##### Table of Contents



UNITED STATES SECURITIES AND EXCHANGE COMMISSION
 Washington, D.C. 20549
 FORM 10-K
 ANNUAL REPORT PURSUANT TO SECTIONS 13 OR 15(d) OF THE SECURITIES EXCHANGE OF 1934
 þ
    
    ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
 o
    
    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
 For the fiscal year ended December 31, 2005
 Commission file number 1-7310
 Michigan Consolidated Gas Company, a Michigan corporation, meets the conditions set forth in
General Instruction I (1) (a) and (b) of Form 10-K and is, therefore, filing this form with the
reduced disclosure format.
 MICHIGAN CONSOLIDATED GAS COMPANY
  Michigan
(State or other jurisdiction of
incorporation or organization)
    
    38-0478040
(I.R.S. Employer
Identification No.)2000 2ndAvenue, Detroit, Michigan
(Address of principal executive offices)
    
    48226-1279
(Zip Code)
 313-235-4000   Securities registered pursuant to Section 12(b) of the Act:   Securities registered pursuant to Section 12(g) of the Act:
 Yes o No þ
 Yes o
No þ
 Yes þ No o
 o
  Large accelerated filer o Accelerated filer o Non-accelerated filer þ
 Yes o No þ
  DOCUMENTS INCORPORATED BY REFERENCE




---



##### 



Michigan Consolidated Gas Company
 Annual Report on Form 10-K  Year Ended December 31, 2005
 Table of Contents
 PageDefinitions
    
    
    1Forward-Looking Statements
    
    
    3Part IItems 1., 1A. & 2. Business, Company Risk Factors and Properties
    
    
    4Item 3.
    
    Legal Proceedings
    
    
    9Item 4.
    
    Submission of Matters to a Vote of Security Holders
    
    
    10PartIIItem 5.
    
    Market for
Registrants Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities
    
    
    10Item 6.
    
    Selected Financial Data
    
    
    10Item 7.
    
    Managements Narrative Analysis of Results of Operations
    
    
    11Item 7A.
    
    Quantitative and Qualitative Disclosures About Market Risk
    
    
    14Item 8.
    
    Financial Statements and Supplementary Data
    
    
    15Item 9.
    
    Changes in and Disagreements with Accountants on Accounting and Financial Disclosure
    
    
    48Item 9A.
    
    Controls and Procedures
    
    
    48Item 9B.
    
    Other Information
    
    
    48PartIIIItem 10.
    
    Directors and Executive Officers of the Registrant
    
    
    48Item 11.
    
    Executive Compensation
    
    
    48Item 12.
    
    Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters
    
    
    48Item 13.
    
    Certain Relationships and Related Transactions
    
    
    48Item 14.
    
    Principal Accountant Fees and Services
    
    
    49PartIVItem 15.
    
    Exhibits and Financial Statement Schedules
    
    
    50Signatures
    
    
    54Michcon Investment and Stock Ownership PlanComputation of Ratio of Earnings to Fixed ChargesConsent of Deloitte & Touche LLPChief Executive Officer Section 302 CertificationChief Financial Officer Section 302 CertificationChief Executive Officer Section 906 CertificationChief Financial Officer Section 906 Certification




---



##### Table of Contents



Definitions
 Customer Choice
    
    Statewide initiative giving customers in
Michigan the option to choose alternative
suppliers for gas.DTE Energy
    
    DTE Energy Company, directly or indirectly,
the parent of The Detroit Edison Company,
MichCon and numerous non-utility subsidiariesEnd User Transportation
    
    A gas delivery service historically provided
to large-volume commercial and industrial
customers who purchase natural gas directly
from producers or brokerage companies. Under
MichCons Customer Choice Program that began
in 1999, this service is also provided to
residential customers and small-volume
commercial and industrial customers.Enterprises
    
    DTE Enterprises Inc., a wholly owned
subsidiary of DTE Energy and indirectly the
parent of MichConGas Storage
    
    For MichCon, the process of injecting, storing
and withdrawing natural gas from a depleted
underground natural gas field.GCR
    
    A gas cost recovery mechanism authorized by
the MPSC, permitting MichCon to pass the cost
of natural gas to its customers.Intermediate Transportation
    
    A gas delivery service provided to producers,
brokers and other gas companies that own the
natural gas, but are not the ultimate
consumers.MichCon
    
    Michigan Consolidated Gas Company, an
indirect, wholly-owned natural gas
distribution and intrastate transmission
subsidiary of EnterprisesMDEQ
    
    Michigan Department of Environmental QualityMGP
    
    Manufactured Gas PlantMPSC
    
    Michigan Public Service CommissionSFAS
    
    Statement of Financial Accounting Standards
 1




---



##### Table of Contents



Units of Measurement:
 Bcf
    
    Billion cubic feet of gasMcf
    
    Thousand cubic feet of gasMMcf
    
    Million cubic feet of gas/d
    
    Added to various units of measure to denote
units per day
 2




---



##### Table of Contents



Forward-Looking Statements
  
    
    the effects of weather and other natural phenomena on operations and sales to customers, and purchases from suppliers;
    
    economic climate and population growth or decline in the geographic areas where we do business;
    
    environmental issues, laws, regulations, and the cost of remediation and compliance;
    
    implementation of the gas Customer Choice program;
    
    impact of gas utility restructuring in Michigan, including legislative amendments;
    
    employee relations and the impact of collective bargaining agreements;
    
    access to capital markets and capital market conditions and the results of other financing efforts which can be
affected by credit agency ratings;
    
    the timing and extent of changes in interest rates;
    
    the level of borrowing;
    
    changes in the cost and availability of natural gas;
    
    effects of competition;
    
    impact of regulation by the MPSC and other applicable governmental proceedings and regulations;
    
    changes in federal, state and local tax laws or their interpretations, including the Internal Revenue Code,
regulations, rulings, court proceedings and audits;
    
    the ability to recover costs through rate increases;
    
    the availability, cost, coverage and terms of insurance;
    
    the cost of protecting assets against, or damage due to, terrorism;
    
    changes in accounting standards and financial reporting regulations;
    
    changes in federal or state laws or their interpretation with respect to regulation, energy policy and other business
issues;
    
    uncollectible accounts receivable;
    
    litigation and related appeals; and
    
    changes in the economic and financial viability of our suppliers and customers, and the continued ability of such
parties to perform their obligations to the Company.
  3




---



##### Table of Contents



Part I
 
 Items 1., 1A. & 2. Business, Company Risk Factors and Properties
 Description
   Revenue by Service
 (in Millions)
    
    2005
    
    
    2004
    
    
    2003Gas Sales
    
    $
    1,823
    
    
    $
    1,401
    
    
    $
    1,237End User Transportation
    
    
    134
    
    
    
    119
    
    
    
    135Intermediate Transportation
    
    
    56
    
    
    
    55
    
    
    
    51Other
    
    
    85
    
    
    
    70
    
    
    
    69$
    2,098
    
    
    $
    1,645
    
    
    $
    1,492
 
    
    Gas Sales Includes the sale and delivery of natural gas
primarily to residential and small-volume commercial and
industrial customers.
    
    End User Transportation Gas delivery service provided
primarily to large-volume commercial and industrial
customers. Additionally, the service is provided to
residential customers, and small-volume commercial and
industrial customers who have elected to participate in our
Customer Choice program. End user transportation customers
purchase natural gas directly from producers or brokers and
utilize our pipeline network to transport the gas to their
facilities or homes.
    
    Intermediate Transportation Gas delivery service provided
to producers, brokers and other gas companies that own the
natural gas, but are not the ultimate consumers.
Intermediate transportation customers utilize our gathering
and high-pressure transmission system to transport the gas to
storage fields, processing plants, pipeline interconnections
or other locations.
    
    Other Includes revenues from providing appliance
maintenance, facility development, gas storage and other
energy-related services.
  4




---



##### Table of Contents



Natural Gas Supply
   Properties
   5




---



##### Table of Contents



Availability (MMcf/d)
    
    Contract expirationPanhandle Eastern Pipeline Company
    
    
    75
    
    
    
    2009Trunkline Gas Company
    
    
    10
    
    
    
    2009Viking Gas Transmission Company
    
    
    50
    
    
    
    2010TransCanada PipeLines Limited
    
    
    50
    
    
    
    2010Great Lakes Gas Transmission L.P.
    
    
    30
    
    
    
    2011ANR Pipeline Company
    
    
    245
    
    
    
    2011Vector Pipeline L.P.
    
    
    50
    
    
    
    2012
  Regulation
    Energy Assistance Program
  6




---



##### Table of Contents



Strategy and Competition
    ENVIRONMENTAL MATTERS
   7




---



##### Table of Contents



Item 1A. Company Risk Factors
  Failure to successfully implement new processes and information systems could interrupt our
operations.
 Weather significantly affects operations .
 We are subject to rate regulation
 Adverse changes in our credit ratings may negatively affect us.
 Regional and national economic conditions can have an unfavorable impact on us.
 Environmental laws and liability may be costly.
   The supply of natural gas may impact our financial results.
 8




---



##### Table of Contents



A work interruption may adversely affect us.
 Our ability to access capital markets at attractive interest rates is important.
 Michigan tax reform may be costly
 We may not be fully covered by insurance.
 Terrorism could affect our business
 EMPLOYEES
  
 Item 3. Legal Proceedings
   Note
    
    Title3
    
    Regulatory Matters9
    
    Commitments and Contingencies
 9




---



##### Table of Contents



Item 4. Submission of Matters to a Vote of Security Holders
  
 Part II
 
 Item 5. Market for Registrants Common Equity, Related Stockholder Matters and Issuer
Purchases of Equity Securities
   
 Item 6. Selected Financial Data
  10




---



##### Table of Contents



Item 7. Managements Narrative Analysis of Results of Operations
   Factors impacting income:
  (in Millions)
    
    2005
    
    
    2004Operating revenues
    
    $
    453
    
    
    $
    153Cost of gas
    
    
    407
    
    
    
    160Gross margin
    
    
    46
    
    
    
    (7
    )Operation and maintenance
    
    
    24
    
    
    
    38Depreciation, depletion and amortization
    
    
    (11
    )
    
    
    3Taxes other than income
    
    
    (6
    )
    
    
    (4
    )Asset (gains) and losses, net
    
    
    50
    
    
    
    (10
    )Other (income) and deductions
    
    
    
    
    
    
    10Income tax provision
    
    
    (5
    )
    
    
    (18
    )Net income
    
    $
    (6
    )
    
    $
    (26
    )
 Gross margins
 11




---



##### Table of Contents



(in Millions)
    
    2005
    
    
    2004
    
    
    2003Operating RevenuesGas Sales
    
    $
    1,823
    
    
    $
    1,401
    
    
    $
    1,237End User Transportation
    
    
    134
    
    
    
    119
    
    
    
    1351,957
    
    
    
    1,520
    
    
    
    1,372Intermediate Transportation
    
    
    56
    
    
    
    55
    
    
    
    51Other
    
    
    85
    
    
    
    70
    
    
    
    69$
    2,098
    
    
    $
    1,645
    
    
    $
    1,492Gas Markets (Bcf)Gas Sales
    
    
    164
    
    
    
    169
    
    
    
    177End User Transportation
    
    
    157
    
    
    
    145
    
    
    
    151321
    
    
    
    314
    
    
    
    328Intermediate Transportation
    
    
    432
    
    
    
    536
    
    
    
    576753
    
    
    
    850
    
    
    
    904
 Operation and maintenance
  
 12




---



##### Table of Contents



Asset (gains) and losses, net
 Other income and deductions
 Income taxes
 Outlook
 13




---



##### Table of Contents



Item 7A. Quantitative and Qualitative Disclosures About Market Risk
 Commodity Price Risk
  Interest Rate Risk
  Credit Risk
  14




---



##### Table of Contents



Item 8. Financial Statements and Supplementary Data
 PageReport of Independent Registered Public Accounting Firm
    
    
    16Consolidated Statement of Operations
    
    
    17Consolidated Statement of Financial Position
    
    
    18Consolidated Statement of Cash Flows
    
    
    19Consolidated Statement of Retained Earnings and Comprehensive Income
    
    
    20Notes to Consolidated Financial Statements
    
    
    21Schedule II  Valuation and Qualifying Accounts
    
    
    53
 15




---



##### Table of Contents



REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
 
      
 16




---



##### Table of Contents



MICHIGAN CONSOLIDATED GAS COMPANY
 
 CONSOLIDATED STATEMENT OF OPERATIONS
 Year Ended December 31(in Millions)
    
    2005
    
    
    2004
    
    
    2003Operating Revenues
    
    $
    2,098
    
    
    $
    1,645
    
    
    $
    1,492Operating ExpensesCost of gas
    
    
    1,455
    
    
    
    1,048
    
    
    
    888Operation and maintenance
    
    
    411
    
    
    
    387
    
    
    
    349Depreciation, depletion and amortization
    
    
    97
    
    
    
    108
    
    
    
    105Taxes other than income
    
    
    42
    
    
    
    48
    
    
    
    52Asset (gains) and losses, net (Note 12)
    
    
    48
    
    
    
    (2
    )
    
    
    82,053
    
    
    
    1,589
    
    
    
    1,402Operating Income
    
    
    45
    
    
    
    56
    
    
    
    90Other (Income) and DeductionsInterest expense
    
    
    57
    
    
    
    57
    
    
    
    57Interest income
    
    
    (10
    )
    
    
    (9
    )
    
    
    (10
    )Other income
    
    
    (4
    )
    
    
    (5
    )
    
    
    (13
    )Other expenses
    
    
    3
    
    
    
    3
    
    
    
    246
    
    
    
    46
    
    
    
    36Income (Loss) Before Income Taxes
    
    
    (1
    )
    
    
    10
    
    
    
    54Income Tax Provision (Benefit) (Note 4)
    
    
    (14
    )
    
    
    (9
    )
    
    
    9Net Income
    
    $
    13
    
    
    $
    19
    
    
    $
    45
  17




---



##### Table of Contents



MICHIGAN CONSOLIDATED GAS COMPANY
 
 CONSOLIDATED STATEMENT OF FINANCIAL POSITION
 December 31(in Millions)
    
    2005
    
    
    2004ASSETSCurrent AssetsCash and cash equivalents
    
    $
    7
    
    
    $
    Accounts receivableCustomer (less allowance for doubtful accounts of $78 and
$71, respectively)
    
    
    322
    
    
    
    184Accrued unbilled revenues
    
    
    230
    
    
    
    167Other
    
    
    79
    
    
    
    82Accrued gas cost recovery revenue
    
    
    42
    
    
    
    55InventoriesGas
    
    
    119
    
    
    
    89Material and supplies
    
    
    16
    
    
    
    15Gas customer choice deferred asset
    
    
    65
    
    
    
    56Other
    
    
    30
    
    
    
    21910
    
    
    
    669Property, Plant and Equipment
    
    
    3,252
    
    
    
    3,195Less accumulated depreciation, depletion and amortization (Note 2)
    
    
    (1,468
    )
    
    
    (1,409
    )1,784
    
    
    
    1,786Other AssetsOther investments
    
    
    90
    
    
    
    92Notes receivable
    
    
    80
    
    
    
    81Regulatory assets (Note 3)
    
    
    65
    
    
    
    64Prepaid benefit costs and due from affiliate
    
    
    399
    
    
    
    367Other
    
    
    15
    
    
    
    17649
    
    
    
    621$
    3,343
    
    
    $
    3,076LIABILITIES AND SHAREHOLDERS EQUITYCurrent LiabilitiesAccounts payable
    
    $
    246
    
    
    $
    149Dividends payable (Note 11)
    
    
    13
    
    
    
    13Short-term borrowings
    
    
    439
    
    
    
    242Current portion of long-term debt, including capital leases
    
    
    40
    
    
    
    Federal income, property and other taxes payable
    
    
    24
    
    
    
    38Regulatory liabilities
    
    
    
    
    
    
    28Other
    
    
    70
    
    
    
    72832
    
    
    
    542Other LiabilitiesDeferred income taxes
    
    
    191
    
    
    
    184Regulatory liabilities (Note 3)
    
    
    490
    
    
    
    564Unamortized investment tax credit
    
    
    17
    
    
    
    18Accrued postretirement benefit costs
    
    
    144
    
    
    
    118Accrued environmental costs
    
    
    29
    
    
    
    17Other
    
    
    141
    
    
    
    571,012
    
    
    
    958Long-Term debt, including capital lease obligations
    
    
    745
    
    
    
    785Commitments and Contingencies (Notes 3 and 9)Shareholders EquityCommon stock, $1 par value, 15,100,000 shares authorized,
10,300,000 shares issued and outstanding
    
    
    10
    
    
    
    10Additional paid in capital
    
    
    432
    
    
    
    432Retained earnings
    
    
    313
    
    
    
    350Accumulated other comprehensive loss
    
    
    (1
    )
    
    
    (1
    )754
    
    
    
    791$
    3,343
    
    
    $
    3,076
  18




---



##### Table of Contents



MICHIGAN CONSOLIDATED GAS COMPANY
 
 CONSOLIDATED STATEMENT OF CASH FLOWS
 Year Ended December 31(in Millions)
    
    2005
    
    
    2004
    
    
    2003Operating ActivitiesNet income
    
    $
    13
    
    
    $
    19
    
    
    $
    45Adjustments to reconcile net income to net cash from
operating activities:Depreciation, depletion and amortization
    
    
    97
    
    
    
    108
    
    
    
    105Deferred income taxes and investment tax credit, net
    
    
    
    
    
    
    45
    
    
    
    (23
    )Asset (gains) and losses, net
    
    
    48
    
    
    
    (1
    )
    
    
    2Changes in assets and liabilities:Accounts receivable, net
    
    
    (135
    )
    
    
    12
    
    
    
    (48
    )Accrued unbilled revenues
    
    
    (63
    )
    
    
    (50
    )
    
    
    (1
    )Inventories
    
    
    (31
    )
    
    
    27
    
    
    
    (62
    )Postretirement obligation
    
    
    26
    
    
    
    22
    
    
    
    19Prepaid benefit costs and due from affiliate
    
    
    (32
    )
    
    
    (34
    )
    
    
    (41
    )Accrued gas cost recovery
    
    
    (16
    )
    
    
    (36
    )
    
    
    3Accounts payable
    
    
    83
    
    
    
    18
    
    
    
    27Federal income, property and other taxes payable
    
    
    (14
    )
    
    
    24
    
    
    
    (18
    )Other assets
    
    
    (16
    )
    
    
    (10
    )
    
    
    (20
    )Other liabilities
    
    
    14
    
    
    
    (7
    )
    
    
    28Net cash (used for) from operating activities
    
    
    (26
    )
    
    
    137
    
    
    
    16Investing ActivitiesCapital expenditures
    
    
    (114
    )
    
    
    (112
    )
    
    
    (98
    )Proceeds from sale of assets
    
    
    
    
    
    
    6
    
    
    
    11Other
    
    
    
    
    
    
    6
    
    
    
    (2
    )Net cash used for investing activities
    
    
    (114
    )
    
    
    (100
    )
    
    
    (89
    )Financing ActivitiesIssuance of long-term debt
    
    
    
    
    
    
    117
    
    
    
    199Redemption of long-term debt
    
    
    
    
    
    
    (112
    )
    
    
    (194
    )Short-term borrowings, net
    
    
    197
    
    
    
    7
    
    
    
    112Dividends paid
    
    
    (50
    )
    
    
    (50
    )
    
    
    (50
    )Net cash from (used for) from financing activities
    
    
    147
    
    
    
    (38
    )
    
    
    67Net Increase (Decrease) in Cash and Cash Equivalents
    
    
    7
    
    
    
    (1
    )
    
    
    (6
    )Cash and Cash Equivalents at Beginning of Period
    
    
    
    
    
    
    1
    
    
    
    7Cash and Cash Equivalents at End of Period
    
    $
    7
    
    
    $
    
    
    
    $
    1Cash Paid for:Interest paid (excluding interest capitalized)
    
    $
    57
    
    
    $
    56
    
    
    $
    57Income taxes paid
    
    
    9
    
    
    
    
    
    
    
    34
  19




---



##### Table of Contents



MICHIGAN CONSOLIDATED GAS COMPANY
 
 CONSOLIDATED STATEMENT OF RETAINED EARNINGS
 AND COMPREHENSIVE INCOME
 Year Ended December 31(in Millions)
    
    2005
    
    
    2004
    
    
    2003Balance  beginning of period
    
    $
    350
    
    
    $
    381
    
    
    $
    398Net income
    
    
    13
    
    
    
    19
    
    
    
    45Common stock dividends declared
    
    
    (50
    )
    
    
    (50
    )
    
    
    (62
    )Balance  end of period
    
    $
    313
    
    
    $
    350
    
    
    $
    381
  Year Ended December 31(in Millions)
    
    2005
    
    
    2004
    
    
    2003Net income
    
    $
    13
    
    
    $
    19
    
    
    $
    45Other comprehensive loss, net of tax:Net unrealized losses on derivatives:Losses arising during the period, net of
taxes of $-, $(1), and $1,
respectively
    
    
    
    
    
    
    (1
    )
    
    
    1
    
    
    
    (1
    )
    
    
    1Pension obligations, net of taxes of $-, $-
and $-, respectively
    
    
    
    
    
    
    
    
    
    
    1Comprehensive income
    
    $
    13
    
    
    $
    18
    
    
    $
    47
  20




---



##### Table of Contents



Michigan Consolidated Gas Company
 
 Notes to Consolidated Financial Statements
 NOTE 1 SIGNIFICANT ACCOUNTING POLICIES
 Corporate Structure
   Principles of Consolidation
  Consolidation of Variable Interest
Entities, an Interpretation of ARB No. 51.
 Basis of Presentation
   Revenues
   21




---



##### Table of Contents



Comprehensive Income
 .
 Net
    
    
    AccumulatedUnrealized
    
    
    OtherLosses on
    
    
    Comprehensive(in Millions)
    
    Derivatives
    
    
    LossBeginning balance
    
    $
    (1
    )
    
    $
    (1
    )Current  period change
    
    
    
    
    
    
    Ending balance
    
    $
    (1
    )
    
    $
    (1
    )
 Cash Equivalents
  Inventories
   Property, Retirement and Maintenance, and Depreciation and Depletion
  (in Millions)
    
    2005
    
    
    2004Property, Plant and EquipmentDistribution
    
    $
    2,098
    
    
    $
    2,020Storage
    
    
    237
    
    
    
    221Other
    
    
    917
    
    
    
    954Total
    
    
    3,252
    
    
    
    3,195Less Accumulated Depreciation and DepletionDistribution
    
    
    (891
    )
    
    
    (845
    )Storage
    
    
    (104
    )
    
    
    (100
    )Other
    
    
    (473
    )
    
    
    (464
    )Total
    
    
    (1,468
    )
    
    
    (1,409
    )Net Property, Plant and Equipment
    
    $
    1,784
    
    
    $
    1,786
 22




---



##### Table of Contents



Long-Lived Assets
  Intangible Assets, Including Software Costs
  Excise and Sales Taxes
  Deferred Debt Costs
  Insured and Uninsured Risks
  23




---



##### Table of Contents



Investments in Debt and Equity Securities
   Note
    
    Title2
    
    New Accounting Pronouncements3
    
    Regulatory Matters4
    
    Income Taxes8
    
    Financial and Other Derivative Instruments10
    
    Retirement Benefits and Trusteed Assets
 NOTE 2  NEW ACCOUNTING PRONOUNCEMENTS
 Consolidation of Variable Interest Entities
 Consolidation of Variable Interest Entities, an Interpretation of
Accounting Research Bulletin (ARB) No. 51,
  Medicare Act Accounting
 Medicare Prescription Drug, Improvement and Modernization Act of 2003
  24




---



##### Table of Contents



Asset Retirement Obligations
 Accounting for Asset Retirement Obligations,
 Accounting for Conditional Asset
Retirement Obligations an interpretation of FASB Statement No. 143.
 Accounting for the Effects of Certain Types of
Regulation
     (in Millions)Asset retirement obligations at January 1, 2005
    
    $
    5Accretion
    
    
    Liabilities incurred (primarily adoption of FIN 47)
    
    
    92Asset retirement obligations at December 31, 2005
    
    $
    97
 25




---



##### Table of Contents



NOTE 3  REGULATORY MATTERS
 Regulation
  Regulatory Assets and Liabilities
 Accounting for the Effects of Certain Types of Regulation
 26




---



##### Table of Contents



(in Millions)
    
    2005
    
    
    2004AssetsDeferred environmental costs
    
    $
    32
    
    
    $
    29Unamortized loss on reacquired debt
    
    
    32
    
    
    
    34Accrued GCR revenue
    
    
    42
    
    
    
    55Recoverable minimum pension liability
    
    
    1
    
    
    
    1Recoverable uncollectibles expense
    
    
    11
    
    
    
    118
    
    
    
    119Less amount included in current assets
    
    
    (53
    )
    
    
    (55
    )$
    65
    
    
    $
    64LiabilitiesAsset removal costs
    
    $
    353
    
    
    $
    429Refundable income taxes
    
    
    125
    
    
    
    135Accrued GCR disallowance
    
    
    
    
    
    
    28Accrued pension
    
    
    12
    
    
    
    2490
    
    
    
    594Less amount included in current liabilities and other liabilities
    
    
    
    
    
    
    (30
    )$
    490
    
    
    $
    564
  
    
    Deferred environmental costs The MPSC approved the
deferral and recovery of investigation and remediation costs
associated with former MGP sites.
    
    Unamortized loss on reacquired debt The unamortized
discount, premium and expense related to debt redeemed with a
refinancing are deferred, amortized and recovered over the
life of the replacement issue.
    
    Accrued GCR revenue Receivable for the temporary
under-recovery of and a return on gas costs incurred by
MichCon which are recoverable through the GCR mechanism.
    
    Recoverable minimum pension liability An additional
minimum pension liability was recorded under generally
accepted accounting principles due to the current under
funded status of certain pension plans. The traditional rate
setting process allows for the recovery of pension costs as
measured by generally accepted accounting principles.
Accordingly, the minimum pension liability associated with
utility operations is recoverable. See Note 10.
    
    Recoverable uncollectibles expense Receivable for the MPSC
approved uncollectible expense true-up mechanism that tracks
the difference in the fluctuation in uncollectible accounts
and amounts recognized pursuant to the MPSC authorization.
  
    
    Asset removal costs The amount collected from
customers for the funding of future asset removal activities.
    
    Refundable income taxes Income taxes refundable to
MichCons customers representing the difference in
property-related deferred income taxes payable and amounts
recognized pursuant to MPSC authorization.
    
    Accrued GCR disallowance Refund resulting from an MPSC
order in MichCons 2002 GCR plan case that required MichCon
to reduce revenues in the calculation of its 2002 GCR
expense.
 27




---



##### Table of Contents




    
    Accrued pension  Pension expense refundable to
customers representing the difference created from volatility
in the pension obligation and amounts recognized pursuant to
MPSC authorization.
 Emergency Rules for Gas Bills
  
    
    lengthen the period of time before a bill is due once it is transmitted to the customer;
    
    prohibit shut off or late payment fees unless an actual meter read is made;
    
    limit the required monthly payment on a settlement agreement;
    
    increase the income level qualifying for shut-off protection and lower the payment
required to remain on shut-off protection; and
    
    lessen or eliminate certain deposit requirements.
 Gas Rate Case
      28




---



##### Table of Contents



Gas Industry Restructuring
  Gas Cost Recovery Proceedings
 2002 Plan Year
  2003
Plan Year
 2004 Plan Year 
 2005-2006 Plan Year 
 29




---



##### Table of Contents



Other
  NOTE 4  INCOME TAXES
  30




---



##### Table of Contents



(Dollars in Millions)
    
    2005
    
    
    2004
    
    
    2003Effective federal income tax rate
    
    
    (n/m
    ) (1)
    
    
    (98.3
    )%
    
    
    16.5
    %Statutory federal income taxes at a rate of 35%
    
    $
    
    
    
    $
    3
    
    
    $
    19Investment tax credit
    
    
    (1
    )
    
    
    (1
    )
    
    
    (1
    )Depreciation
    
    
    (7
    )
    
    
    (7
    )
    
    
    (7
    )Grantor Trust
    
    
    
    
    
    
    
    
    
    
    (1
    )Employee Stock Ownership Plan Dividends
    
    
    (1
    )
    
    
    (1
    )
    
    
    (2
    )Medicare Benefits
    
    
    (2
    )
    
    
    (1
    )
    
    
    Other, net
    
    
    (3
    )
    
    
    (2
    )
    
    
    1Total
    
    $
    (14
    )
    
    $
    (9
    )
    
    $
    9
 
 (1)
    
    Due to the amount of the pre-tax loss in 2005, the effective tax rate is not meaningful
(n/m).  (in Millions)
    
    2005
    
    
    2004
    
    
    2003Current federal and other income tax expense (benefit)
    
    $
    (14
    )
    
    $
    (44
    )
    
    $
    8Deferred federal and other income tax expense
    
    
    
    
    
    
    35
    
    
    
    1Total
    
    $
    (14
    )
    
    $
    (9
    )
    
    $
    9
   (in Millions)
    
    2005
    
    
    2004Property
    
    $
    (97
    )
    
    $
    (90
    )Employee benefits
    
    
    (65
    )
    
    
    (65
    )Other, net
    
    
    (21
    )
    
    
    (16
    )$
    (183
    )
    
    $
    (171
    )Deferred income tax liabilities
    
    $
    (518
    )
    
    $
    (483
    )Deferred income tax assets
    
    
    335
    
    
    
    312$
    (183
    )
    
    $
    (171
    )
   31




---



##### Table of Contents



NOTE 5  LONG-TERM DEBT AND PREFERRED SECURITIES
 Long-Term Debt
  (in Millions)
    
    2005
    
    
    2004First Mortgage Bonds, interest payable semi-annually7.15% series due 2006
    
    $
    40
    
    
    $
    407.21% series due 2007
    
    
    30
    
    
    
    307.06% series due 2012
    
    
    40
    
    
    
    408.25% series due 2014
    
    
    80
    
    
    
    80Remarketable securities, interest payable semi-annually6.45% series due 2038
    
    
    75
    
    
    
    75Senior notes, interest payable semi-annually6.125% series due 2008
    
    
    200
    
    
    
    2005.0% series due 2019
    
    
    120
    
    
    
    1205.7% series due 2033
    
    
    200
    
    
    
    200785
    
    
    
    785Less amount due within one year
    
    
    (40
    )
    
    
    Total
    
    $
    745
    
    
    $
    785
    2011 and(in millions)
    
    2006
    
    
    2007
    
    
    2008
    
    
    2009
    
    
    2010
    
    
    thereafter
    
    
    TotalAmount to mature
    
    $
    40
    
    
    $
    30
    
    
    $
    275
    
    
    
    
    
    
    
    
    
    
    $
    440
    
    
    $
    785
 32




---



##### Table of Contents



Preferred and Preference Securities  Authorized and Unissued
  NOTE 6  SHORT-TERM CREDIT ARRANGEMENTS AND BORROWINGS
    NOTE 7  CAPITAL AND OPERATING LEASES
 Lessee
 Operating(in Millions)
    
    Leases2006
    
    $
    22007
    
    
    12008
    
    
    12009
    
    
    12010
    
    
    Thereafter
    
    
    3Total minimum lease payments
    
    $
    8
  33




---



##### Table of Contents



Lessor
 (in Millions)2006
    
    $
    92007
    
    
    92008
    
    
    92009
    
    
    92010
    
    
    9Thereafter
    
    
    89Total minimum future lease receipts
    
    
    134Residual value of leased pipeline
    
    
    40Less  unearned income
    
    
    (93
    )Net investment in direct financing lease
    
    
    81Less  current portion
    
    
    (1
    )$
    80
 NOTE 8  FINANCIAL AND OTHER DERIVATIVE INSTRUMENTS
 Accounting for Derivative Instruments and Hedging Activities,
 
    
    Derivative instruments must be recognized as assets or liabilities
and measured at fair value, unless they meet the normal purchases
and sales exemption.
    
    Accounting for changes in fair value depends on the purpose of the
derivative instrument and whether it is designated as a hedge and
qualifies for hedge accounting.
    
    Special accounting is allowed for a derivative instrument
qualifying as a hedge and designated as a hedge for the
variability of cash flow associated with a forecasted transaction.
Gain or loss associated with the effective portion of the hedge is
recorded in other comprehensive income. The ineffective portion
is recorded to earnings. Amounts recorded in other comprehensive
income will be reclassified to net income when the forecasted
transaction affects earnings. If a cash flow hedge is
discontinued because it is likely the forecasted transaction will
not occur, net gains or losses are immediately recorded to
earnings.
    
    Special accounting is also allowed for a derivative instrument
qualifying as a hedge and designated as a hedge of the changes in
fair value of an existing asset, liability or firm commitment.
Gain or loss on the hedging instrument is recorded into earnings.
An offsetting loss or gain on the underlying asset, liability or
firm commitment is also recorded to earnings.
  34




---



##### Table of Contents



Commodity Price Risk
  Credit Risk
  Interest Rate Risk
  Fair Value of Financial Instruments
  2005
    
    
    2004Fair Value
    
    
    Carrying Value
    
    
    Fair Value
    
    
    Carrying ValueLong-Term Debt
    
    $806 million
    
    $785 million
    
    $834 million
    
    $785 million
 NOTE 9  COMMITMENTS AND CONTINGENCIES
 Environmental Matters
  35




---



##### Table of Contents



Personal Property Taxes
   36




---



##### Table of Contents



Other Commitments
  Bankruptcies
  Other
   NOTE
10  RETIREMENT BENEFITS AND TRUSTEED ASSETS
 Measurement Date
  37




---



##### Table of Contents



Pension Plan Benefits
     (in Millions)
    
    2005
    
    
    2004
    
    
    2003Service Cost
    
    $
    5
    
    
    $
    5
    
    
    $
    4Interest Cost
    
    
    15
    
    
    
    15
    
    
    
    14Expected Return on Plan Assets
    
    
    (28
    )
    
    
    (28
    )
    
    
    (29
    )Amortization ofNet loss
    
    
    1
    
    
    
    
    
    
    
    Prior service cost
    
    
    1
    
    
    
    1
    
    
    
    2Net transition asset
    
    
    
    
    
    
    
    
    
    
    (1
    )Net Pension Credit
    
    $
    (6
    )
    
    $
    (7
    )
    
    $
    (10
    )
 38




---



##### Table of Contents



(in Millions)
    
    2005
    
    
    2004Accumulated Benefit Obligation  End of Period
    
    $
    244
    
    
    $
    242Projected Benefit Obligation  Beginning of Period
    
    $
    256
    
    
    $
    247Service Cost
    
    
    5
    
    
    
    5Interest Cost
    
    
    15
    
    
    
    15Actuarial Loss
    
    
    14
    
    
    
    7Benefits Paid
    
    
    (15
    )
    
    
    (13
    )Plan Amendments
    
    
    
    
    
    
    (5
    )Projected Benefit Obligation  End of Period
    
    $
    275
    
    
    $
    256Plan Assets at Fair Value  Beginning of Period
    
    $
    330
    
    
    $
    319Actual Return on Plan Assets
    
    
    29
    
    
    
    24Benefits Paid
    
    
    (15
    )
    
    
    (13
    )Plan Assets at Fair Value  End of Period
    
    $
    344
    
    
    $
    330Funded Status of the Plans
    
    $
    69
    
    
    $
    74UnrecognizedNet loss
    
    
    53
    
    
    
    41Prior service cost
    
    
    5
    
    
    
    6Prepaid Pension Cost
    
    $
    127
    
    
    $
    121
  2005
    
    
    2004
    
    
    2003Projected Benefit ObligationDiscount rate
    
    
    5.90
    %
    
    
    6.00
    %
    
    
    6.25
    %Annual increase in future compensation levels
    
    
    4.0
    %
    
    
    4.0
    %
    
    
    4.0
    %Net Pension CostsDiscount rate
    
    
    6.00
    %
    
    
    6.25
    %
    
    
    6.75
    %Annual increase in future compensation levels
    
    
    4.0
    %
    
    
    4.0
    %
    
    
    4.0
    %Expected long-term rate of return on Plan assets
    
    
    9.0
    %
    
    
    9.0
    %
    
    
    9.0
    %
 39




---



##### Table of Contents



(in Millions)2006
    
    $
    132007
    
    
    132008
    
    
    142009
    
    
    142010
    
    
    152011  2015
    
    
    82Total
    
    $
    151
    2005
    
    
    2004Equity Securities
    
    
    68
    %
    
    
    69
    %Debt Securities
    
    
    27
    
    
    
    26Other
    
    
    5
    
    
    
    5100
    %
    
    
    100
    %
 40




---



##### Table of Contents



Equity Securities
    
    
    65
    %Debt Securities
    
    
    28Other
    
    
    7100
    %
  Other Postretirement Benefits
   (in Millions)
    
    2005
    
    
    2004
    
    
    2003Service Cost
    
    $
    11
    
    
    $
    8
    
    
    $
    6Interest Cost
    
    
    24
    
    
    
    23
    
    
    
    20Expected Return on Plan Assets
    
    
    (12
    )
    
    
    (11
    )
    
    
    (14
    )Amortization ofNet (gain) loss
    
    
    7
    
    
    
    2
    
    
    
    (2
    )Prior service cost
    
    
    2
    
    
    
    1
    
    
    
    1Net transition obligation
    
    
    6
    
    
    
    8
    
    
    
    9Net Postretirement Cost
    
    $
    38
    
    
    $
    31
    
    
    $
    20
 41




---



##### Table of Contents



(in Millions)
    
    2005
    
    
    2004Accumulated Postretirement Benefit Obligation  Beginning of Period
    
    $
    419
    
    
    $
    379Service Cost
    
    
    11
    
    
    
    8Interest Cost
    
    
    25
    
    
    
    23Actuarial Loss
    
    
    26
    
    
    
    39Benefits Paid
    
    
    (22
    )
    
    
    (15
    )Plan Amendments
    
    
    (6
    )
    
    
    (15
    )Accumulated Postretirement Benefit Obligation  End of Period
    
    $
    453
    
    
    $
    419Plan Assets at Fair Value  Beginning of Period
    
    $
    126
    
    
    $
    117Actual Return on Plan Assets
    
    
    12
    
    
    
    9Benefits Paid
    
    
    (8
    )
    
    
    Plan Assets at Fair Value  End of Period
    
    $
    130
    
    
    $
    126Funded Status of the Plans
    
    $
    (323
    )
    
    $
    (293
    )UnrecognizedNet loss
    
    
    133
    
    
    
    114Prior service cost
    
    
    14
    
    
    
    16Net transition obligation
    
    
    39
    
    
    
    51Accrued Postretirement Liability at Measurement Date
    
    
    (137
    )
    
    
    (112
    )December Adjustments
    
    
    (7
    )
    
    
    (6
    )Accrued Postretirement Liability  End of Period
    
    $
    (144
    )
    
    $
    (118
    )
  2005
    
    
    2004
    
    
    2003Projected Benefits ObligationDiscount rate
    
    
    5.90
    %
    
    
    6.00
    %
    
    
    6.25
    %Net Benefit CostsDiscount rate
    
    
    6.00
    %
    
    
    6.25
    %
    
    
    6.75
    %Expected long-term rate of return on Plan assets
    
    
    9.0
    %
    
    
    9.0
    %
    
    
    9.0
    %
  42




---



##### Table of Contents



(in Millions)2006
    
    $
    282007
    
    
    282008
    
    
    302009
    
    
    302010
    
    
    302011  2015
    
    
    159Total
    
    $
    305
   2005
    
    
    2004Equity Securities
    
    
    69
    %
    
    
    67
    %Debt Securities
    
    
    31
    
    
    
    33100
    %
    
    
    100
    %
  Equity Securities
    
    
    65
    %Debt Securities
    
    
    28Other
    
    
    7100
    %
  43




---



##### Table of Contents



(in Millions)2006
    
    $
    22007
    
    
    2008
    
    
    22009
    
    
    22010
    
    
    2011  2015
    
    
    8Total
    
    $
    14
 Grantor Trust
  NOTE 11  RELATED PARTY TRANSACTIONS
  44




---



##### Table of Contents



(in Millions)
    
    2005
    
    
    2004
    
    
    2003RevenuesTransportation and storage services
    
    $
    11
    
    
    $
    8
    
    
    $
    11Other services
    
    
    5
    
    
    
    3
    
    
    
    3CostsGas purchases
    
    
    
    
    
    
    5
    
    
    
    15Other services and interest
    
    
    14
    
    
    
    15
    
    
    
    14Corporate expenses and merger costs (net) (1)
    
    
    93
    
    
    
    100
    
    
    
    106
 December 31,(in Millions)
    
    2005
    
    
    2004AssetsAccounts receivable
    
    $
    55
    
    
    $
    57Liabilities & EquityAccounts payable
    
    
    16
    
    
    
    10Notes payable
    
    
    16
    
    
    
    9Exchange gas payable
    
    
    
    
    
    
    1Dividends payable
    
    
    13
    
    
    
    13Dividends declared
    
    
    50
    
    
    
    50Dividends paid
    
    
    50
    
    
    
    50
 
 (1)
    
    As a result of an MPSC order, DTE Energy ceased billing merger costs to MichCon
effective April 2005.    NOTE
12  ASSET GAINS AND LOSSES
   45




---



##### Table of Contents



46




---



##### Table of Contents



NOTE
13  SUPPLEMENTARY QUARTERLY FINANCIAL INFORMATION (UNAUDITED)
  First
    
    
    Second
    
    
    Third
    
    
    Fourth(in Millions)
    
    Quarter
    
    
    Quarter
    
    
    Quarter
    
    
    Quarter
    
    
    Year2005Operating Revenues
    
    $
    834
    
    
    $
    261
    
    
    $
    206
    
    
    $
    797
    
    
    $
    2,098Operating Income (Loss)
    
    
    1
    
    
    
    (3
    )
    
    
    (19
    )
    
    
    66
    
    
    
    45Net Income (Loss)
    
    
    (13
    )
    
    
    (50
    )
    
    
    159
    
    
    
    (83
    )
    
    
    132004Operating Revenues
    
    
    715
    
    
    
    271
    
    
    
    155
    
    
    
    504
    
    
    
    1,645Operating Income (Loss)
    
    
    93
    
    
    
    (37
    )
    
    
    (39
    )
    
    
    39
    
    
    
    56Net Income (Loss)
    
    
    70
    
    
    
    (37
    )
    
    
    (53
    )
    
    
    39
    
    
    
    19
 47




---



##### Table of Contents



Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure
  
 Item 9A. Controls and Procedures
 (a) Evaluation of disclosure controls and procedures
  (b) Changes in internal control over financial reporting
  
 Item 9B. Other Information
  
 Part III
 
 Item 10. Directors and Executive Officers of the Registrant
 
 Item 11. Executive Compensation
 
 Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder
Matters
 
 Item 13. Certain Relationships and Related Transactions
  48




---



##### Table of Contents



Item 14. Principal Accountant Fees and Services
  2005
    
    
    2004Audit fees (1)
    
    $
    1,529,517
    
    
    $
    1,304,900Audit-related fees (2)
    
    
    
    
    
    
    Tax fees (2)
    
    
    
    
    
    
    All other fees
    
    
    
    
    
    
    $
    1,529,517
    
    
    $
    1,304,900
 
 (1)
    
    Represents the aggregate fees billed for the audit of MichCons annual financial
statements and for the reviews of the financial statements included in MichCons
Quarterly Reports on Form 10-Q.(2)
    
    Certain audit- related and tax fees are charged to DTE Energy and are indirectly
allocated to MichCon through overheads.   49




---



##### Table of Contents



Part IV
 
 Item 15. Exhibits and Financial Statement Schedules
 (a)
    
    The following documents are filed as part of this Annual Report on Form 10-K.
 (1)
    
    Consolidated financial statements. See Item 8  Financial Statements and Supplementary
Data.(2)
    
    Financial statement schedule. See Item 8  Financial Statements and Supplementary Data.(3)
    
    Exhibits.
 Exhibit No.
    
    Description(i)
    
    
    
    
    
    Exhibits filed herewith:10-19
    
    
    MichCon Investment and Stock Ownership Plan, as amended and restated effective as of January 1, 2002.12-6
    
    
    Computation of Ratio of Earnings to Fixed Charges.23-5
    
    
    Consent of Deloitte & Touche LLP31-21
    
    
    Chief Executive Officer Section 302 Form 10-K Certification of Periodic Report.31-22
    
    
    Chief Financial Officer Section 302 Form 10-K Certification of Periodic Report.(ii)
    
    
    
    
    
    Exhibits incorporated herein by reference:3
    (a)
    
    Restated Articles of Incorporation (Exhibit 3-1 to Form 10-Q for quarter ended March 31, 1993).3
    (b)
    
    By-Laws (Exhibit 3-2 to Form 10-Q for quarter ended March 31, 1993).4
    (a)
    
    Indenture dated as of June 1, 1998 between Michigan Consolidated Gas Company and Citibank, N.A., as
trustee, related to Senior Debt Securities (Exhibit 4-1 to Registration Statement No. 333-63370).4
    (b)
    
    First Supplemental Indenture dated as of June 18, 1998, establishing Extendable Mandatory Par Put
Remarketed Securities (SM) due June 30, 2038 and Resetable Mandatory Putable/Remarketable Securities,
due June 30, 2038 (Exhibit 4-1 to Form 8-K dated June 18, 1998).4
    (c)
    
    Second Supplemental Indenture dated as of June 9, 1999, establishing 6.85% Senior Secured Insured
Quarterly Notes due 2038 and 6.85% Senior Notes due 2039 (Exhibit 4-1 to Form 8-K dated June 4, 1999).
 50




---



##### Table of Contents



Exhibit No.
    
    Description4
    (d)
    
    Third Supplemental Indenture dated as of August 15, 2001, establishing 6 1/8% Senior Notes due 2008
(Exhibit 4-2 to Form 10-Q for quarter ended September 30, 2001).4
    (e)
    
    Fourth Supplemental Indenture dated as of February 15, 2003, establishing 5.70% Senior Notes, 2003
Series A due 2033 (Exhibit 4-3 to Form 10-Q for quarter ended March 31, 2003).4
    (f)
    
    Fifth Supplemental Indenture dated as of October 1, 2004, establishing 5.00% Senior Notes, 2004 Series
E due 2019 (Exhibit 4-6 to Form 10-Q for quarter ended September 31, 2004).4
    (g)
    
    Indenture of Mortgage and Deed of Trust dated as of March 1, 1944 (Exhibit 7-D to Registration
Statement No. 2-5252).4
    (h)
    
    Twenty-ninth Supplemental Indenture dated as of July 15, 1989, among Michigan Consolidated Gas Company
and Citibank, N.A. and Robert T. Kirchner, as trustees, creating an issue of first mortgage bonds and
providing for the modification and restatement of the Indenture of Mortgage and Deed of Trust dated as
of March 1, 1944 (Exhibit 4-2 to Registration Statement No. 333-63370).4
    (i)
    
    Thirtieth Supplemental Indenture dated as of September 1, 1991, creating first mortgage bonds, 9 1/2
Series due 2021 (Exhibit 4-1 to Form 8-K dated September 27, 1991).4
    (j)
    
    Thirty-first Supplemental Indenture dated as of December 15, 1991, creating first mortgage bonds
designated Secured Term Notes, Series A (Exhibit 4-1 to Form 8-K dated February 28, 1992).4
    (k)
    
    Thirty-second Supplemental Indenture dated as of January 5, 1993, creating first mortgage bonds
designated Secured Term Notes, Series B (Exhibit 4-1 to Form 10-K for year ended December 31, 1992).4
    (l)
    
    Thirty-third Supplemental Indenture dated as of May 1, 1995, creating first mortgage bonds designated
Secured Medium Term Notes, Series B (Exhibit 4-2 to Registration Statement No. 33-59093).4
    (m)
    
    Thirty-fourth Supplemental Indenture dated as of November 1, 1996, creating first mortgage bonds
designated Secured Medium Term Notes, Series C (Exhibit 4-2 to Registration Statement No. 333-16285).4
    (n)
    
    Thirty-fifth Supplemental Indenture dated as of June 18, 1998, creating an issue of first mortgage
bonds designated as collateral bonds (Exhibit 4-2 to Form 8-K dated June 18, 1998).4
    (o)
    
    Thirty-sixth Supplemental Indenture dated as of August 15, 2001, creating
6 1/8% collateral bonds due 2008 (Exhibit 4-3 to Form 10-Q for quarter ended September 30, 2001).4
    (p)
    
    Thirty-seventh Supplemental Indenture dated as of February 15, 2003, establishing the 5.70% collateral
bonds due 2033 (Exhibit 4-4 to Form 10-Q for quarter ended March 31, 2003).4
    (q)
    
    Thirty-eighth Supplemental Indenture dated as of October 1, 2004, establishing the 2004 Series E
collateral bonds (Exhibit 4-5 to Form 10-Q for quarter ended September 31, 2004).
 51




---



##### Table of Contents



Exhibit No.
    
    Description10
    (a)
    
    Form of Second Amended and Restated Five-Year Credit Agreement dated as of October 17, 2005, by and
among Michigan Consolidated Gas Company, the lenders party thereto, JPMorgan Chase Bank, N.A., as
Administrative Agent, and Barclays Bank PLC and Citibank, N.A. as Co-Syndication Agents (Exhibit 10.2
to Form 8-K dated October 17, 2005).99
    (a)
    
    Form of Five-Year Credit Agreement dated as of October 17, 2005, by and among Michigan Consolidated
Gas Company, the lenders party thereto, JPMorgan Chase Bank, N.A., as Administrative Agent, and
Barclays Bank PLC and Citibank, N.A. as Co-Syndication Agents (Exhibit 10.1 to Form 8-K dated October
17, 2005).(iii)
    
    
    
    
    
    Exhibits furnished herewith:32-21
    
    
    Chief Executive Officer Section 906 Form 10-K Certification of Periodic Report32-22
    
    
    Chief Financial Officer Section 906 Form 10-K Certification of Periodic Report
 52




---



##### Table of Contents



Michigan Consolidated Gas Company
 
 Schedule II  Valuation and Qualifying Accounts
 Year Ending December 31,(in Millions)
    
    2005
    
    
    2004
    
    
    2003Allowance for Doubtful Accounts (shown as
deduction from accounts receivable in
the consolidated statement
of financial position)Balance at Beginning of Period
    
    $
    71
    
    
    $
    43
    
    
    $
    27Additions:Charged to costs and expenses
    
    
    64
    
    
    
    62
    
    
    
    39Charged to other accounts (1)
    
    
    4
    
    
    
    4
    
    
    
    Deductions (2)
    
    
    (61
    )
    
    
    (38
    )
    
    
    (23
    )Balance at End of Period
    
    $
    78
    
    
    $
    71
    
    
    $
    43
  (1)
    
    Collection of accounts previously written off.(2)
    
    Non-collectible accounts written off.
 53




---



##### Table of Contents



SIGNATURES
  MICHIGAN CONSOLIDATED GAS COMPANY(Registrant)Date: March 7, 2006
    
    By:
    
    /s/ PETER B. OLEKSIAKPeter B. Oleksiak
Controller and Chief Accounting Officer
  By
    
    /s/ ANTHONY F. EARLEY, JR.
    
    By
    
    /s/ PETER B. OLEKSIAKAnthony F. Earley, Jr.
    
    
    
    Peter B. OleksiakChairman of the Board and
    
    
    
    Controller and Chief Accounting OfficerChief Executive OfficerBy
    
    /s/ SANDRA KAY ENNIS
    
    By
    
    /s/ DAVID E. MEADORSandra Kay Ennis
    
    
    
    David E. MeadorDirector and Corporate Secretary
    
    
    
    Director, Executive Vice President andChief Financial OfficerBy
    
    /s/ BRUCE D. PETERSONBruce D. PetersonDirectorDate: March 7, 2006
 54




---



##### Table of Contents



Exhibit Index
  Exhibit Number
    
    Description(i) Exhibits filed herewith.10-19
    
    Michcon Investment and Stock
Ownership Plan, as amended and restated effective as of January 1,
2002.12-6
    
    Computation of Ratio of Earnings
to Fixed Charges.23-5
    
    Consent of Deloitte & Touche LLP.31-21
    
    Chief Executive Officer Section 302 Form 10-K Certification of Periodic Report.31-22
    
    Chief Financial Officer Section 302 Form 10-K Certification of Periodic Report.(iii) Exhibits furnished herewith.32-21
    
    Chief Executive Officer Section
906 Form 10-K Certification of Periodic Report.32-22
    
    Chief Financial Officer Section
906 Form 10-K Certification of Periodic Report.