SECOND AMENDMENT TO CREDIT AGREEMENT


     This  SECOND  AMENDMENT  TO  CREDIT  AGREEMENT  is made  and  entered  into
effective as of the 31st day of December,  1997 (this  "Amendment") among KINDER
MORGAN  OPERATING  L.P. "B" (formerly  known as Enron  Transportation  Services,
L.P.), a limited partnership formed under the laws of the State of Delaware (the
"Borrower");  each of the  lenders  that is or  becomes  a party  to the  Credit
Agreement  (defined  below)  (individually,  together  with its  successors  and
assigns, a "Lender" and, collectively,  the "Lenders"); and FIRST UNION NATIONAL
BANK (formerly known as First Union National Bank of North Carolina), a national
banking  association (in its individual  capacity,  "First Union"), as agent for
the Lenders (in such  capacity,  together with its  successors in such capacity,
the "Agent").


                                 R E C I T A L S

     A. The  Borrower,  the Agent and the Lenders  previously  entered into that
certain  Credit  Agreement  dated as of  February  14,  1997 as amended by First
Amendment to Credit  Agreement  dated as of  September 1, 1997 (as amended,  the
"Credit Agreement"),  pursuant to which the Lenders agreed to make certain loans
to and  extensions  of  credit  on  behalf  of the  Borrower  upon the terms and
conditions as provided therein.

     B. The Borrower and the Lenders now desire to make certain  amendments  and
supplements to the Credit Agreement.

     NOW,  THEREFORE,  in  consideration  of the  premises  and  other  good and
valuable consideration and the mutual benefits,  covenants and agreements herein
expressed, the parties hereto now agree as follows:

     1. All capitalized  terms used in this Amendment and not otherwise  defined
herein shall have the meanings ascribed to such terms in the Credit Agreement.

     2. The definition of "Agreement" in Section 1.02 of the Credit Agreement is
hereby amended to read as follows:

         "Agreement" shall mean this Credit  Agreement,  as amended by the First
     Amendment  and the Second  Amendment as the same may be further  amended or
     supplemented from time to time.

     3.  Section  1.02 of the Credit  Agreement  is hereby  supplemented,  where
alphabetically appropriate, with the addition of the following definition:

         "Second  Amendment"  shall mean that certain Second Amendment to Credit
     Agreement dated  effective as of December 31, 1997 among the Borrower,  the
     Agent and the Lenders.



<PAGE>


     4.  Section  2.04(a) of the Credit  Agreement  is hereby  deleted,  and the
following is substituted therefor:

          "(a) The  Borrower shall  pay to the  Agent  for the  account  of each
     Lender:

               (i) a commitment  fee on the daily  average  unused amount of the
          Aggregate   Revolving  Credit  Commitment  for  the  period  from  and
          including  the Closing  Date to but  excluding  the  Revolving  Credit
          Termination  Date  at  the  following  rate  per  annum  based  on the
          Indebtedness Ratio:

                 ----------------------------
                 Indebtedness   Commitment
                     Ratio          Fee
                 ----------------------------
                     >3.50         0.375%
                 ----------------------------
                     <
                     -3.50         0.250%
                 ----------------------------

     Accrued  commitment  fees  shall be  payable  quarterly  in arrears on each
     Quarterly  Date and on the  earlier  of the date  the  Aggregate  Revolving
     Credit Commitments are terminated or the Revolving Credit Termination Date.

         (ii) a letter of credit  fee,  computed  (on the basis of a year of 360
     days and actual days  elapsed)  for each day from the  Closing  Date at the
     rate of 1.50% per annum of the LC  Maximum  Amount,  payable  quarterly  in
     arrears on each Quarterly Date."

     5.  Section  9.16 of the  Credit  Agreement  is hereby  amended  to read as
follows:

         "Section 9.16  Transactions  with Affiliates.  Neither the Borrower nor
     any  Subsidiary  will  enter  into  any  transaction,   including,  without
     limitation,  any  purchase,  sale,  lease or  exchange  of  Property or the
     rendering of any service,  with any Affiliate unless such  transactions are
     otherwise  permitted  under this Agreement and are upon fair and reasonable
     terms to it."

     6.  Section  9.19 of the  Credit  Agreement  is hereby  amended  to read as
follows:

          "Section 9.19  Partnership  Agreement.  The Borrower will not amend or
     permit to be  amended  the  Partnership  Agreement  in a manner  materially
     adverse to the Lenders  without the prior  written  consent of the Majority
     Lenders."

     7. This  Amendment  shall become binding when the Agent shall have received
counterparts of this Amendment executed by the Borrower and the Lenders and such
other documents as the Agent or its counsel may reasonably request.


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<PAGE>




     8. The  parties  hereto  hereby  acknowledge  and  agree  that,  except  as
specifically  supplemented and amended,  changed or modified hereby,  the Credit
Agreement shall remain in full force and effect in accordance with its terms.

     9. The Borrower hereby reaffirms that as of the date of this Amendment, the
representations and warranties made by the Borrower in Article VII of the Credit
Agreement  as amended  hereby are true and  correct on the date hereof as though
made on and as of the date of this Amendment.

     10. This Amendment shall be governed by, and construed in accordance  with,
the laws of the State of Texas.

     11. This  Amendment  may be executed  in two or more  counterparts,  and it
shall not be necessary that the signatures of all parties hereto be contained on
any one counterpart  hereof;  each counterpart shall be deemed an original,  but
all of which together shall constitute one and the same instrument.  Delivery of
an executed  signature page by facsimile  transmission  shall be as effective as
delivery of a manually executed counterpart hereof.

     12.  THE  CREDIT  AGREEMENT,  THIS  AMENDMENT,  THE NOTES AND THE  SECURITY
INSTRUMENTS  REPRESENT  THE FINAL  AGREEMENT  BETWEEN THE PARTIES AND MAY NOT BE
CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS OR SUBSEQUENT ORAL AGREEMENTS
OF THE PARTIES. THERE ARE NO UNWRITTEN OR ORAL AGREEMENTS BETWEEN THE PARTIES.



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     IN WITNESS  WHEREOF,  the parties  hereto have caused this  Amendment to be
duly executed effective as of the date first above written.

BORROWER:                  KINDER MORGAN OPERATING L.P. "B"
                           (formerly known as Enron Transportation 
                           Services, L.P.)

                           By:  Kinder Morgan G.P., Inc.,
                                its General Partner



                                By: /s/ William V. Morgan
                                Name: William V. Morgan
                                Title: Vice Chairman

AGENT AND LENDER:          FIRST UNION NATIONAL BANK



                            By: /s/ David Roberts
                            Name: David Roberts
                            Title: Senior Vice President













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