY
         CONSOLIDATED STATEMENT OF CHANGES IN PARTNERS' EQUITY
            For the Nine Months Ended September 30, 2004
                         (In Thousands)
                           (Unaudited)
                           (RESTATED)


                                            <c>
PARTNERS' EQUITY
BALANCE AT DECEMBER 31, 2003                   $310,972

Year-to-date net income                          34,925

Other comprehensive income                        1,066

PARTNERS' EQUITY
BALANCE AT SEPTEMBER 30, 2004                  $346,963

<FN>
The accompanying notes are an integral part of this consolidated financial
statement.
</FN>


</TABLE>

<PAGE>



           PART I. FINANCIAL INFORMATION - (Continued)

           ITEM 1. FINANCIAL STATEMENTS - (Continued)

         IROQUOIS GAS TRANSMISSION SYSTEM, L.P. AND SUBSIDIARY
           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                            (Unaudited)

1. The consolidated financial statements included herein have been prepared
by Iroquois Gas Transmission System, L.P., referred to herein as Iroquois or the
Partnership, without audit pursuant to the rules and regulations of the
Securities and Exchange Commission. Accordingly, they reflect all adjustments
which are, in the opinion of management, necessary for a fair presentation of
the financial results for the interim periods. Certain information and notes
normally included in financial statements prepared in accordance with generally
accepted accounting principles have been condensed or omitted pursuant to such
rules and regulations. However, the Partnership believes that the disclosures
are adequate to make the information presented not misleading. These financial
statements should be read in conjunction with the financial statements and the
notes thereto included in Iroquois' Annual Report on Form 10-K/A for the year
ended December 31, 2003, referred to herein as Iroquois' Form 10-K/A.

The preparation of financial statements in conformity with generally accepted
accounting principles in the United States of America requires management to
make assumptions and estimates that affect the reported amounts of assets and
liabilities and disclosure of contingent assets and liabilities at the date of
the financial statements and the reported amounts of revenues and expenses
during the reporting period. Actual results could differ from those estimates.

Cash Flows Restatement

The consolidated statements of cash flows for the nine months ended September
30, 2004 and 2003 have been restated. The Partnership previously did not exclude
from capital expenditures reported in the consolidated statement of cash flows,
capital expenditures that were unpaid and included in accounts payable at the
end of the reporting period. Thus capital expenditures were reported in the
consolidated statements of cash flows on an accrual basis rather than on a cash
basis which is inconsistent with the requirements of SFAS No. 95, "Statement of
Cash Flows". This error resulted in an over/understatement of cash flows from
investing activities with an equal over/understatement of cash flows from
operating activities. This restatement did not impact the Partnership's
previously reported balance sheets or statements of income.

The following table sets forth the effects of the restatement on certain line
items within the Partnership's previously reported consolidated statement of
cash flows for the nine months ended September 30, 2004:


<TABLE>
<CAPTION>
(in thousands)
                                            As
                                        Originally                       As
                                         Reported      Adjustment     Restated

<S>                                     <C>            <C>          <C>
Changes in working capital -
  accounts payable                         $(13,049)    $ 13,003    $    (46)

Net cash provided by operating
  activities                               $ 45,885     $ 13,003    $ 58,888

Cash flows from investing activities -
  capital expenditures                     $(22,609)    $(13,003)   $(35,612)

Net cash used in investing activities      $(22,609)    $(13,003)   $(35,612)

Accounts payable accruals for capital
  expenditures                             $     --     $  7,594    $  7,594


</TABLE>


The following table sets forth the effects of the restatement on certain line
items within the Partnership's previously reported consolidated statement of
cash flows for the nine months ended September 30, 2003:



<PAGE>


<TABLE>
<CAPTION>
(in thousands)
                                               As
                                           Originally                 As
                                            Reported   Adjustment   Restated

<S>                                       <C>          <C>         <C>

Changes in working capital -
  accounts payable                        $  (7,285)   $   6,839   $   (446)

Net cash provided by operating
  activities                              $  48,524    $   6,839   $ 55,363

Cash flows from investing activities -
  capital expenditures                    $(118,323)   $  (6,839)  $(125,162)

Net cash used in investing activities     $(118,323)   $  (6,839)  $(125,162)

Accounts payable accruals for capital
  expenditures                            $      --    $   9,102   $   9,102
</TABLE>

2. Provision for Income Taxes Restatement/Change in Accounting Principle
   Restatement:

Historically, Iroquois has included a provision for income taxes in its
presentation of the consolidated statements of income and the corresponding
amounts equivalent to deferred income taxes and regulatory assets-income tax in
the consolidated balance sheets. As a partnership, Iroquois should present the
Consolidated Statements of Income without the provision for taxes and should
present the Consolidated Balance Sheets without the amounts equivalent to
deferred income taxes and regulatory assets-income tax related. In addition, the
historical presentation of these items on the Consolidated Statements of Cash
Flows, the consolidated Statement of Changes in Partners' Equity and the Notes
to the Consolidated Financial Statements has been incorrect. Also, Management
determined that it had incorrectly presented its Consolidated Statements of
Income for the three and nine month periods ended September 30, 2003 by not
adjusting for the cumulative effect of a change in accounting principle related
to municipal property taxes.

The following table sets forth the restatement to the Consolidated Statements of
Income for the three and nine months ended September 30, 2004 and 2003, the
Consolidated Balance Sheets as of September 30, 2004 and December 31, 2003, the
Consolidated Statement of Changes in Partners' Equity for the nine months ended
September 30, 2004 and the Consolidated Statements of Cash Flows for the nine
months ended September 30, 2004 and 2003. Additionally, all such amounts have
been reflected as "Restated" elsewhere in these Notes to the Consolidated
Financial Statements.

<TABLE>
<CAPTION>
(in thousands)
                                                    As
                                                Originally                 As
                                                  Reported   Adjustment   Restated

<S>                                              <C>        <C>         <C>

Consolidated Statements of Income

For the three months ended September 30, 2004
Income Before Taxes                               $  8,345  $  (8,345)  $   -  <F1>
Provision for Taxes                                  3,113     (3,113)      -  <F1>
Net Income                                           5,232      3,113     8,345

For the three months ended September 30, 2003
Income Before Taxes                               $ 10,500  $ (10,500)  $   -  <F1>
Provision for Taxes                                  4,064     (4,064)      -  <F1>
Net Income                                           6,436      4,064    10,500

For the nine months ended September 30, 2004
Income Before Taxes                               $ 34,925  $ (34,925)  $   -  <F1>
Provision for Taxes                                 13,935    (13,935)      -  <F1>
Net Income                                          20,990     13,935    34,925

For the nine months ended September 30, 2003
Income Before Taxes                               $ 39,537  $ (39,537)  $   -  <F1>
Provision for Taxes                                 15,619    (15,619)      -  <F1>
Cumulative Effect of Change in
  Accounting Principle                                 -        6,196     6,196
Net Income                                          23,918     21,815    45,733


Consolidated Balance Sheets
As of September 30, 2004
Regulatory Assets - Income Tax Related            $ 19,965  $ (19,965) $    -  <F1>
Total Other Assets and Deferred Charges             33,581    (19,965)   13,616
Total Assets                                       860,273    (19,965)  840,308
Amounts Equivalent to Deferred Income Taxes:
 Generated by Partnership                          149,663   (149,663)      -  <F1>
 Payable by Partners                              (129,668)   129,668       -  <F1>
 Related to Other Comprehensive Income              (1,246)     1,246       -  <F1>
  Total Amounts Equivalent to Deferred Income Taxes 18,719    (18,719)      -  <F1>
Total Liabilities                                  512,064    (18,719)  493,345
Partners' Equity                                   348,209     (1,246)  346,963
Total Liabilities and Partners' Equity             860,273    (19,965)  840,308

Consolidated Balance Sheets
As of December 31, 2003
Regulatory Assets - Income Tax Related           $  19,174  $ (19,174) $    -  <F1>
Total Other Assets and Deferred Charges             34,030    (19,174)   14,856
Total Assets                                       848,705    (19,174)  829,531
Amounts Equivalent to Deferred Income Taxes:
 Generated by Partnership                          122,220   (122,220)      -  <F1>
 Payable by Partners                              (103,046)   103,046       -  <F1>
 Related to Other Comprehensive Income              (1,671)    (1,671)      -  <F1>
  Total Amounts Equivalent to Deferred Income Taxes 17,503    (17,503)      -  <F1>
Total Liabilities                                  536,062    (17,503)  518,559
Partners' Equity                                   312,643     (1,671)  310,972
Total Liabilities and Partners' Equity             848,705    (19,174)  829,531

Consolidated Statements of Cash Flows

For the nine months ended September 30, 2004
Net Income                                       $  20,990   $ 13,935  $ 34,925
Deferred regulatory asset-income tax related          (791)       791       -  <F1>
Amounts equivalent to deferred income taxes            791       (791)      -  <F1>
Income and other taxes payable by partners          13,935    (13,935)      -  <F1>

For the nine months ended September 30, 2003

Net Income                                       $  23,918   $ 21,815  $ 45,733
Deferred regulatory asset-income tax related        (3,701)     3,701       -  <F1>
Amounts equivalent to deferred income taxes          3,701     (3,701)      -  <F1>
Income and other taxes payable by partners          15,619     15,619       -  <F1>
Other current assets                                (2,653)    (3,331)   (5,984)
Other current liabilities                              226     (2,865)   (2,639)

Consolidated Statement of Changes in Partners' Equity
Partners' Equity Balance at December 31, 2003    $ 312,643   $ (1,671) $310,972
Net Income                                          20,990     13,935    34,925
Taxes Payable by Partners                           13,935     13,935       -  <F1>
Accumulated Other Comprehensive Income                 641        426     1,067
Partners' Equity Balance at September 30, 2004   $ 348,209   $ (1,246) $346,963

<FN>
<F1> Line item has been eliminated in the restated financial statements.
</FN>
</TABLE>


3. Comprehensive income consisted of the following:
<TABLE>
<CAPTION>
(in thousands)                        Three months ended       Nine months ended
                                         September 30,           September 30,
                                        2004        2003        2004        2003
                                      RESTATED    RESTATED    RESTATED    RESTATED
<S>                                    <C>        <C>         <C>         <C>
Net income                             $8,345     $10,500      $34,925     $39,537
Other comprehensive income
   Unrealized income on interest
   rate hedge                              33         695        1,066         774

Comprehensive income                   $8,378     $11,195      $35,991     $40,311

</TABLE>


4. Retirement Benefit Plans:

The components of net pension benefit costs included in the Partnership's
consolidated statements of income were as follows:

<TABLE>
<CAPTION>
(in thousands)
                                       Three months ended    Nine months ended
                                           September 30,       September 30,
                                          2004      2003      2004      2003
<S>                                      <C>       <C>       <C>       <C>
Service Cost                             $ 210     $ 203     $ 630     $ 609
Interest Cost                               77        62       231       186
Expected return on plan assets             (88)      (62)     (264)     (184)
Amortization of prior service cost           3         3         9         9
Recognition of net actuarial loss           15        14        45        42

Net periodic pension cost                $ 217     $ 219     $ 651     $ 662

Note 10 of the Notes to Consolidated Financial Statements in Iroquois' December
31, 2003 Form 10-K/A discusses the Partnership's expected contribution to its
pension plans. For the nine months ended September 30, 2004, $1.4 million of
contributions have been made to its pension plans. The Partnership does not plan
to make further contributions in 2004.

</TABLE>

5. Commitments and Contingencies:

Eastchester-Horizon Suit

On January 20, 2004, Horizon Offshore Contractors, Inc. ("Horizon") filed a
complaint against the Partnership and its operating company, Iroquois Pipeline
Operating Company ("IPOC") in the Supreme Court of the State of New York, New
York County (Index No. 04/600140). The complaint alleges that the Partnership
wrongfully terminated its agreement with Horizon to perform the Eastchester
construction work in Long Island Sound and that the Partnership committed other
breaches of such agreement in conjunction with the Eastchester construction
work. The complaint seeks damages in excess of $40 million. On April 7, 2004,
the Partnership filed in such court proceeding an amended answer and
counterclaims against Horizon totaling in excess of $66 million. Given the
preliminary stage of this matter, the Partnership is unable at this time to
assess the likelihood of a favorable or unfavorable outcome and/or the amount or
range of recovery or loss, if any, resulting from Horizon's claims and the
Partnership's counterclaims.

Cal Dive International, Inc.

On March 1, 2004 and in a duplicate filing on March 9, 2004, Cal Dive
International, Inc. ("Cal Dive") filed a Mechanic's Lien totaling $3.3 million
in the offices of the Clerk of Bronx and Suffolk Counties, respectively. Cal
Dive was in privity with Horizon Offshore Contractors, Inc. ("Horizon") and
provided services to Horizon during the Eastchester construction work. The
Partnership instructed Horizon to address the lien notice pursuant to its
contractual obligations. The Partnership also demanded further information from
Cal Dive on the particulars of its lien. The Partnership does not believe it
owes Cal Dive any monies and plans to vigorously contest the validity of the
liens. Furthermore, the Partnership, on April 1 and April 5, 2004 in compliance
with Section 6.2(c)(ii) of its Second Supplemental Indenture, dated August 13,
2003, posted bonds to discharge the Mechanic's Liens.

On September 10, 2004, Cal Dive filed a complaint against the Partnership in the
United States District Court for the Eastern District of New York. The complaint
alleges that Cal Dive has not been paid $3.3 million for work that it performed
on the Eastchester project. Iroquois filed an answer to the Cal-Dive action on
October 15, 2004 and commenced a third party action against Horizon on October
25, 2004. Given the preliminary stage of this matter, the Partnership is unable
at this time to assess the likelihood of a favorable or unfavorable outcome
and/or the amount or range of recovery or loss, if any, resulting from Cal
Dive's claims.

Tom Allen Construction Partnership

On June 14, 2004, Tom Allen Construction Partnership ("Tom Allen"), one of
Horizon's subcontractors for the Eastchester project, filed a complaint against
Horizon and Iroquois in the Supreme Court of the State of New York, New York
County. Tom Allen was responsible for performing the directional drills at
Northport and Hunts Point. Tom Allen is claiming that it has not been paid for
work associated with a failed directional drill at Hunt's Point and is seeking
$5.6 million in damages from Horizon and Iroquois. Iroquois served an answer to
the complaint and various discovery demands on July 30, 2004. Given the
preliminary stage of this matter, the Partnership is unable at this time to
assess the likelihood of a favorable or unfavorable outcome and/or the amount or
range of recovery or loss, if any, resulting from Tom Allen's claims.

Weeks Marine, Inc.

On July 21, 2004 Weeks Marine Inc. ("Weeks"), one of Horizon's subcontractors
for the Eastchester project, filed a complaint against Horizon and Iroquois in
the Supreme Court of the State of New York, New York County. Weeks was
responsible for certain marine construction operations including dredging, rock
placement, fabric placement and associated activities along the Eastchester
project. Weeks is claiming that it has not been paid for work associated with
the marine portion of the Eastchester project and is seeking $18.5 million in
damages from Horizon and Iroquois. Iroquois filed an answer to the complaint on
August 16, 2004. Given the preliminary stage of this matter, the Partnership is
unable at this time to assess the likelihood of a favorable or unfavorable
outcome and/or the amount or range of recovery or loss, if any, resulting from
Week's claims.

Capobianco, A. vs. Iroquois Gas & Consolidated Edison Partnership of New York

On January 28, 2004, Anthony Capobianco filed a complaint against Iroquois Gas
Transmission System, L.P., Iroquois Pipeline Operating Partnership and
Consolidated Edison Partnership of New York in the Supreme Court of the State of
New York, New York County (Index No. 101366/04). The complaint alleges that Mr.
Capobianco, an employee of Hallen Construction Partnership, Inc. ("Hallen"),
sustained personal injuries resulting from an electrical current causing severe
electrical shock while performing his duties as part of the construction of the
Hunts Point segment of the Partnership's Eastchester project. Hallen was the
Partnership's contractor employed to construct that segment of the project. The
claim is asserted for damages in the amount of $10 million. The Partnership has
notified its insurance carriers and an answer has been filed to the complaint.
Hallen's insurer has agreed to indemnify and defend Iroquois in this action up
to the $1 million limit of its general liability insurance policy. Additionally,
Hallen has coverage under an excess liability policy up to $20 million. Given
the preliminary nature of this matter, at this time, the Partnership is unable
to determine the likelihood of an unfavorable outcome and/or the amount or range
of loss, if any, in the event of an unfavorable outcome.

Eastchester Construction Incidents

On November 16, 2002, certain undersea electric transmission cables owned by
Long Island Lighting Partnership d/b/a The Long Island Power Authority, or LIPA,
and Connecticut Light and Power Partnership, or CL&P, were allegedly damaged
and/or severed when an anchor deployed by the DSV MR. SONNY, a work vessel
taking part in the construction of the Eastchester Extension, allegedly allided
with the cables. The MR. SONNY allegedly is owned by Cal Dive, a subcontractor
of the Partnership's general contractor, Horizon Offshore Contractors, Inc.

On December 6, 2002, Cal Dive commenced a maritime limitation of liability
action in the United States District Court for the Eastern District of New York,
seeking exoneration from or limitation of liability in respect of this incident.
LIPA, CL&P, the Partnership, Horizon, and Thales GeoSolutions Group, Ltd.
(another of Horizon's subcontractors), have all filed claims in the limitation
action. In addition, LIPA, CL&P and their subrogated underwriters (the "Cable
Interests") filed third-party claims against the Partnership and its operating
subsidiary, IPOC, as well as Horizon and Thales, seeking recovery for their
alleged losses. The Partnership filed cross-claims against Horizon and Thales
for indemnification in respect of the Cable Interests' claims, and Horizon filed
a third-party claim against Thales. The Cable Interests subsequently agreed to
dismiss their claim against IPOC, but without prejudice to their right to
re-file that claim if they deem necessary.

The Cable Interests originally claimed a total of $34.3 million in damages,
consisting of $14.4 million for repairs and repair related costs, including LIPA
and CL&P internal costs and overheads of $4.7 million, as well as $19.9 million
in consequential damages. In September 2004, the Cable Interests amended their
claim to $23.5 million, consisting of approximately $12.9 million for repairs
and repair related costs and $10.6 million in consequential damages.

The matter is presently in the latter stages of discovery, with a trial date
currently set for February 22, 2005.

In addition to the foregoing, the Partnership has been advised that the Town of
Huntington, New York may assert a claim against the Partnership alleging
violations of certain municipal ordinances on the basis of a claim that
dielectric fluid was released from the cable as a result of the incident.

Under the terms of the construction contract between Horizon and the
Partnership, Horizon is obligated to indemnify the Partnership for Horizon's
negligence associated with the construction of the Eastchester Extension.
Horizon is also contractually responsible for its subcontractors' negligence. As
required by the contract, Horizon named the Partnership as an additional named
insured under Horizon's policies of insurance. The Partnership understands that
it is covered under Horizon's policies to the extent that Horizon has assumed
liability to the Partnership under the contract. Based on Horizon's subcontracts
with Thales and Cal Dive, the Partnership may also be entitled to coverage as an
additional insured party under those parties' policies of insurance. In
addition, Thales's underwriters have agreed to indemnify the Partnership in
accordance with the indemnity provision in the Horizon/Thales contract,
including indemnity for the Partnership's attorneys' fees incurred to date and
going forward. This indemnity is subject to the policies' terms and limit of $10
million. The Partnership further believes it is adequately insured by its own
insurers. Therefore, based on its initial investigation, the Partnership's
management believes that this matter will not have a material adverse effect on
the Partnership's financial condition or results of operations.

On February 27, 2003, the New York Power Authority, or NYPA, informed the
Partnership that one of four cables that comprised its Y-49 facility, which is a
600 megawatt undersea electrical power interconnection between Westchester
County and LIPA's transmission system at Sands Point, New York, allegedly
sustained damage causing a disruption of power transmission over the line and
leakage of dielectric fluid. NYPA alleges that the damage was caused by an
anchor of Horizon's pipeline lay barge, the GULF HORIZON, which was in the
vicinity of NYPA's cable and was involved in work in the Eastchester Extension
at the time of the casualty.

By letter dated March 25, 2003, counsel representing NYPA and LIPA informed the
Partnership that they intend to hold the Partnership, Horizon and Horizon's
subcontractor, Thales, jointly and severally liable for the full extent of their
damages, which they allege includes emergency response costs, repair of the
damaged electrical cable, loss of use and disruption of service, and certain
other as yet unspecified damages arising out of or relating to the incident.

The Partnership is a party to an agreement with NYPA, which provides, among
other things, that the Partnership will indemnify NYPA for damage to the Y-49
cables, which results from the Partnership's or its contractors' negligence,
acts, omissions or willful misconduct. Under the terms of the construction
contract between Horizon and the Partnership, Horizon is obligated to indemnify
the Partnership for Horizon's negligence associated with the construction of the
Eastchester Extension. Horizon is also contractually responsible for its
sub-contractor's negligence. Pursuant to the contract, Horizon named the
Partnership as an additional named insured under Horizon's policies of
insurance. The Partnership is still investigating whether Horizon's insurance is
adequate to cover the Partnership for its potential losses in this matter. The
Partnership may also be entitled to indemnity as an additional insured under
Thales' policies of insurance, although this matter is also still subject to
further investigation. The Partnership has placed Horizon and its underwriters
on notice that it intends to hold Horizon responsible. The Partnership has
further requested that Horizon assume its defense and hold it harmless in
respect of this claim; however, to date, Horizon has rejected this request. The
Partnership has also placed its own insurance underwriters on notice and is
currently investigating the applicability of all available insurance coverages.

On August 15, 2003, Horizon commenced a maritime limitation of liability action
in the United States District Court for the Southern District of Texas, Houston
Division, captioned In the Matter of Horizon Vessels Inc., as owner of the GULF
HORIZON, seeking exoneration from or limitation of liability in connection with
this incident. Horizon's suit contends that if it is not entitled to
exoneration, its liability should be limited to $19.3 million, representing the
value of the GULF HORIZON and her pending freight, and Horizon's insurers have
provided an undertaking (subject to policy defenses) to pay any judgment that
may be rendered in the suit up to $19.3 million. NYPA, LIPA and the insurers of
the Y-49 cable (collectively, the "Y-49 Cable Interests") also have filed claims
in the limitation action asserting total damages of approximately $18.2 million.
On November 12, 2003, the Partnership filed an Answer in Horizon's action,
requesting that the limitation of liability action be dismissed and/or that the
limitation injunction be lifted to permit the Partnership to pursue its claims
against Horizon in the forum of its choice, or, in the alternative, that Horizon
be denied limitation rights under the Limitation Act. The Partnership also filed
a claim in Horizon's limitation action seeking indemnity for any liability it
may be found to have to the Y-49 Cable Interests as a result of the NYPA cable
incident as well as all losses suffered by the Partnership as a result thereof,
and, on a protective basis, seeking full damages for Horizon's breaches and
deficient performance under the Partnership/Horizon construction contract, which
claims are unrelated to the NYPA cable incident. Thales also has filed a claim
in the Horizon limitation action seeking indemnity for any liability it may be
found to have to the Y-49 Cable Interests or the Partnership. The Y-49 Cable
Interests and the Partnership both filed motions to transfer the Texas action to
the United States District Court for the Eastern District of New York. Thales
joined in those motions. By order entered February 27, 2004, the court denied
the motions to transfer. However, in doing so, the court confirmed that the
Partnership could pursue its contract claims against Horizon outside of the
limitation action and that Horizon had no right to limit its liability as to the
Partnership's contract claims. The Y-49 Cable Interests filed cross claims
against the Partnership alleging claims under the Crossing Agreement and in
common law tort.

The Y-49 Cable Interests filed a motion for partial summary judgment against the
Partnership on October 13, 2004. The motion asks the court to find the
Partnership liable for indemnity under the Crossing Agreement for all costs and
expenses incurred by the Y-49 Cable Interests directly related to the emergency
response to the incident and for the costs and expenses of the temporary and
permanent repairs. The Partnership believes the motion is premature.

The parties presently are engaging in document discovery, and the Partnership is
still in the process of investigating this incident and evaluating its rights,
obligations and responsibilities. Given the preliminary stage of this matter,
the Partnership is unable to assess the likelihood of an unfavorable outcome
and/or the amount or range of loss, if any, in the event of an unfavorable
outcome.

The Partnership has also learned that as part of the Eastchester construction
there may have been one or more violations by the contractor of the exclusionary
zones established around certain specified areas of possible cultural resources,
namely underwater archeological sites such as shipwrecks, along the pipeline's
marine route and the contractor may have placed anchors outside the authorized
construction corridor. At this time, the Partnership has no information that any
sites were in fact damaged. The Partnership has informed the FERC and the New
York State Office of Parks, Recreation and Historic Preservation of this matter.
At this time, the Partnership is unable to determine if there will be any
material adverse effect on the Partnership's financial condition and results of
operations due to this matter.

Pursuant to its agreements with the owners of the electric transmission cables
that the Eastchester facilities cross in the Long Island Sound, Iroquois
performed certain post construction surveys to verify the condition of the cable
crossings and confirm the location of the pipeline. Specifically, Iroquois had
constructed a "structure" over the Y-50 cable system consisting of lightweight
flexible concrete mattresses under the pipeline, specially fabricated concrete
blocks adjacent to the pipeline and crushed rock. The surveys and additional
follow-up studies indicate that the "structure" may have settled to a greater
extent than originally anticipated and that its location is believed to be 65
feet north of the location where the pipeline crosses the Y-50 cable. Iroquois
has been discussing this matter with the owner of the Y-50 cable system as to
whether and how these issues should be modified and has notified the FERC by
letter dated September 3, 2004. Given the preliminary stage of this matter,
Iroquois is unable to assess the likelihood of an unfavorable outcome and/or the
amount or range of costs, if any, in the event of an unfavorable outcome.

No liabilities have been recorded by Iroquois in conjunction with any of the
preceding legal matters.

FERC Docket No. RP04-136-000

On January 2, 2004 the Partnership filed a Section 4 rate change proceeding,
consistent with the settlement in Docket No. RP03-589, limited to rates for
service on the Eastchester Extension Project as certificated by FERC in Docket
No. CP00-232. The Eastchester Project was in-service on February 5, 2004. The
Partnership proposed a rate of $0.8444 per Dth on a 100% load-factor basis (as
compared with the Partnership's existing 100% load-factor inter-zone rate of
$0.4234 per Dth, which served as the initial rate per the certificate order).
The increased rate reflected, among other things, an increase in plant costs
from the certificate estimate of $210 million to a level of approximately $334
million. The higher plant costs are the result of a number of factors, including
delays in obtaining construction permits and authorizations; unanticipated
environmental costs; a failed directional drill; higher than expected labor
costs; and construction incidents associated with constructing the Project in a
highly congested marine corridor. Various customers filed motions in response to
the Partnership's requested rate change. On January 30, 2004 the FERC issued an
order accepting the rates and making them effective July 1, 2004, subject to
refund and subject to the outcome of hearings. On February 17, 2004, a
pre-hearing conference before the FERC resulted in a procedural schedule
outlining the various phases of the Partnership's rate filing proceeding with an
anticipated final order due by the end of the second quarter of 2005.

On June 15 and July 8, 2004, settlement conferences were convened at the FERC's
offices to attempt to negotiate a settlement of the issues in the rate case. As
a result of those conferences, the parties reached a settlement in principle of
all issues that was supported or not opposed by all participants to the
proceeding. On July 15, 2004 Iroquois submitted a motion to the Presiding
Administrative Law Judge to suspend the procedural schedule to allow the parties
to formalize the settlement agreement; such motion was granted by the judge on
July 16. Following additional discussions and negotiations with the parties,
Iroquois submitted a comprehensive settlement agreement on August 12, 2004. The
settlement agreement provides for recourse rates of $0.66 per dth for the period
July 1, 2004 through December 31, 2007 and $0.635 per dth for the period January
1, 2008 through December 31, 2011. In addition, Iroquois will not include in
future rates any future legal fees (incurred after June 30, 2004) incurred in
litigation regarding construction incidents associated with the original
Eastchester Project. A moratorium on rate changes, as spelled out more fully in
the settlement agreement, will also be in effect through December 31, 2011. The
settlement agreement was approved by the FERC on October 13, 2004.

In addition to settling the Eastchester recourse rates as set forth above,
Iroquois has also entered into negotiated rate agreements with all of the
initial shippers on the Eastchester Extension Project. The negotiated rates on a
100% load-factor equivalent basis range between $0.47 and $0.59 per dth
depending on whether the agreement was signed pre or post construction and the
length of the negotiated contract.

The recourse rates and negotiated individual Eastchester shipper rates, coupled
with cost overruns experienced on the Eastchester Project, will reduce the
Partnership's initial margins that were anticipated when the project application
was filed with FERC.

National Energy & Gas Transmission Inc. (NEGT) and its Subsidiaries' Bankruptcy
Filing

On July 8, 2003, PG&E Corporation reported that NEGT and a number of its
subsidiaries filed voluntary petitions for reorganization under Chapter 11 of
the U.S. Bankruptcy Code. These subsidiaries include PG&E Energy Trading
Holdings Corporation, PG&E Energy Trading-Gas Corporation, PG&E Energy
Trading-Power Corporation, PG&E ET Investments Corporation, and US Gen New
England, Inc. (US Gen NE).

US Gen NE had two firm transportation service agreements with the Partnership,
one for 40,702 Dth/d, which expires on November 1, 2013, and one for 12,000
Dth/d, which expires on April 1, 2018. The total monthly demand charges for both
contracts were $0.5 million. On September 5, 2003, the bankruptcy court
authorized the rejection of US Gen NE's two firm transportation contracts. In
February 2004, the Partnership entered into a ten year contract for the 12,000
Dth/d while the remaining unsubscribed capacity of 40,720 Dth/d will continue to
be remarketed on a short term basis until longer term market opportunities
emerge.

On October 15, 2003, the Partnership filed a proof of claim with the bankruptcy
court for $49.8 million, representing the present value of the two rejected
contracts. At this time the Partnership does not know what the disposition of
this claim will be nor its ultimate impact on the Partnership.

On September 15, 2004, NEGT announced that it had entered into an agreement with
GS Power Holdings II LLC (a subsidiary of Goldman Sachs) to purchase NEGT's
indirect equity interest in the Partnership. NEGT's indirect interest is held
through JMC-Iroquois, Inc. and Iroquois Pipeline Investment, LLC, both of which
represent a 5.77% interest in the Partnership. According to NEGT, the
acquisition is expected to close in the first quarter of 2005.

FERC Order No. 2004

On November 25, 2003 the FERC issued Order No. 2004 in FERC Docket No. RM01-10.
According to the FERC, Order No. 2004 adopts new standards of conduct that apply
uniformly to interstate natural gas pipelines and public utilities and that
replace standards of conduct currently in effect. The standards of conduct are
designed to ensure that transmission providers do not provide preferential
access to service or information to affiliated entities. Under the schedule
adopted by the FERC, on February 9, 2004 the Partnership submitted its plan and
schedule for implementing Order No. 2004. As required by said schedule, on June
1, 2004 the Partnership posted its revised standards of conduct on its internet
website, identifying the procedures established for implementing the FERC's
requirements. Additionally, as required by the order, on September 22, 2004, the
Partnership developed and posted on its website, a written procedure
implementing its standards of conduct and trained all its employees subject to
the standard. Management does not believe that the requirements of Order No.
2004 will have a material impact on the Partnership.

Athens Project (FERC Docket No. CP02-20-000)

On November 8, 2001, the Partnership filed an application with the FERC to
construct and operate its "Athens Project". Under this proposal, the Partnership
would construct a second compressor unit at its existing Athens, New York
compressor station. The facilities are designed to provide up to 70 MDth/d of
firm transportation to Athens Generating Company, L. P. ("Athens Generating")
with whom the Partnership has executed a firm transportation agreement for this
service. On June 3, 2002, the FERC issued a certificate authorizing the
Partnership to construct the Athens Project facilities. However, the Partnership
anticipated having adequate capacity on its system to serve the initial 70
MDth/d transportation needs of the Athens Generating facility. As a result of
this evaluation, capacity was made available on an interim basis, allowing the
Partnership to defer the commencement of construction of the Athens Project. By
letter dated April 22, 2003, the Partnership requested a 1-year extension from
the FERC of the deadline for completion of construction of the Athens Project,
or until December 3, 2004. On May 14, 2003, the FERC granted the Partnership's
request for the 1-year extension. As of September 30, 2004, the Partnership had
incurred approximately $2.3 million in construction expenditures related to the
Athens Project which is reflected on the balance sheet of the Partnership as
Construction work in progress. The Partnership continues to market this project
to potential customers and also continues to evaluate its feasibility. In the
event that the Partnership is unable to secure customers prior to the December
3, 2004 construction extension deadline, the project will be cancelled and the
$2.3 million in capital expenditures will be written off and charged to expense.

Brookfield Project (FERC Docket No. CP02-31-000)

On October 31, 2002 the FERC issued a certificate authorizing the Partnership to
construct the Brookfield Project facilities.

Based on communications with its prospective customers regarding the timing of
their needs for new firm transportation service, the Partnership has determined
that a temporary deferral of the construction of the Brookfield Project is
necessary. Specifically, Astoria Energy LLC, or Astoria, the largest shipper for
the Brookfield Project, had requested that its service be deferred until
November 1, 2005. On February 28, 2003, the Partnership and Astoria executed an
amendment to their precedent agreements reflecting this deferral. However, on
August 1, 2003, Astoria elected to terminate its precedent agreements with the
Partnership.

The Partnership plans, however, to continue to work directly with Astoria
regarding its future natural gas transportation requirements pending Astoria's
financing of its proposed electric generating facility for which it has a power
purchase agreement with Consolidated Edison Partnership of New York, Inc.

The other original Brookfield Project shipper, PPL Energy Plus, LLC, or PPL, has
also elected to terminate its precedent agreement, and the Partnership is
currently remarketing the Brookfield Project capacity entitlement relinquished
by PPL to other potential shippers. Additionally, the Partnership is exploring
other services and products that may negate the need to find a replacement
shipper. As of September 30, 2004, the Partnership had incurred approximately
$2.5 million in construction expenditures related to the Brookfield Project,
primarily related to the purchase of the Brookfield site.

In anticipation of these developments, on April 22, 2003, the Partnership
requested an eighteen month extension from the FERC to extend the construction
completion time of the Brookfield Project to October 31, 2005. On May 14, 2003,
the FERC granted the Partnership's request and extended the construction
completion date to November 1, 2005.

On June 27, 2003, the Partnership purchased real property at 60 High Meadow
Road, Brookfield, CT, which was previously approved by the FERC as suitable for
construction of the Brookfield compressor station. In accordance with the FERC
approval, the site must be remediated before construction takes place. On
November 3, 2004, the Connecticut Department of Environmental Protection
approved the project's site remediation plan and scope of work schedule. Work is
anticipated to begin in late November. Site remediation is not expected to have
a material adverse impact on the Partnership's operating results or financial
condition.


<PAGE>


PART I. FINANCIAL INFORMATION - (Continued)

ITEM 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS

See Note 2 to the Consolidated Financial Statements for an explanation of the
Provision for Income Taxes Restatement.

Overview
Iroquois Gas Transmission System, L.P., or the Partnership, is a Delaware
limited partnership. It owns and operates a 412-mile interstate natural gas
transmission pipeline from the Canada-United States border near Waddington, New
York to South Commack, Long Island, New York including an approximate 36-mile
mainline extension from Northport, New York through the Long Island Sound to
Hunts Point, New York, also referred to as the Eastchester Extension. The
Eastchester Extension was placed into service on February 5, 2004. The
Partnership provides service to local gas distribution companies, electric
utilities and electric power generators, as well as marketers and other
end-users, directly or indirectly, by connecting with pipelines and
interconnects throughout the northeastern United States. The Partnership is
exclusively a transporter of natural gas in interstate commerce and operates
under authority granted by the Federal Energy Regulatory Commission, or the
FERC. The Partnership was organized in 1989 and commenced full operations in
1992, creating a link between markets in the states of Connecticut,
Massachusetts, New Hampshire, New Jersey, New York and Rhode Island, and western
Canada natural gas supplies.

On November 9, 2004 TransCanada Corporation and Shell US Gas & Power LLC
announced plans to develop an offshore liquefied natural gas (LNG)
regasification terminal, named Broadwater Energy, in the New York State waters
of Long Island Sound. The expected in-service date of the facility is late 2010.
Iroquois has been in discussions with the proponents of this project as to
potential interconnection of the LNG terminal with Iroquois' existing
facilities; those discussions are continuing. Given the preliminary stage of
this matter, Iroquois is unable to assess the possible effects, if any, of the
LNG project, if ultimately constructed, on its system.

Results of Operations
The components of Operating Revenues and Volumes Transported are provided in the
following table:

<TABLE>
<CAPTION>
                                      Three months ended     Nine months ended
Revenues and Volumes Delivered           September 30,         September 30,
                                          2004    2003          2004    2003
<S>                                      <C>     <C>           <C>     <C>
Revenues (dollars in millions)
Long-term firm reserved service          $ 32.6  $ 27.2        $ 99.5  $ 86.3
Short-term firm/interruptible/other<F2>     3.5     2.4          12.2    11.9
Total revenues                           $ 36.1  $ 29.6        $111.7  $ 98.2

Volumes delivered (million dekatherms)
Long-term firm reserved service            70.4    71.5         217.4   212.8
Short-term firm/interruptible/other<F2>    19.8     9.9          54.0    41.5
Total volumes delivered                    90.2    81.4         271.4   254.3
<FN>
<F2>Short-term firm represents firm service contracts of less than one year.
Other revenue includes deferred asset surcharges, park and loan service revenue
and marketing fees.
</FN>
</TABLE>

The Partnership receives revenues under long-term firm reserved transportation
service contracts with shippers in accordance with service rates approved by the
FERC. The Partnership also has interruptible transportation service revenues
which are at the margin and thus can have a significant impact on net income.
Such revenues include short-term firm reserved transportation service contracts
having terms of less than one year as well as standard interruptible
transportation service contracts. While it is common for pipelines to be
obligated under their FERC-approved rate structures to share some of their
interruptible transportation service revenues with long-term firm reserved
service shippers, Iroquois is not currently obligated to do so under the terms
of its currently effective rate settlement which expires December 31, 2007.
However, there can be no assurance that this will be the case in the future.

Three-month period ended September 30, 2004 compared to the three-month period
ended September 30, 2003.

Revenues. Total revenues increased $6.5 million, or 22.0%, to $36.1 million for
the three-month period ended September 30, 2004 from $29.6 million for the
three-month period ended September 30, 2003.

Long-term firm reserved service revenues increased $5.4 million, or 19.9%, to
$32.6 million for the three months ended September 30, 2004 from $27.2 million
for the same period in 2003. This increase was primarily due to additional
revenues from the Eastchester Extension of approximately $7.3 million due to the
February 5, 2004 in-service date of the Eastchester Extension, and approximately
$0.8 million of revenues attributable to the commencement of the Athens contract
in September of 2003. These increases were partially offset by decreased
long-term firm reserved service revenues primarily due to a rate decrease
effective July 1, 2004 of approximately $0.03 per dekatherm as well as the loss
of the firm revenue stream associated with US Gen New England, which filed for
bankruptcy in 2003. Portions of the US Gen New England volumes were
re-contracted under short-term contracts.

Short-term firm/interruptible/other revenues increased $1.1 million, or 45.8%,
to $3.5 million for the three-month period ended September 30, 2004 from $2.4
million for the same period in 2003, primarily due to higher volumes associated
with increased market demand for natural gas during the three-month period ended
September 30, 2004 as compared to the same period in 2003.

Operation and Maintenance Expense. Operation and maintenance expense includes
operating, maintenance and administrative expenses for the Partnership's
corporate office in Shelton, Connecticut and field support for the mainline,
metering and compression facilities. Operation and maintenance expense increased
$1.1 million, or 17.7%, to $7.3 million for the three-month period ended
September 30, 2004 from $6.2 million for the three-month period ended September
30, 2004, primarily due to an increase in regulatory expenses, employee benefit
costs and field operation and maintenance costs, as well as a decrease in
capitalized payroll.

Depreciation and Amortization. Depreciation and amortization increased $2.1
million, or 35.0%, to $8.1 million for the three-month period ended September
30, 2004 from $6.0 million for the same period in 2003, primarily due to the
February 5, 2004 in-service date of the Eastchester Extension.

Taxes other than income taxes. Taxes other than income taxes encompass property
and school taxes paid to various state jurisdictions for mainline, metering and
compression facilities along the pipeline system of Iroquois. Taxes other than
income taxes increased $0.8 million or 24.2% to $4.1 million for the three-month
period ended September 30, 2004 from $3.3 million for the three-month period
ended September 30, 2003 primarily due to assessments on facilities related to
the Eastchester Extension.

Other Income/(Expenses). Other income/(expenses) include certain investment
income and the net of income and expense adjustments not recognized elsewhere.
Other income/(expenses) decreased $2.5 million, for the three-month period ended
September 30, 2004 as compared to the three-month period ended September 30,
2003 primarily due to a decrease in the allowance for equity funds used during
construction ("equity AFUDC"). The decrease in the equity AFUDC related
primarily to the February 5, 2004 in-service date of the Eastchester Extension.

Interest Expense, Net. Interest expense, net increased $2.3 million, or 37.7%,
to $8.4 million for the three-month period ended September 30, 2004 from $6.1
million for the three-month period ended September 30, 2003 primarily due to a
decrease in interest capitalized, related to the February 5, 2004 in-service
date of the Partnership's Eastchester Extension.

Nine-month period ended September 30, 2004 compared to the Nine-month period
ended September 30, 2003.

Revenues. Total revenues increased $13.5 million, or 13.7%, to $111.7 million
for the nine-month period ended September 30, 2004 from $98.2 million for the
nine-month period ended September 30, 2003.

Long-term firm reserved service revenues increased $13.2 million, or 15.3%, to
$99.5 million for the nine months ended September 30, 2004 from $86.3 million
for the same period in 2003. This increase was primarily due to additional
revenues from the Eastchester Extension of approximately $15.0 million due to
the February 5, 2004 in-service date of the Eastchester Extension, and
approximately $3.6 million of revenues attributable to the commencement of the
Athens contract in September of 2003. These increases were partially offset by
decreased long-term firm reserved service revenues primarily due to a rate
decrease effective July 1, 2004 of approximately $0.03 per dekatherm as well as
the loss of the firm revenue stream associated with US Gen New England, which
filed for bankruptcy in 2003. Portions of the US Gen New England volumes were
re-contracted under short-term contracts.

Short-term firm/interruptible/other revenues increased $0.3 million, or 2.5%, to
$12.2 million for the nine-month period ended September 30, 2004 from $11.9
million for the same period in 2003, primarily due to increased market demand
for natural gas in the second and third quarters of 2004, partially offset by
lower volumes associated with softer market demand for natural gas as a result
of warmer weather and more competitive oil prices during the first quarter of
2004 as compared to the same period in 2003.

Operation and Maintenance Expense. Operation and maintenance expense includes
operating, maintenance and administrative expenses for the Partnership's
corporate office in Shelton, Connecticut and field support for the mainline,
metering and compression facilities. Operation and maintenance expense increased
$1.7 million or 9.3% to $20.0 million for the nine-month period ended September
30, 2004 from $18.3 million for the nine-month period ended September 30, 2003,
primarily due to an increase in regulatory expenses, employee benefit costs and
field operation and maintenance costs, as well as a decrease in capitalized
payroll.

Depreciation and Amortization. Depreciation and amortization increased $5.5
million, or 30.6%, to $23.5 million for the nine-month period ended September
30, 2004 from $18.0 million for the same period in 2003, primarily due to the
February 5, 2004 in-service date of the Eastchester Extension.

Taxes other than income taxes. Taxes other than income taxes encompass property
and school taxes paid to various state jurisdictions for mainline, metering and
compression facilities along the pipeline system of Iroquois. Taxes other than
income taxes increased $1.2 million or 12.9% to $10.5 million for the nine-month
period ended September 30, 2004 from $9.3 million for the nine-month period
ended September 30, 2003, primarily due to assessments on facilities related to
the Eastchester Extension.

Other Income/(Expenses). Other income/(expenses) include certain investment
income and the net of income and expense adjustments not recognized elsewhere.
Other income/(expenses) decreased $4.9 million, or 80.3%, to $1.2 million for
the nine-month period ended September 30, 2004 from $6.1 million for the
nine-month period ended September 30, 2003 primarily due to a decrease in equity
AFUDC. The decrease in the equity AFUDC related primarily to the February 5,
2004 in-service date of the Eastchester Extension.

Interest Expense, Net. Interest expense, net increased $5.0 million, or 26.3%,
to $24.0 million for the nine-month period ended September 30, 2004 from $19.0
million for the nine-month period ended September 30, 2003 primarily due to a
decrease in interest capitalized, related to the February 5, 2004 in-service
date of the Partnership's Eastchester Extension.

Liquidity and Capital Resources

See Note 1 to the Consolidated Financial Statements for an explanation of the
restatement of the Consolidated Statements of Cash Flows.

For the first nine months of 2004, the Partnership's source of financing has
been cash flow from operations. The Partnership's ongoing operations will
require the availability of funds to service debt, fund working capital, and
make capital expenditures on the Partnership's existing facilities and expansion
projects. The Partnership expects to fund its 2004 capital expenditures through
internal sources.

Net cash provided by operating activities increased to $58.9 million in the
first nine months of 2004 compared to $55.4 million in the first nine months of
2003, primarily due to an increase in depreciation expense and a decrease in
equity AFUDC, due to the Eastchester Extension Project, partially offset by a
decrease in pre tax net income. Net cash used for financing activities was $16.7
million for the first nine months of 2004, consisting of the repayment of
long-term debt. Net cash provided by financing activities was $78.3 million
during the same period in 2003, primarily due to bank borrowings under the
Partnership's amended credit agreement.

The Partnership has a $10.0 million, 364-day, variable rate revolving line of
credit to support working capital requirements. As of September 30, 2004 and
December 31, 2003, the outstanding principal balance on the revolving credit
facility was $10.0 million.

     Capital expenditures in the first nine months of 2004 were $35.6 million,
compared to $125.2 million in the first nine months of 2003, reflecting
primarily the February 5, 2004 in-service date of the Partnership's Eastchester
Extension.

Total capital expenditures for 2004 are estimated to be approximately $49
million, including approximately $44 million related to the Eastchester
Extension. The remaining capital expenditures planned for 2004 are primarily for
various general plant purchases.

The Partnership's management makes recommendations to the partnership management
committee regarding the amount and timing of distributions to partners. The
amount and timing of distributions is subject to internal cash requirements for
construction, financing and operational requirements. Distributions and cash
calls require the approval of the management committee. There were no cash
distributions to partners during the first nine months of 2004 or during the
same period in 2003.

Off-Balance Sheet Transactions

At September 30, 2004, the Partnership had no off-balance sheet transactions,
arrangements or other relationships with unconsolidated entities or persons that
would adversely affect liquidity, availability of capital resources, financial
position or results of operations.

Information Regarding Forward Looking Statements

This quarterly report contains various forward-looking statements within the
meaning of Section 27A of the Securities Act of 1933, as amended and Section 21E
of the Securities Exchange Act of 1934, as amended. Such forward-looking
statements are based on current expectations, are not guarantees of future
performance and include assumptions about future market conditions, operations
and results. They are made in reliance on the "safe harbor" provisions of the
Private Securities Litigation Reform Act of 1995. The Partnership can give no
assurance that such expectations will be achieved. Among the many factors that
could cause actual results to differ materially from those in the
forward-looking statements herein are: future demand and prices for natural gas;
availability of supplies of Canadian natural gas; regulatory, political,
legislative and judicial developments, particularly with regard to regulation by
the Federal Energy Regulatory Commission; the cost of the Partnership's
expansion projects, including the Eastchester Extension; competitive conditions
in the marketplace; changes in the receptivity of the financial markets to the
Partnership or other oil and gas credit similar to Iroquois and, accordingly,
our strategy for financing any such change in business strategy or expansion. A
discussion of these and other factors which may affect our actual results,
performance, achievements or financial position is contained in the "Risk
Factors" section of the Partnership's Annual Report on Form 10-K, which is on
file with the United States Securities and Exchange Commission.

<PAGE>


PART I. FINANCIAL INFORMATION - (Continued)

  ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Market risk represents the risk of changes in value of a financial instrument,
derivative or non-derivative, caused by fluctuations in interest rates and
prices. The following discussion of the Partnership's risk management activities
includes forward-looking statements that involve risks and uncertainties. Actual
results could differ materially from those contemplated in the forward-looking
statements. The Partnership handles market risks in accordance with established
policies, which may include various derivative transactions.

The financial instruments held or issued by the Partnership are for purposes
other than trading or speculation. The Partnership is exposed to risk resulting
from interest rate changes on its variable-rate debt. The Partnership uses
interest rate swap agreements to manage the risk of increases in certain
variable rate issues. It records amounts paid and received under those
agreements as adjustments to the interest expense of the specific debt issues.
The Partnership believes that there is no material market risk associated with
these agreements. As of September 30, 2004, the Partnership had $98.9 million of
variable-rate debt outstanding, of which approximately $27.8 million is fixed
out under the interest rate swap agreements. Holding other variables constant,
including levels of indebtedness, a one-percentage point change in interest
rates would impact pre-tax earnings by approximately $0.7 million.

The Partnership's pension plan assets are made up of equity and fixed income
investments. Fluctuations in those markets could cause the Partnership to
recognize increased or decreased pension income or expense.

<PAGE>


          PART I. FINANCIAL INFORMATION - (Concluded)

                    ITEM 4. CONTROLS AND PROCEDURES

DISCLOSURE CONTROLS AND PROCEDURES

The Partnership maintains disclosure controls and procedures that are designed
to ensure that information required to be disclosed in the Partnership's SEC
filings is recorded, processed, summarized and reported within the time periods
specified in the SEC's rules and forms, and that such information is accumulated
and communicated to management, including the Partnership's principal executive
officer and principal financial officer, as appropriate, to allow timely
decisions regarding required disclosure based on the definition of "disclosure
controls and procedures", in Rules 13a-15(e) and 15d-15(e) promulgated under the
Securities Exchange Act of 1934.

Management, under the supervision and with the participation of the
Partnership's principal executive officer and principal financial officer,
conducted an evaluation of the effectiveness of the design and operation of the
Partnership's disclosure controls and procedures as of the end of the period
covered by this report. In connection with the restatements described in Notes 1
and 2 to the Partnership's consolidated financial statements, management
determined that there were material weaknesses in the Partnership's internal
control over financial reporting as of September 30, 2004, as more fully
described below. Based on that evaluation and because of the material weaknesses
described below, the principal executive officer and principal financial officer
have concluded that the Partnership's disclosure controls and procedures were
not effective as of September 30, 2004.

Notwithstanding the existence of the material weaknesses described below,
Management believes that the consolidated financial statements in this Form
10-Q/A fairly present, in all material respects, the Partnership's financial
condition as of September 30, 2004 and 2003, and results of its operations and
cash flows for three and nine month periods ended September 30, 2004 and 2003,
in conformity with U.S. generally accepted accounting principles (GAAP).

INTERNAL CONTROL OVER FINANCIAL REPORTING

A material weakness is a control deficiency, or combination of control
deficiencies, that results in more than a remote likelihood that a material
misstatement of the annual or interim financial statements will not be prevented
or detected. The following material weaknesses were identified by management as
of September 30, 2004:

1. The Partnership did not maintain effective controls over the preparation and
review of its consolidated statement of cash flows. Specifically, the
Partnership did not maintain effective controls to appropriately exclude from
capital expenditures reported in the consolidated statement of cash flows,
capital expenditures that were unpaid and included in accounts payable at the
end of the reporting period. Thus capital expenditures were reported in the
consolidated statement of cash flows on an accrual basis rather than on a cash
basis. This error resulted in a misstatement of cash flows from investing and
operating activities. This control deficiency resulted in the restatement of the
consolidated financial statements for the three and nine month periods ended
September 30, 2003 and 2004. Additionally, this control deficiency could result
in a misstatement of the consolidated statement of cash flows that would result
in a material misstatement to annual or interim financial statements that would
not be prevented or detected. Accordingly, management has determined that this
control deficiency constitutes a material weakness.

2. The Partnership did not maintain effective controls over the initial
selection of and application of generally accepted accounting principles related
to the accounting for and presentation of income taxes, including regulatory
assets-income tax related, amounts equivalent to deferred income taxes, income
and other taxes payable by partners and the related income tax provision.
Specifically, the Partnership's controls failed to identify that, as an entity
not subject to Federal income tax, the Partnership should not have adopted
generally accepted accounting principles relative to deferred income tax
accounting in the preparation and presentation of its consolidated financial
statements. This control deficiency resulted in the restatement of the
consolidated financial statements for the three and nine month periods ended
September 30, 2003 and 2004. Additionally, this control deficiency could result
in a misstatement of the aforementioned accounts and related disclosures that
would result in a material misstatement to annual or interim financial
statements that would not be prevented or detected. Accordingly, management has
determined that this control deficiency constitutes a material weakness.

3. The Partnership did not maintain effective controls in the adoption of a
change in generally accepted accounting principles. Specifically, with respect
to a change in accounting principle related to municipal property taxes that
occurred in the fourth quarter of 2003, the Partnership failed to determine that
the cumulative effect adjustment should have been recognized and measured
retroactively as of January 1, 2003, rather than as of December 31, 2003.
Additionally, the Partnership failed to record property tax expense for each
subsequent period as recognized and measured in accordance with the new
accounting principle. This control deficiency resulted in the restatement of the
consolidated financial statements for the three and nine month periods ended
September 30, 2003 and 2004. Additionally, this control deficiency could result
in a misstatement of the cumulative effective of a change in accounting
principle, including periodic property tax expense, that would result in a
material misstatement to annual or interim financial statements that would not
be prevented or detected. Accordingly, management has determined that this
control deficiency constitutes a material weakness.

REMEDIATION ACTIVITIES

In an effort to remediate the material weakness in the Partnership's internal
control over financial reporting with respect to controls over the preparation
and review of its consolidated statement of cash flows, subsequent to September
30, 2004, management has implemented a process to identify the amount of unpaid
capital expenditures at the end of the reporting period to ensure capital
expenditures are properly reflected in the Consolidated Statement of Cash Flows
in accordance with generally accepted accounting principles. Specifically, an
analysis of accounts payable is performed at the end of each quarter to
determine whether accruals for capital expenditures have been recorded. If
capital expenditure accruals have been recorded, those accruals are eliminated
from the Consolidated Statement of Cash Flows and shown as a supplemental
disclosure of cash flow information. In addition, in instances where capital
expenditure accruals have been settled, those settlements are shown as a cash
outflow to investing activities on the Consolidated Statements of Cash Flows.
The impact of these changes will then be evaluated and reflected, as
appropriate, on any interim and annual consolidated financial statements.
Management believes these processes, when fully implemented and tested, will
remediate the material weaknesses described above.

In an effort to remediate the material weaknesses in the Partnership's internal
control over financial reporting related to the initial selection of and
application of generally accepted accounting principles related to income taxes
and the adoption of a change in generally accepted accounting principles
described above, management has implemented a process to exclude the provision
for income taxes from the Consolidated Statements of Income and to also exclude
the amounts equivalent to deferred income taxes and regulatory assets-income tax
related from the Consolidated Balance Sheets and related financial statements.
Specifically, an analysis of the Consolidated Balance Sheets, the Consolidated
Statements of Income, the Consolidated Statements of Cash Flows and the
Consolidated Statements of Changes in Partners' Equity is performed at the end
of each quarter to identify all income tax related items. Since the Partnership
is regulated by the Federal Energy Regulatory Commission, income taxes will
continue to be recorded for regulatory purposes. Those income tax related items
will be eliminated from the Consolidated Statements of Income, the Consolidated
Statements of Cash Flows and the Consolidated Statements of Changes in Partners'
Equity to be included in future Forms 10-Q and Forms 10-K. In addition,
management has instituted a process to correctly account for and present in the
annual and interim financial statements of the Partnership, changes in
accounting principles as required under Accounting Principles Board (APB)
Opinion No. 20. Specifically, if applicable, a review of changes in accounting
principles will be performed by management at the end of each quarter. This
review will include a review of any prior year changes in accounting principles.
The impact of these changes will then be evaluated and reflected, as
appropriate, on any interim and annual consolidated financial statements.
Management believes these processes, when fully implemented and tested, will
remediate the material weaknesses described above.

Other than as described above, there have been no other changes in the
Partnership's internal control over financial reporting that have materially
affected, or are reasonably likely to materially affect, the Partnership's
internal control over financial reporting.


                        PART II. OTHER INFORMATION

         IROQUOIS GAS TRANSMISSION SYSTEM, L.P. AND SUBSIDIARY


ITEM 1. Legal Proceedings

A description of the Partnership's legal proceedings is contained in the
Partnership's Annual Report on Form 10-K for the year ended December 31, 2003.
Those descriptions remain accurate except as updated below.

Eastchester-Horizon Suit

On January 20, 2004, Horizon Offshore Contractors, Inc. ("Horizon") filed a
complaint against the Partnership and its operating company, Iroquois Pipeline
Operating Company ("IPOC") in the Supreme Court of the State of New York, New
York County (Index No. 04/600140). The complaint alleges that the Partnership
wrongfully terminated its agreement with Horizon to perform the Eastchester
construction work in Long Island Sound and that the Partnership committed other
breaches of such agreement in conjunction with the Eastchester construction
work. The complaint seeks damages in excess of $40 million. On April 7, 2004,
the Partnership filed in such court proceeding an amended answer and
counterclaims against Horizon totaling in excess of $66 million. Given the
preliminary stage of this matter, the Partnership is unable at this time to
assess the likelihood of a favorable or unfavorable outcome and/or the amount or
range of recovery or loss, if any, resulting from Horizon's claims and the
Partnership's counterclaims.

Cal Dive International, Inc.

On March 1, 2004 and in a duplicate filing on March 9, 2004, Cal Dive
International, Inc. ("Cal Dive") filed a Mechanic's Lien totaling $3.3 million
in the offices of the Clerk of Bronx and Suffolk Counties, respectively. Cal
Dive was in privity with Horizon Offshore Contractors, Inc. ("Horizon") and
provided services to Horizon during the Eastchester construction work. The
Partnership instructed Horizon to address the lien notice pursuant to its
contractual obligations. The Partnership also demanded further information from
Cal Dive on the particulars of its lien. The Partnership does not believe it
owes Cal Dive any monies and plans to vigorously contest the validity of the
liens. Furthermore, the Partnership, on April 1 and April 5, 2004 in compliance
with Section 6.2(c)(ii) of its Second Supplemental Indenture, dated August 13,
2003, posted bonds to discharge the Mechanic's Liens.

On September 10, 2004, Cal Dive filed a complaint against the Partnership in the
United States District Court for the Eastern District of New York. The complaint
alleges that Cal Dive has not been paid $3.3 million for work that it performed
on the Eastchester project. Iroquois filed an answer to the Cal-Dive action on
October 15, 2004 and commenced a third party action against Horizon on October
25, 2004. Horizon's time to answer or move expires on December 15, 2004. Given
the preliminary stage of this matter, the Partnership is unable at this time to
assess the likelihood of a favorable or unfavorable outcome and/or the amount or
range of recovery or loss, if any, resulting from Cal Dive's claims.

Tom Allen Construction Company

On June 14, 2004, Tom Allen Construction Company ("Tom Allen"), one of Horizon's
subcontractors for the Eastchester project, filed a complaint against Horizon
and Iroquois in the Supreme Court of the State of New York, New York County. Tom
Allen was responsible for performing the directional drills at Northport and
Hunts Point. Tom Allen is claiming that it has not been paid for work associated
with a failed directional drill at Hunt's Point and is seeking $5.6 million in
damages from Horizon and Iroquois. Iroquois served an answer to the complaint
and various discovery demands on July 30, 2004. Given the preliminary stage of
this matter, the Partnership is unable at this time to assess the likelihood of
a favorable or unfavorable outcome and/or the amount or range of recovery or
loss, if any, resulting from Tom Allen's claims.

Weeks Marine, Inc.

On July 21, 2004 Weeks Marine Inc. ("Weeks"), one of Horizon's subcontractors
for the Eastchester project, filed a complaint against Horizon and Iroquois in
the Supreme Court of the State of New York, New York County. Weeks was
responsible for certain marine construction operations including dredging, rock
placement, fabric placement and associated activities along the Eastchester
project. Weeks is claiming that it has not been paid for work associated with
the marine portion of the Eastchester project and is seeking $18.5 million in
damages from Horizon and Iroquois. Iroquois filed an answer to the complaint on
August 16, 2004. Given the preliminary stage of this matter, the Partnership is
unable at this time to assess the likelihood of a favorable or unfavorable
outcome and/or the amount or range of recovery or loss, if any, resulting from
Week's claims.

Capobianco, A. vs. Iroquois Gas & Consolidated Edison Company of New York

On January 28, 2004, Anthony Capobianco filed a complaint against Iroquois Gas
Transmission System, L.P., Iroquois Pipeline Operating Company and Consolidated
Edison Company of New York in the Supreme Court of the State of New York, New
York County (Index No. 101366/04). The complaint alleges that Mr. Capobianco, an
employee of Hallen Construction Company, Inc. ("Hallen"), sustained personal
injuries resulting from an electrical current causing severe electrical shock
while performing his duties as part of the construction of the Hunts Point
segment of the Partnership's Eastchester project. Hallen was the Partnership's
contractor employed to construct that segment of the project. The claim is
asserted for damages in the amount of $10 million. The Partnership has notified
its insurance carriers and an answer has been filed to the complaint. Hallen's
insurer has agreed to indemnify and defend Iroquois in this action up to its $1
million limit of its general liability insurance policy. Additionally, Hallen
has coverage under an excess liability policy up to $20 million. Given the
preliminary nature of this matter, at this time, the Partnership is unable to
determine the likelihood of an unfavorable outcome and/or the amount or range of
loss, if any, in the event of an unfavorable outcome.

Eastchester Construction Incidents

On November 16, 2002, certain undersea electric transmission cables owned by
Long Island Lighting Company d/b/a The Long Island Power Authority, or LIPA, and
Connecticut Light and Power Company, or CL&P, were allegedly damaged and/or
severed when an anchor deployed by the DSV MR. SONNY, a work vessel taking part
in the construction of the Eastchester Extension, allegedly allided with the
cables. The MR. SONNY allegedly is owned by Cal Dive, a subcontractor of the
Partnership's general contractor, Horizon Offshore Contractors, Inc.

On December 6, 2002, Cal Dive commenced a maritime limitation of liability
action in the United States District Court for the Eastern District of New York,
seeking exoneration from or limitation of liability in respect of this incident.
LIPA, CL&P, the Partnership, Horizon, and Thales GeoSolutions Group, Ltd. (one
of Horizon's subcontractors), have all filed claims in the limitation action. In
addition, LIPA, CL&P and their subrogated underwriters (the "Cable Interests")
filed third-party claims against the Partnership and its operating subsidiary,
IPOC, as well as Horizon and Thales, seeking recovery for their alleged losses.
The Partnership filed cross-claims against Horizon and Thales for
indemnification in respect of the Cable Interests' claims, and Horizon filed a
third-party claim against Thales. The Cable Interests subsequently agreed to
dismiss their claim against IPOC, but without prejudice to their right to
re-file that claim if they deem necessary.

The Cable Interests originally claimed a total of $34.3 million in damages,
consisting of $14.4 million for repairs and repair related costs, including LIPA
and CL&P internal costs and overheads of $4.7 million, as well as $19.9 million
in consequential damages. In September 2004, the Cable Interests amended their
claim to $23.5 million, consisting of approximately $12.9 million for repairs
and repair related costs and $10.6 million in consequential damages.

The matter is presently in the latter stages of discovery, with a trial date
currently set for February 22, 2005.

In addition to the foregoing, the Partnership has been advised that the Town of
Huntington, New York may assert a claim against the Partnership alleging
violations of certain municipal ordinances on the basis of a claim that
dielectric fluid was released from the cable as a result of the incident.

Under the terms of the construction contract between Horizon and the
Partnership, Horizon is obligated to indemnify the Partnership for Horizon's
negligence associated with the construction of the Eastchester Extension.
Horizon is also contractually responsible for its subcontractors' negligence. As
required by the contract, Horizon named the Partnership as an additional named
insured under Horizon's policies of insurance. The Partnership understands that
it is covered under Horizon's policies to the extent that Horizon has assumed
liability to the Partnership under the contract. Based on Horizon's subcontracts
with Thales and Cal Dive, the Partnership may also be entitled to coverage as an
additional insured party under those parties' policies of insurance. In
addition, Thales's underwriters have agreed to indemnify the Partnership in
accordance with the indemnity provision in the Horizon/Thales contract,
including indemnity for the Partnership's attorneys' fees incurred to date and
going forward. This indemnity is subject to the policies' terms and limit of $10
million. The Partnership further believes it is adequately insured by its own
insurers. Therefore, based on its initial investigation, the Partnership's
management believes that this matter will not have a material adverse effect on
the Partnership's financial condition or results of operations.

On February 27, 2003, the New York Power Authority, or NYPA, informed the
Partnership that one of four cables that comprised its Y-49 facility, which is a
600 megawatt undersea electrical power interconnection between Westchester
County and LIPA's transmission system at Sands Point, New York, allegedly
sustained damage causing a disruption of power transmission over the line and
leakage of dielectric fluid. NYPA alleges that the damage was caused by an
anchor of Horizon's pipeline lay barge, the GULF HORIZON, which was in the
vicinity of NYPA's cable and was involved in work in the Eastchester Extension
at the time of the casualty.

By letter dated March 25, 2003, counsel representing NYPA and LIPA informed the
Partnership that they intend to hold the Partnership, Horizon and Horizon's
subcontractor, Thales, jointly and severally liable for the full extent of their
damages, which they allege includes emergency response costs, repair of the
damaged electrical cable, loss of use and disruption of service, and certain
other as yet unspecified damages arising out of or relating to the incident.

The Partnership is a party to an agreement with NYPA, which provides, among
other things, that the Partnership will indemnify NYPA for damage to the Y-49
cables, which results from the Partnership's or its contractors' negligence,
acts, omissions or willful misconduct. Under the terms of the construction
contract between Horizon and the Partnership, Horizon is obligated to indemnify
the Partnership for Horizon's negligence associated with the construction of the
Eastchester Extension. Horizon is also contractually responsible for its
sub-contractor's negligence. Pursuant to the contract, Horizon named the
Partnership as an additional named insured under Horizon's policies of
insurance. The Partnership is still investigating whether Horizon's insurance is
adequate to cover the Partnership for its potential losses in this matter. The
Partnership may also be entitled to indemnity as an additional insured under
Thales' policies of insurance, although this matter is also still subject to
further investigation. The Partnership has placed Horizon and its underwriters
on notice that it intends to hold Horizon responsible. The Partnership has
further requested that Horizon assume its defense and hold it harmless in
respect of this claim; however, to date, Horizon has rejected this request. The
Partnership has also placed its own insurance underwriters on notice and is
currently investigating the applicability of all available insurance coverages.

On August 15, 2003, Horizon commenced a maritime limitation of liability action
in the United States District Court for the Southern District of Texas, Houston
Division, captioned In the Matter of Horizon Vessels Inc., as owner of the GULF
HORIZON, seeking exoneration from or limitation of liability in connection with
this incident. Horizon's suit contends that if it is not entitled to
exoneration, its liability should be limited to $19.3 million, representing the
value of the GULF HORIZON and her pending freight, and Horizon's insurers have
provided an undertaking (subject to policy defenses) to pay any judgment that
may be rendered in the suit up to $19.3 million. NYPA, LIPA and the insurers of
the Y-49 cable (collectively, the "Y-49 Cable Interests") also have filed claims
in the limitation action asserting total damages of approximately $18.2 million.
On November 12, 2003, the Partnership filed an Answer in Horizon's action,
requesting that the limitation of liability action be dismissed and/or that the
limitation injunction be lifted to permit the Partnership to pursue its claims
against Horizon in the forum of its choice, or, in the alternative, that Horizon
be denied limitation rights under the Limitation Act. The Partnership also filed
a claim in Horizon's limitation action seeking indemnity for any liability it
may be found to have to the Y-49 Cable Interests as a result of the NYPA cable
incident as well as all losses suffered by the Partnership as a result thereof,
and, on a protective basis, seeking full damages for Horizon's breaches and
deficient performance under the Partnership/Horizon construction contract, which
claims are unrelated to the NYPA cable incident. Thales also has filed a claim
in the Horizon limitation action seeking indemnity for any liability it may be
found to have to the Y-49 Cable Interests or the Partnership. The Y-49 Cable
Interests and the Partnership both filed motions to transfer the Texas action to
the United States District Court for the Eastern District of New York. Thales
joined in those motions. By order entered February 27, 2004, the court denied
the motions to transfer. However, in doing so, the court confirmed that the
Partnership could pursue its contract claims against Horizon outside of the
limitation action and that Horizon had no right to limit its liability as to the
Partnership's contract claims. The Y-49 Cable Interests filed cross claims
against the Partnership alleging claims under the Crossing Agreement and in
common law tort.

The Y-49 Cable Interests filed a motion for partial summary judgment against the
Partnership on October 13, 2004. The motion asks the court to find the
Partnership liable for indemnity under the Crossing Agreement for all costs and
expenses incurred by the Y-49 Cable Interests directly related to the emergency
response to the incident and for the costs and expenses of the temporary and
permanent repairs. The Partnership believes the motion is premature.

The parties presently are engaging in document discovery and the Partnership is
still in the process of investigating this incident and evaluating its rights,
obligations and responsibilities. Given the preliminary stage of this matter,
the Partnership is unable to assess the likelihood of an unfavorable outcome
and/or the amount or range of loss, if any, in the event of an unfavorable
outcome.

The Partnership has also learned that as part of the Eastchester construction
there may have been one or more violations by the contractor of the exclusionary
zones established around certain specified areas of possible cultural resources,
namely underwater archeological sites such as shipwrecks, along the pipeline's
marine route and the contractor may have placed anchors outside the authorized
construction corridor. At this time, the Partnership has no information that any
sites were in fact damaged. The Partnership has informed the FERC and the New
York State Office of Parks, Recreation and Historic Preservation of this matter.
At this time, the Partnership is unable to determine if there will be any
material adverse effect on the Partnership's financial condition and results of
operations due to this matter.

Pursuant to its agreements with the owners of the electric transmission cables
that the Eastchester facilities cross in the Long Island Sound, Iroquois
performed certain post construction surveys to verify the condition of the cable
crossings and confirm the location of the pipeline. Specifically, Iroquois had
constructed a "structure" over the Y-50 cable system consisting of lightweight
flexible concrete mattresses under the pipeline, specially fabricated concrete
blocks adjacent to the pipeline and crushed rock. The surveys and additional
follow-up studies indicate that the "structure" may have settled to a greater
extent than originally anticipated and that its location is believed to be 65
feet north of the location where the pipeline crosses the Y-50 cable. Iroquois
has been discussing this matter with the owner of the Y-50 cable system as to
whether and how these issues should be modified and has notified the FERC by
letter dated September 3, 2004. Given the preliminary stage of this matter,
Iroquois is unable to assess the likelihood of an unfavorable outcome and/or the
amount or range of costs, if any, in the event of an unfavorable outcome.

FERC Docket No. RP04-136-000

On January 2, 2004 the Partnership filed a Section 4 rate change proceeding,
consistent with the settlement in Docket No. RP03-589, limited to rates for
service on the Eastchester Extension Project as certificated by FERC in Docket
No. CP00-232. The Eastchester Project was in-service on February 5, 2004. The
Partnership proposed a rate of $0.8444 per Dth on a 100% load-factor basis (as
compared with the Partnership's existing 100% load-factor inter-zone rate of
$0.4234 per Dth, which served as the initial rate per the certificate order).
The increased rate reflected, among other things, an increase in plant costs
from the certificate estimate of $210 million to a level of approximately $334
million. The higher plant costs are the result of a number of factors, including
delays in obtaining construction permits and authorizations; unanticipated
environmental costs; a failed directional drill; higher than expected labor
costs; and construction incidents associated with constructing the Project in a
highly congested marine corridor. Various customers filed motions in response to
the Partnership's requested rate change. On January 30, 2004 the FERC issued an
order accepting the rates and making them effective July 1, 2004, subject to
refund and subject to the outcome of hearings. On February 17, 2004, a
pre-hearing conference before the FERC resulted in a procedural schedule
outlining the various phases of the Partnership's rate filing proceeding with an
anticipated final order due by the end of the second quarter of 2005.

On June 15 and July 8, 2004, settlement conferences were convened at the FERC's
offices to attempt to negotiate a settlement of the issues in the rate case. As
a result of those conferences, the parties reached a settlement in principle of
all issues that was supported or not opposed by all participants to the
proceeding. On July 15, 2004 Iroquois submitted a motion to the Presiding
Administrative Law Judge to suspend the procedural schedule to allow the parties
to formalize the settlement agreement; such motion was granted by the judge on
July 16. Following additional discussions and negotiations with the parties,
Iroquois submitted a comprehensive settlement agreement on August 12, 2004. The
settlement agreement provides for recourse rates of $0.66 per dth for the period
July 1, 2004 through December 31, 2007 and $0.635 per dth for the period January
1, 2008 through December 31, 2011. In addition, Iroquois will not include in
future rates any future legal fees (incurred after June 30, 2004) incurred in
litigation regarding construction incidents associated with the original
Eastchester Project. A moratorium on rate changes, as spelled out more fully in
the settlement agreement, will also be in effect through December 31, 2011. The
settlement agreement was approved by the FERC on October 13, 2004.

In addition to settling the Eastchester recourse rates as set forth above,
Iroquois has also entered into negotiated rate agreements with all of the
initial shippers on the Eastchester Extension Project. The negotiated rates on a
100% load-factor equivalent basis range between $0.47 and $0.59 per dth
depending on whether the agreement was signed pre or post construction and the
length of the negotiated contract.

The recourse rates and negotiated individual Eastchester shipper rates, coupled
with cost overruns experienced on the Eastchester Project, will reduce the
Partnership's initial margins that were anticipated when the project application
was filed with FERC.

National Energy & Gas Transmission Inc. (NEGT) and its Subsidiaries' Bankruptcy
Filing

On July 8, 2003, PG&E Corporation reported that NEGT and a number of its
subsidiaries filed voluntary petitions for reorganization under Chapter 11 of
the U.S. Bankruptcy Code. These subsidiaries include PG&E Energy Trading
Holdings Corporation, PG&E Energy Trading-Gas Corporation, PG&E Energy
Trading-Power Corporation, PG&E ET Investments Corporation, and US Gen New
England, Inc. (US Gen NE).

US Gen NE had two firm transportation service agreements with the Partnership,
one for 40,702 Dth/d, which expires on November 1, 2013, and one for 12,000
Dth/d, which expires on April 1, 2018. The total monthly demand charges for both
contracts were $0.5 million. On September 5, 2003, the bankruptcy court
authorized the rejection of US Gen NE's two firm transportation contracts. In
February 2004, the Partnership entered into a ten year contract for the 12,000
Dth/d while the remaining unsubscribed capacity of 40,720 Dth/d will continue to
be remarketed on a short term basis until longer term market opportunities
emerge.

On October 15, 2003, the Partnership filed a proof of claim with the bankruptcy
court for $49.8 million, representing the present value of the two rejected
contracts. At this time, the Partnership does not know what the disposition of
this claim will be nor its ultimate impact on the Partnership.

On September 15, 2004, NEGT announced that it had entered into an agreement with
GS Power Holdings II LLC (a subsidiary of Goldman Sachs) to purchase NEGT's
indirect equity interest in the Partnership. NEGT's indirect interest is held
through JMC-Iroquois, Inc. and Iroquois Pipeline Investment, LLC, both of which
represent a 5.77% interest in the Partnership. According to NEGT, the
acquisition is expected to close in the first quarter of 2005.




<PAGE>


ITEMS 2-5 are not applicable.

ITEM 6. EXHIBITS

Exhibits:

Index to Exhibits

Exhibit
Number
31.1     Certification of the Chief Executive Officer to Rule 15d-14(a) under
         the Securities Exchange Act of 1934.

31.2     Certification of the Chief Financial Officer pursuant to Rule 15d-14(a)
         under the Securities Exchange Act of 1934.

32.1     Certification pursuant to Rule 15d-14(b) under the Securities
         Exchange Act of 1934 and 18 U.S.C. Section 1350.


<PAGE>




                           SIGNATURES


Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.


                              IROQUOIS GAS TRANSMISSION SYSTEM, L.P.
                              (A Delaware Limited Partnership)

Date: November 17, 2005          By:  Iroquois Pipeline Operating Company,
                                   as its Agent

                                   /S/ E.J. Holm
                                    -----------------
                                   E.J. Holm
                                   President


                                   /S/ Paul Bailey
                                    -----------------
                                   Paul Bailey
                                   Vice President & Chief Financial Officer