##### Table of Contents



UNITED STATES
 SECURITIES AND EXCHANGE
    COMMISSION
 Washington, D.C. 20549
      Form 10-Q
  (Mark One)þ

QUARTERLY REPORT PURSUANT TO
    SECTION 13 OR 15(d)OF THE SECURITIES EXCHANGE ACT OF
    1934For the quarterly period ended
    September 30, 2006ORo

TRANSITION REPORT PURSUANT TO
    SECTION 13 OR 15(d)OF THE SECURITIES EXCHANGE ACT OF
    1934For the transition period
    from     
    to   Commission File Number 1-4101
    Tennessee Gas Pipeline
    Company
    Delaware(State or Other
    Jurisdiction
    of Incorporation or Organization)

74-1056569(I.R.S. Employer
    Identification No.)El Paso Building
    1001 Louisiana Street
    Houston, Texas(Address of Principal
    Executive Offices)

77002(Zip Code)    Telephone Number:
    (713) 420-2600
   þ o
  non-accelerated Rule 12b-2
  Large accelerated
    filer o

Accelerated
    filer o

Non-accelerated
    filer þ   Rule 12b-2 o þ
      TENNESSEE GAS PIPELINE COMPANY
    MEETS THE CONDITIONS OF GENERAL INSTRUCTION H(1)(a) AND
    (b) TO
    FORM 10-Q
    AND IS THEREFORE FILING THIS REPORT
    WITH A REDUCED DISCLOSURE FORMAT AS PERMITTED BY SUCH
    INSTRUCTION.




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##### 



TENNESSEE
    GAS PIPELINE COMPANY
   TABLE OF CONTENTS
  Caption

PagePART I 
    Financial InformationItem 1.


Financial
    Statements


1Item 2.


Managements
    Discussion and Analysis of Financial Condition and Results of
    Operations


10Item 3.


Quantitative and
    Qualitative Disclosures About Market Risk


*Item 4.


Controls and
    Procedures


13PART II 
    Other InformationItem 1.


Legal
    Proceedings


14Item 1A.


Risk
    Factors


14Cautionary
    Statements for Purposes of the Safe Harbor
    Provisions of the Private Securities
      Litigation Reform Act of 1995Item 2.


Unregistered Sales
    of Equity Securities and Use of Proceeds


*Item 3.


Defaults Upon
    Senior Securities


*Item 4.


Submission of
    Matters to a Vote of Security Holders


*Item 5.


Other
    Information


14Item 6.


Exhibits


15Signatures


16Certification of PEO Pursuant to Section 302Certification of CFO Pursuant to Section 302Certification of PEO Pursuant to Section 906Certification of CFO Pursuant to Section 906      *
    
    We have not included a response to this item in this document
    since no response is required pursuant to the reduced disclosure
    format permitted by General Instruction H to
    Form 10-Q.    /d = per day

MMcf = million cubic feetBBtu = billion British
    thermal units     and/or
 i




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##### Table of Contents



PART I 
    FINANCIAL INFORMATION  Item 1.
    Financial
    Statements  TENNESSEE
    GAS PIPELINE COMPANY
   CONDENSED CONSOLIDATED STATEMENTS OF INCOME
    (In millions)
    (Unaudited)
  Quarters Ended


Nine Months EndedSeptember 30,


September 30,2006


2005


2006


2005Operating revenues

$
182


$
178


$
606


$
565Operating expensesOperation and maintenance


87



75



238



233Depreciation, depletion and
    amortization


41



41



123



121Taxes, other than income taxes


14



13



42



40142



129



403



394Operating income


40



49



203



171Earnings from unconsolidated
    affiliate


4



4



10



11Other income, net


3



1



9



3Interest and debt expense


(32
)


(33
)


(97
)


(98
)Affiliated interest income, net


13



8



34



15Income before income taxes


28



29



159



102Income taxes


11



12



61



40Net income

$
17


$
17


$
98


$
62    1




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TENNESSEE
    GAS PIPELINE COMPANY
   CONDENSED CONSOLIDATED BALANCE SHEETS
    (In millions, except share amounts)
    (Unaudited)
  September 30,


December 31,2006


2005ASSETSCurrent assetsCash and cash equivalents

$



$
Accounts and notes receivableCustomer, net of allowance of $1 in
    2006 and 2005


32



123Affiliates


62



25Other


14



25Materials and supplies


26



22Assets held for sale


28



Deferred income taxes


19



9Other


7



8Total current assets


188



212Property, plant and equipment, at
    cost


3,587



3,345Less accumulated depreciation,
    depletion and amortization


585



5433,002



2,802Additional acquisition cost
    assigned to utility plant, net


2,089



2,119Total property, plant and
    equipment, net


5,091



4,921Other assetsNotes receivable from affiliates


1,157



1,098Investment in unconsolidated
    affiliate


93



101Other


48



431,298



1,242Total assets

$
6,577


$
6,375LIABILITIES AND STOCKHOLDERS
    EQUITYCurrent liabilitiesAccounts payableTrade

$
79


$
85Affiliates


28



18Other


40



38Current maturities of long-term debt


300



Taxes payable


68



37Accrued interest


44



24Contractual deposits


29



21Other


48



21Total current liabilities


636



244Long-term debt, less current
    maturities


1,301



1,600Other liabilitiesDeferred income taxes


1,309



1,271Regulatory liabilities


157



170Other


49



631,515



1,504Commitments and contingenciesStockholders equityCommon stock, par value $5 per
    share; 300 shares authorized; 208 shares issued and
    outstanding






Additional paid-in capital


2,207



2,207Retained earnings


918



820Total stockholders equity


3,125



3,027Total liabilities and
    stockholders equity

$
6,577


$
6,375    2




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TENNESSEE
    GAS PIPELINE COMPANY
   CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
    (In millions)
    (Unaudited)
  Nine Months EndedSeptember 30,2006


2005Cash flows from operating
    activitiesNet income

$
98


$
62Adjustments to reconcile net
    income to net cash from operating activitiesDepreciation, depletion and
    amortization


123



121Deferred income taxes


28



42Earnings from unconsolidated
    affiliate, adjusted for cash distributions


7



53Other non-cash income items


(4
)


Asset and liability changes


74



67Net cash provided by operating
    activities


326



345Cash flows from investing
    activitiesAdditions to property, plant and
    equipment


(275
)


(121
)Net change in notes receivable
    from affiliates


(59
)


(226
)Other


8



2Net cash used in investing
    activities


(326
)


(345
)Net change in cash and cash
    equivalents






Cash and cash equivalentsBeginning of period






End of period

$



$
    3




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TENNESSEE
    GAS PIPELINE COMPANY
   NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
    (Unaudited)
  1.
    Basis of
    Presentation and Significant Accounting Policies  Basis of
    Presentation
  Form 10-Q Form 10-Q Form 10-K, Form 10-K.
  Significant
    Accounting Policies
  Form 10-K,
  Accounting for Pipeline Integrity Costs.
  New
    Accounting Pronouncements Issued But Not Yet Adopted
  Accounting for Uncertainty in Income Taxes. Accounting for
    Uncertainty in Income Taxes. Accounting for Income Taxes,
  Fair Value Measurements. Fair Value
    Measurements
  Accounting for Pension and Other Postretirement
    Benefits. Employers Accounting for
    Defined Benefit Pension and Other Postretirement
    Plans  An Amendment of FASB Statements No. 87,
    88, 106, and 132(R).
 4




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Evaluation of Prior Period Misstatements in Current Financial
    Statements. Considering the Effects of Prior Year Misstatements When
    Quantifying Misstatements in Current Year Financial
    Statements.
  2.
    Divestitures  Accounting for the Impairment
    or Disposal of Long-Lived Assets
  3.
    Debt and
    Credit Facilities  Debt
    Credit
    Facilities
    4.
    Commitments
    and Contingencies  Legal
    Proceedings
  Gas Measurement Cases. and/or re: Natural Gas Royalties Qui Tam Litigation,
 5




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Will Price, et al. v. Gas Pipelines and Their
    Predecessors, et al.,
  Hurricane Litigation. George Barasich,
    et al. v. Columbia Gulf Transmission Company,
    et al., and Charles Villa Jr., et al. v. Columbia
    Gulf Transmission Company, et al Henry and Hattie Bands et al. v. Columbia Gulf
    Transmission Company et al
      Environmental
    Matters
   6




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##### Table of Contents



Balance at January 1, 2006

$
32Reduction in estimated costs


(12
)Payments for remediation activities


(3
)Balance at September 30, 2006

$
17   clean-up
  PCB Cost Recoveries. This pre-collected
  CERCLA Matters. clean-up
    Guarantees
  Form 10-K
 7




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5.
    Investment
    in Unconsolidated Affiliate and Transactions with
    Affiliates  Investment
    in Unconsolidated Affiliate
    Quarters Ended


Nine Months EndedSeptember 30,


September 30,2006


2005


2006


2005(In millions)Operating results data:Operating revenues

$
4


$
4


$
13


$
13Operating expenses


1



1



5



5Income from continuing operations
    and net income


4



4



10



11     Transactions
    with Affiliates
  Cash Management Program. short-term
  Notes Receivable.
  Accounts Receivable Sales Program. Accounting for
    Transfers and Servicing of Financial Assets and Extinguishments
    of Liabilities.
  Taxes.
 8




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##### Table of Contents



Other Affiliate Balances.
  September 30,


December 31,2006


2005(In millions)Accounts and notes
    receivable  other

$



$
11Contractual deposits


8



7Other non-current liabilities


1



1   Affiliate Revenues and Expenses.
    Quarters Ended


Nine Months EndedSeptember 30,


September 30,2006


2005


2006


2005(In millions)Revenues from affiliates

$
6


$
7


$
17


$
19Operation and maintenance expenses
    from
    affiliates(1)


13



19



44



55Reimbursements of operating
    expenses charged to affiliates


18



20



58



59     (1)
    
    Includes expenses related to a
    long-term storage contract with an affiliate. 9




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##### Table of Contents



Item 2.
    Managements
    Discussion and Analysis of Financial Condition and Results of
    Operations  Form 10-Q. Form 10-K, Form 10-Q.
  Results
    of Operations
    2006


2005(In millions, except volumes)Operating revenues

$
606


$
565Operating expenses


(403
)


(394
)Operating income


203



171Earnings from unconsolidated
    affiliate


10



11Other income, net


9



3EBIT


222



185Interest and debt expense


(97
)


(98
)Affiliated interest income, net


34



15Income taxes


(61
)


(40
)Net income

$
98


$
62Throughput volumes (BBtu/d)


4,646



4,492     EBITRevenue


Expense


Other


ImpactFavorable/(Unfavorable)(In millions)Gas not used in operations,
    revaluations and other natural gas sales

$
28


$
2


$



$
30Higher services revenues


17











17Lower general and administrative
    expenses






16







16Impacts of Hurricanes Katrina and
    Rita






(13
)






(13
)Higher pipeline integrity costs






(5
)






(5
)Environmental reserve adjustment






4







4Allowance for Funds Used During
    Construction










5



5Other(1)


(4
)


(13
)






(17
)Total impact on EBIT

$
41


$
(9
)

$
5


$
37     (1)
    
    Consists of individually
    insignificant items. 10




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Gas Not Used in Operations, Revaluations and Other Natural
    Gas Sales. Form 10-K.
  Higher Services Revenues.
  Lower General and Administrative
    Expenses.
  Impacts of Hurricanes Katrina and Rita.
  Higher Pipeline Integrity Costs.
  Environmental Reserve Adjustment.
  Allowance for Funds Used During Construction
    (AFUDC).
  Expansions. ConneXion-New
      Sale of Lateral.
  Affiliated
    Interest Income, Net
   11




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Income
    Taxes
  Nine Months EndedSeptember 30,2006


2005(In millions,except for rates)Income taxes

$
61


$
40Effective tax rate


38
%


39
%     Liquidity
    and Capital Expenditures
  Liquidity
    Overview
          Debt
   12




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Capital
    Expenditures
        Commitments
    and Contingencies
    Item 3.
    Quantitative
    and Qualitative Disclosures About Market Risk  Form 10-Q.
  Item 4.
    Controls
    and Procedures  Evaluation
    of Disclosure Controls and Procedures
      Changes
    in Internal Control Over Financial Reporting
   13




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##### Table of Contents



PART II 
    OTHER INFORMATION  Item 1.
    Legal
    Proceedings  Form 10-K
  Item 1A.
    Risk
    Factors CAUTIONARY
    STATEMENTS FOR PURPOSES OF THE SAFE HARBOR
    PROVISIONS OF THE
    PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995    Form 10-K.
  Item 2.
    Unregistered
    Sales of Equity Securities and Use of Proceeds  Form 10-Q.
  Item 3.
    Defaults
    Upon Senior Securities  Form 10-Q.
  Item 4.
    Submission
    of Matters to a Vote of Security Holders  Form 10-Q.
  Item 5.
    Other
    Information   14




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Item 6.
    Exhibits    ExhibitNumber

Description10
.A

Amended and Restated Credit
    Agreement dated as of July 31, 2006, among El Paso
    Corporation, Colorado Interstate Gas Company, El Paso
    Natural Gas Company, Tennessee Gas Pipeline Company, the several
    banks and other financial institutions from time to time parties
    thereto and JPMorgan Chase Bank, N.A., as administrative agent
    and as collateral agent (Exhibit 10.A to our Current Report
    on
    Form 8-K,
    filed with the SEC on August 2, 2006).10
.B

Amended and Restated Security
    Agreement dated as of July 31, 2006, among El Paso
    Corporation, Colorado Interstate Gas Company, El Paso
    Natural Gas Company, Tennessee Gas Pipeline Company, the
    Subsidiary Guarantors and certain other credit parties thereto
    and JPMorgan Chase Bank, N.A., not in its individual capacity,
    but solely as collateral agent for the Secured Parties and as
    the depository bank (Exhibit 10.B to our Current Report on
    Form 8-K,
    filed with the SEC on August 2, 2006).10
.C

First Tier Receivables Sale
    Agreement dated August 31, 2006, between Tennessee Gas
    Pipeline Company and TGP Finance Company, L.L.C.
    (Exhibit 10.A to our Current Report on
    Form 8-K,
    filed with the SEC on September 8, 2006).10
.D

Second Tier Receivables Sale
    Agreement dated August 31, 2006, between TGP Finance
    Company, L.L.C. and TGP Funding Company, L.L.C.
    (Exhibit 10.B to our Current Report on
    Form 8-K,
    filed with the SEC on September 8, 2006).10
.E

Receivables Purchase Agreement
    dated August 31, 2006, among TGP Funding Company, L.L.C.,
    as Seller, Tennessee Gas Pipeline Company, as Servicer, Starbird
    Funding Corporation, as the initial Conduit Investor and
    Committed Investor, the other investors from time to time
    parties thereto, BNP Paribas, New York Branch, as the initial
    Managing Agent, the other Managing Agents from time to time
    parties thereto, and BNP Paribas, New York Branch, as Program
    Agent (Exhibit 10.C to our Current Report on
    Form 8-K,
    filed with the SEC on September 8, 2006).*31
.A

Certification of Principal
    Executive Officer pursuant to Section 302 of the
    Sarbanes-Oxley Act of 2002.*31
.B

Certification of Chief Financial
    Officer pursuant to Section 302 of the Sarbanes-Oxley Act
    of 2002.*32
.A

Certification of Principal
    Executive Officer pursuant to Section 906 of the
    Sarbanes-Oxley Act of 2002.*32
.B

Certification of Chief Financial
    Officer pursuant to Section 906 of the Sarbanes-Oxley Act
    of 2002.   Undertaking
  Regulation S-K,
 15




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##### Table of Contents



SIGNATURES    TENNESSEE GAS PIPELINE COMPANY
   
    President
  (Principal Executive Officer)
   
    Senior Vice President,
  Chief Financial Officer and Controller
  (Principal Accounting and Financial Officer)
 16




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TENNESSEE
    GAS PIPELINE COMPANY
   EXHIBIT INDEX
    ExhibitNumber

Description10
.A

Amended and Restated Credit
    Agreement dated as of July 31, 2006, among El Paso
    Corporation, Colorado Interstate Gas Company, El Paso
    Natural Gas Company, Tennessee Gas Pipeline Company, the several
    banks and other financial institutions from time to time parties
    thereto and JPMorgan Chase Bank, N.A., as administrative agent
    and as collateral agent (Exhibit 10.A to our Current Report
    on
    Form 8-K,
    filed with the SEC on August 2, 2006).10
.B

Amended and Restated Security
    Agreement dated as of July 31, 2006, among El Paso
    Corporation, Colorado Interstate Gas Company, El Paso
    Natural Gas Company, Tennessee Gas Pipeline Company, the
    Subsidiary Guarantors and certain other credit parties thereto
    and JPMorgan Chase Bank, N.A., not in its individual capacity,
    but solely as collateral agent for the Secured Parties and as
    the depository bank (Exhibit 10.B to our Current Report on
    Form 8-K,
    filed with the SEC on August 2, 2006).10
.C

First Tier Receivables Sale
    Agreement dated August 31, 2006, between Tennessee Gas
    Pipeline Company and TGP Finance Company, L.L.C.
    (Exhibit 10.A to our Current Report on
    Form 8-K,
    filed with the SEC on September 8, 2006).10
.D

Second Tier Receivables Sale
    Agreement dated August 31, 2006, between TGP Finance
    Company, L.L.C. and TGP Funding Company, L.L.C.
    (Exhibit 10.B to our Current Report on
    Form 8-K,
    filed with the SEC on September 8, 2006).10
.E

Receivables Purchase Agreement
    dated August 31, 2006, among TGP Funding Company, L.L.C.,
    as Seller, Tennessee Gas Pipeline Company, as Servicer, Starbird
    Funding Corporation, as the initial Conduit Investor and
    Committed Investor, the other investors from time to time
    parties thereto, BNP Paribas, New York Branch, as the
    initial Managing Agent, the other Managing Agents from time to
    time parties thereto, and BNP Paribas, New York Branch, as
    Program Agent (Exhibit 10.C to our Current Report on
    Form 8-K,
    filed with the SEC on September 8, 2006).*31
.A

Certification of Principal
    Executive Officer pursuant to Section 302 of the
    Sarbanes-Oxley Act of 2002.*31
.B

Certification of Chief Financial
    Officer pursuant to Section 302 of the Sarbanes-Oxley Act
    of 2002.*32
.A

Certification of Principal
    Executive Officer pursuant to Section 906 of the
    Sarbanes-Oxley Act of 2002.*32
.B

Certification of Chief Financial
    Officer pursuant to Section 906 of the Sarbanes-Oxley Act
    of 2002.