**____________**

**____________**

**(Mark      one)**

**QUARTERLY      REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE**

**SECURITIES      EXCHANGE ACT OF 1934**

**For      the quarterly period ended September 30, 2006**

**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 001-03196**

**CONSOLIDATED      NATURAL GAS COMPANY**

**(Exact      name of registrant as specified in its charter)**

| **DELAWARE***(State                or other jurisdiction of incorporation or organization**)*                                          | **54-1966737***(I.R.S.                Employer Identification No.)* |
|----------------------------------------------------------------------------------------------------------------------------------------|---------------------------------------------------------------------|
|                                                                                                                                   |                                                                |
| **120                TREDEGAR STREET****RICHMOND,                VIRGINIA***(Address                of principal executive offices**)* |  **23219***(Zip                Code**)*                        |
|                                                                                                                                   |                                                                |
| **(804)                819-2000***(Registrant's                telephone number)*                                                      |

**THE      REGISTRANT MEETS THE CONDITIONS SET FORTH IN GENERAL INSTRUCTION H(1)(a) AND      (b)      OF FORM 10-Q AND IS FILING THIS FORM 10-Q UNDER THE REDUCED DISCLOSURE      FORMAT.**

----

**CONSOLIDATED      NATURAL GAS COMPANY**

**INDEX**

|                                             |                                                                                                                                                                                  |   |
|--------------------------------------------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|
| **PART                I. Financial Information** |
|  Item                1.                     |  Consolidated                Financial                Statements                                                                                                                 |   |
|                                             |  Consolidated                Statements of                Income                -                Three and Nine Months Ended September 30, 2006                and 2005          |   |
|                                             |  Consolidated                Balance Sheets                - September                30, 2006 and December 31, 2005                                                             |   |
|                                             |  Consolidated                Statements                of                Cash Flows -                Nine Months Ended September                30,                2006 and 2005 |   |
|                                             |  Notes                to Consolidated                Financial                Statements                                                                                         |   |
|  Item                2.                     |  Management's                Discussion                and Analysis of Results of Operations                                                                                     |   |
|  Item                4.                     |  Controls                and Procedures                                                                                                                                          |   |
|                                             |  **PART                II. Other Information**                                                                                                                                   |   |
|  Item                1.                     |  Legal                Proceedings                                                                                                                                                |   |
|  Item                1A.                    | Risk Factors                                                                                                                                                                     |   |
|  Item                6.                     |  Exhibits                                                                                                                                                                        |   |

----

**CONSOLIDATED      NATURAL GAS COMPANY**

**PART      I. FINANCIAL INFORMATION**

**ITEM      1. CONSOLIDATED FINANCIAL STATEMENTS**

**CONSOLIDATED      STATEMENTS OF INCOME**

**(Unaudited)      **

----

|                                                                                                                                 | **Three                Months Ended****September                30,**** ** | **Nine                Months Ended****September                30,**** ** |
|--------------------------------------------------------------------------------------------------------------------------------------|---------------------------------------------------------------------------------|--------------------------------------------------------------------------------|
|                                                                                                                                 | **2006 **                                                                  | 2005                                                                           | **2006 ** | 2005 |
| (millions)                                                                                                                           |                                                                            |
|                                                                                                                                 |                                                                            |                                                                           |   |   |
| **Operating                Revenue**                                                                                                 |                                                                            |                                                                           |   |   |
|      External                customers                                                                      | **$1,406 **                                                                | $1,153                                                                    | **$5,470 ** | $4,630  |
|      Affiliated                customers                                                                    | **108 **                                                                   | 324                                                                       | **417 ** | 801  |
| Total                operating revenue                                                                                               | **1,514 **                                                                 | 1,477                                                                     | **5,887 ** | 5,431  |
| **Operating                Expenses**                                                                                                |                                                                            |                                                                           |   |   |
| Purchased                gas:                                                                                                        |                                                                            |                                                                           |   |   |
|      External                suppliers                                                                      | **163 **                                                                   | 477                                                                       | **1,582 ** | 1,904  |
|      Affiliated                suppliers                                                                    | **161 **                                                                   | 124                                                                       | **520 ** | 420  |
| Electric                fuel and energy purchases:                                                                                   |                                                                            |                                                                           |   |   |
|      External                suppliers                                                                      | **41 **                                                                    | 48                                                                        | **99 ** | 99  |
|      Affiliated                suppliers                                                                    | **22 **                                                                    | 67                                                                        | **85 ** | 155  |
| Other                energy-related commodity purchases                                                                              | **1 **                                                                     | 122                                                                       | **413 ** | 290  |
| Other                operations and maintenance:                                                                                     |                                                                            |                                                                           |   |   |
|      External                suppliers                                                                      | **165 **                                                                   | 779                                                                       | **705 ** | 1,194  |
|      Affiliated                suppliers                                                                    | **55 **                                                                    | 41                                                                        | **152 ** | 128  |
| Depreciation,                depletion and amortization                                                                              | **229 **                                                                   | 163                                                                       | **672 ** | 498  |
| Other                taxes                                                                                                           | **59 **                                                                    | 60                                                                        | **217 ** | 210  |
| Total                operating expenses                                                                                              | **896 **                                                                   | 1,881                                                                     | **4,445 ** | 4,898  |
| Income                (loss) from operations                                                                                         | **618 **                                                                   | (404)                                                                          | **1,442 ** | 533  |
| Other                income (loss)                                                                                                   | **(4)**                                                                         | 8                                                                         | **12 ** | 20  |
| Interest                and related charges:                                                                                         |                                                                            |                                                                           |   |   |
|      Interest                expense                                                                        | **73 **                                                                    | 58                                                                        | **209 ** | 155  |
|      Interest                expense - junior subordinated notes payable to affiliated                trust | **4 **                                                                     | 4                                                                         | **12 ** | 12  |
|      Total                interest and related charges                                                      | **77 **                                                                    | 62                                                                        | **221 ** | 167  |
| Income                (loss) before income taxes                                                                                     | **537 **                                                                   | (458)                                                                          | **1,233 ** | 386  |
| Income                tax expense (benefit)                                                                                          | **197 **                                                                   | (160)                                                                          | **542 ** | 146  |
| **Net                Income (Loss)**                                                                                                 | **$  340 **                                                      | $ (298)                                                                   | **$  691 ** | $  240  |

----

**CONSOLIDATED      NATURAL GAS COMPANY**

**CONSOLIDATED      BALANCE SHEETS**

**(Unaudited)**

----

|                                                                                                   | **September                30,****2006**    | December                31,2005(1)      |
|--------------------------------------------------------------------------------------------------------|---------------------------------------------|-----------------------------------------|
| (millions)                                                                                             |                                        |
|                                                                                                   |                                        |                                    |
| **ASSETS**                                                                                             |                                        |                                    |
| **Current                Assets**                                                                      |                                        |                                    |
| Cash                and cash equivalents                                                               | **$     20 ** | $     44  |
| Accounts                receivable:                                                                    |                                        |                                    |
|     Customers                (less allowance for doubtful accounts of $16 and $27) | **868 **                               | 1,502                              |
|     Affiliates                                                                     | **97 **                                | 214                                |
| Other                receivables                                                                       | **104 **                               | 110                                |
| Inventories                                                                                            | **382 **                               | 366                                |
| Derivative                assets                                                                       | **1,086 **                             | 1,991                              |
| Deferred                income taxes                                                                   | **141 **                               | 510                                |
| Assets                held for sale                                                                    | **1,077 **                             | 2                                  |
| Prepayments                                                                                            | **38 **                                | 122                                |
| Other                                                                                                  | **247 **                               | 567                                |
|        Total                current assets                          | **4,060 **                             | 5,428                              |
| **Investments**                                                                                        | **289 **                               | 305                                |
| **Property,                Plant and Equipment**                                                       |                                        |                                    |
| Property,                plant and equipment                                                           | **19,919 **                            | 19,126                             |
| Accumulated                depreciation, depletion and amortization                                    | **(6,995)**                                 | (6,780)                                 |
|        Total                property, plant and equipment, net      | **12,924 **                            | 12,346                             |
| **Deferred                Charges and Other Assets**                                                   |                                        |                                    |
| Goodwill                                                                                               | **623 **                               | 623                                |
| Prepaid                pension cost                                                                    | **1,167 **                             | 1,086                              |
| Derivative                assets                                                                       | **502 **                               | 1,403                              |
| Regulatory                assets                                                                       | **131 **                               | 403                                |
| Intangible                assets                                                                       | **125 **                               | 130                                |
| Other                                                                                                  | **135 **                               | 178                                |
|        Total                deferred charges and other assets       | **2,683 **                             | 3,823                              |
|        Total                assets                                  | **$19,956 **                           | $21,902                            |

----

**CONSOLIDATED      NATURAL GAS COMPANY**

**CONSOLIDATED      BALANCE SHEETS—(Continued)**

**(Unaudited)**

----

|                                                                                                      | **September                30,****2006** | December                31,2005(1) |
|-----------------------------------------------------------------------------------------------------------|------------------------------------------|------------------------------------|
| (millions)                                                                                                |                                     |
|                                                                                                      |                                     |
| **LIABILITIES                AND SHAREHOLDER’S EQUITY**                                             |                                     |
| **Current                Liabilities**                                                                    |                                     |                               |
| Securities                due within one year                                                             | **$   734 **         | $   734        |
| Short-term                debt                                                                            | **80 **                             | 187                           |
| Accounts                payable                                                                           | **1,097 **                          | 1,438                         |
| Payables                to affiliates                                                                     | **156 **                            | 151                           |
| Affiliated                current borrowings                                                              | **2,180 **                          | 1,922                         |
| Accrued                interest, payroll and taxes                                                        | **264 **                            | 250                           |
| Derivative                liabilities                                                                     | **1,762 **                          | 3,731                         |
| Liabilities                held for sale                                                                  | **419 **                            | --                            |
| Other                                                                                                     | **308 **                            | 489                           |
|        Total                current liabilities                        | **7,000 **                          | 8,902                         |
| **Long-Term                Debt**                                                                         |                                     |                               |
| Long-term                debt                                                                             | **2,705 **                          | 2,708                         |
| Junior                subordinated notes payable to affiliated trust                                      | **206 **                            | 206                           |
|        Total                long-term debt                             | **2,911 **                          | 2,914                         |
| **Deferred                Credits and Other Liabilities**                                                 |                                     |                               |
| Deferred                income taxes and investment tax credits                                           | **2,824 **                          | 2,321                         |
| Derivative                liabilities                                                                     | **742 **                            | 2,706                         |
| Regulatory                liabilities                                                                     | **123 **                            | 147                           |
| Other                                                                                                     | **602 **                            | 621                           |
|        Total                deferred credits and other liabilities     | **4,291 **                          | 5,795                         |
|        Total                liabilities                                | **14,202 **                         | 17,611                        |
| **Commitments                and Contingencies**(see                Note 13)                              |                                     |                               |
| **Common                Shareholder’s Equity**                                                      |                                     |                               |
| Common                stock**—**no                par value, 100 shares authorized and outstanding  | **1,816 **                          | 1,816                         |
| Other                paid-in capital                                                                      | **3,273 **                          | 3,273                         |
| Retained                earnings                                                                          | **1,276 **                          | 971                           |
| Accumulated                other comprehensive loss                                                       | **(611)**                                | (1,769)                            |
|        Total                common shareholder’s equity          | **5,754 **                          | 4,291                         |
|        Total                liabilities and shareholder’s equity | **$19,956 **                        | $21,902                       |

----

**CONSOLIDATED      NATURAL GAS COMPANY**

**C****ONSOLIDATED      STATEMENTS OF CASH FLOWS**

**(Unaudited)**

----

|                                                                                                                                       | **Nine                Months Ended****   September                30,** |
|--------------------------------------------------------------------------------------------------------------------------------------------|----------------------------------------------------------------------------------------|
|                                                                                                                                       | **2006**                                                                               | 2005 |
| (millions)                                                                                                                                 |                                                                                   |
|                                                                                                                                       |                                                                                   |   |
| **Operating                Activities**                                                                                                    |                                                                                   |   |
| Net                income                                                                                                                  | **$  691 **                                                             | $  240  |
| Adjustments                to reconcile net income to net cash provided by operating                activities:                            |                                                                                   |   |
|     Net                realized and unrealized derivative (gains) losses                                               | **(304)**                                                                              | 574  |
|     Depreciation,                depletion and amortization                                                            | **672 **                                                                          | 498  |
|     Deferred                income taxes and investment tax credits, net                                               | **393 **                                                                          | 34  |
|     Charges                related to pending sale of gas distribution subsidiaries                                    | **180 **                                                                          | --  |
|     Other                adjustments to net income                                                                     | **(160)**                                                                              | (26) |
|     Changes                in:                                                                                         |                                                                                   |   |
|         Accounts                receivable                                                         | **532 **                                                                          | 244  |
|        Affiliated                accounts receivables and payable                                       | **143 **                                                                          | (25) |
|         Inventories                                                                                | **(102)**                                                                              | (157) |
|         Purchased                gas costs, net                                                    | **158 **                                                                          | 7  |
|         Accounts                payable                                                            | **(309)**                                                                              | 81  |
|         Accrued                interest, payroll and taxes                                         | **54 **                                                                           | 23  |
|         Margin                deposit assets and liabilities                                       | **(44)**                                                                               | 164  |
|         Prepaid                pension costs                                                       | **(81)**                                                                               | (76) |
|         Deferred                revenues                                                           | **(125)**                                                                              | (178) |
|         Other                operating assets and liabilities                                      | **208 **                                                                          | (103) |
| **            **Net                cash provided by operating activities       | **1,906 **                                                                        | 1,300  |
| **Investing                Activities**                                                                                                    |                                                                                   |   |
| Additions                to gas and oil properties, including acquisitions                                                                 | **(1,374)**                                                                            | (1,114) |
| Plant                construction and other property additions                                                                             | **(310)**                                                                              | (260) |
| Acquisition                of business, net of cash acquired                                                                               | **(91)**                                                                               | (43) |
| Proceeds                from sales of gas and oil properties                                                                               | **20 **                                                                           | 86  |
| Other                                                                                                                                      | **59 **                                                                           | (25) |
|             Net                cash used in investing activities               | **(1,696)**                                                                            | (1,356) |
| **Financing                Activities**                                                                                                    |                                                                                   |   |
| Issuance                (repayment) of short-term debt                                                                                     | **(107)**                                                                              | 190  |
| Issuance                of affiliated current borrowings, net                                                                              | **258 **                                                                          | 439  |
| Repayment                of long-term debt                                                                                                 | **-- **                                                                           | (150) |
| Common                dividend payments                                                                                                    | **(386)**                                                                              | (416) |
| Other                                                                                                                                      | **3 **                                                                            | 4  |
|             Net                cash provided by (used in) financing activities | **(232)**                                                                              | 67  |
| Increase                (decrease) in cash and cash equivalents                                                                            | **(22)**                                                                               | 11  |
| Cash                and cash equivalents at beginning of period                                                                            | **44 **                                                                           | 19  |
| Cash                and cash equivalents at end of period(1)                                                                               | **$   22 **                                                        | $   30  |
| **Noncash                Financing Activities**:                                                                                           |                                                                                   |   |
|         Conversion                of short-term borrowings to contributed capital                  | **$ -- **                                                                    | $750 |

----

**CONSOLIDATED        NATURAL GAS COMPANY**

**NOTES        TO CONSOLIDATED FINANCIAL STATEMENTS**

**(Unaudited)**

**Note        1.  Nature of Operations**

**Note        2.  Significant Accounting Policies **

----

**Note        3.  Newly Adopted Accounting Standards**

***EITF        04-13***

*Accounting        for Purchases and Sales of Inventory with the Same Counterparty*

----

|                                                                 | **Three                  Months Ended****September                  30,** | **Nine                  Months Ended****September                  30,** |
|----------------------------------------------------------------------|---------------------------------------------------------------------------|--------------------------------------------------------------------------|
|                                                                 | **2006**                                                                  | 2005                                                                     | **2006** | 2005 |
| (millions)                                                           |                                                                      |
| Sale                  activity included in operating revenue         | **$37**                                                                   | $195                                                                     | **$540** | $479 |
| Purchase                  activity included in operating expenses(1) | ** 40**                                                              |  199                                                                | ** 539** |  485 |

**Note        4.  Recently Issued Accounting Standards**

***SFAS        No. 158***

*Employers’ Accounting for Defined Benefit Pension and Other        Postretirement Plans. *

***SAB        108***

*Considering        the Effects of Prior Year Misstatements when Quantifying Misstatements in        Current Year Financial Statements*

**FIN        48**

*Accounting for Uncertainty        in Income Taxes *

----

***SFAS        No. 157***

*Fair        Value*
*Measurements*
*Issues        Involved in Accounting for Derivative Contracts Held for Trading Purposes        and        Contracts Involved in Energy Trading and Risk Management        Activities.*

**Note        5.  Sale of Regulated Gas Distribution Subsidiaries**

----

| (millions)                                                                                                                |   | **September                  30, 2006** |
|---------------------------------------------------------------------------------------------------------------------------|--------|-----------------------------------------|
| **ASSETS**                                                                                                                |   |                                    |
| **Current                  Assets**                                                                                       |   |                                    |
| Cash                                                                                                                      |   | **$    2 **    |
| Customer                  accounts receivable                                                                             |   | **93 **                            |
| Unrecovered                  gas costs                                                                                    |   | **28 **                            |
| Other                                                                                                                     |   | **126 **                           |
|           Total                  current assets                         |   | **249 **                           |
| **Investments**                                                                                                           |   | **2 **                             |
| **Property,                  Plant and Equipment**                                                                        |   |                                    |
| Property,                  plant and equipment                                                                            |   | **1,098 **                         |
| Accumulated                  depreciation, depletion and amortization                                                     |   | **(374)**                               |
|           Total                  property, plant and equipment, net     |   | **724 **                           |
| **Deferred                  Charges and Other Assets**                                                                    |   |                                    |
| Regulatory                  assets                                                                                        |   | **100 **                           |
| Other                                                                                                                     |   | **1 **                             |
|           Total                  deferred charges and other assets      |   | **101 **                           |
|           Assets                  held for sale                         |   | **$1,076 **                        |
|                                                                                                                      |   |                                    |
| **LIABILITIES**                                                                                                           |   |                                    |
| **Current                  Liabilities**                                                                                  |   |                                    |
| Accounts                  payable                                                                                         |   | **$   68 **         |
| Payables                  to affiliates                                                                                   |   | **23 **                            |
| Deferred                  income taxes                                                                                    |   | **13 **                            |
| Other                                                                                                                     |   | **95 **                            |
|           Total                  current liabilities                    |   | **199 **                           |
| **Deferred                  Credits and Other Liabilities**                                                               |   |                                    |
| Asset                  retirement obligations                                                                             |   | **33 **                            |
| Deferred                  income taxes                                                                                    |   | **166 **                           |
| Regulatory                  liabilities                                                                                   |   | **10 **                            |
| Other                                                                                                                     |   | **11 **                            |
|           Total                  deferred credits and other liabilities |   | **220 **                           |
|           Liabilities                  held for sale                    |   | **$  419 **              |

----

----

|                                               | **Three                  Months****Ended                  September 30,** | **Nine                  Months****Ended                  September 30,** |
|----------------------------------------------------|---------------------------------------------------------------------------|--------------------------------------------------------------------------|
|                                               | **2006**                                                                  | 2005                                                                     | **2006** | 2005 |
| (millions)                                         |                                                                      |
|                                               |                                                                      |                                                                     |   |   |
| Operating                  Revenue                 | **$63 **                                                             | $60                                                                 | **$512 ** | $472  |
|                                               |                                                                      |                                                                     |   |   |
| Income                  (loss) before income taxes | **(6)**                                                                   | (9)                                                                      | **(134)** | 37  |

*Recognition        of Deferred Tax Assets for a Parent Company's Excess Tax Basis in the Stock        of a        Subsidiary that is Accounted for as a Discontinued Operation. *

*Applying        the Conditions of Paragraph 42 of FASB Statement No. 144 in Determining Whether        to Report Discontinued Operations*

**Note        6.  Operating Revenue**

----

|                                                                                        | **Three                  Months****Ended                  September 30,** | **Nine                  Months****Ended                  September 30,** |
|---------------------------------------------------------------------------------------------|---------------------------------------------------------------------------|--------------------------------------------------------------------------|
|                                                                                        | **2006**                                                                  | 2005                                                                     | **2006** | 2005 |
| (millions)                                                                                  |                                                                      |
|                                                                                        |                                                                      |                                                                     |   |   |
| Gas                  sales:                                                                 |                                                                      |                                                                     |   |   |
|     Regulated                                                           | **$96**                                                                   | $122                                                                     | **$1,071** | $1,117 |
|     Nonregulated:                                                       |                                                                      |                                                                     |   |   |
|          External                  customers   | **221**                                                                   | 256                                                                      | **1,095** | 910 |
|          Affiliated                  customers | **100**                                                                   | 293                                                                      | **393** | 751 |
| Nonregulated                  electric sales                                                | **82**                                                                    | 123                                                                      | **259** | 277 |
| Other                  energy-related commodity sales                                       | **108**                                                                   | 183                                                                      | **704** | 461 |
| Gas                  transportation and storage                                             | **192**                                                                   | 184                                                                      | **683** | 653 |
| Gas                  and oil production                                                     | **418**                                                                   | 296                                                                      | **1,324** | 1,007 |
| Other                                                                                       | **297**                                                                   | 20                                                                       | **358** | 255 |
|      Total                  operating revenue                      | **$1,514**                                                                | $1,477                                                                   | **$5,887** | $5,431 |

----

**Note        7.     Income Taxes **

----

|                                                                                                         | **Nine                  Months****Ended                  September 30,** |
|--------------------------------------------------------------------------------------------------------------|--------------------------------------------------------------------------|
|                                                                                                         | **2006**                                                                 | 2005 |
|                                                                                                         |                                                                     |   |
| U.S.                  statutory rate                                                                         | **35.0%**                                                                | 35.0% |
|                                                                                                         |                                                                     |   |
| Increases                  (decreases) resulting from:                                                       |                                                                     |   |
|     Employee                  pension and other benefits                                 | **(0.4)**                                                                | (2.7) |
|     State                  taxes, net of federal benefit                                 | **2.9 **                                                            | 6.7  |
|     Changes                  in valuation allowances                                     | **(2.0)**                                                                | (1.3) |
|     Recognition                  of deferred taxes - stock of subsidiaries held for sale | **7.8 **                                                            | --  |
|     Other,                  net                                                          | **0.6 **                                                            | 0.1  |
| Effective                  tax rate                                                                          | **43.9%**                                                                | 37.8% |

* *

**Note        8.  Comprehensive Income**

----

|                                                                                                                                                                                                                                                                                                        | **                      Three Months**** Ended****                         September 30,    ** | **Nine                  Months ****Ended****                     September 30,    ** |
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|------------------------------------------------------------------------------------------------------------------------------|
|                                                                                                                                                                                                                                                                                                        | **2006**                                                                                                                                                                       | 2005                                                                                                                         | **2006** | 2005 |
| (millions)                                                                                                                                                                                                                                                                                                  |                                                                                                                                                                           |
|                                                                                                                                                                                                                                                                                                        |                                                                                                                                                                           |                                                                                                                         |   |   |
| Net                  income (loss)                                                                                                                                                                                                                                                                          | **$340**                                                                                                                                                                       | $(298)                                                                                                                       | **$  691** | $  240  |
| Other                  comprehensive income (loss):                                                                                                                                                                                                                                                         |                                                                                                                                                                           |                                                                                                                         |   |   |
|   Net                  other comprehensive income (loss)   associated with effective                  portion of   changes in fair value of derivative cash                    flow hedges, net of taxes and amounts reclassified to                  earnings | **592**(1)                                                                                                                                                                     | (588)(2)                                                                                                                     | **1,158**(1) | (1,263)(2) |
| Total                  comprehensive income (loss)                                                                                                                                                                                                                                                          | **$932**                                                                                                                                                                       | $(886)                                                                                                                       | **$1,849** | $(1,023) |

----

**Note        9.  Hedge Accounting Activities**

*Accounting        for Derivative Instruments and Hedging Activities*

----

|                                                                                                                                                         | **Three                  Months****Ended                  September 30,** | **Nine                  Months****Ended                  September 30,** |
|--------------------------------------------------------------------------------------------------------------------------------------------------------------|---------------------------------------------------------------------------|--------------------------------------------------------------------------|
|                                                                                                                                                         | **2006**                                                                  | 2005                                                                     | **2006** | 2005 |
| (millions)                                                                                                                                                   |                                                                      |                                                                     |   |   |
| Portion                  of gains (losses) on hedging instruments determined to be ineffective                  and                  included in net income: |                                                                      |                                                                     |   |   |
|       Fair                  value hedges                                                                                       | **$ (1)**                                                            | $  3                                                      | **$  (3)** | $  4  |
|       Cash                  flow hedges(1)                                                                                     | **(1)**                                                                   | (29)                                                                     | **19 ** | (41) |
| Net                  ineffectiveness                                                                                                                         | **$ (2)**                                                            | $(26)                                                                    | **$ 16 ** | $(37) |

| (1) | Represents                  hedge ineffectiveness, primarily due to changes in the fair value                  differential between the delivery location and commodity specifications                  of                  derivatives held by our E&P operations and the delivery location and                  commodity specifications of our forecasted gas and oil                  sales. |
|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|                                      | AOCI                  After-Tax | Portion                  Expected to be Reclassified to Earnings During the Next 12 Months                  After-Tax | Maximum                  Term |
|-------------------------------------------|---------------------------------|-----------------------------------------------------------------------------------------------------------------------|-------------------------------|
| (millions)                                |                            |                                                                                                                  |
| Commodities:                              |                            |                                                                                                                  |                          |
|      Gas         | $  (241)              | $(229)                                                                                                                | 54                  months    |
|      Oil         | (366)                           | (250)                                                                                                                 | 39                  months    |
|      Electricity | (3)                             | (3)                                                                                                                   | 8                  months     |
| Interest                  Rate            | (1)                             | --                                                                                                               | 98                  months    |
| Total                                     | $(611)                          | $(482)                                                                                                                |                          |

----

**Note        10.  Ceiling Test **

**Note        11.  Variable Interest Entities**

*Consolidation        of Variable Interest Entities,*

**Note        12.  Significant Financing Transactions**

***Joint        Credit Facilities***

----

***Other        Credit Facilities***

----

|  **Facility                  Limit**                    | **Outstanding****Letters                  of Credit** | **Facility                  Capacity****Remaining** | **Facility                  Inception****Date** | **Facility****Maturity                  Date** |
|--------------------------------------------------------------|-------------------------------------------------------|-----------------------------------------------------|-------------------------------------------------|------------------------------------------------|
| (millions)                                                   |                                                  |                                                |                                            |                                           |
| $100                                                         | $                  25                                 | $                  75                               | June                  2004                      | June                  2007                     |
| 100                                                          | 100                                                   | --                                                  | August                  2004                    | August                  2009                   |
|          200(1) | ---                                                   | 200                                                 | December                  2005                  | December                  2010                 |
| $400                                                         | $125                                                  | $275                                                |                                            |                                           |

| (1) | This                  facility can also be used to support commercial paper                  borrowings.  |
|-----|----------------------------------------------------------------------------------------------------------------|

**Note        13.  Commitments and Contingencies **

***Insurance        for E&P Operations***

***Lease        Commitment***

----

***Guarantees***

*Lease        Commitment,*

----

|                                              | **      Stated****      Limit** | **       Value****(1)** |
|---------------------------------------------------|---------------------------------------------------------------------------------------------|------------------------------------------------------------|
| (millions)                                        |                                                                                        |                                                       |
| Subsidiary                  debt(2)               | $   205                                             | $   205            |
| Offshore                  drilling commitments(3) | ---                                                                | 493                               |
| Commodity                  transactions(4)        | 1,188                                                              | 632                               |
| Other                                             | 415                                                                | 258                               |
| Total                  subsidiary obligations     | $1,808                                                             | $1,588                            |

| (1) | Represents                  the estimated portion of the guarantees’ stated limit that is utilized as                  of September 30, 2006 based upon prevailing economic conditions                  and fact                  patterns specific to each guarantee arrangement. For those guarantees                  related to obligations that are recorded as liabilities by our                  subsidiaries, the value includes the recorded                  amount. |
|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (2) | Guarantees                  of debt of Dominion Oklahoma Texas Exploration and Production Inc.                  (DOTEPI). In the event of default by this subsidiary, we would                  be                  obligated to repay such amounts. |
|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (3) | Performance                  and payment guarantees related to an offshore day work drilling                  contract,                  rig share agreements and related services for certain subsidiaries.                  There                  are no stated limits for these                  guarantees. |
|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (4) | Guarantees                  of contract payments for certain subsidiaries involved in natural                  gas and                  oil production, natural gas delivery and energy marketing activities.                  These guarantees were provided to counterparties in order to facilitate                  physical and financial transactions in gas, pipeline capacity,                  transportation, oil, electricity and related commodities and services.                  If                  any of these subsidiaries fail to perform or pay under the contracts                  and                  the counterparties seek performance or payment, we would be required                  to                  satisfy such obligation. We and our subsidiaries receive similar                  guarantees as collateral for credit extended to others. The value                  provided                  includes certain guarantees that do not have stated                  limits. |
|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

***Surety        Bonds and Letters of Credit***

**Note        14.  Credit Risk **

**Note        15.    Related Party Transactions**

***Transactions        with Affiliates***

----

|                                                              | **Three                  Months****Ended                  September 30,** | **Nine                  Months****Ended                  September 30,** |
|-------------------------------------------------------------------|---------------------------------------------------------------------------|--------------------------------------------------------------------------|
|                                                              | ** 2006**                                                            |  2005                                                               | ** 2006** |  2005 |
| (millions)                                                        |                                                                      |
|                                                              |                                                                      |                                                                     |   |   |
| Sales                  of natural gas                             | **$100**                                                                  | $293                                                                     | **$393** | $751 |
| Gas                  transportation and storage services provided | **5**                                                                     | 15                                                                       | **14** | 24 |
| Sales                  of electricity                             | **9**                                                                     | 16                                                                       | **17** | 26 |
| Loss                  on other energy-related commodity contracts | **5**                                                                     | --                                                                       | **8** | -- |
| Purchases                  of natural gas                         | **161**                                                                   | 124                                                                      | **520** | 420 |
| Purchases                  of electric fuel and energy            | **22**                                                                    | 67                                                                       | **85** | 155 |

----

***Transactions        with Dominion***

**Note        16.  Employee Benefit Plans **

----

|                                                                                     | **                             Pension Benefits** | **                           Other Postretirement****                          Benefits** |
|------------------------------------------------------------------------------------------|----------------------------------------------------------------------------------------------------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (millions)                                                                               | **2006 **                                                                                           | 2005                                                                                                                                                                      | **2006** | 2005 |
| **Three                  Months Ended September 30,**                                    |                                                                                                     |
|   Service                  cost                                                | **$ 3 **                                                                                       | $ 3                                                                                                                                                                  | **$ 4 ** | $ 4  |
|   Interest                  cost                                               | **8 **                                                                                              | 8                                                                                                                                                                         | **7 ** | 6  |
|   Expected                  return on plan assets                              | **(27)**                                                                                                 | (26)                                                                                                                                                                           | **(5)** | (4) |
|   Amortization                  of transition obligation                       | **-- **                                                                                             | --                                                                                                                                                                        | **1 ** | 1  |
|   Amortization                  of net loss                                    | **   -- **                                                                           |   --                                                                                                                                                            | **3 ** | 1  |
|   Net                  periodic benefit cost (credit)                          | **$(16)**                                                                                                | $(15)                                                                                                                                                                          | **$10 ** | $8  |
|    Company’s                  net periodic benefit cost (credit)(1) |  **$(27)**                                                                                          |  $(25)                                                                                                                                                                    |  **$13 ** |  $12  |
|                                                                                     |                                                                                                     |                                                                                                                                                                           |   |   |
| **Nine                  Months Ended September 30,**                                     |                                                                                                     |                                                                                                                                                                           |   |   |
|   Service                  cost                                                | **$ 9 **                                                                                       | $ 9                                                                                                                                                                  | **$ 11 ** | $11  |
|   Interest                  cost                                               | **24 **                                                                                             | 23                                                                                                                                                                        | **20 ** | 18  |
|   Expected                  return on plan assets                              | **(80)**                                                                                                 | (77)                                                                                                                                                                           | **(14)** | (12) |
|   Curtailment                  loss(2)                                         | **-- **                                                                                             | --                                                                                                                                                                        | **3 ** | -  |
|   Amortization                  of transition obligation                       | **-- **                                                                                             | --                                                                                                                                                                        | **3 ** | 4  |
|   Amortization                  of prior service cost (credit)                 | **-- **                                                                                             | 1                                                                                                                                                                         | **(1)** | -  |
|   Amortization                  of net loss                                    | **  -- **                                                                                 |    --                                                                                                                                                      | **8 ** | 4  |
|   Net                  periodic benefit cost (credit)                          | **$(47)**                                                                                                | $(44)                                                                                                                                                                          | **$30 ** | $25  |
|    Company’s                  net periodic benefit cost (credit)(1) |  **$(81)**                                                                                          |  $(76)                                                                                                                                                                    |  **$43 ** |  $36  |

| (1) | Amounts                  represent all benefit plans in which we participate, including                  benefit                  plans covering multiple Dominion                  subsidiaries. |
|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (2) | Relates                  to the pending sale of Peoples and                  Hope. |
|-----|------------------------------------------------------------------------------------|

**Employer        Contributions**

----

**Note        17.  Condensed Consolidating Financial Information**

**Condensed        Consolidating Statement of Income Information**

----

| Three                  Months Ended September 30, 2006 | CNG                  (Parent Company) | DOTEPI              | Other                  Subsidiaries | Adjustments                  & Eliminations | Consolidated         |
|--------------------------------------------------------|---------------------------------------|---------------------|-------------------------------------|-------------------------------------------------|----------------------|
| (millions)                                             |                                  |
|                                                   |                                  |                |                                |                                            |                 |
| Operating                  revenue                     | **$   -- **       | **$212**            | **$1,455**                          | **$(153)**                                      | **$1,514**           |
| Operating                  expense                     | **4 **                           | **123**             | **921**                             | **(152)**                                       | **896**              |
| Income                  (loss) from operations         | **(4)**                               | **89**              | **534**                             | **(1)**                                         | **618**              |
| Other                  income (loss)                   | **62 **                          | **--**              | **--**                              | **(66)**                                        | **(4)**              |
| Interest                  and related charges          | **53 **                          | **26**              | **64**                              | **(66)**                                        | **77**               |
| Income                  before income taxes            | **5 **                           | **63**              | **470**                             | **(1)**                                         | **537**              |
| Income                  tax expense                    | **1 **                           | **24**              | **174**                             | **(2)**                                         | **197**              |
| Equity                  in earnings of subsidiaries    | **336 **                         | **--**              | **--**                              | **(336)**                                       | **--**               |
| Net                  income                            | **$340 **                        | **$  39** | **$ ** **296**            | **$(335)**                                      | **$  340** |

----

| Nine                  Months Ended September 30, 2006 | CNG                  (Parent Company) | DOTEPI              | Other                  Subsidiaries | Adjustments                  & Eliminations | Consolidated               |
|-------------------------------------------------------|---------------------------------------|---------------------|-------------------------------------|-------------------------------------------------|----------------------------|
| (millions)                                            |                                  |
|                                                  |                                  |                |                                |                                            |                       |
| Operating                  revenue                    | **$   -- **       | **$584**            | **$5,771**                          | **$(468)**                                      | **$5,887**                 |
| Operating                  expense                    | **7 **                           | **381**             | **4,507**                           | **(450)**                                       | **4,445**                  |
| Income                  (loss) from operations        | **(7)**                               | **203**             | **1,264**                           | **(18)**                                        | **1,442**                  |
| Other                  income                         | **183 **                         | **--**              | **21**                              | **(192)**                                       | **12**                     |
| Interest                  and related charges         | **160 **                         | **62**              | **191**                             | **(192)**                                       | **221**                    |
| Income                  before income taxes           | **16 **                          | **141**             | **1,094**                           | **(18)**                                        | **1,233**                  |
| Income                  tax expense                   | **100 **                         | **67**              | **382**                             | **(7)**                                         | **542**                    |
| Equity                  in earnings of subsidiaries   | **775 **                         | **--**              | **--**                              | **(775)**                                       | **--**                     |
| Net                  income                           | **$691 **                        | **$  74** | **$  712**                | **$(786)**                                      | **$   691** |

----

----

| Three                  Months Ended September 30, 2005 | CNG                  (Parent Company) | DOTEPI          | Other                  Subsidiaries | Adjustments                  & Eliminations | Consolidated       |
|--------------------------------------------------------|---------------------------------------|-----------------|-------------------------------------|-------------------------------------------------|--------------------|
| (millions)                                             |                                  |
|                                                   |                                  |            |                                |                                            |               |
| Operating                  revenue                     | $    --      | $199            | $1,420                         | $(142)                                          | $1,477        |
| Operating                  expense                     | 1                                | 120             | 1,897                          | (137)                                           | 1,881         |
| Income                  (loss) from operations         | (1)                                   | 79              | (477)                               | (5)                                             | (404)              |
| Other                  income                          | 55                               | --              | 8                              | (55)                                            | 8                  |
| Interest                  and related charges          | 51                               | 16              | 48                             | (53)                                            | 62                 |
| Income                  (loss) before income taxes     | 3                                | 63              | (517)                               | (7)                                             | (458)              |
| Income                  tax expense (benefit)          | --                               | 31              | (188)                               | (3)                                             | (160)              |
| Equity                  in losses of subsidiaries      | (301)                                 | --              | --                             | 301                                        | --            |
| Net                  income (loss)                     | $(298)                                | $  32 | $  (329)                  | $297                                       | $  (298) |

| Nine                  Months Ended September 30, 2005 | CNG                  (Parent Company) | DOTEPI           | Other                  Subsidiaries | Adjustments                  & Eliminations | Consolidated           |
|-------------------------------------------------------|---------------------------------------|------------------|-------------------------------------|-------------------------------------------------|------------------------|
| (millions)                                            |                                  |
|                                                  |                                  |             |                                |                                            |                   |
| Operating                  revenue                    | $   --            | $561             | $5,265                              | $(395)                                          | $5,431                 |
| Operating                  expense                    | 2                                | 323              | 4,955                               | (382)                                           | 4,898                  |
| Income                  (loss) from operations        | (2)                                   | 238              | 310                                 | (13)                                            | 533                    |
| Other                  income                         | 154                              | --               | 22                                  | (156)                                           | 20                     |
| Interest                  and related charges         | 151                              | 47               | 123                                 | (154)                                           | 167                    |
| Income                  before income taxes           | 1                                | 191              | 209                                 | (15)                                            | 386                    |
| Income                  tax expense (benefit)         | (2)                                   | 74               | 80                                  | (6)                                             | 146                    |
| Equity                  in earnings of subsidiaries   | 237                              | --               | --                                  | (237)                                           | --                     |
| Net                  income                           | $240                             | $  117 | $  129                    | $(246)                                          | $   240 |

**Condensed        Consolidating Balance Sheet Information**

| At                  September 30, 2006                                              | CNG                  (Parent Company) | DOTEPI                     | Other                  Subsidiaries | Adjustments                  & Eliminations | Consolidated     |
|-------------------------------------------------------------------------------------|---------------------------------------|----------------------------|-------------------------------------|-------------------------------------------------|------------------|
| (millions)                                                                          |                                  |
|                                                                                |                                  |
| **Assets**                                                                          |                                  |                       |                                |                                            |             |
| Current                  assets                                                     | **$1,821**                            | **$   465** | **$ 3,862**                    | **$(2,088)**                                    | **$ 4,060** |
| Investment                  in affiliates                                           | **5,244**                             | **-- **               | **125**                             | **(5,181)**                                     | **188**          |
| Loans                  to affiliates                                                | **2,181**                             | **-- **               | **-- **                        | **(2,181)**                                     | **-- **     |
| Property,                  plant and equipment, net                                 | **--  **                    | **4,679**                  | **9,073**                           | **(828)**                                       | **12,924**       |
| Deferred                  charges and other assets                                  | **155**                               | **531**                    | **2,229**                           | **(131)**                                       | **2,784**        |
|    Total                  assets                                     | **$9,401**                            | **$5,675**                 | **$15,289**                         | **$(10,409)**                                   | **$19,956**      |
|                                                                                |                                  |                       |                                |                                            |             |
| **Liabilities                  & Shareholder’s Equity**                   |                                  |                       |                                |                                            |             |
| Current                  liabilities                                                | **$898**                              | **$2,692**                 | **$ 7,180**                    | **$(3,770)**                                    | **$ 7,000** |
| Long-term                  debt                                                     | **2,506**                             | **199**                    | **-- **                        | **-- **                                    | **2,705**        |
| Notes                  payable to affiliates                                        | **206**                               | **-- **               | **1,092**                           | **(1,092)**                                     | **206**          |
| Deferred                  credits and other liabilities                             | **37**                                | **1,130**                  | **3,431**                           | **(307)**                                       | **4,291**        |
| Common                  shareholder’s equity                                  | **5,754**                             | **1,654**                  | **3,586**                           | **(5,240)**                                     | **5,754**        |
|    Total                  liabilities and shareholder’s equity | **$9,401**                            | **$5,675**                 | **$15,289**                         | **$(10,409)**                                   | **$19,956**      |

----

| At                  December 31, 2005                                               | CNG                  (Parent Company) | DOTEPI                 | Other                  Subsidiaries | Adjustments                  & Eliminations | Consolidated   |
|-------------------------------------------------------------------------------------|---------------------------------------|------------------------|-------------------------------------|-------------------------------------------------|----------------|
| (millions)                                                                          |                                  |
|                                                                                |                                  |
| **Assets**                                                                          |                                  |                   |                                |                                            |           |
| Current                  assets                                                     | $2,019                                | $   539 | $6,529                              | $(3,659)                                        | $5,428         |
| Investment                  in affiliates                                           | 3,697                                 | --           | 147                                 | (3,634)                                         | 210            |
| Loans                  to affiliates                                                | 2,188                                 | --           | --                        | (2,188)                                         | --   |
| Property,                  plant and equipment, net                                 | --                               | 4,079                  | 8,370                               | (103)                                           | 12,346         |
| Deferred                  charges and other assets                                  | 373                                   | 555                    | 3,621                               | (631)                                           | 3,918          |
|    Total                  assets                                     | $8,277                                | $5,173                 | $18,667                             | $(10,215)                                       | $21,902        |
|                                                                                |                                  |                   |                                |                                            |           |
| **Liabilities                  & Shareholder’s Equity**                   |                                  |                   |                                |                                            |           |
| Current                  liabilities                                                | $ 1,026                          | $2,646                 | $ 9,976                        | $ (4,746)                                  | $ 8,902   |
| Long-term                  debt                                                     | 2,508                                 | 200                    | --                             | --                                         | 2,708          |
| Notes                  payable to affiliates                                        | 206                                   | --                | 1,099                               | (1,099)                                         | 206            |
| Deferred                  credits and other liabilities                             | 246                                   | 1,231                  | 5,004                               | (686)                                           | 5,795          |
| Common                  shareholder’s equity                                  | 4,291                                 | 1,096                  | 2,588                               | (3,684)                                         | 4,291          |
|    Total                  liabilities and shareholder’s equity | $8,277                                | $5,173                 | $18,667                             | $(10,215)                                       | $21,902        |

**Condensed        Consolidating Statement of Cash Flow Information**

| Nine                  Months Ended September 30, 2006                | CNG                  (Parent Company) | DOTEPI              | Other                  Subsidiaries | Adjustments                  & Eliminations | Consolidated     |
|----------------------------------------------------------------------|---------------------------------------|---------------------|-------------------------------------|-------------------------------------------------|------------------|
| (millions)                                                           |                                  |
|                                                                 |                                  |
| Net                  cash provided by operating activities           | **$415 **                        | **$ 56 ** | **$1,781 **                    | **$(346)**                                      | **$1,906**  |
| Net                  cash provided by (used in) investing activities | **75 **                          | **(685)**           | **(1,136)**                         | **50 **                                    | **(1,696)**      |
| Net                  cash provided by (used in) financing activities | **(490)**                             | **626 **       | **(664)**                           | **296 **                                   | **(232)**        |

| Nine                  Months Ended September 30, 2005                | CNG                  (Parent Company) | DOTEPI           | Other                  Subsidiaries | Adjustments                  & Eliminations | Consolidated |
|----------------------------------------------------------------------|---------------------------------------|------------------|-------------------------------------|-------------------------------------------------|--------------|
| (millions)                                                           |                                  |
|                                                                 |                                  |
| Net                  cash provided by operating activities           | $444                             | $ 271  | $995                           | $(410)                                          | $1,300  |
| Net                  cash provided by (used in) investing activities | 72                               | (483)            | (817)                               | (128)                                           | (1,356)      |
| Net                  cash provided by (used in) financing activities | (373)                                 | 212         | (168)                               | 396                                        | 67      |

**Note        18.  Operating Segments**

***Delivery***
** **
*Accounting        for the Effects of Certain Types of Regulation. *

***Energy***
** **

***E&P***

----

***Corporate***
* *
*** ***

----

|                                                       | Delivery         | Energy    | E&P    | Corporate                 | Adjustments&Eliminations | Consolidated                  Total |
|------------------------------------------------------------|------------------|-----------|------------|---------------------------|------------------------------|-------------------------------------|
| (millions)                                                 |             |
|                                                       |             |
| **Three                  Months ended September 30, 2006** |             |      |       |                      |                         |                                |
| Operating                  revenue:                        |             |      |       |                      |                         |                                |
|    External                  customers      | **$327 **   | **$282**  | **$797**   | **$ -- **       | **$  -- **    | **$1,406 **                    |
|    Affiliated                  customers    | **-- **     | **97**    | **2**      | **9 **               | **-- **                 | **108 **                       |
|    Intersegment                             | **1 **      | **59**    | **43**     | **-- **              | **(103)**                    | **-- **                        |
|    Total                  operating revenue | **328 **    | **438**   | **842**    | **9 **               | **(103)**                    | **1,514 **                     |
| Net                  income (loss)                         | **(9)**          | **61**    | **290**    | **(2)**                   | **-- **                 | **340 **                       |
|                                                       |             |      |       |                      |                         |                                |
| Three                  Months ended September 30, 2005     |             |      |       |                      |                         |                                |
| Operating                  revenue:                        |             |      |       |                      |                         |                                |
|    External                  customers      | $330        | $312      | $512       | $ (1)                | $  --         | $1,153                         |
|    Affiliated                  customers    | --          | 303       | 3          | 18                   | --                      | 324                            |
|    Intersegment                             | 1           | 71        | 51         | --                   | (123)                        | --                             |
|    Total                  operating revenue | 331         | 686       | 566        | 17                   | (123)                        | 1,477                          |
| Net                  income (loss)                         | (6)              | 44        | 20         | (356)                     | --                      | (298)                               |
|                                                       |             |      |       |                      |                         |                                |
| **Nine                  Months Ended September 30, 2006**  |             |      |       |                      |                         |                                |
| Operating                  revenue:                        |             |      |       |                      |                         |                                |
|    External                  customers      | **$2,164 ** | **$992**  | **$2,314** | **$  -- ** | **$  -- **    | **$5,470 **                    |
|    Affiliated                  customers    | **1 **      | **392**   | **7**      | **17 **              | **-- **                 | **417 **                       |
|    Intersegment                             | **2 **      | **213**   | **139**    | **-- **              | **(354)**                    | **-- **                        |
|    Total                  operating revenue | **2,167 **  | **1,597** | **2,460**  | **17 **              | **(354)**                    | **5,887 **                     |
| Net                  income (loss)                         | **91 **     | **201**   | **585**    | **(186)**                 | --                      | **691 **                       |
|                                                       |             |      |       |                      |                         |                                |
| Nine                  Months Ended September 30, 2005      |             |      |       |                      |                         |                                |
| Operating                  revenue:                        |             |      |       |                      |                         |                                |
|    External                  customers      | $2,000      | $894      | $1,736     | $  --      | $  --         | $4,630                         |
|    Affiliated                  customers    | 1           | 759       | 14         | 27                   | --                      | 801                            |
|    Intersegment                             | 24          | 186       | 123        | --                   | (333)                        | --                             |
|    Total                  operating revenue | 2,025       | 1,839     | 1,873      | 27                   | (333)                        | 5,431                          |
| Net                  income (loss)                         | 114         | 173       | 309        | (356)                     | --                      | 240                            |

----

**CONSOLIDATED        NATURAL GAS COMPANY**

**ITEM        2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF**

**RESULTS        OF OPERATIONS**

**Contents        of MD&A **

**Forward-Looking        Statements **

----

**Accounting        Matters **

**Critical        Accounting Policies and Estimates **

**Other**

***SFAS        No. 158***

*Employers’ Accounting for        Defined Benefit Pension and Other Postretirement Plans.*

**FIN        48**

*Accounting        for Uncertainty in Income Taxes*

***SFAS        No. 157***

*Fair        Value*
*Measurements*
*Issues        Involved in Accounting for Derivative Contracts Held for Trading Purposes        and        Contracts Involved in Energy Trading and Risk Management        Activities.*

----

**Results        of Operations**

----

| (millions)                                     | **2006** |                         2005 |                           $ Change |
|------------------------------------------------|----------|------------------------------------------------------------|----------------------------------------------------------------------------|
| **Third                  Quarter**             |     |
|   Net                  income (loss) | **$340** | $(298)                                                     | $638                                                                       |
| **Year-To-Date**                               |     |                                                       |                                                                       |
|   Net                  income        | **$691** | $240                                                       | $451                                                                       |

**Overview        **

***Third        Quarter 2006 vs. 2005***

***Year-To-Date        2006 vs. 2005***

**Analysis        of Consolidated Operations **

----

|                                                      | **Third                  Quarter** | **Year-To-Date** |
|-----------------------------------------------------------|------------------------------------|------------------|
| (millions)                                                | **2006**                           | 2005             | $                  Change | **2006** | 2005 | $                  Change |
| Operating                  Revenue                        | **$1,514 **                   | $1,477      | $37  | **$5,887** | $5,431 | $456  |
| Operating                  Expenses:                      |                               |             |   |   |   |   |
| Purchased                  gas                            | **324 **                      | 601         | (277) | **2,102** | 2,324 | (222) |
| Electric                  fuel and energy purchases       | **63 **                       | 115         | (52) | **184** | 254 | (70) |
| Other                  energy-related commodity purchases | **1 **                        | 122         | (121) | **413** | 290 | 123  |
| Other                  operations and maintenance         | **220 **                      | 820         | (600) | **857** | 1,322 | (465) |
| Depreciation,                  depletion and amortization | **229 **                      | 163         | 66  | **672** | 498 | 174  |
| Other                  taxes                              | **59 **                       | 60          | (1) | **217** | 210 | 7  |
| Other                  income (loss)                      | **(4)**                            | 8           | (12) | **12** | 20 | (8) |
| Interest                  and related charges             | **77 **                       | 62          | 15  | **221** | 167 | 54  |
| Income                  tax expense (benefit)             | **197 **                      | (160)            | 357  | **542** | 146 | 396  |

**Third        Quarter 2006 vs. 2005**

**Operating        Revenue **

| · | $269                  million of business interruption insurance revenue received in                  2006,                  associated with the 2005                  hurricanes; |
|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| · | A                  $122 million increase in sales of gas and oil production due to                  higher                  volumes ($216 million) partially offset by lower prices ($94 million);                  and |
|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| · | A                  $55 million increase in sales of extracted products, primarily                  due to                  increased volumes ($42 million) and increased prices ($13 million);                  partially offset by |
|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| · | A                  $228 million decrease in gas sales primarily due to a decrease                  of $250                  million resulting from our producer services operations reflecting                  lower                  prices and volumes and a $32 million decrease in revenue from sales                  of gas                  purchased by E&P operations to facilitate gas transportation and other                  contracts primarily due to lower volumes and the implementation                  of EITF                  04-13, partially offset by a $41 million increase in sales by nonregulated                  retail energy marketing activities primarily due to higher                  volumes |
|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   |  |
|--------|--|

----

| · | A                  $125 million decrease as a result of the impact of netting sales                  and                  purchases of oil under buy/sell arrangements that were entered                  into or                  modified by E&P operations subsequent to April 1, 2006, in accordance                  with EITF 04-13. The effect of this decrease was largely offset                  by a                  corresponding decrease in Other energy-related commodity purchases                  expense; |
|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| · | A                  $41 million decrease in electric sales primarily due to decreased                  volumes,                  partially offset by higher customer contract sales rates for electric                  commodities at our nonregulated retail energy marketing operations;                  and                                                                                                                                                                                                                   |
| · | A                  $26 million decrease from regulated gas distribution operations                  primarily                  reflecting a $21 million decrease resulting from the loss of customers                  related to Energy Choice programs and a $5 million decrease associated                  with milder weather and changes in customer usage and other factors.                                                                                                                                               |

**Operating        Expenses and Other Items **

***Purchased        gas expense***
* *

***Electric        fuel and energy purchases expense***

***Other        energy-related commodity purchases expense***
*Operating        Revenue*

***Other        operations and maintenance expense***

| · | The                  absence of a $556 million loss recognized in 2005 related to the                  discontinuance of hedge accounting for certain gas and oil hedges,                  resulting from an interruption of gas and oil production in the                  Gulf of                  Mexico caused by the 2005 hurricanes, and subsequent changes in                  the fair                  value of those hedges; |
|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| · | A                  $51 million benefit resulting from favorable price changes in the                  fair                  value of certain gas and oil derivatives that were de-designated                  as hedges                  following the 2005 hurricanes; and |
|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| · | A                  $27 million decrease in hedge ineffectiveness expense associated                  with our                  E&P operations, primarily due to a decrease in the fair value                  differential between the delivery location and commodity specifications                  of                  derivative contracts held by us as compared to our forecasted gas                  and oil                  sales and the increased use of basis                  swaps. |
|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| · | A                  $29 million increase attributable to higher production handling,                  transportation and operating costs related to E&P operations; and |
|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| · | A                  $13 million increase resulting from price risk management activities                  associated with our nonregulated retail energy marketing                  operations. |
|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

***Depreciation,        depletion and amortization expense***

***Other        income***

***Interest        and related charges***

**Year-To-Date        2006 vs. 2005**

**Operating        Revenue **

| · | A                  $317 million increase in sales of gas and oil production, primarily                  due to                  higher volumes ($331 million) partially offset by lower prices                  ($14                  million); |
|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| · | A                  $130 million increase in sales of extracted products, primarily                  due to                  increased volumes ($89 million) and increased prices ($41                  million); |
|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| · | A                  $121 million increase in sales of purchased oil under buy/sell                  arrangements by E&P operations resulting from higher market prices                  ($68 million) and increased sales volumes ($53 million);                  and |
|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| · | An                  increase of $90 million resulting from business interruption insurance                  revenue of $269 million received in 2006, associated with the 2005                  hurricanes, versus insurance revenue of $179 million received in                  2005,                  associated with Hurricane Ivan; partially offset                  by |
|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

| · | A                  $173 million decrease in gas sales primarily due to a decrease                  of $309                  million resulting from our producer services operations reflecting                  lower                  volumes, partially offset by higher prices and a $60 million decrease                  in                  revenue from sales of gas purchased by E&P operations to facilitate                  gas transportation and other contracts primarily due to the implementation                  of EITF 04-13, partially offset by a $187 million increase in sales                  by                  nonregulated retail energy marketing activities primarily due to                  higher                  prices ($128 million) and increased volumes ($59 million);                  and |
|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| · | A                  $46 million decrease from regulated gas distribution operations                  primarily                  reflecting a $103 million decrease resulting from the loss of customers                  related to Energy Choice programs and a $162 million decrease associated                  with milder weather and changes in customer usage and other factors,                  partially offset by a $219 million increase related to the recovery                  of                  higher gas prices. |
|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

**Operating        Expenses and Other Items **

***Purchased        gas expense***
* *

***Electric        fuel and energy purchases expense***

***Other        energy-related commodity purchases expense***

***Other        operations and maintenance expense***

| · | The                  absence of a $556 million loss recognized in 2005 related to the                  discontinuance of hedge accounting for certain gas and oil hedges,                  resulting from an interruption of gas and oil production in the                  Gulf of                  Mexico caused by the 2005 hurricanes, and subsequent changes in                  the fair                  value of those hedges; |
|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| · | A                  $189 million benefit resulting from favorable price changes in                  the fair                  value of certain gas and oil derivatives that were de-designated                  as hedges                  following the 2005 hurricanes; |
|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| · | A                  $60 million decrease in hedge ineffectiveness expense associated                  with our                  E&P operations, primarily due to a decrease in the fair value                  differential between the delivery location and commodity specifications                  of                  derivative contracts held by us as compared to our forecasted gas                  and oil                  sales and the increased use of basis swaps;                  and |
|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| · | The                  absence of a $59 million loss related to the discontinuance of                  hedge                  accounting in March 2005, for certain oil derivatives primarily                  resulting                  from a delay in reaching anticipated production levels in the Gulf                  of                  Mexico, and subsequent changes in the fair value of those derivatives. |
|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| · | A                  $163 million charge from the write-off of certain regulatory assets                  related to the pending sale of Peoples and                  Hope; |
|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| · | An                  $82 million increase attributable to higher production handling,                  transportation and operating costs related to E&P                  operations; |
|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| · | A                  $42 million increase in bad debt expense primarily reflecting expenses                  for                  regulated gas operations related to low income home energy assistance                  programs. These expenditures are recovered through rates and do                  not impact                  our net income; |
|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| · | A                  $25 million increase resulting from price risk management activities                  associated with our nonregulated retail energy marketing                  operations; |
|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| · | An                  $18 million increase in insurance costs for E&P operations due to                  higher insurance premiums incurred following the 2005 hurricanes;                  and |
|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| · | An                  $18 million increase resulting primarily from higher salaries,                  wages and                  benefits. |
|--------|------------------------------------------------------------------------------------------------------------------------------------------|

***Depreciation,        depletion and amortization expense***

----

***Other        income***

***Interest        and related charges***

**Segment        Results of Operations **

----

| **Third                  Quarter**          | **2006**             | **2005**         | **$                  Change** |
|---------------------------------------------|----------------------|------------------|-------------------------------|
| (millions)                                  |                 |             |                          |
| Delivery                                    | **$  (9)** | $  (6) | $ (3)                    |
| Energy                                      | **61 **         | 44          | 17                       |
| E&P                                     | **290 **        | 20          | 270                      |
| Primary                  operating segments | **342 **        | 58          | 284                      |
| Corporate                                   | **(2)**              | (356)            | 354                      |
|     Consolidated        | **$340 **       | $(298)           | $638                     |
|                                        |                 |             |                          |
| **Year-To-Date**                            |                 |             |                          |
| (millions)                                  |                 |             |                          |
| Delivery                                    | **$ 91 **  | $114        | $(23)                         |
| Energy                                      | **201 **        | 173         | 28                       |
| E&P                                     | **585 **        | 309         | 276                      |
| Primary                  operating segments | **877 **        | 596         | 281                      |
| Corporate                                   | **(186)**            | (356)            | 170                      |
|     Consolidated        | **$691 **       | $240        | $451                     |

**Delivery        **

|                                                                                    |  **Third                  Quarter** |  **Year-To-Date** |
|------------------------------------------------------------------------------------|------------------------------------------|------------------------|
|                                                                               | **2006**                                 | 2005                   | %                  Change |  **2006** |  2005 |  %                  Change |
| Gas                  throughput (bcf):                                             |                                     |                   |   |   |   |   |
|     Gas                  sales                                 | **6**                                    | 8                      | (25)% | **68** | 90 | (24)% |
|     Gas                  transportation                        | **37**                                   | 35                     | 6    | **167** | 172 | (3)   |
| Heating                  degree days (gas service area)(1)                         | **111**                                  | 24                     | 363    | **3,347** | 3,794 | (12)   |
| Average                  gas delivery customer accounts(2):                        |                                     |                   |   |   |   |   |
|     Gas                  sales                                 | **780**                                  | 1,000                  | (22)   | **881** | 1,037 | (15)   |
|     Gas                  transportation                        | **893**                                  | 674                    | 32    | **807** | 653 | 24    |
| Average                  nonregulated retail energy marketing customer accounts(2) | **1,398**                                | 1,175                  | 19    | **1,308** | 1,153 | 13    |

----

|                                                                | **Third                  Quarter****2006                  vs. 2005****Increase                  (Decrease)** | **Year-To-Date****2006                  vs. 2005 Increase (Decrease)** |
|---------------------------------------------------------------------|--------------------------------------------------------------------------------------------------------------|------------------------------------------------------------------------|
| (millions)                                                          |                                                                                                         |
| Interest                  expense                                   | $ (5)                                                                                                   | $ (17)                                                            |
| Nonregulated                  retail energy marketing operations(1) | (2)                                                                                                          | 7                                                                 |
| Weather                                                             | 1                                                                                                       | (13)                                                                   |
| Other                  margins(2)                                   | --                                                                                                      | (11)                                                                   |
| Other                                                               | 3                                                                                                       | 11                                                                |
| Change                  in net income contribution                  | $ (3)                                                                                                   | $ (23)                                                            |

**Energy        **

----

|                                                 | **Third                  Quarter** | **Year-To-Date** |
|------------------------------------------------------|------------------------------------|------------------|
|                                                      | **2006**                           | 2005             | %                  Change |  **2006** |  2005 |  %                  Change |
|                                                 |                               |             |   |   |   |   |
| Gas                  transportation throughput (bcf) | **128**                            | 131              | (2)% | **484** | 565 | (14)% |

----

|                                                        | **Third                  Quarter****2006                  vs. 2005****Increase                  (Decrease)** | **Year-To-Date****2006                  vs. 2005****Increase                  (Decrease)** |
|-------------------------------------------------------------|--------------------------------------------------------------------------------------------------------------|--------------------------------------------------------------------------------------------|
| (millions)                                                  |                                                                                                         |
| Gas                  transmission:                          |                                                                                                         |                                                                                       |
|    Other                  margins(1)         | $ 18                                                                                               | $ 39                                                                             |
|    Rate                  settlement(2)  | --                                                                                                      | (13)                                                                                       |
| Producer                  services(3)                       | 2                                                                                                       | 13                                                                                    |
| Other                                                       | (3)                                                                                                          | (11)                                                                                       |
| Change                  in net income contribution          | $ 17                                                                                               | $ 28                                                                             |

| (3) | Higher                  income in the year-to-date period resulting from the impact of                  favorable                  price changes on gas marketing activities associated with certain                  contractual assets. |
|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

**E&P**

|                                                              |  **Third                  Quarter** |  **Year-To-Date** |
|-------------------------------------------------------------------|------------------------------------------|------------------------|
|                                                                   | **2006**                                 | 2005                   | %                  Change |  **2006** | 2005  |  %                  Change |
|                                                              |                                     |                   |   |   |   |   |
| Gas                  production (bcf)                             | **68.3**                                 | 56.5                   | 21% | **196.7** | 175.5 | 12% |
| Oil                  production (million bbls)                    | **6.0**                                  | 3.0                    | 100  | **17.8** | 10.5 | 70  |
| Average                  realized prices without hedging results: |                                     |                   |   |   |   |   |
|      Gas                  (per mcf)(1)   | **$6.42**                                | $8.12                  | (21) | **$6.94** | $7.07 | (2) |
|      Oil                  (per bbl)      | **$58.84**                               | $55.81                 | 5  | **$57.42** | $49.11 | 17  |
| Average                  realized prices with hedging results:    |                                     |                   |   |   |   |   |
|      Gas                  (per mcf)(1)   | **$4.44**                                | $4.58                  | (3) | **$4.67** | $4.45 | 5  |
|      Oil                  (per bbl)      | **$32.86**                               | $22.76                 | 44  | **$35.35** | $26.01 | 36  |
| DD&A                  (unit of production rate per mcfe)      | **$1.74**                                | $1.53                  | 14  | **$1.74** | $1.49 | 17  |
|                                                              |

----

|                                                                 | **Third                  Quarter****2006                  vs. 2005****Increase                  (Decrease)** | **Year-To-Date****2006                  vs. 2005**** ****Increase                  (Decrease)** |
|----------------------------------------------------------------------|--------------------------------------------------------------------------------------------------------------|------------------------------------------------------------------------------------------------------|
| (millions)                                                           |                                                                                                         |
| Business                  interruption insurance                     | $ 171                                                                                              | $  58                                                                                 |
| Gas                  and oil—production(1)                     | 146                                                                                                     | 270                                                                                             |
| Operations                  and maintenance expense(2)               | 43                                                                                                      | 107                                                                                             |
| Gas                  and oil—prices                            | (47)                                                                                                         | 9                                                                                               |
| Depreciation,                  depletion and amortization expense(3) | (45)                                                                                                         | (118)                                                                                                |
| Interest                  expense                                    | (9)                                                                                                          | (34)                                                                                                 |
| Income                  tax adjustments (4)                          | --                                                                                                      | (22)                                                                                                 |
| Other                                                                | 11                                                                                                      | 6                                                                                               |
| Change                  in net income contribution                   | $ 270                                                                                              | $ 276                                                                                      |

----

----

|   | **Natural                  Gas**  | **Oil**                                                                   |
|--------|-----------------------------------|---------------------------------------------------------------------------|
| Year   | **Hedged****Production****(bcf)** | **Average****Hedge                  Price****(per                  mcf)** | **Hedged****Production****(million bbls)** | **Average****Hedge                  Price****(per                  bbl)** |
| 2006   |   47.5             | $4.64                                                                | 3.5 | $25.02  |
| 2007   | 195.5                        | 5.91                                                                      | 10.0  | 33.41 |
| 2008   | 151.2                        | 8.26                                                                      | 5.0 | 49.36 |
| 2009   | 25.5                              | 8.09                                                                      | 0.3 | 75.36 |

**Corporate        **

----

|                                                               | **Third                  Quarter** | **Year-To-Date** |
|--------------------------------------------------------------------|------------------------------------|------------------|
|                                                               | **2006**                           | 2005             | $                  Change | **2006** | 2005 | $                  Change |
| (millions)                                                         |                               |             |   |   |   |   |
| Specific                  items attributable to operating segments | **$ (10)**                    | $(359)           | $ 349  | **$(125)** | $(359) | $234  |
| Other                  corporate operations                        | **8 **                        | 3           | 5  | **(61)** | 3  | (64) |
| Total                  net income (expense)                        | **$ (2)**                     | $(356)           | $ 354  | **$(186)** | $(356) | $170  |

***Specific        Items Attributable to Operating Segments***

**Third        Quarter 2006 vs. 2005**

**Year-To-Date        2006 vs. 2005**

***Other        Corporate Operations***

**Year-To-Date        2006 vs. 2005**

----

**Credit        Risk**

----

|                                                                              | **Gross                  Credit Exposure** |
|-----------------------------------------------------------------------------------|--------------------------------------------|
| (millions)                                                                        |                                       |
| Investment                  grade(1)                                              | $333                                       |
| Non-investment                  grade(2)                                          | 39                                         |
| No                  external ratings:                                             |                                       |
|    Internally                  rated—investment grade(3)     | 30                                         |
|    Internally                  rated—non-investment grade(4) | 151                                        |
|       Total                                         | $553                                       |

| (1) | Designations                  as investment grade are based on minimum credit ratings assigned                  by                  Moody’s Investors Service (Moody’s) and Standard & Poor’s Rating                  Services, (Standard & Poor’s). The five largest counterparty                  exposures, combined, for this category represented approximately                  28% of                  the total gross credit exposure. |
|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (2) | The                  five largest counterparty exposures, combined, for this category                  represented approximately 5% of the total gross credit                  exposure. |
|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (3) | The                  five largest counterparty exposures, combined, for this category                  represented approximately 4% of the total gross credit                  exposure. |
|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (4) | The                  five largest counterparty exposures, combined, for this category                  represented approximately 4% of the total gross credit                  exposure. |
|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

**Future        Issues and Other Matters**

**Possible        Sale of E&P Business**

**Future        Divestitures**

----

**Minimum        Service Standards**

**Cove        Point Expansion**

**Offshore        Oil and Gas Leases**

----

**CONSOLIDATED        NATURAL GAS COMPANY**

**ITEM        4. CONTROLS AND PROCEDURES**

----

**CONSOLIDATED        NATURAL GAS COMPANY**

**PART        II. OTHER INFORMATION**

**ITEM        1. LEGAL PROCEEDINGS**

*Other        Matters*

**ITEM        1A. RISK FACTORS**

*Forward-Looking        Statements*

**Dominion’s        decision to pursue a sale of most of our E&P assets is expected to be        dilutive to earnings, could have an adverse impact on our results of operations        and may not yield the benefits expected.**

**Our        exploration and production business is dependent on factors that cannot be        predicted or controlled and that could**
**damage        facilities, disrupt production or reduce the book value of our        assets.**

----

**CONSOLIDATED        NATURAL GAS**
**COMPANY**

**PART        II. OTHER INFORMATION**

----

**CONSOLIDATED          NATURAL GAS**
**COMPANY**

**PART          II. OTHER INFORMATION**

**I****TEM          6. EXHIBITS** 

| **(a)                    Exhibits:** |
|--------------------------------------|
|                                 |
|                                 | 3.1 | Certificate                    of Incorporation of Consolidated Natural Gas Company (Exhibit                    (3A)(i) to                    Form 10-K for the fiscal year ended December 31, 1999, File No.                    1-3196,                    incorporated by reference). |
|                                 | 3.2 | Certificate                    of Amendment of Certificate of Incorporation, dated January 28,                    2000                    (Exhibit (3A)(ii) to Form 10-K for the fiscal year ended December                    31,                    1999, File No. 1-3196, incorporated by reference). |
|                                 | 3.3 | Bylaws                    as in effect on December 15, 2000 (Exhibit 3B to Form 10-K for                    the fiscal                    year ended December 31, 2000, File No. 1-3196, incorporated by                    reference). |
|                                 | 4 | Consolidated                    Natural Gas Company agrees to furnish to the Securities and Exchange                    Commission upon request any other instrument with respect to                    long-term                    debt as to which the total amount of securities authorized does                    not exceed                    10% of its total consolidated assets. |
|                                 | 12 | Ratio                    of earnings to fixed charges (filed herewith). |
|                                 | 31.1 | Certification                    by Registrant’s Chief Executive Officer pursuant to Section 302 of the                    Sarbanes-Oxley Act of 2002 (filed herewith). |
|                                 | 31.2 | Certification                    by Registrant’s Chief Financial Officer pursuant to Section 302 of the                    Sarbanes-Oxley Act of 2002 (filed herewith). |
|                                 | 32 | Certification                    to the Securities and Exchange Commission by Registrant’s Chief Executive                    Officer and Chief Financial Officer, as required by Section 906                    of the                    Sarbanes-Oxley Act of 2002 (filed herewith). |
|                                 | 99 | Condensed                    consolidated earnings statements (unaudited) (filed                    herewith). |

----

|                              | **CONSOLIDATED                  NATURAL GAS COMPANY**Registrant                                                                                                                                                                                                                                              |
|-----------------------------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|                              |                                                                                                                                                                                                                                                                                                         |
| November                  1, 2006 |                   /s/                  Steven A.                  Rogers                        |
|                              | Steven                  A. RogersSenior                  Vice President and Controller(Principal                  Accounting Officer)                                                                                                                                                                        |
|                              |                                                                                                                                                                                                                                                                                                         |