FIRST AMENDMENT TO GUARANTY AGREEMENT


     THIS  FIRST  AMENDMENT  TO  GUARANTY  AGREEMENT  is made and  entered  into
effective as of the 1st day of September, 1997 (this "Amendment") between KINDER
MORGAN ENERGY PARTNERS, L.P. (formerly known as Enron Liquids Pipeline, L.P.), a
Delaware  limited  partnership  (the  "Guarantor") and FIRST UNION NATIONAL BANK
(formerly known as First Union National Bank of North  Carolina),  as agent (the
"Agent")  for the  lenders  (the  "Lenders")  that are or become  parties to the
Credit Agreement defined below.

                              W I T N E S S E T H:

     WHEREAS,  KINDER  MORGAN  OPERATING  L.P.  "B"  (formerly  known  as  Enron
Transportation Services, L.P.), a Delaware limited partnership (the "Borrower"),
the Agent and the Lenders have entered into that certain Credit  Agreement dated
as of February 14, 1997 as amended by First Amendment to Credit  Agreement dated
of even date herewith  (such Credit  Agreement as amended and as the same may be
further amended from time to time, herein called the "Credit Agreement"); and

     WHEREAS,  Guarantor  executed that certain  Guaranty  Agreement dated as of
February  14,  1997  (the  "Guaranty  Agreement")  pursuant  to  the  terms  and
conditions stated in the Credit Agreement;

     WHEREAS, Guarantor has requested, and the Lenders have agreed, that certain
changes be made to the Guaranty 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 Guaranty Agreement.

     2. Section 3.3(a) of the Guaranty Agreement is hereby amended by adding the
following new clause (vi):

         "(vi) the  Guarantor  may  become  and remain  liable  with  respect to
     unsecured  Indebtedness  of the  Guarantor  owing to any of its  Affiliates
     created and outstanding  under a subordinated  promissory note subordinated
     pursuant to a Subordination  Agreement substantially in the form of Exhibit
     A to the First Amendment to Guaranty Agreement."

     3. Section 3.3(c) of the Guaranty Agreement is hereby amended by adding the
following new clause (viii):



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         "(viii)  investments,  loans or advances made by the Guarantor in or to
     its Subsidiaries;  provided that immediately  before and after each loan or
     advance no Default or Event of Default exists and is continuing."

     4. Section  3.3(k) of the Guaranty  Agreement is hereby  amended to read as
follows:

         "(k)  Transactions  with Affiliates.  The Guarantor will not 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  the  Credit
     Agreement, are in the ordinary course of its business and are upon fair and
     reasonable terms to it."

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

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

     7. 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.



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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.

GUARANTOR:                 KINDER MORGAN  ENERGY  PARTNERS, L.P.

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



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

AGENT:                     FIRST UNION NATIONAL BANK



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