##### 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 1-7320
      ANR Pipeline Company
   Delaware

38-1281775(State or Other Jurisdiction
    of Incorporation or Organization)

(I.R.S. Employer
    Identification No.)El Paso Building
    1001 Louisiana Street
    Houston, Texas

77002(Address of Principal Executive
    Offices)

(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
      ANR 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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##### 



ANR
    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


9Item 3.

Quantitative and
    Qualitative Disclosures About Market Risk


*Item 4.

Controls and
    Procedures


12PART II 
    Other InformationItem 1.

Legal
    Proceedings


13Item 1A.

Risk
    Factors


13Cautionary
    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


13Item 6.

Exhibits


14Signatures


15Certification 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
    BBtu =
    billion British thermal
    units     i




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


Nine Months EndedSeptember 30,


September 30,2006


2005


2006


2005Operating revenues

$
111


$
112


$
405


$
415Operating expensesOperation and maintenance


62



64



183



186Depreciation, depletion and
    amortization


9



10



28



30Taxes, other than income taxes


6



5



20



1777



79



231



233Operating income


34



33



174



182Earnings from unconsolidated
    affiliate


14



15



44



46Other income, net










1



2Interest and debt expense


(16
)


(17
)


(49
)


(52
)Affiliated interest income, net


10



6



25



14Income before income taxes


42



37



195



192Income taxes


16



14



72



71Net income

$
26


$
23


$
123


$
121    1




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ANR
    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 $2 in 2005


11



85Affiliates


19



8Other


9



8Materials and supplies


21



21Deferred income taxes


13



12Other


6



6Total current assets


79



140Property, plant and equipment, at
    cost


3,908



3,777Less accumulated depreciation,
    depletion and amortization


2,134



2,146Total property, plant and
    equipment, net


1,774



1,631Other assetsNotes receivable from affiliates


610



527Investment in unconsolidated
    affiliate


295



300Other


21



19926



846Total assets

$
2,779


$
2,617LIABILITIES AND STOCKHOLDERS
    EQUITYCurrent liabilitiesAccounts payableTrade

$
34


$
56Affiliates


23



37Other


16



21Taxes payable


121



72Accrued interest


15



16Other


34



32Total current liabilities


243



234Long-term debt


741



740Other liabilitiesDeferred income taxes


390



370Affiliate payable


167



172Other


68



54625



596Commitments and contingenciesStockholders equityCommon stock, par value $1 per
    share; 1,000 shares authorized, issued and outstanding






Additional paid-in capital


597



597Retained earnings


573



450Total stockholders equity


1,170



1,047Total liabilities and
    stockholders equity

$
2,779


$
2,617    2




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


2005Cash flows from operating
    activitiesNet income

$
123


$
121Adjustments to reconcile net
    income to net cash from operating activitiesDepreciation, depletion and
    amortization


28



30Deferred income taxes


19



18Earnings from unconsolidated
    affiliate, adjusted for cash distributions


5



9Other non-cash income items


2



2Asset and liability changes


32



24Net cash provided by operating
    activities


209



204Cash flows from investing
    activitiesAdditions to property, plant and
    equipment


(125
)


(65
)Net change in notes receivable
    from affiliates


(83
)


(71
)Other


(1
)


Net cash used in investing
    activities


(209
)


(136
)Cash flows from financing
    activitiesPayment to retire long-term debt






(68
)Net cash used in financing
    activities






(68
)Net change in cash and cash
    equivalents






Cash and cash equivalentsBeginning of period






End of period

$



$
    3




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ANR
    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
 4




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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).
    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.
    Credit
    Facilities    3.
    Commitments
    and Contingencies  Legal
    Proceedings
  Gas Measurement Cases. re: Natural Gas Royalties Qui Tam Litigation,
  Will Price, et al. v. Gas Pipelines and Their Predecessors,
    et al.,
     5




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Environmental
    Matters
      Balance at January 1, 2006

$
27Addition/adjustments for
    remediation activities


6Payments for remediation activities


(4
)Balance at September 30, 2006

$
29     CERCLA Matters.
   6




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4.
    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

$
30


$
32


$
93


$
98Operating expenses


14



15



41



43Income from continuing operations
    and net
    income(1)


9



9



29



30    (1)
    Our proportionate share of Great Lakes net income includes
    our share of taxes recorded by Great Lakes. Our earnings from
    unconsolidated affiliate recognized in our income statements are
    presented before these taxes.    Transactions
    with Affiliates
  Cash Management Program. short-term
  Accounts Receivable Sales Program. Accounting for
    Transfers and Servicing of Financial Assets and Extinguishments
    of Liabilities
  Taxes.
 7




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Other Affiliate Balances.
  September 30,


December 31,2006


2005(In millions)Accounts and notes
    receivable  other

$



$
4Other current liabilities


9



9   Affiliate Revenues and Expenses.
      Quarters Ended


Nine Months EndedSeptember 30,


September 30,2006


2005


2006


2005(In millions)Revenues from affiliates

$
1


$
1


$
2


$
3Operation and maintenance expenses
    from affiliates


29



30



83



87Reimbursements of operating
    expenses charged to affiliates






1



3



3  8




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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

$
405


$
415Operating expenses


(231
)


(233
)Operating income


174



182Earnings from unconsolidated
    affiliate


44



46Other income, net


1



2EBIT


219



230Interest and debt expense


(49
)


(52
)Affiliated interest income, net


25



14Income taxes


(72
)


(71
)Net income

$
123


$
121Throughput volumes
    (BBtu/d)(1)


5,045



5,265    (1)
    Throughput volumes include billable transportation throughput
    volumes for storage withdrawal and volumes associated with our
    proportionate share of our 50 percent equity investment in
    Great Lakes. 9




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EBITRevenue


Expense


Other


ImpactFavorable/(Unfavorable)(In millions)Contract restructuring/settlements

$
(43
)

$
(2
)

$
(1
)

$
(46
)Higher services revenues


32











32Gas not used in operations,
    revaluations and other natural gas sales


1



5







6Cashout adjustment






19







19Higher environmental costs






(6
)






(6
)Higher maintenance and other costs






(6
)






(6
)Impact of Hurricane Rita






(3
)






(3
)Other(1)






(5
)


(2
)


(7
)Total impact on EBIT

$
(10
)

$
2


$
(3
)

$
(11
)    (1)
    Consists of individually insignificant items.    Contract Restructuring/Settlements.
  Higher Services Revenues.
  Gas Not Used in Operations, Revaluations and Other Natural
    Gas Sales. Form 10-K.
  Cashout Adjustment.
  Higher Environmental Costs.
  Higher Maintenance and Other Costs.
  Impact of Hurricane Rita.
 10




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Affiliated
    Interest Income, Net








Income
    Taxes


|                   |  |                   |    |   |      |   |    |  
|------------------ |  | ----------------- | -- | - | ---- | - | -- | -
|                   |  | Nine Months Ended |   
|                   |  | September 30,     |   
|                   |  | 2006              |    |   | 2005 |  
|                   |  | (In millions      |   
|                   |  | except for rates) |   
|                  
|Income taxes       |  | $                 | 72 |   |      | $ | 71 |  
|Effective tax rate |  |                   | 37 | % |      |   | 37 | %









Liquidity
    and Capital Expenditures




Liquidity
    Overview








approximately




Capital
    Expenditures










11



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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
      Change in
    Internal Control Over Financial Reporting
   12




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PART II 
    OTHER INFORMATION Item 1. Legal
    Proceedings   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   13




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Item 6.
    Exhibits    ExhibitNumber

Description10
.A

First Tier Receivables Sale
    Agreement dated August 31, 2006 between ANR Pipeline
    Company, and ANR 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
.B

Second Tier Receivables Sale
    Agreement dated August 31, 2006 between ANR Finance
    Company, L.L.C. and ANR 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
.C

Receivables Purchase Agreement
    dated August 31, 2006 among ANR Funding Company, L.L.C., as
    Seller, ANR 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,
 14




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SIGNATURES     ANR PIPELINE COMPANYDate: November 6, 2006

/s/  STEPHEN C. BEASLEYStephen C. BeasleyPresident(Principal Executive Officer)Date: November 6, 2006

/s/  JOHN
    R.
    SULTJohn
    R. SultSenior Vice President,
    Chief Financial Officer and Controller
    (Principal Accounting and Financial Officer)  15




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ANR
    PIPELINE COMPANY
    EXHIBIT INDEX
    ExhibitNumber

Description10
.A

First Tier Receivables Sale
    Agreement dated August 31, 2006 between ANR Pipeline
    Company, and ANR 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
.B

Second Tier Receivables Sale
    Agreement dated August 31, 2006 between ANR Finance
    Company, L.L.C. and ANR 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
.C

Receivables Purchase Agreement
    dated August 31, 2006 among ANR Funding Company, L.L.C., as
    Seller, ANR 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.