Tableof Contents

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| x |    | QUARTERLY      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 |
|---|--------------|---------------------------------------------------------------------------------------------------|

| Kansas                                                                  |    | 48-0290000                                    |
|-------------------------------------------------------------------------|--------------|-----------------------------------------------|
| (State      or other jurisdiction ofincorporation      or organization) |    | (I.R.S.      EmployerIdentification      No.) |

| 500      Dallas Street, Suite 1000, Houston, Texas 77002           |
|--------------------------------------------------------------------|
| (Address      of principal executive offices, including zip  code) |

| (713)      369-9000                                            |
|----------------------------------------------------------------|
| (Registrant’s      telephone number, including areacode) |

|                                                                                         |
|----------------------------------------------------------------------------------------------|
| (Former      name, former address and former fiscal year, if changed since last      report) |

| Large      accelerated filer o    | Accelerated      filer o         |
|-----------------------------------|----------------------------------|
|                         |                             |
| Non-accelerated      filer þ | Smaller      reporting company o |

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|    |                                                              | Page   |
|--------------|-------------------------------------------------------------------|--------|
| PART I.      | FINANCIAL    INFORMATION                                          |   |
|         |                                                              |   |
| Item1.       | Financial Statements.      (Unaudited)                            |   |
|    |                                                              |   |
|         | Consolidated Balance      Sheets                                  | 3-4    |
|         | Consolidated Statements of      Operations                        | 5      |
|         | Consolidated Statements of Cash      Flows                        | 6-7    |
|         | Notes to Consolidated Financial      Statements                   | 8-41   |
|    |                                                              |   |
| Item2.       | Management’s Discussion and      Analysis of Financial      |   |
|         | Condition and Results of      Operations.                         | 42-57  |
|    |                                                              |   |
| Item3.       | Quantitative and Qualitative      Disclosures About Market Risk.  | 57     |
|    |                                                              |   |
| Item4.       | Controls and      Procedures.                                     | 58     |
|    |                                                              |   |
| PART    II.  | OTHER      INFORMATION                                            |   |
|    |                                                              |   |
| Item1.       | Legal      Proceedings.                                           | 58     |
|    |                                                              |   |
| Item 1A.     | Risk      Factors.                                                | 58     |
|    |                                                              |   |
| Item2.       | Unregistered Sales of Equity      Securities and Use of Proceeds. | 58     |
|    |                                                              |   |
| Item3.       | Defaults Upon Senior      Securities.                             | 58     |
|    |                                                              |   |
| Item4.       | Submission of Matters to a Vote      of Security Holders.         | 58     |
|    |                                                              |   |
| Item5.       | Other      Information.                                           | 58     |
|    |                                                              |   |
| Item6.       | Exhibits.                                                         | 58-59  |
|    |                                                              |   |
| SIGNATURE    | 60                                                                |

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PART I. - FINANCIALINFORMATION

Item 1.  FinancialStatements.

KNIGHT INC. ANDSUBSIDIARIES

|                                                   | March      31, 2009 |     | December      31, 2008 |
|--------------------------------------------------------|---------------------|----------|------------------------|
| ASSETS                                                 |                |     |                   |   |   |   |   |
| Current      Assets                                    |                |     |                   |   |   |   |   |
| Cash      and Cash Equivalents                         | $                   | 110.5    |                   |   | $ | 118.6 |   |
| Restricted      Deposits                               |                | 3.3      |                   |   |   | - |   |
| Accounts,      Notes and Interest Receivable, Net      |                | 684.3    |                   |   |   | 992.5 |   |
| Inventories                                            |                | 66.5     |                   |   |   | 44.2 |   |
| Gas      Imbalances                                    |                | 6.6      |                   |   |   | 14.1 |   |
| Fair      Value of Derivative Instruments              |                | 118.5    |                   |   |   | 115.2 |   |
| Other                                                  |                | 27.5     |                   |   |   | 32.6 |   |
|                                                   |                | 1,017.2  |                   |   |   | 1,317.2 |   |
|                                         |                |     |                   |   |   |   |   |
| Property,      Plant and Equipment, Net                |                | 16,168.4 |                   |   |   | 16,109.8 |   |
| Notes      Receivable—Related Parties            |                | 174.9    |                   |   |   | 178.1 |   |
| Investments                                            |                | 1,987.6  |                   |   |   | 1,827.4 |   |
| Goodwill                                               |                | 4,691.8  |                   |   |   | 4,698.7 |   |
| Other      Intangibles, Net                            |                | 246.8    |                   |   |   | 251.5 |   |
| Fair      Value of Derivative Instruments, Non-current |                | 577.7    |                   |   |   | 828.0 |   |
| Deferred      Charges and Other Assets                 |                | 213.7    |                   |   |   | 234.2 |   |
| Total      Assets                                      | $                   | 25,078.1 |                   |   | $ | 25,444.9 |   |

----

|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             | March      31, 2009 |     | December      31, 2008 |
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|---------------------|----------|------------------------|
| LIABILITIES      AND STOCKHOLDERS’ EQUITY                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |                |     |                   |   |   |   |   |
| Current      Liabilities                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |                |     |                   |   |   |   |   |
| Current      Portion of Debt                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     | $                   | 530.6    |                   |   | $ | 302.5 |   |
| Cash      Book Overdrafts                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |                | 41.8     |                   |   |   | 45.2 |   |
| Accounts      Payable                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |                | 524.5    |                   |   |   | 849.8 |   |
| Accrued      Interest                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |                | 115.3    |                   |   |   | 241.9 |   |
| Accrued      Taxes                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                | 101.1    |                   |   |   | 152.1 |   |
| Gas      Imbalances                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |                | 12.2     |                   |   |   | 12.4 |   |
| Fair      Value of Derivative Instruments                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |                | 139.4    |                   |   |   | 129.5 |   |
| Other                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |                | 207.4    |                   |   |   | 281.3 |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |                | 1,672.3  |                   |   |   | 2,014.7 |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |                |     |                   |   |   |   |   |
| Long-term      Debt                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |                |     |                   |   |   |   |   |
| Outstanding      Notes and Debentures                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |                | 11,003.9 |                   |   |   | 11,020.1 |   |
| Deferrable      Interest Debentures Issued to Subsidiary Trusts                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |                | 35.7     |                   |   |   | 35.7 |   |
| Preferred      Interest in General Partner of Kinder Morgan Energy    Partners                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |                | 100.0    |                   |   |   | 100.0 |   |
| Value      of Interest Rate Swaps                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |                | 833.3    |                   |   |   | 971.0 |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |                | 11,972.9 |                   |   |   | 12,126.8 |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |                |     |                   |   |   |   |   |
| Deferred      Income Taxes, Non-current                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |                | 2,064.9  |                   |   |   | 2,081.3 |   |
| Fair      Value of Derivative Instruments, Non-current                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |                | 98.0     |                   |   |   | 92.2 |   |
| Other      Long-term Liabilities and Deferred Credits                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |                | 631.3    |                   |   |   | 653.0 |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |                | 14,767.1 |                   |   |   | 14,953.3 |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |                |     |                   |   |   |   |   |
| Commitments      and Contingencies (Notes 12 and 17)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |                |     |                   |   |   |   |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |                |     |                   |   |   |   |   |
| Stockholders’      Equity                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |                |     |                   |   |   |   |   |
| Common      Stock – Authorized and Outstanding – 100 Shares, Par Value $0.01 Per      Share                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |                | -        |                   |   |   | - |   |
| Additional      Paid-in Capital                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |                | 7,818.4  |                   |   |   | 7,810.0 |   |
| Retained      Deficit                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |                | (3,287.0 | )                      |   |   | (3,352.3 | ) |
| Accumulated      Other Comprehensive Loss                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |                | (80.1    | )                      |   |   | (53.4 | ) |
| Total      Knight Inc. Stockholders’      Equity                                                                                                |                | 4,451.3  |                   |   |   | 4,404.3 |   |
| Noncontrolling      Interests                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |                | 4,187.4  |                   |   |   | 4,072.6 |   |
| Total      Stockholders’ Equity                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |                | 8,638.7  |                   |   |   | 8,476.9 |   |
| Total      Liabilities and Stockholders’ Equity                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            | $                   | 25,078.1 |                   |   | $ | 25,444.9 |   |

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KNIGHT INC. AND SUBSIDIARIES

|                                                                      | Three      Months Ended March 31, |
|---------------------------------------------------------------------------|-----------------------------------|
|                                                                      | 2009                              |   | 2008 |
| Operating      Revenues                                                   |                              |   |   |   |   |   |   |
| Natural      Gas Sales                                                    | $                                 | 888.7 |   |   | $ | 1,721.8 |   |
| Services                                                                  |                              | 661.4 |   |   |   | 807.9 |   |
| Product      Sales and Other                                              |                              | 278.8 |   |   |   | 365.3 |   |
| Total      Operating Revenues                                             |                              | 1,828.9 |   |   |   | 2,895.0 |   |
|                                                                 |                              |   |   |   |   |   |   |
| Operating      Costs and Expenses                                         |                              |   |   |   |   |   |   |
| Gas      Purchases and Other Costs of Sales                               |                              | 865.6 |   |   |   | 1,760.6 |   |
| Operations      and Maintenance                                           |                              | 256.4 |   |   |   | 301.8 |   |
| General      and Administrative                                           |                              | 92.9 |   |   |   | 86.3 |   |
| Depreciation,      Depletion and Amortization                             |                              | 264.8 |   |   |   | 218.1 |   |
| Taxes,      Other Than Income Taxes                                       |                              | 39.0 |   |   |   | 52.5 |   |
| Other      Expenses (Income)                                              |                              | 0.3 |   |   |   | (0.5 | ) |
| Total      Operating Costs and Expenses                                   |                              | 1,519.0 |   |   |   | 2,418.8 |   |
|                                                                 |                              |   |   |   |   |   |   |
| Operating      Income                                                     |                              | 309.9 |   |   |   | 476.2 |   |
|                                                                 |                              |   |   |   |   |   |   |
| Other      Income and (Expenses)                                          |                              |   |   |   |   |   |   |
| Earnings      of Equity Investees                                         |                              | 47.2 |   |   |   | 43.7 |   |
| Interest      Expense, Net                                                |                              | (141.5 | ) |   |   | (210.7 | ) |
| Interest      Income (Expense) – Deferrable Interest Debentures     |                              | (0.5 | ) |   |   | 6.7 |   |
| Other,      Net                                                           |                              | 10.6 |   |   |   | 3.2 |   |
| Total      Other Income and (Expenses)                                    |                              | (84.2 | ) |   |   | (157.1 | ) |
|                                                                 |                              |   |   |   |   |   |   |
| Income      from Continuing Operations Before Income Taxes           |                              | 225.7 |   |   |   | 319.1 |   |
| Income      Taxes                                                         |                              | 80.6 |   |   |   | 87.1 |   |
| Income      from Continuing Operations                                    |                              | 145.1 |   |   |   | 232.0 |   |
| Loss      from Discontinued Operations, Net of Tax                        |                              | (0.2 | ) |   |   | (0.1 | ) |
| Net      Income                                                           |                              | 144.9 |   |   |   | 231.9 |   |
| Net      Income Attributable to Noncontrolling Interests                  |                              | (29.6 | ) |   |   | (126.2 | ) |
|                                                                 |                              |   |   |   |   |   |   |
| Net      Income Attributable      to Knight Inc.’s Stockholder | $                                 | 115.3 |   |   | $ | 105.7 |   |

----

KNIGHT INC. AND SUBSIDIARIES

|                                                                                                       | Three      Months Ended March 31, |
|------------------------------------------------------------------------------------------------------------|-----------------------------------|
|                                                                                                       | 2009                              |   | 2008 |
| Cash      Flows from Operating Activities                                                                  |                              |   |   |   |   |   |   |
| Net      Income                                                                                            | $                                 | 144.9 |   |   | $ | 231.9 |   |
| Adjustments      to Reconcile Net Income to Net Cash Flows from      Operating Activities             |                              |   |   |   |   |   |   |
| Loss      from Discontinued Operations, Net of Tax                                                         |                              | 0.2 |   |   |   | 0.1 |   |
| Loss      on Early Extinguishment of Debt                                                                  |                              | - |   |   |   | 18.4 |   |
| Depreciation,      Depletion and Amortization                                                              |                              | 264.8 |   |   |   | 218.1 |   |
| Deferred      Income Taxes                                                                                 |                              | 17.0 |   |   |   | 15.9 |   |
| Income      from the Allowance for Equity Funds Used During    Construction                                |                              | (9.3 | ) |   |   | - |   |
| Equity      in Earnings of Equity Investees                                                                |                              | (47.2 | ) |   |   | (43.7 | ) |
| Distributions      from Equity Investees                                                                   |                              | 60.0 |   |   |   | 24.1 |   |
| Net      Losses (Gains) on Sales of Assets                                                                 |                              | 0.4 |   |   |   | (0.5 | ) |
| Mark-to-Market      Interest Rate Swap Gain                                                                |                              | - |   |   |   | (19.8 | ) |
| Changes      in Working Capital Items                                                                      |                              | (326.1 | ) |   |   | (307.2 | ) |
| Proceeds      from (Payment for) Termination of Interest Rate Swaps                                        |                              | 144.4 |   |   |   | (2.5 | ) |
| Kinder      Morgan Energy Partners’ Rate Reparations, Refunds      and Reserve Adjustments |                              | - |   |   |   | (23.3 | ) |
| Other,      Net                                                                                            |                              | (35.5 | ) |   |   | (10.9 | ) |
| Net      Cash Flows Provided by Continuing Operations                                                      |                              | 213.6 |   |   |   | 100.6 |   |
| Net      Cash Flows Used in Discontinued Operations                                                        |                              | (0.3 | ) |   |   | (0.1 | ) |
| Net      Cash Flows Provided by Operating Activities                                                       |                              | 213.3 |   |   |   | 100.5 |   |
|                                                                                                  |                              |   |   |   |   |   |   |
| Cash      Flows from Investing Activities                                                                  |                              |   |   |   |   |   |   |
| Capital      Expenditures                                                                                  |                              | (417.6 | ) |   |   | (638.3 | ) |
| Proceeds      from Sale of 80% Interest in NGPL PipeCo LLC, Net of $1.1      Cash Sold      |                              | - |   |   |   | 2,899.3 |   |
| Proceeds      from NGPL PipeCo LLC Restricted Cash                                                         |                              | - |   |   |   | 3,106.4 |   |
| Other      Acquisitions                                                                                    |                              | (0.5 | ) |   |   | (0.3 | ) |
| Repayments      from Customers                                                                             |                              | 98.1 |   |   |   | - |   |
| Net      Investments in Margin Deposits                                                                    |                              | (5.8 | ) |   |   | (98.8 | ) |
| Distributions      from Equity Investees                                                                   |                              | - |   |   |   | 89.1 |   |
| Contributions      to Investments                                                                          |                              | (174.2 | ) |   |   | (336.5 | ) |
| Change      in Natural Gas Storage and NGL Line Fill Inventory                                             |                              | - |   |   |   | (2.7 | ) |
| Net      (Cost of Removal) Proceeds from Sales of Other Assets                                             |                              | (0.8 | ) |   |   | 62.0 |   |
| Net      Cash Flows (Used in) Provided by Investing Activities                                             | $                                 | (500.8 | ) |   | $ | 5,080.2 |   |

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|                                                           | Three      Months Ended March 31, |
|----------------------------------------------------------------|-----------------------------------|
|                                                           | 2009                              |   | 2008 |
| Cash      Flows from Financing Activities                      |                              |   |   |   |   |   |   |
| Short-term      Debt, Net                                      | $                                 | 471.6 |   |   | $ | (521.4 | ) |
| Long-term      Debt Issued                                     |                              | - |   |   |   | 900.0 |   |
| Long-term      Debt Retired                                    |                              | (251.6 | ) |   |   | (5,859.9 | ) |
| Discount      on Early Extinguishment of Debt                  |                              | - |   |   |   | 69.2 |   |
| (Decrease)      Increase in Cash Book Overdrafts               |                              | (3.3 | ) |   |   | 35.0 |   |
| Short-term      Advances from (to) Unconsolidated Affiliates   |                              | 1.2 |   |   |   | (14.7 | ) |
| Cash      Dividends                                            |                              | (50.0 | ) |   |   | - |   |
| Contributions      from Noncontrolling Interests               |                              | 287.9 |   |   |   | 384.5 |   |
| Distributions      to Noncontrolling Interests                 |                              | (175.8 | ) |   |   | (143.5 | ) |
| Debt      Issuance Costs                                       |                              | (1.5 | ) |   |   | (6.6 | ) |
| Other,      Net                                                |                              | 1.8 |   |   |   | 1.8 |   |
| Net      Cash Flows Provided by (Used in) Financing Activities |                              | 280.3 |   |   |   | (5,155.6 | ) |
|                                                           |                              |   |   |   |   |   |   |
| Effect      of Exchange Rate Changes on Cash                   |                              | (0.9 | ) |   |   | (0.7 | ) |
|                                                           |                              |   |   |   |   |   |   |
| Net      (Decrease) Increase in Cash and Cash Equivalents      |                              | (8.1 | ) |   |   | 24.4 |   |
| Cash      and Cash Equivalents at Beginning of Period          |                              | 118.6 |   |   |   | 148.6 |   |
| Cash      and Cash Equivalents at End of Period                | $                                 | 110.5 |   |   | $ | 173.0 |   |

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KNIGHT INC. AND SUBSIDIARIES

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|                                 | December      31, 2008 |    | AcquisitionsandPurchase      PriceAdjustments1 |   | Impairmentof      Assets |   | Other2 |   | March      31, 2009 |
|--------------------------------------|------------------------|---------|------------------------------------------------|--------|--------------------------|--------|--------|--------|---------------------|
|                                 | (In      millions)     |
| Products      Pipelines–KMP    | $                      | 850.0   |                                           |   |                     | $      | -      |   |                |   | $ | - |   |   | $ | - |   |   | $ | 850.0 |   |
| Natural      Gas Pipelines–KMP |                   | 1,349.2 |                                           |   |                     |   | -      |   |                |   |   | - |   |   |   | - |   |   |   | 1,349.2 |   |
| CO2–KMP                        |                   | 1,521.7 |                                           |   |                     |   | -      |   |                |   |   | - |   |   |   | - |   |   |   | 1,521.7 |   |
| Terminals–KMP                  |                   | 774.2   |                                           |   |                     |   | 0.1    |   |                |   |   | - |   |   |   | - |   |   |   | 774.3 |   |
| Kinder      Morgan Canada–KMP  |                   | 203.6   |                                           |   |                     |   | -      |   |                |   |   | - |   |   |   | (7.0 | ) |   |   | 196.6 |   |
| Consolidated      Total              | $                      | 4,698.7 |                                           |   |                     | $      | 0.1    |   |                |   | $ | - |   |   | $ | (7.0 | ) |   | $ | 4,691.8 |   |

| 1 | Adjustments      relate primarily to a reallocation between goodwill and property, plant,      and equipment in our final purchase price  allocation. |
|---|-------------------------------------------------------------------------------------------------------------------------------------------------------|

| 2 | Adjustments      relate to the translation of goodwill denominated in foreign      currencies. |
|---|------------------------------------------------------------------------------------------------|

|                                                  | March      31,2009 |   | December      31,2008 |
|-------------------------------------------------------|--------------------|--------|-----------------------|
|                                                  | (In      millions) |
| Customer      Relationships, Contracts and Agreements |               |   |                  |   |   |   |   |
| Gross      Carrying Amount                            | $                  | 270.9  |                  |   | $ | 270.9 |   |
| Accumulated      Amortization                         |               | (34.9  | )                     |   |   | (30.3 | ) |
| Net      Carrying Amount                              |               | 236.0  |                  |   |   | 240.6 |   |
|                                                  |               |   |                  |   |   |   |   |
| Technology-based      Assets, Lease Values and Other  |               |   |                  |   |   |   |   |
| Gross      Carrying Amount                            |               | 11.7   |                  |   |   | 11.7 |   |
| Accumulated      Amortization                         |               | (0.9   | )                     |   |   | (0.8 | ) |
| Net      Carrying Amount                              |               | 10.8   |                  |   |   | 10.9 |   |
|                                                  |               |   |                  |   |   |   |   |
| Total      Other Intangibles, Net                     | $                  | 246.8  |                  |   | $ | 251.5 |   |

----

|                                                  | Three      Months Ended March 31, |
|-------------------------------------------------------|-----------------------------------|
|                                                  | 2009                              |   | 2008 |
|                                                  | (In      millions)                |
| Customer      Relationships, Contracts and Agreements | $                                 | 4.6 |   |   | $ | 5.1 |   |
| Technology-based      Assets, Lease Value and Other   |                              | 0.1 |   |   |   | 0.1 |   |
| Total      Amortization                               | $                                 | 4.7 |   |   | $ | 5.2 |   |

|                                                                       | Three      Months Ended March 31, |    |
|----------------------------------------------------------------------------|-----------------------------------|---------|
|                                                                       | 2009                              |    |   |   | 2008 |   |
|                                                                       | Knight      Inc.                  |    |   |   | Noncontrolling      Interests |   |   |   | Total |   |   |   | Knight      Inc. |   |   |   | Noncontrolling      Interests |   |   |   | Total |   |
|                                                                       |                              |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                       |                              |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Beginning      Balance                                                     | $                                 | 4,404.3 |   |   | $ | 4,072.6 |   |   | $ | 8,476.9 |   |   | $ | 7,821.5 |   |   | $ | 3,314.0 |   |   | $ | 11,135.5 |   |
| Impact      from Equity Transactions of Kinder Morgan Energy Partners      |                              | 6.5     |   |   |   | (10.1 | ) |   |   | (3.6 | ) |   |   | (16.0 | ) |   |   | (15.4 | ) |   |   | (31.4 | ) |
| A-1      and B Unit Amortization                                           |                              | 1.9     |   |   |   | - |   |   |   | 1.9 |   |   |   | 1.9 |   |   |   | - |   |   |   | 1.9 |   |
| Distributions      to Noncontrolling Interests                             |                              | -       |   |   |   | (176.3 | ) |   |   | (176.3 | ) |   |   | - |   |   |   | (144.4 | ) |   |   | (144.4 | ) |
| Contributions      from Noncontrolling Interests                           |                              | -       |   |   |   | 287.9 |   |   |   | 287.9 |   |   |   | - |   |   |   | 384.5 |   |   |   | 384.5 |   |
| Cash      Dividends                                                        |                              | (50.0   | ) |   |   | - |   |   |   | (50.0 | ) |   |   | - |   |   |   | - |   |   |   | - |   |
| Other                                                                      |                              | -       |   |   |   | 2.7 |   |   |   | 2.7 |   |   |   | - |   |   |   | (2.0 | ) |   |   | (2.0 | ) |
| Comprehensive      Income (Loss)                                           |                              |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Net      Income                                                            |                              | 115.3   |   |   |   | 29.6 |   |   |   | 144.9 |   |   |   | 105.7 |   |   |   | 126.2 |   |   |   | 231.9 |   |
| Other      Comprehensive Income (Loss), Net of Tax                         |                              |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Change      in Fair Value of Derivatives Utilized for Hedging Purposes     |                              | 15.9    |   |   |   | 17.5 |   |   |   | 33.4 |   |   |   | (219.8 | ) |   |   | (189.6 | ) |   |   | (409.4 | ) |
| Reclassification      of Change in Fair Value of Derivatives to Net Income |                              | (20.5   | ) |   |   | (8.4 | ) |   |   | (28.9 | ) |   |   | 115.5 |   |   |   | 75.7 |   |   |   | 191.2 |   |
| Change      in Employee Benefit Plans                                      |                              | (0.9    | ) |   |   | (1.4 | ) |   |   | (2.3 | ) |   |   | 1.9 |   |   |   | 1.6 |   |   |   | 3.5 |   |
| Change      in Foreign Currency Translation Adjustment                     |                              | (21.2   | ) |   |   | (26.7 | ) |   |   | (47.9 | ) |   |   | (24.3 | ) |   |   | (25.7 | ) |   |   | (50.0 | ) |
| Total      Other Comprehensive Loss                                        |                              | (26.7   | ) |   |   | (19.0 | ) |   |   | (45.7 | ) |   |   | (126.7 | ) |   |   | (138.0 | ) |   |   | (264.7 | ) |
| Total      Comprehensive Income (Loss)                                     |                              | 88.6    |   |   |   | 10.6 |   |   |   | 99.2 |   |   |   | (21.0 | ) |   |   | (11.8 | ) |   |   | (32.8 | ) |
| Ending      Balance                                                        | $                                 | 4,451.3 |   |   | $ | 4,187.4 |   |   | $ | 8,638.7 |   |   | $ | 7,786.4 |   |   | $ | 3,524.9 |   |   | $ | 11,311.3 |   |

|                               | March      31,2009 |    | December      31,2008 |
|------------------------------------|--------------------|---------|-----------------------|
|                               | (In      millions) |
| Kinder      Morgan Energy Partners | $                  | 2,313.2 |                  |   | $ | 2,198.2 |   |
| Kinder      Morgan Management      |               | 1,828.3 |                  |   |   | 1,826.5 |   |
| Triton      Power Company LLC      |               | 37.2    |                  |   |   | 39.0 |   |
| Other                              |               | 8.7     |                  |   |   | 8.9 |   |
|                               | $                  | 4,187.4 |                  |   | $ | 4,072.6 |   |

----

|                                                                                                    | March      31, 2009 |   | December      31, 2008 |
|---------------------------------------------------------------------------------------------------------|---------------------|--------|------------------------|
|                                                                                                    | (In      millions)  |
| Derivative      Assets (Liabilities)                                                                    |                |   |                   |   |   |   |   |
| Current      Assets: Fair Value of Derivative Instruments                                               | $                   | 46.5   |                   |   | $ | 60.4 |   |
| Assets:      Fair Value of Derivative Instruments, Non-current                                          | $                   | 27.2   |                   |   | $ | 20.1 |   |
| Current      Liabilities: Fair Value of Derivative Instruments                                          | $                   | (9.8   | )                      |   | $ | (13.2 | ) |
| Liabilities      and Stockholders’ Equity: Fair Value of Derivative Instruments,      Non-current | $                   | (24.4  | )                      |   | $ | (24.1 | ) |

----

|                                  | Three      Months Ended March 31, |
|---------------------------------------|-----------------------------------|
|                                  | 2009                              |   | 2008 |
|                                  | (In      millions)                |
| Accounts      Receivable              | $                                 | 199.6 |   |   | $ | (122.8 | ) |
| Materials      and Supplies Inventory |                              | (4.3 | ) |   |   | (2.1 | ) |
| Other      Current Assets             |                              | 5.3 |   |   |   | (38.9 | ) |
| Accounts      Payable                 |                              | (246.2 | ) |   |   | 32.4 |   |
| Accrued      Interest                 |                              | (126.5 | ) |   |   | (138.8 | ) |
| Accrued      Taxes                    |                              | (52.9 | ) |   |   | 43.4 |   |
| Other      Current Liabilities        |                              | (101.1 | ) |   |   | (80.4 | ) |
|                                  | $                                 | (326.1 | ) |   | $ | (307.2 | ) |

|                                     | Three      Months Ended March 31, |
|------------------------------------------|-----------------------------------|
|                                     | 2009                              |   | 2008 |
|                                     | (In      millions)                |
| Cash      Paid During the Period for     |                              |   |   |   |   |   |   |
| Interest,      Net of Amount Capitalized | $                                 | 271.6 |   |   | $ | 341.6 |   |
| Income      Taxes Paid (Net of Refunds)1 | $                                 | 140.5 |   |   | $ | 1.1 |   |

| 1 | Income      taxes paid include amounts paid related to prior  periods. |
|---|------------------------------------------------------------------------|

|                    | Three      Months Ended March 31, |
|-------------------------|-----------------------------------|
|                    | 2009                              |   | 2008 |
|                    | (In      millions)                |
| Income      Taxes       | $                                 | 80.6 |   |   | $ | 87.1 |   |
| Effective      Tax Rate |                              | 35.7 | % |   |   | 27.3 | % |

----

----

|                                                       | March      31, 2009          |
|------------------------------------------------------------|------------------------------|
|                                                       | Short-termNotes      Payable |   | CommercialPaperOutstanding |   | Weighted-AverageInterest      Rate |
|                                                       | (In      millions)           |
|                                                       |                         |   |   |   |   |   |   |   |   |   |   |   |   |
| Knight      Inc. – Secured Debt1                     |                         | $ | 40.7 |   |   | $ | - |   |   |   | 1.66 | % |   |
| Kinder      Morgan Energy Partners – Unsecured Debt2 |                         | $ | 439.8 |   |   | $ | - |   |   |   | 1.12 | % |   |

| 1 | The      average short-term debt outstanding (and related weighted-average interest      rate) was $121.2 million (2.29%) during the three months ended March 31,      2009. |
|---|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 2 | The      average short-term debt outstanding (and related weighted-average interest      rate) was $266.0 million (2.02%) during the three months ended March 31,      2009. |
|---|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

----

----

----

|   | · | NGPL PipeCo LLC—after      February 15, 2008, this segment consists of our 20% interest in NGPL      PipeCo LLC, a major interstate natural gas pipeline and storage system      which we operate. |
|--------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | Power consists of a      natural gas-fired electric generationfacility. |
|--------|--------|-------------------------------------------------------------------------|

|   | · | Products Pipelines–KMP      derives its revenues primarily from the transportation and terminaling of      refined petroleum products, including gasoline, diesel fuel, jet fuel and      natural gas liquids. |
|--------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | Natural Gas      Pipelines–KMP derives its revenues primarily from the sale,      transport, processing, treating, storage and gathering of natural      gas. |
|--------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | CO2–KMP derives its      revenues primarily from the production and sale of crude oil from fields      in the Permian Basin of West Texas and from the transportation and      marketing of carbon dioxide used as a flooding medium for recovering crude      oil from mature oil fields. |
|--------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | Terminals–KMP derives      its revenues primarily from the transloading and storing of refined      petroleum products and dry and liquid bulk products, including coal,      petroleum coke, cement, alumina, salt and other bulk      chemicals. |
|--------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | Kinder Morgan      Canada–KMP derives its revenues primarily from the transportation      of crude oil and refined products. |
|--------|--------|------------------------------------------------------------------------------------------------------------------------------------|

----

|                                                                                                                          | Three      Months Ended March 31, |
|-------------------------------------------------------------------------------------------------------------------------------|-----------------------------------|
|                                                                                                                          | 2009                              |   | 2008 |
|                                                                                                                          | (In      millions)                |
| Segment      Earnings before Depreciation, Depletion, Amortization and Amortization of      Excess Cost of Equity Investments |                              |   |   |   |   |   |   |
| NGPL      PipeCo LLC1                                                                                                         | $                                 | 12.3 |   |   | $ | 96.0 |   |
| Power                                                                                                                         |                              | 1.1 |   |   |   | 2.1 |   |
| Products      Pipelines–KMP2                                                                                            |                              | 145.4 |   |   |   | 140.2 |   |
| Natural      Gas Pipelines–KMP2                                                                                         |                              | 200.0 |   |   |   | 188.4 |   |
| CO2–KMP2                                                                                                                |                              | 191.7 |   |   |   | 233.3 |   |
| Terminals–KMP2                                                                                                          |                              | 134.3 |   |   |   | 125.8 |   |
| Kinder      Morgan Canada–KMP2,3                                                                                        |                              | 19.5 |   |   |   | 34.6 |   |
| Total      Segment Earnings before DD&A                                                                                   |                              | 704.3 |   |   |   | 820.4 |   |
| Depreciation,      Depletion and Amortization                                                                                 |                              | (264.8 | ) |   |   | (218.1 | ) |
| Amortization      of Excess Cost of Equity Investments                                                                        |                              | (1.4 | ) |   |   | (1.4 | ) |
| Other      Operating Income                                                                                                   |                              | 11.5 |   |   |   | - |   |
| General      and Administrative Expense                                                                                       |                              | (92.9 | ) |   |   | (86.3 | ) |
| Interest      and Other, Net4                                                                                                 |                              | (150.3 | ) |   |   | (204.5 | ) |
| Add      Back: Income Taxes Included in Segments Above2                                                                       |                              | 19.3 |   |   |   | 9.0 |   |
| Income      from Continuing Operations Before Income Taxes                                                                    | $                                 | 225.7 |   |   | $ | 319.1 |   |

| Revenues      from External Customers |   |    |   |   |   |    |   |
|---------------------------------------|--------|---------|--------|--------|--------|---------|--------|
| NGPL      PipeCo LLC1                 | $      | -       |   |   | $      | 132.1   |   |
| Power                                 |   | 6.6     |   |   |   | 7.5     |   |
| Products      Pipelines–KMP     |   | 188.2   |   |   |   | 198.3   |   |
| Natural      Gas Pipelines–KMP  |   | 1,051.7 |   |   |   | 1,912.5 |   |
| CO2–KMP                         |   | 253.2   |   |   |   | 319.9   |   |
| Terminals–KMP                   |   | 267.7   |   |   |   | 280.0   |   |
| Kinder      Morgan Canada–KMP3  |   | 50.0    |   |   |   | 43.9    |   |
| Other                                 |   | 11.5    |   |   |   | 0.8     |   |
| Total      Revenues                   | $      | 1,828.9 |   |   | $      | 2,895.0 |   |
| Intersegment      Revenues            |   |    |   |   |   |    |   |
| NGPL      PipeCo LLC      1           | $      | -       |   |   | $      | 0.9     |   |
| Terminals–KMP                   |   | 0.2     |   |   |   | 0.2     |   |
| Other                                 |   | -       |   |   |   | (0.8    | )      |
| Total      Intersegment Revenues      | $      | 0.2     |   |   | $      | 0.3     |   |

|                                 | March      31, 2009 |
|--------------------------------------|---------------------|
|                                 | (In      millions)  |
| Assets                               |                |   |   |
| NGPL PipeCo LLC      1               | $                   | 730.9 |   |
| Power                                |                | 53.1 |   |
| Products      Pipelines–KMP    |                | 5,518.4 |   |
| Natural      Gas Pipelines–KMP |                | 7,754.0 |   |
| CO2–KMP                        |                | 4,457.4 |   |
| Terminals–KMP                  |                | 4,347.7 |   |
| Kinder      Morgan Canada–KMP3 |                | 1,503.9 |   |
| Total      segment assets            |                | 24,365.4 |   |
| Other5                               |                | 712.7 |   |
| Total      Consolidated Assets       | $                   | 25,078.1 |   |

| 1 | Effective      February 15, 2008, we sold an 80% ownership interest in NGPL PipeCo LLC to      Myria. As a result of the sale, beginning February 15, 2008, we account      for our 20% ownership interest in NGPL PipeCo LLC as an equity method      investment. |
|---|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 2 | Income      taxes of Kinder Morgan Energy Partners of $19.3 million and $9.0 million      for the three months ended March 31, 2009 and 2008, respectively, are      included in segment earnings before depreciation, depletion, amortization      and amortization of excess cost of equity  investments. |
|---|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

| 3 | On      August 28, 2008, we sold our one-third interest in the net assets of the      Express pipeline system (“Express”), as well as our full ownership of the      net assets of the Jet Fuel pipeline system (“Jet Fuel”), to Kinder Morgan      Energy Partners. The results of Express and Jet Fuel are now reported in      the segment referred to as Kinder Morgan Canada–KMP for all      periods. |
|---|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 4 | Includes      (i) interest expense and (ii) miscellaneous other income and expenses not      allocated to business segments. |
|---|------------------------------------------------------------------------------------------------------------------------------|

| 5 | Includes      assets of cash, restricted deposits, market value of derivative      instruments (including interest rate swaps) and miscellaneous corporate      assets (such as information technology and telecommunications equipment)      not allocated to individualsegments. |
|---|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| Derivatives      Designated as Hedging Contractsunder      SFAS No. 133 |   | Notional      Quantity        |
|-------------------------------------------------------------------------|--------|-------------------------------|
| Crude      oil                                                          |   | 30.6      million barrels     |
| Natural      gas                                                        |   | 19.7      billion cubic feet1 |

| Derivatives      Not Designated as Hedging Contractsunder      SFAS No. 133 |   | Notional      Quantity       |
|-----------------------------------------------------------------------------|--------|------------------------------|
| Crude      oil                                                              |   | 0.1      million barrels     |
| Natural      gas                                                            |   | 0.5      billion cubic feet1 |

----

| Fair      Value of Derivative Contracts                                 |
|-------------------------------------------------------------------------|
|                                                                    | Asset      Derivatives |   |   |   | Liability      Derivatives |
|                                                                    | March      31, 2009 |   | December      31, 2008 |   |   |   | March      31, 2009 |   | December      31, 2008 |
|                                                                    | Balance      Sheet    Location     | FairValue |   | Balance      Sheet    Location     | FairValue |   |   |   | Balance      Sheet    Location     | FairValue |   |   | Balance      Sheet    Location     | FairValue |   |
|                                                                    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Derivatives Designated      as Hedging Contracts under SFAS No. 133     |   |   |   |   |   |   |   |   |   |   |
| Energy      Commodity Derivative Contracts                              | Fair      Value of Derivative Instrument | $115.7 |   | Fair      Value of Derivative Instruments | $113.5 |   |   |   | Fair      Value of Derivative Instruments | $(138.6 | ) |   | Fair      Value of Derivative Instruments | $(129.4 | ) |
|                                                                    | Fair      Value of Derivative Instruments, Non-current | 76.0 |   | Fair      Value of Derivative Instruments, Non-current | 48.9 |   |   |   | Fair      Value of Derivative Instruments, Non-current | (94.6 | ) |   | Fair      Value of Derivative Instruments, Non-current | (92.2 | ) |
| Subtotal                                                                |   | 191.7 |   |   | 162.4 |   |   |   |   | (233.2 | ) |   |   | (221.6 | ) |
| Interest      Rate Swap Agreements                                      | Fair      Value of Derivative Instruments, Non-current | 475.7 |   | Fair      Value of Derivative Instruments, Non-current | 747.1 |   |   |   | Fair      Value of Derivative Instruments, Non-current | (3.4 | ) |   | Fair      Value of Derivative Instruments, Non-current | - |   |
|                                                                    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Cross      Currency Swap Agreements                                     | Fair      Value of Derivative Instruments, Non-current | 26.0 |   | Fair      Value of Derivative Instruments, Non-current | 32.0 |   |   |   | Fair      Value of Derivative Instruments, Non-current | - |   |   | Fair      Value of Derivative Instruments, Non-current | - |   |
| Total                                                                   |   | 693.4 |   |   | 941.5 |   |   |   |   | (236.6 | ) |   |   | (221.6 | ) |
|                                                                    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Derivatives Not      Designated as Hedging Contracts under SFAS No. 133 |   |   |   |   |   |   |   |   |   |   |
| Energy      Commodity Derivative Contracts                              | Fair      Value of Derivative Instruments | 2.8 |   | Fair      Value of Derivative Instruments | 1.8 |   |   |   | Fair      Value of Derivative Instruments | (0.8 | ) |   | Fair      Value of Derivative Instruments | (0.1 | ) |
|                                                                    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Total      Derivatives                                                  |   | $696.2 |   |   | $943.3 |   |   |   |   | $(237.4 | ) |   |   | $(221.7 | ) |

----

| Derivatives      inFair      ValueHedging |                    | Location      ofGain/(Loss)Recognized      in Income      on |   | Amount      of Gain/(Loss)Recognized      in Income on Derivative |   |                    | Hedged      Items inFair      ValueHedging |   | Location      ofGain/(Loss)Recognized      in Income      on Related |   | Amount      of Gain/(Loss)Recognized      in Income onRelated      Hedged Items |
|-------------------------------------------|-------------------------|--------------------------------------------------------------|--------|-------------------------------------------------------------------|--------|-------------------------|--------------------------------------------|--------|----------------------------------------------------------------------|--------|---------------------------------------------------------------------------------|
|                                      | Three      Months Ended |                                                         |   |                                                              |   | Three      Months Ended |
| Relationships                             |                    | Derivative                                                   |   | 2009                                                              |   | 2008                    |                                       |   | Relationships                                                        |   | Hedged      Item                                                                |   | 2009 |   |   | 2008 |   |
| Interest      Rate Swap Agreements        |                    | Interest,      Net – Income/(Expense)                  |   | $                                                                 | (130.4 | )                       |                                       | $      | 119.1                                                                |   |                                                                            | Fixed      Rate Debt  |   | Interest,      Net – Income/(Expense) |   | $ | 130.4 |   |   | $ | (119.1 | ) |
| Total                                     |                    |                                                         |   | $                                                                 | (130.4 | )                       |                                       | $      | 119.1                                                                |   |                                                                            | Total |   |   |   | $ | 130.4 |   |   | $ | (119.1 | ) |

| Derivatives      inCash      Flow          |   | Amount      of Gain/(Loss)Recognized      in OCIon      Derivative |   | Location      ofGain/(Loss)Reclassified      from |   | Amount      of Gain/(Loss)Reclassified      fromAccumulated      OCIinto      Income |   | Location      ofGain/(Loss)Recognized      in Incomeon      Derivative(Ineffective      Portionand      Amount |   | Amount      of Gain/(Loss)Recognized      in Incomeon      Derivative (Ineffective      Portionand      AmountExcluded      from |
|--------------------------------------------|--------|--------------------------------------------------------------------|--------|---------------------------------------------------|--------|--------------------------------------------------------------------------------------|--------|----------------------------------------------------------------------------------------------------------------|--------|---------------------------------------------------------------------------------------------------------------------------------------|
| (Effective      Portion)                   |   | Accumulated      OCI                                               |   | (Effective      Portion)                          |   | Excluded      from                                                                   |   | Effectiveness      Testing)                                                                                    |
| Hedging                                    |   | Three      Months Ended                                            |   | into      Income                                  |   | Three      Months Ended                                                              |   | Effectiveness                                                                                                  |   | Three      Months Ended                                                                                                               |
| Relationships                              |   | 2009                                                               |   | 2008                                              |   | (Effective      Portion)                                              |   | 2009                                                                                                           |   | 2008                                                                                                                                  |   | Testing) |   | 2009 |   | 2008 |
| Energy      Commodity Derivative Contracts |   | $                                                                  | 15.9   |                                              |   | $                                                                                    | (219.8 | )                                                                                                              |   | Revenues-Natural      Gas Sales                                                                                                  |   | $ | 0.5 |   |   | $ | — |   |   | Revenues |   | $ | — |   |   | $ | — |   |
|                                       |   |                                                               |   |                                              |   |                                                                                 |   |                                                                                                           |   | Revenues-Product      Sales and Other                                                                                                 |   |   | 20.1 |   |   |   | (115.3 | ) |   |   |   |   |   |   |   |   |   |   |
|                                       |   |                                                               |   |                                              |   |                                                                                 |   |                                                                                                           |   | Gas      Purchases and Other Costs of Sales                                                                                           |   |   | (0.1 | ) |   |   | (0.2 | ) |   | Gas      Purchases and Other Costs of Sales |   |   | — |   |   |   | (1.6 | ) |
| Total                                      |   | $                                                                  | 15.9   |                                              |   | $                                                                                    | (219.8 | )                                                                                                              |   | Total                                                                                                                                 |   | $ | 20.5 |   |   | $ | (115.5 | ) |   | Total |   | $ | — |   |   | $ | (1.6 | ) |

|   Derivatives      in Net |   | Amount      of Gain/(Loss)Recognized      in OCIon      Derivative |   | Location      ofGain/(Loss)      Reclassified from |   | Amount      of Gain/(Loss)Reclassified      fromAccumulated      OCIinto      Income |   | Location      ofGain/(Loss)Recognized      in Incomeon      Derivative(Ineffective      Portionand      Amount |   | Amount      of Gain/(Loss)Recognized      in Incomeon      Derivative (Ineffective      Portion and Amount Excluded from |
|-------------------------------------|--------|--------------------------------------------------------------------|--------|----------------------------------------------------|--------|--------------------------------------------------------------------------------------|--------|----------------------------------------------------------------------------------------------------------------|--------|-------------------------------------------------------------------------------------------------------------------------------|
| (Effective      Portion)            |   |   Accumulated      OCI                                   |   | (Effective      Portion)                           |   | Excluded      from                                                                   |   | Effectiveness      Testing)                                                                                    |
| Investment      Hedging             |   | Three      Months Ended                                            |   | into      Income                                   |   | Three      Months Ended                                                              |   | Effectiveness                                                                                                  |   | Three      Months Ended                                                                                                       |
|   Relationships           |   | 2009                                                               |   | 2008                                               |   |    (Effective      Portion)                                           |   | 2009                                                                                                           |   | 2008                                                                                                                          |   | Testing) |   | 2009 |   | 2008 |
| Cross      Currency Swap Agreements |   | $                                                                  | (6.0   | )                                                  |   | $                                                                                    | 22.2   |                                                                                                           |   | Revenues-Natural      Gas Sales                                                                                          |   | $ | - |   |   | $ | - |   |   | Revenues |   | $ | - |   |   | $ | - |   |
| Total                               |   | $                                                                  | (6.0   | )                                                  |   | $                                                                                    | 22.2   |                                                                                                           |   | Total                                                                                                                         |   | $ | - |   |   | $ | - |   |   | Total |   | $ | - |   |   | $ | - |   |

| Derivatives      NotDesignated      as     |   | Location      of Gain/(Loss)Recognized      in |   | Amount      of Gain/(Loss)Recognized      in Incomeon      Derivative |
|--------------------------------------------|--------|------------------------------------------------|--------|-----------------------------------------------------------------------|
|                                       |   | Three      Months Ended                        |
| Hedging      Contracts                     |   | Income      on Derivative                      |   | 2009                                                                  |   | 2008 |
| Energy      commodity derivative contracts |   | Gas      Purchases and Other Costs of Sales    |   | $                                                                     | (0.4 | ) |   | $ | — |   |
| Total                                      |   |                                           |   | $                                                                     | (0.4 | ) |   | $ | — |   |

----

|                                       | Asset      Position |
|--------------------------------------------|---------------------|
| Interest      Rate Swap Agreements         | $                   | 475.7 |   |
| Energy      Commodity Derivative Contracts |                | 194.5 |   |
| Cross      Currency Swap Agreements        |                | 26.0 |   |
| Gross      Exposure                        |                | 696.2 |   |
| Netting      Agreement Impact              |                | (127.5 | ) |
| Net      Exposure                          | $                   | 568.7 |   |

| Credit Ratings      Downgraded1                             |   | IncrementalObligations |   | CumulativeObligations2 |
|-------------------------------------------------------------|--------|------------------------|--------|------------------------|
| One      Level to BBB-/Baa3                                 |   | $                      | 75.9   |                   |   | $ | 79.2 |   |
| Two      Levels to Below BBB-/Baa3 (Below Investment Grade) |   | $                      | 57.8   |                   |   | $ | 137.0 |   |

| 1 | If      there are split ratings among the independent credit rating agencies, most      counterparties use the higher credit rating to determine our incremental      collateral obligations, while the remaining use the lower credit rating.      Therefore, a one level downgrade to BBB-/Baa3 by one agency would not      trigger the entire $75.9 million incremental  obligation. |
|---|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 2 | Includes      current posting at currentrating. |
|---|-------------------------------------------------|

----

| Fair      Value |
|-----------------|

|   | · | Level      1 Inputs—quoted prices (unadjusted) in active markets for identical assets      or liabilities that the reporting entity has the ability to access at the      measurement date; |
|--------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | Level      2 Inputs—inputs other than quoted prices included within Level 1 that are      observable for the asset or liability, either directly or indirectly. If      the asset or liability has a specified (contractual) term, a Level 2 input      must be observable for substantially the full term of the asset or      liability; and |
|--------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | Level      3 Inputs—unobservable inputs for the asset or liability. These      unobservable inputs reflect the entity’s own assumptions about the      assumptions that market participants would use in pricing the asset or      liability, and are developed based on the best information available in      the circumstances (which might include the reporting entity’s own      data). |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|                                              | Asset      Fair Value Measurements Using |
|---------------------------------------------------|------------------------------------------|
|                                              | Total                                    |   | Quoted      Prices inActive      Marketsfor      IdenticalAssets      (Level 1) |   | Significant      OtherObservableInputs      (Level 2) |   | SignificantUnobservableInputs      (Level 3) |
| As      of March 31, 2009                         | (In      millions)                       |
| Energy      Commodity Derivative Contracts1       | $                                        | 194.5 |   |   | $ | 0.1 |   |   | $ | 126.5 |   |   | $ | 67.9 |   |   |
| Interest      Rate Swap Agreements                | $                                        | 475.7 |   |   | $ | - |   |   | $ | 475.7 |   |   | $ | - |   |   |
| Cross      Currency Interest Rate Swap Agreements | $                                        | 26.0 |   |   | $ | - |   |   | $ | 26.0 |   |   | $ | - |   |   |
|                                              |                                     |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| As      of December 31, 2008                      |                                     |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Energy      Commodity Derivative Contracts2       | $                                        | 164.2 |   |   | $ | 0.1 |   |   | $ | 108.9 |   |   | $ | 55.2 |   |   |
| Interest      Rate Swap Agreements                | $                                        | 747.1 |   |   | $ | - |   |   | $ | 747.1 |   |   | $ | - |   |   |
| Cross      Currency Interest Rate Swap Agreements | $                                        | 32.0 |   |   | $ | - |   |   | $ | 32.0 |   |   | $ | - |   |   |

----

|                                        | Liability      Fair Value Measurements Using |
|---------------------------------------------|----------------------------------------------|
|                                        | Total                                        |   | Quoted      Prices inActive      Marketsfor      IdenticalAssets      (Level 1) |   | Significant      OtherObservableInputs      (Level 2) |   | SignificantUnobservableInputs      (Level 3) |
| As      of March 31, 2009                   | (In      millions)                           |
| Energy      Commodity Derivative Contracts3 | $                                            | (234.0 | ) |   | $ | - |   |   | $ | (219.5 | ) |   | $ | (14.5 | ) |   |
| Interest      Rate Swap Agreements          | $                                            | (3.4 | ) |   | $ | - |   |   | $ | (3.4 | ) |   | $ | - |   |   |
|                                        |                                         |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| As      of December 31, 2008                |                                         |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Energy      Commodity Derivative Contracts4 | $                                            | (221.7 | ) |   | $ | - |   |   | $ | (210.6 | ) |   | $ | (11.1 | ) |   |
| Interest      Rate Swap Agreements          | $                                            | - |   |   | $ | - |   |   | $ | - |   |   | $ | - |   |   |

| 1 | Level      1 consists primarily of NYMEX natural gas futures. Level 2 consists      primarily of OTC West Texas Intermediate hedges and NYMEX natural gas      futures. Level 3 consists primarily of West Texas Sour hedges, natural gas      basis swaps and West Texas Intermediateoptions. |
|---|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 2 | Level      1 consists primarily of NYMEX natural gas futures. Level 2 consists      primarily of OTC West Texas Intermediate hedges and OTC natural gas hedges      that are settled on NYMEX. Level 3 consists primarily of West Texas      Intermediate options and West Texas Sourhedges. |
|---|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 3 | Level      2 consists primarily of OTC West Texas Intermediate hedges. Level 3      consists primarily of West Texas Sour hedges, natural gas basis swaps and      West Texas Intermediateoptions. |
|---|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 4 | Level      2 consists primarily of OTC West Texas Intermediate hedges. Level 3      consists primarily of natural gas basis swaps, natural gas options and      West Texas Intermediateoptions. |
|---|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|                                                                                        | Three      Months Ended March 31, |
|---------------------------------------------------------------------------------------------|-----------------------------------|
|                                                                                        | 2009                              |   | 2008 |
|                                                                                        | (In      millions)                |
| Net      Asset (Liability)                                                                  |                              |   |   |   |   |   |   |
| Beginning      of Period Balance                                                            | $                                 | 44.1 |   |   | $ | (100.3 | ) |
| Realized      and Unrealized Net Losses                                                     |                              | 6.3 |   |   |   | (44.8 | ) |
| Purchases      and Settlements                                                              |                              | 3.0 |   |   |   | 21.3 |   |
| End      of Period Balance                                                                  | $                                 | 53.4 |   |   | $ | (123.8 | ) |
| Change      in Unrealized Net Losses Relating to Contracts Still Held at End of      Period | $                                 | (14.5 | ) |   | $ | (37.7 | ) |

|                           | Three      Months Ended March 31, |
|--------------------------------|-----------------------------------|
|                           | 2009                              |   | 2008 |
|                           | (In      millions)                |
| Service      Cost              | $                                 | 1.2 |   |   | $ | 2.8 |   |
| Interest      Cost             |                              | 3.9 |   |   |   | 3.6 |   |
| Expected      Return on Assets |                              | (3.9 | ) |   |   | (5.8 | ) |
| Amortization      of Net Loss  |                              | 2.1 |   |   |   | - |   |
| Net      Periodic Pension Cost | $                                 | 3.3 |   |   | $ | 0.6 |   |

----

|                                     | Three      Months Ended March 31, |
|------------------------------------------|-----------------------------------|
|                                     | 2009                              |   | 2008 |
|                                     | (In      millions)                |
| Service      Cost                        | $                                 | 0.1 |   |   | $ | 0.1 |   |
| Interest      Cost                       |                              | 1.2 |   |   |   | 1.1 |   |
| Expected      Return on Assets           |                              | (1.2 | ) |   |   | (1.6 | ) |
| Amortization      of Net Loss (Gain)     |                              | 0.1 |   |   |   | (0.1 | ) |
| Net      Periodic Pension Cost (Benefit) | $                                 | 0.2 |   |   | $ | (0.5 | ) |

----

----

----

|   | · | FERC      Docket No. OR92-8, et al.—Complainants/Protestants: Chevron, Navajo, ARCO,      BP WCP, Western Refining, ExxonMobil, Tosco, and Texaco (Ultramar is an      intervenor)—Defendant: SFPP; FERC Docket      No. OR92-8-025—Complainants/Protestants: BP WCP; ExxonMobil; Chevron;      ConocoPhillips; and Ultramar—Defendant: SFPP—Subject: Complaints against      East Line and West Line rates and Watson Station Drain-Dry      Charge; |
|--------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | FERC      Docket No. OR96-2, et al.—Complainants/Protestants: All Shippers except      Chevron (which is an intervenor)—Defendant: SFPP—Subject: Complaints      against all SFPP rates; |
|--------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | FERC      Docket Nos. OR02-4 and OR03-5—Complainant/Protestant: Chevron—Defendant:      SFPP; FERC Docket No. OR04-3—Complainants/Protestants: America West      Airlines, Southwest Airlines, Northwest Airlines, and Continental      Airlines—Defendant: SFPP; FERC Docket Nos. OR03-5, OR05-4 and      OR05-5—Complainants/Protestants: BP WCP, ExxonMobil, and ConocoPhillips      (other shippers intervened)—Defendant: SFPP—Subject: Complaints against      all SFPP rates; OR02-4 was dismissed and Chevron appeal pending at U.S.      Court of Appeals for D.C. Circuit, referred to in this report as D.C.      Circuit; |
|--------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | FERC      Docket Nos. OR07-1 & OR07-2—Complainant/Protestant: Tesoro—Defendant:      SFPP—Subject: Complaints against North Line and West Line rates; held in      abeyance; |
|--------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | FERC      Docket Nos. OR07-3 & OR07-6—Complainants/Protestants: BP WCP, Chevron,      ConocoPhillips; ExxonMobil, Tesoro, and Valero Marketing—Defendant:      SFPP—Subject: Complaints against 2005 and 2006 indexed rate increases;      dismissed by FERC; appeal pending at D.C.  Circuit; |
|--------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | FERC      Docket No. OR07-4—Complainants/Protestants: BP WCP, Chevron, and      ExxonMobil—Defendants: SFPP, Kinder Morgan G.P., Inc., and Knight      Inc.—Subject: Complaints against all SFPP rates; held in abeyance;      complaint withdrawn as to SFPP’saffiliates; |
|--------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | FERC      Docket Nos. OR07-5 and OR07-7 (consolidated) and      IS06-296—Complainants/Protestants: ExxonMobil and Tesoro—Defendants:      Calnev, Kinder Morgan G.P., Inc., and Knight Inc —Subject: Complaints and      protest against Calnev rates; OR07-5 and IS06-296 were settled in      2008; |
|--------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | FERC      Docket Nos. OR07-8 and OR07-11 (consolidated)—Complainants/Protestants: BP      WCP and ExxonMobil —Defendant: SFPP—Subject: Complaints against SFPP 2005      index rates; settled in 2008; |
|--------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | FERC      Docket No. OR07-9—Complainant/Protestant: BP WCP—Defendant: SFPP—Subject:      Complaint against ultra low sulfur diesel surcharge; dismissed by FERC; BP      WCP appeal dismissed by D.C.Circuit; |
|--------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | FERC      Docket No. OR07-14—Complainants/Protestants: BP WCP and      Chevron—Defendants: SFPP, Calnev, and several affiliates—Subject:      Complaint against cash management practices; dismissed by      FERC; |
|--------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | FERC      Docket No. OR07-16—Complainant/Protestant: Tesoro—Defendant:      Calnev—Subject: Complaint against Calnev 2005, 2006 and 2007 indexed rate      increases; dismissed by FERC; Tesoro appeal dismissed by D.C.      Circuit; |
|--------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | FERC      Docket Nos. OR07-18, OR07-19 & OR07-22—Complainants/Protestants:      Airline Complainants, BP WCP, Chevron, ConocoPhillips and Valero      Marketing—Defendant: Calnev—Subject: Complaints against Calnev rates;      complaint amendments pending beforeFERC; |
|--------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | FERC      Docket No. OR07-20—Complainant/Protestant: BP WCP—Defendant: SFPP—Subject:      Complaint against 2007 indexed rate increases; dismissed by FERC; appeal      pending at D.C. Circuit; |
|--------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | FERC      Docket Nos. OR08-13 & OR08-15—Complainants/Protestants: BP WCP and      ExxonMobil—Defendant: SFPP—Subject: Complaints against all SFPP rates and      2008 indexed rate increases; |
|--------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|   | · | FERC      Docket No. IS05-230 (North Line rate case)—Complainants/Protestants:      Shippers—Defendant: SFPP—Subject: SFPP filing to increase North Line rates      to reflect expansion; initial decision issued; pending at      FERC; |
|--------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | FERC      Docket No. IS05-327—Complainants/Protestants: Shippers—Defendant:      SFPP—Subject: 2005 indexed rate increases; protests dismissed by FERC;      appeal dismissed by D.C. Circuit; |
|--------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | FERC      Docket Nos. IS06-283, IS06-356, IS08-28 and      IS08-302—Complainants/Protestants: Shippers—Defendant: SFPP—Subject: East      Line expansion rate increases;settled; |
|--------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | FERC      Docket Nos. IS06-356, IS07-229 and IS08-302—Complainants/Protestants:      Shippers—Defendant: SFPP—Subject: 2006, 2007 and 2008 indexed rate      increases; protests dismissed by FERC; East Line rates resolved by East      Line settlement; |
|--------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | FERC      Docket No. IS07-137—Complainants/Protestants: Shippers—Defendant:      SFPP—Subject: ULSD surcharge; settlement pending with  FERC; |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | FERC      Docket No. IS07-234—Complainants/Protestants: BP WCP and      ExxonMobil—Defendant: Calnev—Subject: 2007 indexed rate increases;      protests dismissed by FERC; |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | FERC      Docket No. IS08-390—Complainants/Protestants: BP WCP, ExxonMobil,      ConocoPhillips, Valero, Chevron, the Airlines—Defendant: SFPP—Subject:      West Line rate increase; and |
|--------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | Motions      to compel payment of interim damages (various      dockets)—Complainants/Protestants: Shippers—Defendants: SFPP, Kinder      Morgan G.P., Inc., and Knight Inc.; Motion for resolution on the merits      (various dockets)—Complainants/Protestants: BP WCP and      ExxonMobil—Defendant: SFPP andCalnev. |
|--------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

----

----

----

----

----

----

----

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SFAS No. 142
, Goodwill and Other IntangibleAssets. Forus, this Staff Position was effective January 1, 2009, and the adoption of thisStaff Position did not have a material impact on our consolidated financialstatements.

----

----

Item 2.  Management’s Discussion and Analysis ofFinancial Condition and Results of Operations.

----

|                                                                                                                                           | Three      Months Ended March 31,      |   | Increase/(Decrease)Change      from 2008 |
|------------------------------------------------------------------------------------------------------------------------------------------------|----------------------------------------|--------|------------------------------------------|
|                                                                                                                                           | 2009                                   |   | 2008                                     |   | Dollars |   | Percent |
|                                                                                                                                           | (In      millions, except percentages) |
| Segment      Earnings before Depreciation, Depletion and Amortization Expense and      Amortization of Excess Cost of Equity Investments1 |                                   |   |                                     |   |   |   |   |   |   |   |   |   |   |   |   |
| NGPL      PipeCo LLC      2                                                                                                                    | $                                      | 12.3   |                                     |   |   | 96.0 |   |   | $ | (83.7 | ) |   |   | (87 | )% |
| Power                                                                                                                                          |                                   | 1.1    |                                     |   |   | 2.1 |   |   |   | (1.0 | ) |   |   | (48 | )% |
| Products      Pipelines–KMP3                                                                                                             |                                   | 145.4  |                                     |   |   | 140.2 |   |   |   | 5.2 |   |   |   | 4 | % |
| Natural      Gas Pipelines–KMP4                                                                                                          |                                   | 200.0  |                                     |   |   | 188.4 |   |   |   | 11.6 |   |   |   | 6 | % |
| CO2–KMP5                                                                                                                                 |                                   | 191.7  |                                     |   |   | 233.3 |   |   |   | (41.6 | ) |   |   | (18 | )% |
| Terminals–KMP6                                                                                                                           |                                   | 134.3  |                                     |   |   | 125.8 |   |   |   | 8.5 |   |   |   | 7 | % |
| Kinder      Morgan Canada–KMP7                                                                                                           |                                   | 19.5   |                                     |   |   | 34.6 |   |   |   | (15.1 | ) |   |   | (44 | )% |
| Segment      Earnings before DD&A                                                                                                          |                                   | 704.3  |                                     |   |   | 820.4 |   |   |   | (116.1 | ) |   |   | (14 | )% |
| Depreciation,      Depletion and Amortization Expense                                                                                          |                                   | (264.8 | )                                        |   |   | (218.1 | ) |   |   | (46.7 | ) |   |   | (21 | )% |
| Amortization      of Excess Cost of Equity Investments                                                                                         |                                   | (1.4   | )                                        |   |   | (1.4 | ) |   |   | - |   |   |   | - | % |
| Other      Operating Income                                                                                                                    |                                   | 11.5   |                                     |   |   | - |   |   |   | 11.5 |   |   |   | NA |   |
| General      and Administrative Expense                                                                                                        |                                   | (92.9  | )                                        |   |   | (86.3 | ) |   |   | (6.6 | ) |   |   | (8 | )% |
| Interest      and Other, Net                                                                                                                   |                                   | (150.3 | )                                        |   |   | (204.5 | ) |   |   | 54.2 |   |   |   | 27 | % |
| Income      from Continuing Operations before Income Taxes1                                                                                    |                                   | 206.4  |                                     |   |   | 310.1 |   |   |   | (103.7 | ) |   |   | (33 | )% |
| Income      Taxes1                                                                                                                             |                                   | (61.3  | )                                        |   |   | (78.1 | ) |   |   | 16.8 |   |   |   | 22 | % |
| Income      from Continuing Operations                                                                                                         |                                   | 145.1  |                                     |   |   | 232.0 |   |   |   | (86.9 | ) |   |   | (37 | )% |
| Loss      from Discontinued Operations, Net of Tax                                                                                             |                                   | (0.2   | )                                        |   |   | (0.1 | ) |   |   | (0.1 | ) |   |   | (100 | )% |
| Net      Income                                                                                                                                |                                   | 144.9  |                                     |   |   | 231.9 |   |   |   | (87.0 | ) |   |   | (38 | )% |
| Net      Income Attributable to Noncontrolling Interests                                                                                       |                                   | (29.6  | )                                        |   |   | (126.2 | ) |   |   | 96.6 |   |   |   | 77 | % |
| Net      Income Attributable to Knight Inc.’s Stockholder                                                                                | $                                      | 115.3  |                                     |   | $ | 105.7 |   |   | $ | 9.6 |   |   |   | 9 | % |

| 1 | Kinder      Morgan Energy Partners’ income taxes of $19.3 million and $9.0 million for      the three months ended March 31, 2009 and 2008, respectively, are included      in segment earnings. |
|---|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 2 | Effective      February 15, 2008, we sold an 80% ownership interest in NGPL PipeCo LLC to      Myria Acquisition Inc. (“Myria”). As a result of the sale, beginning      February 15, 2008, we account for our 20% ownership interest in NGPL      PipeCo LLC as an equity methodinvestment. |
|---|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 3 | 2009      and 2008 amounts include decreases in income of $0.6 million and $0.8      million, respectively, resulting from unrealized foreign currency losses      on long-term debt transactions. |
|---|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 4 | 2009      amount includes a $1.3 million decrease in income resulting from      unrealized mark to market gains and losses due to the discontinuance of      hedge accounting at Casper Douglas. 2008 amount includes a $0.2 million      increase in segment earnings resulting from valuation adjustments related      to derivative contracts in place at the time of the Going Private      transaction and recorded in the application of the purchase method of      accounting. 2009 amount includes a $0.8 million decrease in segment      earnings related to assets sold, which had been revalued as part of the      Going Private transaction and recorded in the application of the purchase      method of accounting. |
|---|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 5 | 2009      and 2008 amounts include $24.3 million and $33.5 million, respectively,      increases in segment earnings resulting from valuation adjustments related      to derivative contracts in place at the time of the Going Private      transaction and recorded in the application of the purchase method of      accounting. |
|---|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 6 | 2009      amount includes a $0.4 million decrease in segment earnings related to      assets sold, which had been revalued as part of the Going Private      transaction and recorded in the application of the purchase method of      accounting. |
|---|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 7 | Includes      earnings of the Trans Mountain pipeline system, our interest in the      Express pipeline system and the Jet Fuel pipeline system. 2009 amount      includes a $14.9 million increase in expense primarily due to certain      non-cash regulatory accounting adjustments to the carrying amount of the      previously established deferred taxliability. |
|---|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|                                  | Three      Months Ended March 31, |
|---------------------------------------|-----------------------------------|
|                                  | 2009                              |   | 2008 |
|                                  | (In      millions)                |
| Segment      Earnings before DD&A | $                                 | 12.3 |   |   | $ | 96.0 |   |

|                                                 | Three      Months Ended March 31, |
|------------------------------------------------------|-----------------------------------|
|                                                 | 2009                              |   | 2008 |
|                                                 | (In      millions)                |
| Operating      Revenues                              | $                                 | 6.6 |   |   |   | 7.5 |   |
| Operating      Expenses and Noncontrolling Interests |                              | (5.5 | ) |   |   | (5.4 | ) |
| Segment      Earnings before DD&A                | $                                 | 1.1 |   |   |   | 2.1 |   |

----

|                                         | Three      Months Ended March 31, |
|----------------------------------------------|-----------------------------------|
|                                         | 2009                              |   | 2008 |
|                                         | (In      millions)                |
| Operating      Revenues                      | $                                 | 188.2 |   |   | $ | 198.3 |   |
| Operating      Expenses                      |                              | (49.0 | ) |   |   | (62.4 | ) |
| Other      Expense                           |                              | - |   |   |   | (0.1 | ) |
| Earnings      from Equity Investments        |                              | 3.5 |   |   |   | 4.8 |   |
| Interest      Income and Other Income, Net1  |                              | 2.8 |   |   |   | 0.5 |   |
| Income      Tax Benefit (Expense)            |                              | (0.1 | ) |   |   | (0.9 | ) |
| Segment      Earnings (Loss) Before DD&A | $                                 | 145.4 |   |   | $ | 140.2 |   |
|                                    |                              |   |   |   |   |   |   |
| Operating      Statistics (MMBbl)            |                              |   |   |   |   |   |   |
| Gasoline                                     |                              | 95.6 |   |   |   | 97.8 |   |
| Diesel      Fuel                             |                              | 35.5 |   |   |   | 38.6 |   |
| Jet      Fuel                                |                              | 26.8 |   |   |   | 29.7 |   |
| Total      Refined Product Volumes           |                              | 157.9 |   |   |   | 166.1 |   |
| Natural      Gas Liquids                     |                              | 4.8 |   |   |   | 6.9 |   |
| Total      Delivery Volumes2                 |                              | 162.7 |   |   |   | 173.0 |   |

| 1 | 2009      and 2008 amounts include decreases in income of $0.6 million and $0.8      million, respectively, resulting from unrealized foreign currency losses      on long-term debt transactions. |
|---|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 2 | Includes      Pacific, Plantation, Calnev, Central Florida, Cochin and Cypress pipeline      volumes. |
|---|-------------------------------------------------------------------------------------------------------|

|                                    | EBDAIncrease/(Decrease)                |   | RevenuesIncrease/(Decrease) |
|-----------------------------------------|----------------------------------------|--------|-----------------------------|
|                                    | (In      millions, except percentages) |
| West      Coast Terminals               | $                                      | 5.7    |                        |   | 50 | % |   | $ | 4.6 |   |   | 26 | % |
| Central      Florida Pipeline           |                                   | 2.5    |                        |   | 25 | % |   |   | 3.1 |   |   | 26 | % |
| Cochin      Pipeline System             |                                   | 1.1    |                        |   | 11 | % |   |   | (3.7 | ) |   | (26 | )% |
| Plantation      Pipeline                |                                   | (2.1   | )                           |   | (18 | )% |   |   | (6.1 | ) |   | (55 | )% |
| Pacific      Operations                 |                                   | (1.1   | )                           |   | (2 | )% |   |   | (4.9 | ) |   | (5 | )% |
| All      Other (Including Eliminations) |                                   | (1.1   | )                           |   | (3 | )% |   |   | (3.1 | ) |   | (6 | )% |
| Total      Products Pipelines           | $                                      | 5.0    |                        |   | 4 | % |   | $ | (10.1 | ) |   | (5 | )% |

----

|                                       | Three      Months Ended March 31, |
|--------------------------------------------|-----------------------------------|
|                                       | 2009                              |   | 2008 |
|                                       | (In      millions)                |
| Operating      Revenues                    | $                                 | 1,051.7 |   |   | $ | 1,912.5 |   |
| Operating      Expenses1                   |                              | (890.5 | ) |   |   | (1,744.9 | ) |
| Other      Expense2                        |                              | (0.8 | ) |   |   | - |   |
| Earnings      from Equity Investments      |                              | 26.6 |   |   |   | 23.5 |   |
| Interest      Income and Other Income, Net |                              | 14.7 |   |   |   | 0.2 |   |
| Income      Tax Expense                    |                              | (1.7 | ) |   |   | (2.9 | ) |
| Segment      Earnings before DD&A      | $                                 | 200.0 |   |   | $ | 188.4 |   |
|                                  |                              |   |   |   |   |   |   |
| Operating      Statistics (Trillion Btus)  |                              |   |   |   |   |   |   |
| Natural      Gas Transport Volumes3        |                              | 545.2 |   |   |   | 495.4 |   |
| Natural      Gas Sales Volumes4            |                              | 203.7 |   |   |   | 215.0 |   |

| 1 | 2009      amount includes a $1.3 million decrease in income resulting from      unrealized mark to market gains and losses due to the discontinuance of      hedge accounting at Casper Douglas. 2008 amount includes a $0.2 million      increase in segment earnings resulting from valuation adjustments related      to derivative contracts in place at the time of the Going Private      transaction and recorded in the application of the purchase method of      accounting. |
|---|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 2 | 2009      amount includes a $0.8 million decrease in segment earnings related to      assets sold, which had been revalued as part of the Going Private      transaction and recorded in the application of the purchase method of      accounting. |
|---|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 3 | Includes      Kinder Morgan Interstate Gas Transmission LLC, Trailblazer Pipeline      Company LLC, TransColorado Gas Transmission Company LLC, Rockies Express      Pipeline LLC, and Texas intrastate natural gas pipeline group      volumes. |
|---|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 4 | Represents      Texas intrastate natural gas pipeline group  volumes. |
|---|-----------------------------------------------------------------------|

----

|                                             | EBDAIncrease/(Decrease)                |   | RevenuesIncrease/(Decrease) |
|--------------------------------------------------|----------------------------------------|--------|-----------------------------|
|                                             | (In      millions, except percentages) |
| Kinder      Morgan Louisiana Pipeline            | $                                      | 8.6    |                        |   | NA |   |   | $ | - |   |   | NA |   |
| Rockies      Express Pipeline                    |                                   | 4.7    |                        |   | 31 | % |   |   | - |   |   | NA |   |
| Kinder      Morgan Interstate Gas Transmission   |                                   | 4.2    |                        |   | 16 | % |   |   | 1.4 |   |   | 4 | % |
| Texas      Intrastate Natural Gas Pipeline Group |                                   | (1.8   | )                           |   | (2 | )% |   |   | (841.2 | ) |   | (47 | )% |
| Thunder      Creek                               |                                   | (1.2   | )                           |   | (100 | )% |   |   | - |   |   | NA |   |
| All      Others                                  |                                   | (0.6   | )                           |   | (2 | )% |   |   | (23.4 | ) |   | (34 | )% |
| Intrasegment      Eliminations                   |                                   | -      |                        |   | NA |   |   |   | 2.4 |   |   | 91 | % |
| Total      Natural Gas Pipelines                 | $                                      | 13.9   |                        |   | 7 | % |   | $ | (860.8 | ) |   | (45 | )% |

----

|                                                                      | Three      Months Ended March 31, |
|---------------------------------------------------------------------------|-----------------------------------|
|                                                                      | 2009                              |   | 2008 |
|                                                                      | (In      millions)                |
| Operating      Revenues1                                                  | $                                 | 253.2 |   |   | $ | 319.9 |   |
| Operating      Expenses                                                   |                              | (66.6 | ) |   |   | (90.7 | ) |
| Earnings      from Equity Investments                                     |                              | 5.8 |   |   |   | 5.6 |   |
| Other      Income, Net                                                    |                              | - |   |   |   | (0.2 | ) |
| Income      Tax Benefit (Expense)                                         |                              | (0.7 | ) |   |   | (1.3 | ) |
| Segment      Earnings before DD&A                                     | $                                 | 191.7 |   |   | $ | 233.3 |   |
|                                                                 |                              |   |   |   |   |   |   |
| Operating      Statistics                                                 |                              |   |   |   |   |   |   |
| Carbon      Dioxide Delivery Volumes(Bcf)2                                |                              | 212.8 |   |   |   | 180.2 |   |
| SACROC      Oil Production (Gross)(MBbl/d)3                               |                              | 30.0 |   |   |   | 27.3 |   |
| SACROC      Oil Production (Net)(MBbl/d)4                                 |                              | 25.0 |   |   |   | 22.8 |   |
| Yates      Oil Production (Gross)(MBbl/d)3                                |                              | 26.5 |   |   |   | 28.6 |   |
| Yates      Oil Production (Net)(MBbl/d)4                                  |                              | 11.7 |   |   |   | 12.7 |   |
| Natural      Gas Liquids Sales Volumes (Net)(MBbl/d)4                     |                              | 8.9 |   |   |   | 9.5 |   |
| Realized      Weighted Average Oil Price per Bbl5,      6                 | $                                 | 43.85 |   |   | $ | 50.03 |   |
| Realized      Weighted Average Natural Gas Liquids Price per Bbl6,      7 | $                                 | 28.10 |   |   | $ | 65.93 |   |

| 1 | 2009      and 2008 amounts include $24.3 million and $33.5 million, respectively,      increases in segment earnings resulting from valuation adjustments related      to derivative contracts in place at the time of the Going Private      transaction and recorded in the application of the purchase method of      accounting. |
|---|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 2 | Includes      Cortez, Central Basin, Canyon Reef Carriers, Centerline and Pecos pipeline      volumes. |
|---|--------------------------------------------------------------------------------------------------------|

| 3 | Represents      100% of the production from the field. Kinder Morgan Energy Partners owns      an approximately 97% working interest in the SACROC unit and an      approximately 50% working interest in the Yates  unit. |
|---|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 4 | Net      to Kinder Morgan Energy Partners, after royalties and outside working      interests. |
|---|------------------------------------------------------------------------------------------------|

| 5 | Includes      all of Kinder Morgan Energy Partners’ crude oil production      properties. |
|---|-------------------------------------------------------------------------------------------------|

| 6 | Hedge      gains/losses for crude oil and natural gas liquids are included with crude      oil. |
|---|-------------------------------------------------------------------------------------------------|

| 7 | Includes      production attributable to leasehold ownership and production attributable      to Kinder Morgan Energy Partners’ ownership in processing plants and third      party processing agreements. |
|---|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|                                     | EBDAIncrease/(Decrease)                |   | RevenuesIncrease/(Decrease) |
|------------------------------------------|----------------------------------------|--------|-----------------------------|
|                                     | (In      millions, except percentages) |
| Sales      and Transportation Activities | $                                      | (6.7   | )                           |   | (10 | )% |   | $ | (6.0 | ) |   | (8 | )% |
| Oil      and Gas Producing Activities    |                                   | (25.7  | )                           |   | (19 | )% |   |   | (55.2 | ) |   | (24 | )% |
| Intrasegment      Eliminations           |                                   | -      |                        |   | N/A |   |   |   | 3.7 |   |   | 21 | % |
| Total                                    | $                                      | (32.4  | )                           |   | (16 | )% |   | $ | (57.5 | ) |   | (20 | )% |

----

----

|                                                 | Three      Months Ended March 31, |
|------------------------------------------------------|-----------------------------------|
|                                                 | 2009                              |   | 2008 |
|                                                 | (In      millions)                |
| Operating      Revenues                              | $                                 | 267.9 |   |   | $ | 280.2 |   |
| Operating      Expenses                              |                              | (133.6 | ) |   |   | (152.8 | ) |
| Other      Income1                                   |                              | 0.5 |   |   |   | 0.6 |   |
| Earnings      from Equity Investments                |                              | 0.1 |   |   |   | 1.0 |   |
| Interest      Income and Other Income (Expense), Net |                              | (0.1 | ) |   |   | 1.3 |   |
| Income      Tax Expense                              |                              | (0.5 | ) |   |   | (4.5 | ) |
| Segment      Earnings before DD&A                | $                                 | 134.3 |   |   | $ | 125.8 |   |
|                                            |                              |   |   |   |   |   |   |
| Operating      Statistics                            |                              |   |   |   |   |   |   |
| Bulk      Transload Tonnage (MMtons)2                |                              | 18.8 |   |   |   | 23.9 |   |
| Liquids      Leaseable Capacity (MMBbl)              |                              | 54.2 |   |   |   | 50.0 |   |
| Liquids      Utilization                             |                              | 97.3 | % |   |   | 97.5 | % |

| 1 | 2009      amount includes a $0.4 million decrease in segment earnings related to      assets sold, which had been revalued as part of the Going Private      transaction and recorded in the application of the purchase method of      accounting. |
|---|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 2 | Volumes      for acquired terminals are included for both  periods. |
|---|---------------------------------------------------------------------|

|                         | EBDA                                   |   | Revenues            |
|------------------------------|----------------------------------------|--------|---------------------|
|                         | Increase/(Decrease)                    |   | Increase/(Decrease) |
|                         | (In      millions, except percentages) |
| Mid-Atlantic                 | $                                      | 4.2    |                |   | 62 | % |   | $ | 3.8 |   |   | 19 | % |
| Texas      Petcoke           |                                   | 3.4    |                |   | 23 | % |   |   | (0.8 | ) |   | (2 | )% |
| Lower      River (Louisiana) |                                   | 3.3    |                |   | 41 | % |   |   | (2.9 | ) |   | (11 | )% |
| Northeast                    |                                   | 3.1    |                |   | 17 | % |   |   | 3.5 |   |   | 12 | % |
| West                         |                                   | 1.7    |                |   | 27 | % |   |   | 1.9 |   |   | 12 | % |
| Mid      River               |                                   | (3.0   | )                   |   | (44 | )% |   |   | (9.0 | ) |   | (41 | )% |
| Materials      Services      |                                   | (2.1   | )                   |   | (45 | )% |   |   | (4.6 | ) |   | (35 | )% |
| Southeast                    |                                   | (1.8   | )                   |   | (17 | )% |   |   | (4.7 | ) |   | (19 | )% |
| All      others              |                                   | (0.9   | )                   |   | (2 | )% |   |   | (2.0 | ) |   | (2 | )% |
| Total      Terminals         | $                                      | 7.9    |                |   | 6 | % |   | $ | (14.8 | ) |   | (5 | )% |

----

|                                       | Three      Months Ended March 31, |
|--------------------------------------------|-----------------------------------|
|                                       | 2009                              |   | 2008 |
|                                       | (In      millions)                |
| Operating      Revenues                    | $                                 | 50.0 |   |   |   | 43.9 |   |
| Operating      Expenses                    |                              | (15.2 | ) |   |   | (15.7 | ) |
| Other      Income                          |                              | - |   |   |   | 2.2 |   |
| Earnings      from Equity Investment       |                              | 0.3 |   |   |   | 3.6 |   |
| Interest      Income and Other Income, Net |                              | 0.7 |   |   |   | - |   |
| Income      Tax Benefit (Expense)1         |                              | (16.3 | ) |   |   | 0.6 |   |
| Segment      Earnings before DD&A      | $                                 | 19.5 |   |   |   | 34.6 |   |
|                                  |                              |   |   |   |   |   |   |
| Operating      Statistics                  |                              |   |   |   |   |   |   |
| Transport      Volumes (MMBbl)             |                              | 24.8 |   |   |   | 19.5 |   |

| 1 | 2009      amount includes a $14.9 million increase in expense primarily due to      certain non-cash regulatory accounting adjustments to the carrying amount      of the previously established deferred tax  liability. |
|---|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|                                                                          | Three      Months Ended March 31, |
|-------------------------------------------------------------------------------|-----------------------------------|
|                                                                          | 2009                              |   | 2008 |
|                                                                          | (In      millions)                |
| Knight      Inc. General and Administrative Expense                           | $                                 | 10.4 |   |   | $ | 9.5 |   |
| Kinder      Morgan Energy Partners General and    Administrative Expense |                              | 82.5 |   |   |   | 76.8 |   |
| Consolidated      General and Administrative Expense                          | $                                 | 92.9 |   |   | $ | 86.3 |   |

|                                                       | Three      Months Ended March 31, |
|------------------------------------------------------------|-----------------------------------|
|                                                       | 2009                              |   | 2008 |
|                                                       | (In      millions)                |
| Interest      Expense, Net                                 | $                                 | 141.5 |   |   | $ | 210.7 |   |
| Interest      Expense–Deferrable Interest Debentures |                              | 0.5 |   |   |   | (6.7 | ) |
| Other,      Net1                                           |                              | 8.3 |   |   |   | 0.5 |   |
| Consolidated      Interest and Other, Net1                 | $                                 | 150.3 |   |   | $ | 204.5 |   |

| 1 | “Other,      Net” represents offset to noncontrolling interests and interest income      shown above and included in segmentearnings. |
|---|---------------------------------------------------------------------------------------------------------------------------------------------------|

----

|                                                              | At      March 31, 2009    |   | At      April 30, 2009     |
|-------------------------------------------------------------------|---------------------------|--------|----------------------------|
|                                                              | Short-termDebtOutstanding |   | AvailableBorrowingCapacity |   | Short-termDebtOutstanding |   | AvailableBorrowingCapacity |
|                                                              | (In      millions)        |
| Credit      Facilities                                            |                      |   |                       |   |   |   |   |   |   |   |   |
| Knight      Inc.                                                  |                      |   |                       |   |   |   |   |   |   |   |   |
| $1.0      billion, six-year secured revolver, due May 2013        | $                         | 40.7   |                       | $ | 906.9 |   | $ | 133.1 |   | $ | 804.1 |
|                                                         |                      |   |                       |   |   |   |   |   |   |   |   |
| Kinder      Morgan Energy Partners                                |                      |   |                       |   |   |   |   |   |   |   |   |
| $1.85      billion, five-year unsecured revolver, due August 2010 | $                         | 439.8  |                       | $ | 1,056.9 |   | $ | 603.8 |   | $ | 872.9 |

----

----

|                                                      | Three      Months Ended March 31,      |   | Increase(Decrease) |   | %      |
|-----------------------------------------------------------|----------------------------------------|--------|--------------------|--------|--------|
|                                                      | 2009                                   |   | 2008               |   |   |
|                                                      | (In      millions, except percentages) |
| Net      Cash Provided by (Used in):                      |                                   |   |               |   |   |   |   |   |   |   |   |   |   |   |   |
| Operating      Activities                                 | $                                      | 213.3  |               |   | $      | 100.5 |   |   | $ | 112.8 |   |   |   | 112 | % |
| Investing      Activities                                 |                                   | (500.8 | )                  |   |   | 5,080.2 |   |   |   | (5,581.0 | ) |   |   | (110 | )% |
| Financing      Activities                                 |                                   | 280.3  |               |   |   | (5,155.6 | ) |   |   | 5,435.9 |   |   |   | 105 | % |
|                                                      |                                   |   |               |   |   |   |   |   |   |   |   |   |   |   |   |
| Effect      of Exchange Rate Changes on Cash              |                                   | (0.9   | )                  |   |   | (0.7 | ) |   |   | (0.2 | ) |   |   | (29 | )% |
|                                                      |                                   |   |               |   |   |   |   |   |   |   |   |   |   |   |   |
| Net      (Decrease) Increase in Cash and Cash Equivalents | $                                      | (8.1   | )                  |   | $      | 24.4 |   |   | $ | (32.5 | ) |   |   | (133 | )% |

----

|   | · | price      trends and overall demand for natural gas liquids, refined petroleum      products, oil, carbon dioxide, natural gas, electricity, coal and other      bulk materials and chemicals in NorthAmerica; |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | economic      activity, weather, alternative energy sources, conservation and      technological advances that may affect price trends and      demand; |
|--------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | changes      in tariff rates charged by our or those of Kinder Morgan Energy Partners’      pipeline subsidiaries implemented by the Federal Energy Regulatory      Commission, or other regulatory agencies or the California Public      Utilities Commission; |
|--------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | our      ability to acquire new businesses and assets and integrate those      operations into our existing operations, as well as the ability to expand      our facilities; |
|--------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | difficulties      or delays experienced by railroads, barges, trucks, ships or pipelines in      delivering products to or from Kinder Morgan Energy Partners’ terminals or      pipelines; |
|--------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|   | · | our      ability to successfully identify and close acquisitions and make      cost-saving changes in operations; |
|--------|--------|-------------------------------------------------------------------------------------------------------------------|

|   | · | shut-downs      or cutbacks at major refineries, petrochemical or chemical plants, ports,      utilities, military bases or other businesses that use our services or      provide services or products to us; |
|--------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | crude      oil and natural gas production from exploration and production areas that      we or Kinder Morgan Energy Partners serve, such as the Permian Basin area      of West Texas, the U.S. Rocky Mountains and the Alberta oil      sands; |
|--------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | changes      in laws or regulations, third-party relations and approvals and decisions      of courts, regulators and governmental bodies that may adversely affect      our business or ability to compete; |
|--------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | changes      in accounting pronouncements that impact the measurement of our results of      operations, the timing of when such measurements are to be made and      recorded, and the disclosures surrounding these  activities; |
|--------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | our      ability to offer and sell equity securities, and Kinder Morgan Energy      Partners’ ability to offer and sell equity securities and its ability to      sell debt securities or obtain debt financing in sufficient amounts to      implement that portion of our or Kinder Morgan Energy Partners’ business      plans that contemplates growth through acquisitions of operating      businesses and assets and expansions of  facilities; |
|--------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | our      indebtedness, which could make us vulnerable to general adverse economic      and industry conditions, limit our ability to borrow additional funds      and/or place us at competitive disadvantages compared to our competitors      that have less debt or have other adverse  consequences; |
|--------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | interruptions      of electric power supply to our facilities due to natural disasters, power      shortages, strikes, riots, terrorism, war or other  causes; |
|--------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | our      ability to obtain insurance coverage without significant levels of      self-retention of risk; |
|--------|--------|----------------------------------------------------------------------------------------------------------|

|   | · | acts      of nature, sabotage, terrorism or other similar acts causing damage      greater than our insurance coveragelimits; |
|--------|--------|-------------------------------------------------------------------------------------------------------------------------------|

|   | · | capital      and credit markets conditions, including availability of credit generally,      as well as inflation and interestrates; |
|--------|--------|--------------------------------------------------------------------------------------------------------------------------------------|

|   | · | the      political and economic stability of the oil producing nations of the      world; |
|--------|--------|-------------------------------------------------------------------------------------------|

|   | · | national,      international, regional and local economic, competitive and regulatory      conditions and developments; |
|--------|--------|-------------------------------------------------------------------------------------------------------------------------|

|   | · | our      ability to achieve cost savings and revenue  growth; |
|--------|--------|---------------------------------------------------------------|

|   | · | foreign      exchange fluctuations; |
|--------|--------|-------------------------------------|

|   | · | the      timing and extent of changes in commodity prices for oil, natural gas,      electricity and certain agriculturalproducts; |
|--------|--------|------------------------------------------------------------------------------------------------------------------------------------|

|   | · | the      extent of Kinder Morgan Energy Partners’ success in discovering,      developing and producing oil and gas reserves, including the risks      inherent in exploration and development drilling, well completion and      other development activities; |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | engineering      and mechanical or technological difficulties that Kinder Morgan Energy      Partners may experience with operational equipment, in well completions      and workovers, and in drilling newwells; |
|--------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | the      uncertainty inherent in estimating future oil and natural gas production      or reserves that Kinder Morgan Energy Partners may    experience; |
|--------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | the      ability to complete expansion projects on time and on    budget; |
|--------|--------|---------------------------------------------------------------------------|

|   | · | the      timing and success of Kinder Morgan Energy Partners’ and our business      development efforts; and |
|--------|--------|--------------------------------------------------------------------------------------------------------------------|

|   | · | unfavorable      results of litigation and the fruition of contingencies referred to in the      accompanying Notes to Consolidated Financial  Statements. |
|--------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------|

Item 3.  Quantitative andQualitative Disclosures about Market Risk.

----

Item 4.  Controls andProcedures.

PART II – OTHER INFORMATION

Item 1.     LegalProceedings.

Item 1A.   Risk Factors.

UnregisteredSales of Equity Securities and Use of Proceeds.

Item 3.     DefaultsUpon Senior Securities.

Item 4.     Submissionof Matters to a Vote of Security Holders.

Item 5.      OtherInformation.

Item 6.     Exhibits.

|   | · | may      have been used for the purpose of allocating risk between the parties      rather than establishing matters offact; |
|--------|--------|------------------------------------------------------------------------------------------------------------------------------|

|   | · | may      have been qualified by disclosures that were made to the other party in      connection with the negotiation of the applicable agreement, which      disclosures are not necessarily reflected in the  agreement; |
|--------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | may      apply standards of materiality in a way that is different from what may be      viewed as material to you or other readers;and |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------------|

|   | · | may      apply only as of the date of the applicable agreement or such other date      or dates as may be specified in the agreement and are subject to more      recent developments. |
|--------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|   |  4.1 | Certain      instruments with respect to the long-term debt of Knight Inc. and its      consolidated subsidiaries that relate to debt that does not exceed 10% of      the total assets of Knight Inc. and its consolidated subsidiaries are      omitted pursuant to Item 601(b) (4) (iii) (A) of Regulation S-K, 17 C.F.R.      sec.229.601. Knight Inc. hereby agrees to furnish supplementally to the      Securities and Exchange Commission a copy of each such instrument upon      request. |
|--------|-----------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | 31.1* | Section      13a – 14(a) / 15d – 14(a) Certification of Chief Executive      Officer |
|--------|-------|--------------------------------------------------------------------------------------------------|

|   | 31.2* | Section      13a – 14(a) / 15d – 14(a) Certification of Chief Financial      Officer |
|--------|-------|--------------------------------------------------------------------------------------------------|

|   | 32.1* | Section      1350 Certification of Chief ExecutiveOfficer |
|--------|-------|-----------------------------------------------------------|

|   | 32.2* | Section      1350 Certification of Chief FinancialOfficer |
|--------|-------|-----------------------------------------------------------|

----

SIGNATURE

|         | KNIGHT      INC.(Registrant)                                                                      |
|-------------------|-----------------------------------------------------------------------------------------------------------------------|
| May      13, 2009 | /s/      Kimberly A. Dang                                                                                             |
|              | Kimberly      A. DangVice      President and Chief Financial Officer(Principal      Financial and Accounting Officer) |

----