Table of Contents

----

----

| 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 |
|--------------------------------|--------------------------|-----------------------------------|----------------------------------|

----

KNIGHT INC. AND SUBSIDIARIES

Contents

|    |                                                              | PageNumber |
|--------------|-------------------------------------------------------------------|------------|
| PART I.      | FINANCIAL    INFORMATION                                          |       |
|         |                                                              |       |
| Item 1.      | 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                   | 8-57       |
|    |                                                              |       |
| Item 2.      | Management’s Discussion and Analysis of      Financial      |       |
|         | Condition and Results of      Operations.                         | 58-81      |
|    |                                                              |       |
| Item 3.      | Quantitative and Qualitative      Disclosures About Market Risk.  | 81         |
|    |                                                              |       |
| Item 4.      | Controls and      Procedures.                                     | 81         |
|    |                                                              |       |
| PART II.     | OTHER INFORMATION                                                 |       |
|    |                                                              |       |
| Item 1.      | Legal Proceedings.                                                | 82         |
|    |                                                              |       |
| Item 1A.     | Risk Factors.                                                     | 82-83      |
|    |                                                              |       |
| Item 2.      | Unregistered Sales of Equity Securities      and Use of Proceeds. | 83         |
|    |                                                              |       |
| Item 3.      | Defaults Upon Senior      Securities.                             | 83         |
|    |                                                              |       |
| Item 4.      | Submission of Matters to a Vote of      Security Holders.         | 83         |
|    |                                                              |       |
| Item 5.      | Other Information.                                                | 84         |
|    |                                                              |       |
| Item 6.      | Exhibits.                                                         | 84         |
|    |                                                              |       |
| SIGNATURE    | 85                                                                |

----

PART I. - FINANCIALINFORMATION

Item 1.  FinancialStatements.

CONSOLIDATED BALANCE SHEETS(Unaudited)

|                                                      | March      31,2008 |     | December      31,2007 |
|-----------------------------------------------------------|--------------------|----------|-----------------------|
| ASSETS:                                                   |               |     |                  |   |   |   |   |
| Current      Assets:                                      |               |     |                  |   |   |   |   |
| Cash      and Cash Equivalents                            | $                  | 173.0    |                  |   | $ | 148.6 |   |
| Restricted      Deposits                                  |               | 166.6    |                  |   |   | 67.9 |   |
| Accounts,      Notes and Interest Receivable, Net:        |               |     |                  |   |   |   |   |
| Trade                                                     |               | 1,082.3  |                  |   |   | 970.0 |   |
| Related      Parties                                      |               | 24.2     |                  |   |   | 5.2 |   |
| Inventories:                                              |               |     |                  |   |   |   |   |
| Product                                                   |               | 48.7     |                  |   |   | 19.5 |   |
| Materials      and Supplies                               |               | 18.8     |                  |   |   | 18.3 |   |
| Gas      Imbalances:                                      |               |     |                  |   |   |   |   |
| Trade                                                     |               | 19.5     |                  |   |   | 30.4 |   |
| Related      Party                                        |               | 6.3      |                  |   |   | (3.5 | ) |
| Assets      Held for Sale                                 |               | -        |                  |   |   | 3,353.3 |   |
| Other                                                     |               | 71.2     |                  |   |   | 73.9 |   |
|                                                      |               | 1,610.6  |                  |   |   | 4,683.6 |   |
|                                            |               |     |                  |   |   |   |   |
| Notes      Receivable – Related Parties             |               | 87.3     |                  |   |   | 87.9 |   |
|                                                 |               |     |                  |   |   |   |   |
| Investments                                               |               | 2,197.8  |                  |   |   | 1,996.2 |   |
|                                                 |               |     |                  |   |   |   |   |
| Goodwill                                                  |               | 8,592.3  |                  |   |   | 8,174.0 |   |
|                                            |               |     |                  |   |   |   |   |
| Other      Intangibles, Net                               |               | 306.6    |                  |   |   | 321.1 |   |
|                                                 |               |     |                  |   |   |   |   |
| Property,      Plant and Equipment, Net:                  |               |     |                  |   |   |   |   |
| Property,      Plant and Equipment                        |               | 15,620.6 |                  |   |   | 15,080.9 |   |
| Accumulated      Depreciation, Depletion and Amortization |               | (471.0   | )                     |   |   | (277.0 | ) |
|                                                      |               | 15,149.6 |                  |   |   | 14,803.9 |   |
|                                            |               |     |                  |   |   |   |   |
| Assets      Held for Sale, Non-current                    |               | -        |                  |   |   | 5,634.6 |   |
|                                                 |               |     |                  |   |   |   |   |
| Deferred      Charges and Other Assets                    |               | 496.0    |                  |   |   | 399.7 |   |
|                                                 |               |     |                  |   |   |   |   |
| Total      Assets                                         | $                  | 28,440.2 |                  |   | $ | 36,101.0 |   |

----

|                                                                                                    | March      31,2008 |     | December      31,2007 |
|---------------------------------------------------------------------------------------------------------|--------------------|----------|-----------------------|
| LIABILITIES      AND STOCKHOLDERS’ EQUITY:                                                        |               |     |                  |   |   |   |   |
| Current      Liabilities:                                                                               |               |     |                  |   |   |   |   |
| Current      Maturities of Long-term Debt                                                               | $                  | 275.7    |                  |   | $ | 79.8 |   |
| Notes      Payable                                                                                      |               | 366.7    |                  |   |   | 888.1 |   |
| Cash      Book Overdrafts                                                                               |               | 65.6     |                  |   |   | 30.7 |   |
| Accounts      Payable:                                                                                  |               |     |                  |   |   |   |   |
| Trade                                                                                                   |               | 1,022.9  |                  |   |   | 943.1 |   |
| Related      Parties                                                                                    |               | 1.2      |                  |   |   | 0.6 |   |
| Accrued      Interest                                                                                   |               | 99.7     |                  |   |   | 242.7 |   |
| Accrued      Taxes                                                                                      |               | 747.4    |                  |   |   | 728.2 |   |
| Gas      Imbalances                                                                                     |               | 19.4     |                  |   |   | 23.7 |   |
| Liabilities      Held for Sale                                                                          |               | -        |                  |   |   | 168.2 |   |
| Deferred      Revenue                                                                                   |               | 18.2     |                  |   |   | - |   |
| Other                                                                                                   |               | 872.1    |                  |   |   | 834.7 |   |
|                                                                                                    |               | 3,488.9  |                  |   |   | 3,939.8 |   |
|                                                                                                    |               |     |                  |   |   |   |   |
| Other      Liabilities and Deferred Credits:                                                            |               |     |                  |   |   |   |   |
| Deferred      Income Taxes, Non-current                                                                 |               | 1,852.9  |                  |   |   | 1,849.4 |   |
| Liabilities      Held for Sale, Non-current                                                             |               | -        |                  |   |   | 2,424.1 |   |
| Other                                                                                                   |               | 1,514.6  |                  |   |   | 1,454.8 |   |
|                                                                                                    |               | 3,367.5  |                  |   |   | 5,728.3 |   |
|                                                                                               |               |     |                  |   |   |   |   |
| Long-term      Debt:                                                                                    |               |     |                  |   |   |   |   |
| Outstanding      Notes and Debentures                                                                   |               | 9,842.7  |                  |   |   | 14,714.6 |   |
| Deferrable      Interest Debentures Issued to Subsidiary Trusts                                         |               | 35.7     |                  |   |   | 283.1 |   |
| Preferred      Interest in General Partner of Kinder Morgan Energy    Partners                          |               | 100.0    |                  |   |   | 100.0 |   |
| Value      of Interest Rate Swaps                                                                       |               | 294.1    |                  |   |   | 199.7 |   |
|                                                                                               |               | 10,272.5 |                  |   |   | 15,297.4 |   |
|                                                                                               |               |     |                  |   |   |   |   |
| Minority      Interests in Equity of Subsidiaries                                                       |               | 3,524.9  |                  |   |   | 3,314.0 |   |
|                                                                                               |               |     |                  |   |   |   |   |
| Stockholders’      Equity:                                                                        |               |     |                  |   |   |   |   |
| Common      Stock – Authorized and Outstanding – 100 Shares, Par Value $0.01 Per      Share |               | -        |                  |   |   | - |   |
| Additional      Paid-in Capital                                                                         |               | 7,808.1  |                  |   |   | 7,822.2 |   |
| Retained      Earnings                                                                                  |               | 352.7    |                  |   |   | 247.0 |   |
| Accumulated      Other Comprehensive Loss                                                               |               | (374.4   | )                     |   |   | (247.7 | ) |
| Total      Stockholders’ Equity                                                                   |               | 7,786.4  |                  |   |   | 7,821.5 |   |
|                                                                                               |               |     |                  |   |   |   |   |
| Total      Liabilities and Stockholders’ Equity                                                   | $                  | 28,440.2 |                  |   | $ | 36,101.0 |   |

----

CONSOLIDATED STATEMENTS OF OPERATIONS(Unaudited)

|                                                                  | SuccessorCompany                           |    |   | PredecessorCompany                         |
|-----------------------------------------------------------------------|--------------------------------------------|---------|--------|--------------------------------------------|
|                                                                  | Three      Months EndedMarch      31, 2008 |    |   | Three      Months EndedMarch      31, 2007 |
| Operating      Revenues:                                              |                                       |    |   |                                       |   |   |   |   |
| Natural      Gas Sales                                                | $                                          | 1,721.8 |   |                                       |   | $ | 1,417.9 |   |
| Transportation      and Storage                                       |                                       | 807.9   |   |                                       |   |   | 801.1 |   |
| Product      Sales and Other                                          |                                       | 365.3   |   |                                       |   |   | 225.4 |   |
| Total      Operating Revenues                                         |                                       | 2,895.0 |   |                                       |   |   | 2,444.4 |   |
|                                                             |                                       |    |   |                                       |   |   |   |   |
| Operating      Costs and Expenses:                                    |                                       |    |   |                                       |   |   |   |   |
| Gas      Purchases and Other Costs of Sales                           |                                       | 1,760.6 |   |                                       |   |   | 1,452.5 |   |
| Operations      and Maintenance                                       |                                       | 301.8   |   |                                       |   |   | 286.2 |   |
| General      and Administrative                                       |                                       | 86.3    |   |                                       |   |   | 110.4 |   |
| Depreciation,      Depletion and Amortization                         |                                       | 218.1   |   |                                       |   |   | 153.0 |   |
| Taxes,      Other Than Income Taxes                                   |                                       | 52.5    |   |                                       |   |   | 43.5 |   |
| Other      Income, Net                                                |                                       | (0.5    | )      |                                       |   |   | (2.2 | ) |
| Impairment      of Assets                                             |                                       | -       |   |                                       |   |   | 377.1 |   |
| Total      Operating Costs and Expenses                               |                                       | 2,418.8 |   |                                       |   |   | 2,420.5 |   |
|                                                             |                                       |    |   |                                       |   |   |   |   |
| Operating      Income                                                 |                                       | 476.2   |   |                                       |   |   | 23.9 |   |
|                                                             |                                       |    |   |                                       |   |   |   |   |
| Other      Income and (Expenses):                                     |                                       |    |   |                                       |   |   |   |   |
| Earnings      of Equity Investees                                     |                                       | 43.7    |   |                                       |   |   | 23.8 |   |
| Interest      Expense, Net                                            |                                       | (210.7  | )      |                                       |   |   | (144.1 | ) |
| Interest      Income (Expense) – Deferrable Interest Debentures |                                       | 6.7     |   |                                       |   |   | (5.5 | ) |
| Minority      Interests                                               |                                       | (126.2  | )      |                                       |   |   | (58.2 | ) |
| Other,      Net                                                       |                                       | 3.2     |   |                                       |   |   | 2.2 |   |
| Total      Other Income and (Expenses)                                |                                       | (283.3  | )      |                                       |   |   | (181.8 | ) |
|                                                             |                                       |    |   |                                       |   |   |   |   |
| Income      (Loss) from Continuing Operations Before Income Taxes     |                                       | 192.9   |   |                                       |   |   | (157.9 | ) |
| Income      Taxes                                                     |                                       | 87.1    |   |                                       |   |   | 87.7 |   |
| Income      (Loss) from Continuing Operations                         |                                       | 105.8   |   |                                       |   |   | (245.6 | ) |
| (Loss)      Income from Discontinued Operations, Net of Tax           |                                       | (0.1    | )      |                                       |   |   | 233.2 |   |
|                                                             |                                       |    |   |                                       |   |   |   |   |
| Net      Income (Loss)                                                | $                                          | 105.7   |   |                                       |   | $ | (12.4 | ) |

----

CONSOLIDATED STATEMENTS OF CASH FLOWS(Unaudited)

|                                                                                                | SuccessorCompany                          |    |   | PredecessorCompany                        |
|-----------------------------------------------------------------------------------------------------|-------------------------------------------|---------|--------|-------------------------------------------|
|                                                                                                | Three      MonthsEndedMarch      31, 2008 |    |   | Three      MonthsEndedMarch      31, 2007 |
| INCREASE      (DECREASE) IN CASH AND CASH EQUIVALENTS                                               |                                      |    |   |                                      |   |   |   |   |
| Cash      Flows From Operating Activities:                                                          |                                      |    |   |                                      |   |   |   |   |
| Net      Income (Loss)                                                                              | $                                         | 105.7   |   |                                      |   | $ | (12.4 | ) |
| Adjustments      to Reconcile Net Income to Net Cash Flows from Operating      Activities:          |                                      |    |   |                                      |   |   |   |   |
| Loss      (Income) from Discontinued Operations, Net of Tax                                         |                                      | 0.1     |   |                                      |   |   | (226.1 | ) |
| Loss      from Impairment of Assets                                                                 |                                      | -       |   |                                      |   |   | 377.1 |   |
| Loss      on Early Extinguishment of Debt                                                           |                                      | 18.4    |   |                                      |   |   | - |   |
| Depreciation,      Depletion and Amortization                                                       |                                      | 218.1   |   |                                      |   |   | 155.3 |   |
| Deferred      Income Taxes                                                                          |                                      | 15.9    |   |                                      |   |   | 7.5 |   |
| Equity      in Earnings of Equity Investees                                                         |                                      | (43.7   | )      |                                      |   |   | (24.4 | ) |
| Distributions      from Equity Investees                                                            |                                      | 24.1    |   |                                      |   |   | 46.2 |   |
| Minority      Interests in Income of Consolidated Subsidiaries                                      |                                      | 126.2   |   |                                      |   |   | 58.2 |   |
| Gains      from Property Casualty Indemnifications                                                  |                                      | -       |   |                                      |   |   | (1.8 | ) |
| Net      Gains on Sales of Assets                                                                   |                                      | (0.5    | )      |                                      |   |   | (2.5 | ) |
| Mark-to-Market      Interest Rate Swap Gain                                                         |                                      | (19.8   | )      |                                      |   |   | - |   |
| Changes      in Gas in Underground Storage                                                          |                                      | (28.0   | )      |                                      |   |   | (52.3 | ) |
| Changes      in Working Capital Items                                                               |                                      | (279.2  | )      |                                      |   |   | (51.2 | ) |
| (Payment      for) Proceeds from Termination of Interest Rate Swaps                                 |                                      | (2.5    | )      |                                      |   |   | 56.6 |   |
| Kinder      Morgan Energy Partners’ Rate Reparations, Refunds and Reserve      Adjustments    |                                      | (23.3   | )      |                                      |   |   | - |   |
| Other,      Net                                                                                     |                                      | (10.9   | )      |                                      |   |   | 14.9 |   |
| Net      Cash Flows Provided by Continuing Operations                                               |                                      | 100.6   |   |                                      |   |   | 345.1 |   |
| Net      Cash Flows (Used in) Provided by Discontinued Operations                                   |                                      | (0.1    | )      |                                      |   |   | 121.3 |   |
| Net      Cash Flows Provided by Operating Activities                                                |                                      | 100.5   |   |                                      |   |   | 466.4 |   |
|                                                                                           |                                      |    |   |                                      |   |   |   |   |
| Cash      Flows From Investing Activities:                                                          |                                      |    |   |                                      |   |   |   |   |
| Capital      Expenditures                                                                           |                                      | (638.3  | )      |                                      |   |   | (357.4 | ) |
| Proceeds      from Sale of 80% Interest in NGPL PipeCo LLC, Net of $1.1      Million Cash Sold |                                      | 2,899.3 |   |                                      |   |   | - |   |
| Proceeds      from NGPL PipeCo LLC Restricted Cash                                                  |                                      | 3,106.4 |   |                                      |   |   | - |   |
| Acquisitions                                                                                        |                                      | (0.3    | )      |                                      |   |   | (3.9 | ) |
| Net      Investments in Margin Deposits                                                             |                                      | (98.8   | )      |                                      |   |   | (48.8 | ) |
| Distributions      from Equity Investees                                                            |                                      | 89.1    |   |                                      |   |   | - |   |
| Other      Investments                                                                              |                                      | (336.5  | )      |                                      |   |   | (16.0 | ) |
| Change      in Natural Gas Storage and NGL Line Fill Inventory                                      |                                      | (2.7    | )      |                                      |   |   | 5.2 |   |
| Property      Casualty Indemnifications                                                             |                                      | -       |   |                                      |   |   | 8.0 |   |
| Net      Proceeds from Sales of Other Assets                                                        |                                      | 62.0    |   |                                      |   |   | 1.4 |   |
| Net      Cash Flows Provided by (Used in) Continuing Investing      Activities                      |                                      | 5,080.2 |   |                                      |   |   | (411.5 | ) |
| Net      Cash Flows Provided by Discontinued Investing Activities                                   |                                      | -       |   |                                      |   |   | 587.1 |   |
| Net      Cash Flows Provided by Investing Activities                                                | $                                         | 5,080.2 |   |                                      |   | $ | 175.6 |   |

----

|                                                              | SuccessorCompany                          |     |   | PredecessorCompany                        |
|-------------------------------------------------------------------|-------------------------------------------|----------|--------|-------------------------------------------|
|                                                              | Three      MonthsEndedMarch      31, 2008 |     |   | Three      MonthsEndedMarch      31, 2007 |
| INCREASE      (DECREASE) IN CASH AND CASH EQUIVALENTS             |                                      |     |   |                                      |   |   |   |   |
| Cash      Flows From Financing Activities:                        |                                      |     |   |                                      |   |   |   |   |
| Short-term      Debt, Net                                         | $                                         | (521.4   | )      |                                      |   | $ | (833.9 | ) |
| Long-term      Debt Issued                                        |                                      | 900.0    |   |                                      |   |   | 1,000.0 |   |
| Long-term      Debt Retired                                       |                                      | (5,859.9 | )      |                                      |   |   | (1.4 | ) |
| Discount      on Early Extinguishment of Debt                     |                                      | 69.2     |   |                                      |   |   | - |   |
| Increase      (Decrease) in Cash Book Overdrafts                  |                                      | 35.0     |   |                                      |   |   | (25.2 | ) |
| Common      Stock Issued                                          |                                      | -        |   |                                      |   |   | 4.8 |   |
| Excess      Tax Benefits from Share-based Payment Arrangements    |                                      | -        |   |                                      |   |   | 1.9 |   |
| Short-term      Advances From (To) Unconsolidated Affiliates      |                                      | (14.7    | )      |                                      |   |   | 3.2 |   |
| Cash      Dividends, Common Stock                                 |                                      | -        |   |                                      |   |   | (117.4 | ) |
| Minority      Interests, Contributions                            |                                      | 384.5    |   |                                      |   |   | - |   |
| Minority      Interests, Distributions                            |                                      | (143.5   | )      |                                      |   |   | (125.6 | ) |
| Debt      Issuance Costs                                          |                                      | (6.6     | )      |                                      |   |   | (7.9 | ) |
| Other,      Net                                                   |                                      | 1.8      |   |                                      |   |   | - |   |
| Net      Cash Flows Used in by Continuing Financing Activities    |                                      | (5,155.6 | )      |                                      |   |   | (101.5 | ) |
| Net      Cash Flows Provided by Discontinued Financing Activities |                                      | -        |   |                                      |   |   | 34.0 |   |
| Net      Cash Flows Used in Financing Activities                  |                                      | (5,155.6 | )      |                                      |   |   | (67.5 | ) |
|                                                         |                                      |     |   |                                      |   |   |   |   |
| Effect      of Exchange Rate Changes on Cash                      |                                      | (0.7     | )      |                                      |   |   | 0.2 |   |
|                                                         |                                      |     |   |                                      |   |   |   |   |
| Cash      Balance Included in Assets Held for Sale                |                                      | -        |   |                                      |   |   | (14.1 | ) |
|                                                         |                                      |     |   |                                      |   |   |   |   |
| Net      Increase in Cash and Cash Equivalents                    |                                      | 24.4     |   |                                      |   |   | 560.6 |   |
| Cash      and Cash Equivalents at Beginning of Period             |                                      | 148.6    |   |                                      |   |   | 129.8 |   |
| Cash      and Cash Equivalents at End of Period                   | $                                         | 173.0    |   |                                      |   | $ | 690.4 |   |

----

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS(Unaudited)

----

| The      Total Purchase Price Consisted of the Following:           |   |     |   |
|---------------------------------------------------------------------|--------|----------|--------|
| Cash      Paid                                                      | $      | 5,112.0  |   |
| Kinder      Morgan, Inc. Shares Contributed                         |   | 2,719.2  |   |
| Equity      Contributed                                             |   | 7,831.2  |   |
| Cash      from Issuances of Long-term Debt                          |   | 4,696.2  |   |
| Total      Purchase Price                                           | $      | 12,527.4 |   |
|                                                           |   |     |   |
| The      Preliminary Allocation of the Purchase Price is asFollows: |   |     |   |
| Current      Assets                                                 | $      | 1,551.2  |   |
| Goodwill                                                            |   | 13,458.9 |   |
| Investments                                                         |   | 1,067.0  |   |
| Property,      Plant and Equipment, Net                             |   | 15,593.0 |   |
| Deferred      Charges and Other Assets                              |   | 1,681.5  |   |
| Current      Liabilities                                            |   | (3,279.5 | )      |
| Deferred      Income Taxes                                          |   | (2,596.7 | )      |
| Other      Deferred Credits                                         |   | (1,777.5 | )      |
| Long-term      Debt                                                 |   | (9,855.9 | )      |
| Minority      Interests                                             |   | (3,314.6 | )      |
|                                                                | $      | 12,527.4 |   |

----

|                                      | March      31,2008 |   | December      31,2007 |
|-------------------------------------------|--------------------|--------|-----------------------|
|                                      | (In      millions) |
| Gas      in Underground Storage (Current) |               | $      | 28.4                  |   |   |   | $ | - |   |
| Product      Inventories                  |               |   | 20.3                  |   |   |   |   | 19.5 |   |
| Materials      and Supplies               |               |   | 18.8                  |   |   |   |   | 18.3 |   |
|                                      |               | $      | 67.5                  |   |   |   | $ | 37.8 |   |

|                                           | December      31, 2007 |    | Acquisitionsand      PurchasePriceAdjustments |   | Other1 |   | March      31,2008 |
|------------------------------------------------|------------------------|---------|-----------------------------------------------|--------|--------|--------|--------------------|
|                                           | (In      millions)     |
| KMP      – Products Pipelines Segment    | $                      | 2,179.4 |                                          |   | $      | 70.0   |               |   | $ | (6.9 | ) |   | $ | 2,242.5 |   |
| KMP      – Natural Gas Pipelines Segment |                   | 3,201.0 |                                          |   |   | 308.6  |               |   |   | (10.6 | ) |   |   | 3,499.0 |   |
| KMP      – CO2      Segment              |                   | 1,077.6 |                                          |   |   | 192.2  |               |   |   | (3.7 | ) |   |   | 1,266.1 |   |
| KMP      – Terminals Segment             |                   | 1,465.9 |                                          |   |   | (118.0 | )                  |   |   | (4.5 | ) |   |   | 1,343.4 |   |
| KMP      – Trans Mountain Segment        |                   | 250.1   |                                          |   |   | -      |               |   |   | (8.8 | ) |   |   | 241.3 |   |
|                                      |                   |    |                                          |   |   |   |               |   |   |   |   |   |   |   |   |
| Consolidated      Total                        | $                      | 8,174.0 |                                          |   | $      | 452.8  |               |   | $ | (34.5 | ) |   | $ | 8,592.3 |   |

| 1 | Adjustments      include (i) the translation of goodwill denominated in foreign currencies      and (ii) reductions in the allocation of equity method goodwill due to      reductions in our ownership percentage of Kinder Morgan Energy      Partners. |
|---|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|                                                   | March      31,2008 |   | December      31,2007 |
|--------------------------------------------------------|--------------------|--------|-----------------------|
|                                                   | (In      millions) |
| Customer      Relationships, Contracts and Agreements: |               |   |                  |   |   |   |   |   |   |   |   |
| Gross      Carrying Amount1                            |               | $      | 312.0                 |   |   |   |   | $ | 321.3 |   |   |
| Accumulated      Amortization                          |               |   | (16.7                 | ) |   |   |   |   | (11.6 | ) |   |
| Net      Carrying Amount                               |               |   | 295.3                 |   |   |   |   |   | 309.7 |   |   |
|                                                   |               |   |                  |   |   |   |   |   |   |   |   |
| Technology-based      Assets, Lease Value and Other:   |               |   |                  |   |   |   |   |   |   |   |   |
| Gross      Carrying Amount                             |               |   | 11.7                  |   |   |   |   |   | 11.7 |   |   |
| Accumulated      Amortization                          |               |   | (0.4                  | ) |   |   |   |   | (0.3 | ) |   |
| Net      Carrying Amount                               |               |   | 11.3                  |   |   |   |   |   | 11.4 |   |   |
|                                                   |               |   |                  |   |   |   |   |   |   |   |   |
| Total      Other Intangibles, Net                      |               | $      | 306.6                 |   |   |   |   | $ | 321.1 |   |   |

|   | 1 | The      change in the Gross Carrying Amount is due primarily to an approximately      $18 million adjustment for Kinder Morgan Energy Partners’ allocated      purchase price of Marine Terminals, Inc.’s bulk terminal assets, partially      offset by adjustments in purchase price allocations related to the Going      Private transaction. This adjustment had the effect of increasing      “Goodwill” and decreasing “Other Intangibles, Net” by that amount. As of      March 31, 2008, Kinder Morgan Energy Partners’ allocation of the purchase      price of Marine Terminals, Inc.’s bulk terminal assets was preliminary and      is expected to be final by the third quarter of  2008. |
|--------|---|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|                                                  | SuccessorCompany                          |   |   | PredecessorCompany                        |
|-------------------------------------------------------|-------------------------------------------|--------|--------|-------------------------------------------|
|                                                  | Three      MonthsEndedMarch      31, 2008 |   |   | Three      MonthsEndedMarch      31, 2007 |
|                                                  | (In      millions)                        |   |   | (In      millions)                        |
| Customer      Relationships, Contracts and Agreements | $                                         | 5.1    |   |                                      |   | $ | 3.8 |   |
| Technology-based      Assets, Lease Value and Other1  |                                      | 0.1    |   |                                      |   |   | - |   |
| Total      Amortization                               | $                                         | 5.2    |   |                                      |   | $ | 3.8 |   |

|   | 1 | Expense      for the three months ended March 31, 2007 was less than $0.1      million. |
|--------|---|-----------------------------------------------------------------------------------------|

|                               | March      31,2008 |    | December      31,2007 |
|------------------------------------|--------------------|---------|-----------------------|
|                               | (In      millions) |
| Kinder      Morgan Energy Partners | $                  | 1,829.8 |                  | $ | 1,616.0 |
| Kinder      Morgan Management, LLC |               | 1,658.0 |                  |   | 1,657.7 |
| Triton      Power Company LLC      |               | 27.9    |                  |   | 29.2 |
| Other                              |               | 9.2     |                  |   | 11.1 |
|                               | $                  | 3,524.9 |                  | $ | 3,314.0 |

----

|                     | Three      Months EndedMarch      31, 2008 |
|--------------------------|--------------------------------------------|
|                     | (In      millions)                         |
| Beginning      of Period |                                       | $ | 55.0 |   |   |
| Additions                |                                       |   | 0.9 |   |   |
| Liabilities      Settled |                                       |   | (0.9 | ) |   |
| Liabilities      Sold1   |                                       |   | (2.8 | ) |   |
| Accretion      Expense   |                                       |   | 0.6 |   |   |
| End      of Period       |                                       | $ | 52.8 |   |   |

|   | 1 | ARO      liabilities associated with the NGPL business segment, 80% of which was      sold in February 2008 (see Note 5). |
|--------|---|---------------------------------------------------------------------------------------------------------------------------|

|                                               | March      31,2008 |   | December      31,2007 |
|----------------------------------------------------|--------------------|--------|-----------------------|
|                                               | (In      millions) |   | (In      millions)    |
| Derivative      Liability:                         |               |   |                  |   |   |   |   |
| Current      Liabilities: Other                    | $                  | (282.9 | )                     |   | $ | (239.8 | ) |
| Other      Liabilities and Deferred Credits: Other | $                  | (509.9 | )                     |   | $ | (386.5 | ) |

----

|                               | March      31,2008 |
|------------------------------------|--------------------|
| Derivative      Asset (Liability): |               |   |   |
| Current      Assets: Other         | $                  | 0.6 |   |
| Current      Liabilities: Other    | $                  | (2.9 | ) |

|                                                  | SuccessorCompany                          |   |   | PredecessorCompany                        |
|-------------------------------------------------------|-------------------------------------------|--------|--------|-------------------------------------------|
|                                                  | Three      MonthsEndedMarch      31, 2008 |   |   | Three      MonthsEndedMarch      31, 2007 |
|                                                  | (In      millions)                        |   |   | (In      millions)                        |
| INCREASE      (DECREASE) IN CASH AND CASH EQUIVALENTS |                                      |   |   |                                      |   |   |   |   |
| Accounts      Receivable                              | $                                         | (122.8 | )      |                                      |   | $ | 2.0 |   |
| Materials      and Supplies Inventory                 |                                      | (2.1   | )      |                                      |   |   | 0.1 |   |
| Other      Current Assets                             |                                      | (10.9  | )      |                                      |   |   | 12.5 |   |
| Accounts      Payable                                 |                                      | 32.4   |   |                                      |   |   | (32.6 | ) |
| Other      Current Liabilities                        |                                      | (175.8 | )      |                                      |   |   | (33.2 | ) |
|                                                  | $                                         | (279.2 | )      |                                      |   | $ | (51.2 | ) |

|                                                               | SuccessorCompany                          |   |   | PredecessorCompany                        |
|--------------------------------------------------------------------|-------------------------------------------|--------|--------|-------------------------------------------|
|                                                               | Three      MonthsEndedMarch      31, 2008 |   |   | Three      MonthsEndedMarch      31, 2007 |
|                                                               | (In      millions)                        |   |   | (In      millions)                        |
| Interest,      Net of Amount Capitalized                           | $                                         | 341.6  |   |                                      |   | $ | 294.6 |   |
| Income      Taxes Paid, Including Amounts Related to Prior Periods | $                                         | 1.1    |   |                                      |   | $ | 15.9 |   |

----

|                                                                                     | SuccessorCompany                           |   |   | Predecessor      Company                   |
|------------------------------------------------------------------------------------------|--------------------------------------------|--------|--------|--------------------------------------------|
|                                                                                     | Three      Months EndedMarch      31, 2008 |   |   | Three      Months EndedMarch      31, 2007 |
|                                                                                     | (In      millions)                         |   |   | (In      millions)                         |
| Net      Income (Loss)                                                                   | $                                          | 105.7  |   |                                       |   | $ | (12.4 | ) |
| Other      Comprehensive Loss, Net of Tax:                                               |                                       |   |   |                                       |   |   |   |   |
| Change      in Fair Value of Derivatives Utilized for Hedging Purposes                   |                                       | (219.8 | )      |                                       |   |   | (21.8 | ) |
| Reclassification      of Change in Fair Value of Derivatives to Net Income               |                                       | 115.5  |   |                                       |   |   | 10.6 |   |
| Employee      Benefit Plans:                                                             |                                       |   |   |                                       |   |   |   |   |
| Prior      Service Cost Arising During Period                                            |                                       | 0.4    |   |                                       |   |   | - |   |
| Net      Gain Arising During Period                                                      |                                       | 1.5    |   |                                       |   |   | - |   |
| Amortization      of Prior Service Cost Included in Net Periodic      Benefit Costs |                                       | 0.1    |   |                                       |   |   | 0.9 |   |
| Amortization      of Net Loss Included in Net Periodic Benefit Costs                     |                                       | (0.2   | )      |                                       |   |   | (0.2 | ) |
| Change      in Foreign Currency Translation Adjustment                                   |                                       | (24.3  | )      |                                       |   |   | 9.3 |   |
| Other      Comprehensive Loss                                                            |                                       | (126.8 | )      |                                       |   |   | (1.2 | ) |
|                                                                                |                                       |   |   |                                       |   |   |   |   |
| Comprehensive      Loss                                                                  | $                                          | (21.1  | )      |                                       |   | $ | (13.6 | ) |

----

----

----

|                                                                  | SuccessorCompany                           |   |   | Predecessor      Company                   |
|-----------------------------------------------------------------------|--------------------------------------------|--------|--------|--------------------------------------------|
|                                                                  | Three      Months EndedMarch      31, 2008 |   |   | Three      Months EndedMarch      31, 2007 |
|                                                                  | (In      millions)                         |   |   | (In      millions)                         |
| Operating      Revenues                                               | $                                          | -      |   |                                       |   | $ | 698.6 |   |
|                                                                  |                                       |   |   |                                       |   |   |   |   |
| (Loss)      Earnings from Discontinued Operations Before Income Taxes |                                       | (0.1   | )      |                                       |   |   | 340.8 |   |
| Income      Taxes                                                     |                                       | -      |   |                                       |   |   | (107.6 | ) |
| (Loss)      Gain from Discontinued Operations                         | $                                          | (0.1   | )      |                                       |   | $ | 233.2 |   |

| Credit      Facilities                                             |
|--------------------------------------------------------------------|
|                                                               |
| Knight Inc.1                                                       |
| $1.0      billion, six-year secured revolver, due May 2013         |
| Kinder Morgan Energy      Partners2                                |
| $1.85      billion, five-year unsecured revolver, due August  2010 |

| 1 | On      January 5, 2007, after shareholder approval of the Going Private      transaction was announced, Kinder Morgan, Inc.’s secured senior debt      rating was downgraded by Standard & Poor’s Rating Services to BB- due      to the anticipated increase in debt related to the proposed transaction.      On April 11, 2007 and May 30, 2007, Fitch and Moody’s Investor Services      lowered their ratings to BB and Ba2, respectively, also related to the      transaction. Following the sale of an 80% ownership interest in our NGPL      business segment on February 15, 2008 (see Note 5), Standard & Poor’s      Rating Services upgraded Knight Inc.’s secured senior debt to BB, Fitch      upgraded its rating to BB+, and Moody’s Investor Services to Ba1. Because      we have a non-investment grade credit rating, we no longer have access to      the commercial paper market. As a result, we are currently utilizing our      $1.0 billion revolving credit facility for Knight Inc.’s short-term      borrowing needs. |
|---|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | As      discussed following, the loan agreements we had in place prior to the      Going Private transaction were cancelled and replaced with a new loan      agreement. Our indentures related to publicly issued notes do not contain      covenants related to maintenance of credit ratings. Accordingly, no such      covenants were impacted by the downgrade in our credit ratings occasioned      by the Going Private transaction. |
|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 2 | On      January 5, 2007, in anticipation of the Going Private transaction closing,      Standard & Poor’s Rating Services downgraded Kinder Morgan Energy      Partners one level to BBB and removed its rating from credit watch with      negative implications. As projected by      Moody’s Investor Services in its credit opinion dated November 15, 2006,      it downgraded Kinder Morgan Energy Partners’ credit rating from Baa1 to      Baa2 on May 30, 2007, following the closing of the Going Private      transaction. Additionally, Kinder Morgan Energy Partners’ rating was      downgraded by Fitch Ratings from BBB+ to BBB on April 11, 2007.      Currently, Kinder Morgan Energy Partners’ corporate debt credit      rating is BBB, Baa2 and BBB, respectively, at S&P, Moody’s Investor      Services and Fitch. |
|---|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|                               | March      31, 2008                                               |
|------------------------------------|-------------------------------------------------------------------|
|                               | Short-termBorrowingsOutstandingUnderRevolvingCredit      Facility |   | CommercialPaperOutstanding |   | Weighted      AverageInterest      Rate ofShort-term      DebtOutstanding |
|                               | (In      millions)                                                |
| Knight      Inc.                   |                                                              |   |   |   |   |   |   |   |   |   |   |   |
| $1.0      billion                  |                                                              | $ | 70.0 |   |   | $ | - |   |   | 3.94 | % |   |
| Kinder      Morgan Energy Partners |                                                              |   |   |   |   |   |   |   |   |   |   |   |
| $1.85      billion                 |                                                              | $ | - |   |   | $ | 296.7 |   |   | 3.26 | % |   |

|                                                  | Successor      Company                     |   |                                                                 | Predecessor      Company                   |
|-------------------------------------------------------|--------------------------------------------|--------|----------------------------------------------------------------------|--------------------------------------------|
|                                                  | Three      Months EndedMarch      31, 2008 |   |                                                                 | Three      Months EndedMarch      31, 2007 |
|                                                  | AverageShort-termDebtOutstanding           |   | Weighted-AverageInterest      Rate ofShort-term      DebtOutstanding |                                       |   | AverageShort-termDebtOutstanding |   | Weighted-AverageInterest      Rate ofShort-term      DebtOutstanding |
|                                                  | (In      millions of U.S. dollars)         |   |                                                                 | (In      millions of U.S. dollars)         |
| Credit      Facilities:                               |                                       |   |                                                                 |                                       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Knight Inc.1                                          |                                       |   |                                                                 |                                       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| $1.0      billion                                     | $                                          | 191.6  |                                                                 |                                       |   | 5.56 | % |   |   |   | $ | - |   |   |   | - | % |   |
| Kinder Morgan, Inc.2                                  |                                       |   |                                                                 |                                       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| $800      million                                     | $                                          | -      |                                                                 |                                       |   | - | % |   |   |   | $ | - |   |   |   | - | % |   |
|                                             |                                       |   |                                                                 |                                       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Commercial      Paper and Bankers’ Acceptances: |                                       |   |                                                                 |                                       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Kinder      Morgan Energy Partners                    |                                       |   |                                                                 |                                       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| $1.85      billion                                    | $                                          | 446.9  |                                                                 |                                       |   | 4.06 | % |   |   |   | $ | 564.8 |   |   |   | 5.41 | % |   |
| Terasen Inc.3                                         |                                       |   |                                                                 |                                       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| C$450      million                                    | $                                          | -      |                                                                 |                                       |   | - | % |   |   |   | $ | 80.1 |   |   |   | 4.34 | % |   |
| Terasen Gas Inc.3                                     |                                       |   |                                                                 |                                       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| C$500      million                                    | $                                          | -      |                                                                 |                                       |   | - | % |   |   |   | $ | 153.0 |   |   |   | 4.23 | % |   |
| Terasen Pipelines (Corridor)      Inc.3               |                                       |   |                                                                 |                                       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| C$375      million                                    | $                                          | -      |                                                                 |                                       |   | - | % |   |   |   | $ | 240.9 |   |   |   | 4.23 | % |   |

| 1 | In      conjunction with the Going Private transaction, Knight Inc. entered into a      $5.755 billion credit agreement dated May 30, 2007, which included three      term credit facilities, which were subsequently retired, and one revolving      credit facility. Knight Inc. does not have a commercial paper      program. |
|---|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 2 | Our      $800 million credit facility was terminated on May 30,    2007. |
|---|--------------------------------------------------------------------------|

| 3 | On      February 26, 2007 and March 5, 2007, we entered into definitive agreements      to sell Terasen Inc., including Terasen Gas Inc., and Terasen Pipelines      (Corridor) Inc., respectively. These transactions closed on May 17, 2007      and June 15, 2007, respectively (see Note6). |
|---|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|                                             | Debt      Paid Downand/or      Retired |
|--------------------------------------------------|----------------------------------------|
|                                             | (In      millions)                     |
| Knight      Inc.                                 |                                   |   |   |   |   |
| Senior      Secured Credit Term Loan Facilities: |                                   |   |   |   |   |
| Tranche      A Term Loan, Due 2013               |                                   | $ | 995.0 |   |   |
| Tranche      B Term Loan, Due 2014               |                                   |   | 3,183.5 |   |   |
| Credit      Facility:                            |                                   |   |   |   |   |
| $1.0      billion Secured Revolver, Due May 2013 |                                   |   | 375.0 |   |   |
| Total      Paid Off and/or Retired               |                                   | $ | 4,553.5 |   |   |

|                                                                                                                                                | Par      Value ofDebt      Repurchased |
|-----------------------------------------------------------------------------------------------------------------------------------------------------|----------------------------------------|
|                                                                                                                                                | (In      millions)                     |
| Knight      Inc.                                                                                                                                    |                                   |   |   |   |   |
| Debentures:                                                                                                                                         |                                   |   |   |   |   |
| 6.50%      Series, Due      2013                                                                       |                                   | $ | 18.9 |   |   |
| 6.67%      Series, Due 2027                                                                                                |                                   |   | 143.0 |   |   |
| 7.25%      Series, Due 2028                                                                                                               |                                   |   | 461.0 |   |   |
| 7.45%      Series, Due 2098                                                                                                                    |                                   |   | 124.1 |   |   |
| Senior      Notes:                                                                                                                                  |                                   |   |   |   |   |
| 6.50%      Series, Due 2012                                                                                                                    |                                   |   | 160.7 |   |   |
| Kinder      Morgan Finance Company, ULC                                                                                                             |                                   |   |   |   |   |
| 6.40%      Series, Due      2036                                                                       |                                   |   | 513.6 |   |   |
| Deferrable      Interest Debentures Issued to Subsidiary Trusts                                                                                     |                                   |   |   |   |   |
| 8.56%      Junior Subordinated      Deferrable Interest Debentures Due 2027                                                                    |                                   |   | 87.3 |   |   |
| 7.63%      Junior Subordinated Deferrable Interest Debentures      Due 2028                                                                    |                                   |   | 160.6 |   |   |
| Repurchase      of Outstanding Debt      Securities                 |                                   | $ | 1,669.2 |   |   |

----

----

----

----

----

|                                                                                                                                      | SuccessorCompany                           |    |   | Predecessor      Company                   |
|-------------------------------------------------------------------------------------------------------------------------------------------|--------------------------------------------|---------|--------|--------------------------------------------|
|                                                                                                                                      | Three      Months EndedMarch      31, 2008 |    |   | Three      Months EndedMarch      31, 2007 |
|                                                                                                                                      | (In      millions)                         |    |   | (In      millions)                         |
| Segment      Earnings before Depreciation, Depletion, Amortization and Amortization of      Excess Cost of  Equity Investments: |                                       |    |   |                                       |   |   |   |   |
| NGPL1                                                                                                                                     | $                                          | 96.0    |   |                                       |   | $ | 160.3 |   |
| Power                                                                                                                                     |                                       | 2.1     |   |                                       |   |   | 5.7 |   |
| Express                                                                                                                                   |                                       | 4.0     |   |                                       |   |   | 3.6 |   |
| Products      Pipelines – KMP2                                                                                                      |                                       | 140.3   |   |                                       |   |   | 133.7 |   |
| Natural      Gas Pipelines – KMP2                                                                                                   |                                       | 188.4   |   |                                       |   |   | 134.7 |   |
| CO2 –      KMP2                                                                                                                     |                                       | 233.3   |   |                                       |   |   | 125.4 |   |
| Terminals      – KMP2                                                                                                               |                                       | 125.8   |   |                                       |   |   | 100.5 |   |
| Trans      Mountain – KMP2                                                                                                          |                                       | 30.2    |   |                                       |   |   | (358.2 | ) |
| Total      Segment Earnings Before DD&A                                                                                               |                                       | 820.1   |   |                                       |   |   | 305.7 |   |
| Depreciation,      Depletion and Amortization                                                                                             |                                       | (218.1  | )      |                                       |   |   | (153.0 | ) |
| Amortization      of Excess Cost of Equity Investments                                                                                    |                                       | (1.4    | )      |                                       |   |   | (1.4 | ) |
| Interest      and Corporate Expenses, Net3                                                                                                |                                       | (416.7  | )      |                                       |   |   | (318.2 | ) |
| Add      Back: Income Taxes Included in Segments Above2                                                                                   |                                       | 9.0     |   |                                       |   |   | 9.0 |   |
| Income      (Loss) from Continuing Operations Before Income Taxes                                                                         | $                                          | 192.9   |   |                                       |   | $ | (157.9 | ) |
|                                                                                                                                 |                                       |    |   |                                       |   |   |   |   |
| Revenues      from External Customers:                                                                                                    |                                       |    |   |                                       |   |   |   |   |
| NGPL1                                                                                                                                     | $                                          | 132.1   |   |                                       |   | $ | 263.0 |   |
| Power                                                                                                                                     |                                       | 7.5     |   |                                       |   |   | 11.6 |   |
| Products      Pipelines – KMP                                                                                                       |                                       | 198.3   |   |                                       |   |   | 197.1 |   |
| Natural      Gas Pipelines – KMP                                                                                                    |                                       | 1,912.5 |   |                                       |   |   | 1,532.4 |   |
| CO2 –      KMP                                                                                                                      |                                       | 319.9   |   |                                       |   |   | 191.6 |   |
| Terminals      – KMP                                                                                                                |                                       | 280.0   |   |                                       |   |   | 214.9 |   |
| Trans      Mountain – KMP                                                                                                           |                                       | 43.1    |   |                                       |   |   | 32.8 |   |
| Other                                                                                                                                     |                                       | 1.6     |   |                                       |   |   | 1.0 |   |
| Total      Revenues                                                                                                                       | $                                          | 2,895.0 |   |                                       |   | $ | 2,444.4 |   |
|                                                                                                                                 |                                       |    |   |                                       |   |   |   |   |
| Intersegment      Revenues:                                                                                                               |                                       |    |   |                                       |   |   |   |   |
| NGPL1                                                                                                                                     | $                                          | 0.9     |   |                                       |   | $ | 0.6 |   |
| Natural      Gas Pipelines – KMP                                                                                                    |                                       | -       |   |                                       |   |   | 3.0 |   |
| Terminals      – KMP                                                                                                                |                                       | 0.2     |   |                                       |   |   | 0.2 |   |
| Other                                                                                                                                     |                                       | (0.8    | )      |                                       |   |   | - |   |
| Total      Intersegment Revenues                                                                                                          | $                                          | 0.3     |   |                                       |   | $ | 3.8 |   |
|                                                                                                                                 |                                       |    |   |                                       |   |   |   |   |
| Depreciation,      Depletion and Amortization:                                                                                            |                                       |    |   |                                       |   |   |   |   |
| NGPL1                                                                                                                                     | $                                          | 9.3     |   |                                       |   | $ | 27.0 |   |
| Power                                                                                                                                     |                                       | -       |   |                                       |   |   | (4.5 | ) |
| Products      Pipelines – KMP                                                                                                       |                                       | 27.9    |   |                                       |   |   | 20.3 |   |
| Natural      Gas Pipelines – KMP                                                                                                    |                                       | 25.5    |   |                                       |   |   | 16.0 |   |
| CO2 –      KMP                                                                                                                      |                                       | 108.4   |   |                                       |   |   | 68.9 |   |
| Terminals      – KMP                                                                                                                |                                       | 39.3    |   |                                       |   |   | 20.5 |   |
| Trans      Mountain – KMP                                                                                                           |                                       | 7.6     |   |                                       |   |   | 4.7 |   |
| Other                                                                                                                                     |                                       | 0.1     |   |                                       |   |   | 0.1 |   |
| Total      Consolidated Depreciation, Depletion and Amortization                                                                          | $                                          | 218.1   |   |                                       |   | $ | 153.0 |   |
|                                                                                                                                 |                                       |    |   |                                       |   |   |   |   |
| Capital      Expenditures – Continuing Operations:                                                                                  |                                       |    |   |                                       |   |   |   |   |
| NGPL1                                                                                                                                     | $                                          | 10.2    |   |                                       |   | $ | 49.0 |   |
| Products      Pipelines – KMP                                                                                                       |                                       | 57.3    |   |                                       |   |   | 36.3 |   |
| Natural      Gas Pipelines – KMP                                                                                                    |                                       | 187.7   |   |                                       |   |   | 26.9 |   |
| CO2 –      KMP                                                                                                                      |                                       | 95.0    |   |                                       |   |   | 89.6 |   |
| Terminals      – KMP                                                                                                                |                                       | 146.0   |   |                                       |   |   | 92.6 |   |
| Trans      Mountain – KMP                                                                                                           |                                       | 142.1   |   |                                       |   |   | 50.3 |   |
| Other                                                                                                                                     |                                       | -       |   |                                       |   |   | 12.7 |   |
| Total      Capital Expenditures – Continuing Operations                                                                             | $                                          | 638.3   |   |                                       |   | $ | 357.4 |   |

|   |   |
|--------|--------|

----

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

| 2 | Income      taxes of Kinder Morgan Energy Partners of $9.0 million for each of the      three-month periods ended March 31, 2008 and 2007, are included in Segment      Earnings Before Depreciation, Depletion, Amortization and Amortization of      Excess Cost of Equity Investments. |
|---|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 3 | Includes      (i) general and administrative expense, (ii) interest expense, (iii)      minority interests and (iv) miscellaneous other income and expenses not      allocated to business segments. |
|---|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|                                   | March      31, 2008 |
|----------------------------------------|---------------------|
|                                   | (In      millions)  |
| Assets:                                |                |   |   |
| NGPL1                                  | $                   | 720.4 |   |
| Power                                  |                | 49.4 |   |
| Express                                |                | 416.0 |   |
| Products      Pipelines – KMP    |                | 7,002.1 |   |
| Natural      Gas Pipelines – KMP |                | 9,202.0 |   |
| CO2 –      KMP                   |                | 4,028.3 |   |
| Terminals      – KMP             |                | 4,811.5 |   |
| Trans      Mountain – KMP        |                | 1,542.5 |   |
| Total      segment assets              |                | 27,772.2 |   |
| Other2                                 |                | 668.0 |   |
| Total      Consolidated Assets         | $                   | 28,440.2 |   |

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

| 2 | 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. |
|---|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|                                   | Successor      Company                 |
|----------------------------------------|----------------------------------------|
|                                   | Three      Months Ended March 31, 2008 |
|                                   | UnitedStates                           |   | Canada |   | Mexico and Other2 |   | Total |
|                                   | (In      millions)                     |
| Revenues      from External Customers: |                                   |
| NGPL1                                  | $                                      | 132.1 |   | $ | - |   | $ | - |   | $ | 132.1 |   |   |
| Power                                  |                                   | 7.5 |   |   | - |   |   | - |   |   | 7.5 |   |   |
| Products      Pipelines – KMP    |                                   | 191.4 |   |   | 6.9 |   |   | - |   |   | 198.3 |   |   |
| Natural      Gas Pipelines – KMP |                                   | 1,909.0 |   |   | - |   |   | 3.5 |   |   | 1,912.5 |   |   |
| CO2 –      KMP                   |                                   | 319.9 |   |   | - |   |   | - |   |   | 319.9 |   |   |
| Terminals      – KMP             |                                   | 268.1 |   |   | 10.1 |   |   | 1.8 |   |   | 280.0 |   |   |
| Trans      Mountain                    |                                   | 3.0 |   |   | 40.1 |   |   | - |   |   | 43.1 |   |   |
| Other                                  |                                   | 0.8 |   |   | 0.8 |   |   | - |   |   | 1.6 |   |   |
|                                   | $                                      | 2,831.8 |   | $ | 57.9 |   | $ | 5.3 |   | $ | 2,895.0 |   |   |

----

|                                   | Predecessor      Company               |
|----------------------------------------|----------------------------------------|
|                                   | Three      Months Ended March 31, 2007 |
|                                   | UnitedStates                           |   | Canada |   | Mexico and Other2 |   | Total |
|                                   | (In      millions)                     |
| Revenues      from External Customers: |                                   |
| NGPL                                   | $                                      | 263.0 |   | $ | - |   | $ | - |   | $ | 263.0 |
| Power                                  |                                   | 11.6 |   |   | - |   |   | - |   |   | 11.6 |
| Products      Pipelines – KMP    |                                   | 190.7 |   |   | 6.4 |   |   | - |   |   | 197.1 |
| Natural      Gas Pipelines – KMP |                                   | 1,529.0 |   |   | - |   |   | 3.4 |   |   | 1,532.4 |
| CO2 –      KMP                   |                                   | 191.6 |   |   | - |   |   | - |   |   | 191.6 |
| Terminals      – KMP             |                                   | 213.5 |   |   | - |   |   | 1.4 |   |   | 214.9 |
| Trans      Mountain                    |                                   | 2.5 |   |   | 30.3 |   |   | - |   |   | 32.8 |
| Other                                  |                                   | - |   |   | 1.0 |   |   | - |   |   | 1.0 |
|                                   | $                                      | 2,401.9 |   | $ | 37.7 |   | $ | 4.8 |   | $ | 2,444.4 |

|                                   | At      March 31, 2008 |
|----------------------------------------|------------------------|
|                                   | UnitedStates           |   | Canada |   | Mexico and Other2 |   | Total |
|                                   | (In      millions)     |
| Long-lived Assets3:                    |                   |   |   |   |   |   |   |   |   |   |   |
| NGPL1                                  | $                      | 720.4 |   | $ | - |   | $ | - |   | $ | 720.4 |
| Power                                  |                   | 32.9 |   |   | - |   |   | - |   |   | 32.9 |
| Express                                |                   | 281.7 |   |   | 120.7 |   |   | - |   |   | 402.4 |
| Products      Pipelines – KMP    |                   | 4,564.0 |   |   | 105.1 |   |   | - |   |   | 4,669.1 |
| Natural      Gas Pipelines – KMP |                   | 4,831.8 |   |   | - |   |   | 83.5 |   |   | 4,915.3 |
| CO2 –      KMP                   |                   | 2,561.7 |   |   | - |   |   | - |   |   | 2,561.7 |
| Terminals      – KMP             |                   | 2,810.4 |   |   | 215.0 |   |   | 6.1 |   |   | 3,031.5 |
| Trans      Mountain – KMP        |                   | 18.4 |   |   | 1,219.8 |   |   | - |   |   | 1,238.2 |
| Other                                  |                   | 349.0 |   |   | 10.2 |   |   | - |   |   | 359.2 |
|                                   | $                      | 16,170.3 |   | $ | 1,670.8 |   | $ | 89.6 |   | $ | 17,930.7 |

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

| 2 | Terminals      – KMP includes revenues of $1.8 million and $1.4 million for the      three-month periods ended March 31, 2008 and 2007, respectively, and      long-lived assets of $6.1 million at March 31, 2008, attributable to      operations in the Netherlands. |
|---|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 3 | Long-lived      assets exclude goodwill and other intangibles,  net. |
|---|----------------------------------------------------------------------|

----

|                                                | March      31,2008 |   |   | December      31,2007 |
|-----------------------------------------------------|--------------------|--------|--------|-----------------------|
|                                                | (In      millions) |   |   | (In      millions)    |
| Derivatives      Asset (Liability)                  |               |   |   |                  |   |   |   |   |
| Current      Assets: Other                          | $                  | 37.6   |   |                  |   | $ | 37.1 |   |
| Current      Assets: Assets Held for Sale           | $                  | -      |   |                  |   | $ | 8.4 |   |
| Deferred      Charges and Other Assets              | $                  | 7.2    |   |                  |   | $ | 4.4 |   |
| Current      Liabilities: Other                     | $                  | (685.9 | )      |                  |   | $ | (594.7 | ) |
| Current      Liabilities: Liabilities Held for Sale | $                  | -      |   |                  |   | $ | (0.4 | ) |
| Other      Liabilities and Deferred Credits: Other  | $                  | (995.0 | )      |                  |   | $ | (836.8 | ) |

----

----

|   | · | 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 as of March 31, 2008 Using |
|--------------------------------------------|---------------------------------------------------------------|
|                                       | Total                                                         |   | Quoted      Prices in ActiveMarkets      for IdenticalAssets      (Level 1) |   | Significant      OtherObservableInputs      (Level 2) |   | SignificantUnobservableInputs      (Level 3) |
| Energy      Commodity Derivative Contracts | $                                                             | 44.8 |   |   |   | $ | - |   |   |   |   | $ | 40.7 |   |   |   | $ | 4.1 |   |   |
|                                       |                                                          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Interest      Rate Swap Agreements         |                                                          | 257.1 |   |   |   |   | - |   |   |   |   |   | 257.1 |   |   |   |   | - |   |   |

|                                       | Liability      Fair Value Measurements as of March 31, 2008 Using |
|--------------------------------------------|-------------------------------------------------------------------|
|                                       | Total                                                             |   | Quoted      Prices in ActiveMarkets      for IdenticalLiabilities      (Level 1) |   | Significant      OtherObservableInputs      (Level 2) |   | SignificantUnobservableInputs      (Level 3) |
| Energy      Commodity Derivative Contracts | $                                                                 | (1,680.9 | ) |   |   | $ | (2.8 | ) |   |   |   | $ | (1,550.2 | ) |   |   | $ | (127.9 | ) |   |
|                                       |                                                              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Cross      Currency Swaps                  |                                                              | (29.0 | ) |   |   |   | - |   |   |   |   |   | (29.0 | ) |   |   |   | - |   |   |

----

|                                                                                            | Significant Unobservable Inputs      (Level 3) |
|-------------------------------------------------------------------------------------------------|------------------------------------------------|
| Net      Asset (Liability)                                                                      |                                           |   |   |
| Balance      as of January 1, 2008                                                              | $                                              | (100.3 | ) |
| Realized      and Unrealized Net Losses                                                         |                                           | (44.8 | ) |
| Purchases      and Settlements                                                                  |                                           | 21.3 |   |
| Transfers      in (out) of Level 3                                                              |                                           | - |   |
| Balance      as of March 31, 2008                                                               |                                           | (123.8 | ) |
| Change      in Unrealized Net Losses Relating to Contracts Still Held as of March 31,      2008 |                                           | (37.7 | ) |

|                                      | SuccessorCompany                           |   |   | Predecessor      Company                   |
|-------------------------------------------|--------------------------------------------|--------|--------|--------------------------------------------|
|                                      | Three      Months EndedMarch      31, 2008 |   |   | Three      Months EndedMarch      31, 2007 |
| Service      Cost                         | $                                          | 2.8    |   |                                       |   | $ | 2.7 |   |
| Interest      Cost                        |                                       | 3.6    |   |                                       |   |   | 3.3 |   |
| Expected      Return on Assets            |                                       | (5.8   | )      |                                       |   |   | (5.8 | ) |
| Amortization      of Prior Service Credit |                                       | -      |   |                                       |   |   | 0.1 |   |
| Amortization      of Net Loss             |                                       | -      |   |                                       |   |   | 0.3 |   |
| Net      Periodic Pension Cost            | $                                          | 0.6    |   |                                       |   | $ | 0.6 |   |

|                                                               | SuccessorCompany                           |   |   | Predecessor      Company                   |
|--------------------------------------------------------------------|--------------------------------------------|--------|--------|--------------------------------------------|
|                                                               | Three      Months EndedMarch      31, 2008 |   |   | Three      Months EndedMarch      31, 2007 |
| Service      Cost                                                  | $                                          | 0.1    |   |                                       |   | $ | 0.1 |   |
| Interest      Cost                                                 |                                       | 1.1    |   |                                       |   |   | 1.2 |   |
| Expected      Return on Assets                                     |                                       | (1.6   | )      |                                       |   |   | (1.6 | ) |
| Amortization      of Prior Service Credit                          |                                       | -      |   |                                       |   |   | (0.4 | ) |
| Amortization      of Net Loss                                      |                                       | (0.1   | )      |                                       |   |   | 1.2 |   |
| Net      Periodic Postretirement Benefit  Cost (Benefit) | $                                          | (0.5   | )      |                                       |   | $ | 0.5 |   |

----

|                           | PredecessorCompany                         |
|--------------------------------|--------------------------------------------|
|                           | Three      Months EndedMarch      31, 2007 |
| Service      Cost              | $                                          | 2.4 |   |
| Interest      Cost             |                                       | 4.0 |   |
| Expected      Return on Assets |                                       | (4.9 | ) |
| Plan      Amendments           |                                       | - |   |
| Other                          |                                       | 0.1 |   |
| Net      Periodic Pension Cost |                                       | 1.6 |   |
| Defined      Contribution Cost |                                       | - |   |
| Total      Pension Costs       | $                                          | 1.6 |   |

|                                          | PredecessorCompany                         |
|-----------------------------------------------|--------------------------------------------|
|                                          | Three      Months EndedMarch      31, 2007 |
| Service      Cost                             | $                                          | 0.5 |   |
| Interest      Cost                            |                                       | 1.0 |   |
| Net      Periodic Postretirement Benefit Cost | $                                          | 1.5 |   |

----

|   | · | the      Standards of Conduct apply only to the relationship between interstate      natural gas transmission pipelines and their marketing affiliates, not      their energy affiliates; |
|--------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | all      risk management personnel can beshared; |
|--------|--------|--------------------------------------------------|

|   | · | the      requirement to post discretionary tariff actions was eliminated (but      interstate natural gas pipelines must still maintain a log of      discretionary tariff waivers); |
|--------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | lawyers      providing legal advice may be shared employees;  and |
|--------|--------|-------------------------------------------------------------------|

|   | · | new      interstate natural gas transmission pipelines are not subject to the      Standards of Conduct until they commence  service. |
|--------|--------|---------------------------------------------------------------------------------------------------------------------------------------|

----

----

----

----

----

|   | · | 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 |
|--------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | FERC      Docket Nos. OR92-8-028,      etal.—Complainants/Protestants:      BP WCP; ExxonMobil; Chevron; ConocoPhillips; and Ultramar—Defendant:      SFPP |
|--------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

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

|   | · | 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 |
|--------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | FERC      Docket No. OR03-5-001—Complainants/Protestants: BP WCP; ExxonMobil; and      ConocoPhillips (other shippers intervened)—Defendant:  SFPP |
|--------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | FERC      Docket No. OR07-1—Complainant/Protestant: Tesoro—Defendant:      SFPP |
|--------|--------|---------------------------------------------------------------------------------------------|

|   | · | FERC      Docket No. OR07-2—Complainant/Protestant: Tesoro—Defendant:      SFPP |
|--------|--------|---------------------------------------------------------------------------------------------|

|   | · | FERC      Docket No. OR07-3—Complainants/Protestants: BP WCP; Chevron; ExxonMobil;      Tesoro; and Valero Marketing—Defendant:SFPP |
|--------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | FERC      Docket No. OR07-4—Complainants/Protestants: BP WCP; Chevron; and      ExxonMobil—Defendants: SFPP; Kinder Morgan G.P., Inc.; and Knight      Inc. |
|--------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | FERC      Docket Nos. OR07-5 and OR07-7 (consolidated)—Complainants/Protestants:      ExxonMobil and Tesoro—Defendants: Calnev; Kinder Morgan G.P., Inc.; and      Knight Inc. |
|--------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|   |   | Complaints      allege that none of Calnev’s current rates are just or reasonable. On July      19, 2007, the FERC accepted and held in abeyance the portion of the      complaints against the non-grandfathered portion of Calnev’s rates,      dismissed with prejudice the complaints against Calnev’s affiliates, and      allowed complainants to file amended complaints regarding the      grandfathered portion of Calnev’s rates. ExxonMobil filed a request for      rehearing of the dismissal of the complaints against Calnev’s affiliates,      which is currently pending before the FERC. Following a FERC decision in      December 2007, ExxonMobil and Tesoro filed amended complaints in these      dockets, which Calnev answered. The FERC has not acted on the amended      complaints. Calnev and ExxonMobil have reached an agreement in principle      to settle this and other dockets. On April 18, 2008, ExxonMobil filed a      notice withdrawing its complaint in Docket No. OR07-5 and its motion to      intervene in Docket No. OR07-7;   |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | FERC      Docket No. OR07-6—Complainant/Protestant: ConocoPhillips—Defendant:      SFPP |
|--------|--------|-----------------------------------------------------------------------------------------------------|

|   | · | FERC      Docket No. OR07-8 (consolidated with Docket No.      OR07-11)—Complainant/Protestant: BP WCP—Defendant:  SFPP |
|--------|--------|-------------------------------------------------------------------------------------------------------------------------------------|

|   | · | FERC      Docket No. OR07-9—Complainant/Protestant: BP WCP—Defendant:      SFPP |
|--------|--------|---------------------------------------------------------------------------------------------|

|   | · | FERC      Docket No. OR07-10—Complainants/Protestants: BP WCP; ConocoPhillips;      Valero; and ExxonMobil—Defendant:Calnev |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------------|

|   | · | FERC      Docket No. OR07-11 (consolidated with Docket No.      OR07-8)—Complainant/Protestant: ExxonMobil—Defendant:  SFPP |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------------|

|   | · | FERC      Docket No. OR07-14—Complainants/Protestants: BP WCP and      Chevron—Defendants: SFPP; Calnev, and several  affiliates |
|--------|--------|----------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | FERC      Docket No. OR07-16—Complainant/Protestant: Tesoro—Defendant:      Calnev |
|--------|--------|------------------------------------------------------------------------------------------------|

|   | · | FERC      Docket No. OR07-18—Complainants/Protestants: Airline Complainants;      Chevron; and Valero Marketing—Defendant:Calnev |
|--------|--------|----------------------------------------------------------------------------------------------------------------------------------------------|

----

|   | · | FERC      Docket No. OR07-19—Complainant/Protestant: ConocoPhillips—Defendant:      Calnev |
|--------|--------|--------------------------------------------------------------------------------------------------------|

|   | · | FERC      Docket No. OR07-20—Complainant/Protestant: BP WCP—Defendant:      SFPP |
|--------|--------|----------------------------------------------------------------------------------------------|

|   | · | FERC      Docket No. OR07-22—Complainant/Protestant: BP WCP—Defendant:      Calnev |
|--------|--------|------------------------------------------------------------------------------------------------|

|   | · | FERC      Docket No. IS05-230 (North Line rate case)—Complainants/Protestants:      Shippers—Defendant: SFPP |
|--------|--------|--------------------------------------------------------------------------------------------------------------------------|

|   | · | FERC      Docket No. IS05-327—Complainants/Protestants: Shippers—Defendant:      SFPP |
|--------|--------|---------------------------------------------------------------------------------------------------|

|   | · | FERC      Docket No. IS06-283 (East Line rate case)—Complainants/Protestants:      Shippers—Defendant: SFPP |
|--------|--------|-------------------------------------------------------------------------------------------------------------------------|

|   | · | FERC      Docket No. IS06-296—Complainant/Protestant: ExxonMobil—Defendant:      Calnev |
|--------|--------|-----------------------------------------------------------------------------------------------------|

|   | · | FERC      Docket No. IS06-356—Complainants/Protestants: Shippers—Defendant:      SFPP |
|--------|--------|---------------------------------------------------------------------------------------------------|

|   | · | FERC      Docket No. IS07-137 (ULSD surcharge)—Complainants/Protestants:      Shippers—Defendant: SFPP |
|--------|--------|--------------------------------------------------------------------------------------------------------------------|

----

|   | · | FERC      Docket No. IS07-229—Complainants/Protestants: BP WCP and      ExxonMobil—Defendant: SFPP |
|--------|--------|----------------------------------------------------------------------------------------------------------------|

|   | · | FERC      Docket No. IS07-234—Complainants/Protestants: BP WCP and      ExxonMobil—Defendant: Calnev |
|--------|--------|------------------------------------------------------------------------------------------------------------------|

|   | · | FERC      Docket No. IS08-28—Complainants/Protestants: ConocoPhillips; Chevron; BP      WCP; ExxonMobil; Southwest Airlines; Western; and Valero—Defendant:      SFPP |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | Motions      to compel payment of interim damages (various      dockets)—Complainants/Protestants: Shippers—Defendants: SFPP; Kinder      Morgan G.P., Inc.; and Knight Inc. |
|--------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

----

----

----

----

----

----

----

----

----

----

----

----

----

----

----

SFAS No. 142
, Goodwill and Other IntangibleAssets. This FSP is effective for financial statements issued for fiscalyears beginning after December 15, 2008 (January 1, 2009 for us), and interimperiods within those fiscal years. Early adoption is prohibited. We arecurrently reviewing the effects of this FSP.

----

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

----

----

|                                                                                                                                       | SuccessorCompany                           |   |   | Predecessor      Company                   |
|--------------------------------------------------------------------------------------------------------------------------------------------|--------------------------------------------|--------|--------|--------------------------------------------|
|                                                                                                                                       | Three      Months EndedMarch      31, 2008 |   |   | Three      Months EndedMarch      31, 2007 |
|                                                                                                                                       | (In      millions)                         |   |   | (In      millions)                         |
| Segment      Earnings before Depreciation, Depletion and Amortization Expense and      Amortization of Excess Cost of Equity Investments:1 |                                       |   |   |                                       |   |   |   |   |   |
| NGPL                                                                                                                                       | $                                          | 96.0   |   |                                       |   |   | $ | 160.3 |   |
| Power                                                                                                                                      |                                       | 2.1    |   |                                       |   |   |   | 5.7 |   |
| Express                                                                                                                                    |                                       | 4.0    |   |                                       |   |   |   | 3.6 |   |
| Products      Pipelines – KMP                                                                                                        |                                       | 140.3  |   |                                       |   |   |   | 133.7 |   |
| Natural      Gas Pipelines – KMP                                                                                                     |                                       | 188.4  |   |                                       |   |   |   | 134.7 |   |
| CO2 –      KMP                                                                                                                       |                                       | 233.3  |   |                                       |   |   |   | 125.4 |   |
| Terminals      – KMP                                                                                                                 |                                       | 125.8  |   |                                       |   |   |   | 100.5 |   |
| Trans      Mountain – KMP                                                                                                            |                                       | 30.2   |   |                                       |   |   |   | (358.2 | ) |
| Segment      Earnings before Depreciation, Depletion and Amortization Expense and      Amortization of Excess Cost of Equity Investments   |                                       | 820.1  |   |                                       |   |   |   | 305.7 |   |
| Depreciation,      Depletion and Amortization Expense                                                                                      |                                       | (218.1 | )      |                                       |   |   |   | (153.0 | ) |
| Amortization      of Excess Cost of Equity Investments                                                                                     |                                       | (1.4   | )      |                                       |   |   |   | (1.4 | ) |
| Interest      and Corporate Expenses, Net                                                                                                  |                                       | (416.7 | )      |                                       |   |   |   | (318.2 | ) |
| Income      (Loss) From Continuing Operations Before Income Taxes1                                                                         |                                       | 183.9  |   |                                       |   |   |   | (166.9 | ) |
| Income      Taxes1                                                                                                                         |                                       | (78.1  | )      |                                       |   |   |   | (78.7 | ) |
| Income      (Loss) From Continuing Operations                                                                                              |                                       | 105.8  |   |                                       |   |   |   | (245.6 | ) |
| (Loss)      Income From Discontinued Operations, Net of Tax                                                                                |                                       | (0.1   | )      |                                       |   |   |   | 233.2 |   |
| Net      Income (Loss)                                                                                                                     | $                                          | 105.7  |   |                                       |   |   | $ | (12.4 | ) |

| 1 | Income      taxes of Kinder Morgan Energy Partners of $9.0 million for each of the      three-month periods ended March 31, 2008 and 2007, are included in segment      earnings. |
|---|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

| Business      Segment                                                               | Business      Conducted                                                                                                                                                                                                                                                            |   | Referred to      As:                                              |
|-------------------------------------------------------------------------------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|-------------------------------------------------------------------|
|                                                                           |                                                                                                                                                                                                                                                                               |   |                                                              |
| Natural      Gas Pipeline Company ofAmerica      and certain affiliates   |  The      ownership and operation of a major interstate natural gas pipeline and      storage system until February 14, 2008, after which time an equity method      investment ; see Note 5 of the accompanying Notes to Consolidated      Financial Statements.   |   |  Natural      Gas Pipeline Company of America, or NGPL  |

----

| Power      Generation                                              | The      ownership and operation of natural gas-fired electric generation      facilities. Our principal remaining power assets were sold in January      2008; see Note 5 of the accompanying Notes to Consolidated Financial      Statements.                                                                   |   | Power                                   |
|-------------------------------------------------------------------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|----------------------------------------------|
| Express      Pipeline System                                       | The      ownership of a one-third interest in the Express and Platte Pipelines, a      crude pipeline system, which investment we account for under the equity      method, and certain related entities                                                                                                          |   | Express                                 |
| Petroleum      Products Pipelines (Kinder Morgan Energy Partners)  |  The      ownership and operation of refined petroleum products pipelines that      deliver gasoline, diesel fuel, jet fuel and natural gas liquids to various      markets; plus associated product terminals and petroleum pipeline transmix      processing facilities                                              |   |  Products      Pipelines – KMP    |
| Natural      Gas Pipelines (Kinder Morgan Energy Partners)         |  The      ownership and operation of major interstate and intrastate natural gas      pipeline and storage systems                                                                                                                                                                                           |   |  Natural      Gas Pipelines – KMP |
| CO2      (Kinder Morgan Energy Partners)                      | The      production, transportation and marketing of carbon dioxide (CO2) to      oil fields that use CO2 to      increase production of oil; plus ownership interests in and/or operation      of oil fields in West Texas; plus the ownership and operation of a crude      oil pipeline system in West Texas   |   | CO2 -      KMP                          |
| Liquids      and Bulk Terminals (Kinder Morgan Energy Partners)    |  The      ownership and/or operation of liquids and bulk terminal facilities and      rail transloading and materials handling facilities that together      transload, store and deliver a wide variety of bulk, petroleum,      petrochemical and other liquids products                                   |   |  Terminals      - KMP                   |
| Trans      Mountain Pipeline (Kinder Morgan Energy Partners)       | The      ownership and operation of crude and refined petroleum pipelines,      principally located in Canada                                                                                                                                                                                                               |   | Trans      Mountain – KMP              |

----

|                                  | Successor      Company                     |   |   | Predecessor      Company                   |
|---------------------------------------|--------------------------------------------|--------|--------|--------------------------------------------|
|                                  | Three      Months EndedMarch      31, 2008 |   |   | Three      Months EndedMarch      31, 2007 |
|                                  | (In      millions)                         |   |   | (In      millions)                         |
| Segment      Earnings Before DD&A | $                                          | 96.0   |   |                                       |   | $ | 160.3 |   |

|                                                       | Successor      Company                     |   |   | Predecessor      Company                   |
|------------------------------------------------------------|--------------------------------------------|--------|--------|--------------------------------------------|
|                                                       | Three      Months EndedMarch      31, 2008 |   |   | Three      Months EndedMarch      31, 2007 |
|                                                       | (In      millions)                         |   |   | (In      millions)                         |
| Operating      Revenues                                    | $                                          | 7.5    |   |                                       |   | $ | 11.6 |   |
| Operating      Expenses and Minority Interests             |                                       | (5.4   | )      |                                       |   |   | (9.1 | ) |
| Equity      in Earnings of Thermo Cogeneration Partnership |                                       | -      |   |                                       |   |   | 3.2 |   |
| Segment      Earnings Before DD&A                      | $                                          | 2.1    |   |                                       |   | $ | 5.7 |   |

----

|                                  | Successor      Company                     |   |   | Predecessor      Company                   |
|---------------------------------------|--------------------------------------------|--------|--------|--------------------------------------------|
|                                  | Three      Months EndedMarch      31, 2008 |   |   | Three      Months EndedMarch      31, 2007 |
|                                  | (In      millions)                         |   |   | (In      millions)                         |
| Segment      Earnings Before DD&A | $                                          | 4.0    |   |                                       |   | $ | 3.6 |   |

|                                                  | Successor      Company                     |   |   | Predecessor      Company                   |
|-------------------------------------------------------|--------------------------------------------|--------|--------|--------------------------------------------|
|                                                  | Three      Months EndedMarch      31, 2008 |   |   | Three      Months EndedMarch      31, 2007 |
|                                                  | (In      millions)                         |   |   | (In      millions)                         |
| Operating      Revenues                               | $                                          | 198.3  |   |                                       |   | $ | 197.1 |   |
| Operating      Expenses                               |                                       | (62.4  | )      |                                       |   |   | (68.0 | ) |
| Other      Income (Expense)                           |                                       | -      |   |                                       |   |   | (0.5 | ) |
| Earnings      from Equity Investments                 |                                       | 4.8    |   |                                       |   |   | 6.8 |   |
| Interest      Income and Other Income (Expense), Net1 |                                       | 0.5    |   |                                       |   |   | 1.1 |   |
| Income      Taxes                                     |                                       | (0.9   | )      |                                       |   |   | (2.8 | ) |
| Segment      Earnings Before DD&A                 | $                                          | 140.3  |   |                                       |   | $ | 133.7 |   |
|                                             |                                       |   |   |                                       |   |   |   |   |
| Operating      Statistics:                            |                                       |   |   |                                       |   |   |   |   |
| Gasoline      (MMBbl)                                 |                                       | 97.8   |   |                                       |   |   | 107.2 |   |
| Diesel      Fuel (MMBbl)                              |                                       | 38.6   |   |                                       |   |   | 38.2 |   |
| Jet      Fuel (MMBbl)                                 |                                       | 29.7   |   |                                       |   |   | 30.2 |   |
| Total      Refined Product Volumes (MMBbl)            |                                       | 166.1  |   |                                       |   |   | 175.6 |   |
| Natural      Gas Liquids (MMBbl)                      |                                       | 6.9    |   |                                       |   |   | 9.6 |   |
| Total      Delivery Volumes (MMBbl)2                  |                                       | 173.0  |   |                                       |   |   | 185.2 |   |

| 1 | 2008      amounts include a decrease in income of $0.8 million, 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) |
| Cochin      Pipeline System              | $                                      | (0.5   | )                           |   | (5 | )% |   |   | (6.8 | ) |   | (32 | )% |
| Pacific      operations                  |                                   | 3.2    |                        |   | 5 | % |   |   | 3.1 |   |   | 3 | % |
| Southeast      Terminals                 |                                   | 2.4    |                        |   | 26 | % |   |   | 1.6 |   |   | 9 | % |
| Central      Florida Pipeline            |                                   | 0.8    |                        |   | 9 | % |   |   | 0.4 |   |   | 4 | % |
| All      others (including eliminations) |                                   | 1.5    |                        |   | 3 | % |   |   | 2.9 |   |   | 5 | % |
| Total      Products Pipelines            | $                                      | 7.4    |                        |   | 6 | % |   | $ | 1.2 |   |   | 1 | % |

----

|                                                 | Successor      Company                     |     |   | Predecessor      Company                   |
|------------------------------------------------------|--------------------------------------------|----------|--------|--------------------------------------------|
|                                                 | Three      Months EndedMarch      31, 2008 |     |   | Three      Months EndedMarch      31, 2007 |
|                                                 | (In      millions)                         |     |   | (In      millions)                         |
| Operating      Revenues                              | $                                          | 1,912.5  |   |                                       |   | $ | 1,535.4 |   |
| Operating      Expenses1                             |                                       | (1,744.9 | )      |                                       |   |   | (1,405.7 | ) |
| Other      Income (Expense)                          |                                       | -        |   |                                       |   |   | - |   |
| Earnings      from Equity Investments2               |                                       | 23.5     |   |                                       |   |   | 6.4 |   |
| Interest      Income and Other Income (Expense), Net |                                       | 0.2      |   |                                       |   |   | - |   |
| Income      Tax Benefit (Expense)                    |                                       | (2.9     | )      |                                       |   |   | (1.4 | ) |
| Segment      Earnings Before DD&A                | $                                          | 188.4    |   |                                       |   | $ | 134.7 |   |
|                                            |                                       |     |   |                                       |   |   |   |   |
| Operating      Statistics:                           |                                       |     |   |                                       |   |   |   |   |
| Natural      Gas Transport Volumes (Trillion Btus)3  |                                       | 495.4    |   |                                       |   |   | 405.0 |   |
| Natural      Gas Sales Volumes (Trillion Btus)4      |                                       | 215.0    |   |                                       |   |   | 209.0 |   |

| 1 | 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 (see Note 1(A) of the accompanying Notes to      Consolidated Financial Statements). |
|---|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 2 | 2007      amount includes a $1.0 million increase in expense associated with Kinder      Morgan Energy Partners’ portion of a loss from the early extinguishment of      debt by Red Cedar GatheringCompany. |
|---|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 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 pipeline      volumes. |
|---|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 4 | Represents      Texas intrastate natural gas pipelinegroup. |
|---|-------------------------------------------------------------|

|                                             | EBDAIncrease/(Decrease)                |    | RevenuesIncrease/(Decrease) |
|--------------------------------------------------|----------------------------------------|---------|-----------------------------|
|                                             | (In      millions, except percentages) |
| Texas      Intrastate Natural Gas Pipeline Group | $                                      | 32.0    |                        |   | 41 | % |   | $ | 355.9 |   |   | 25 | % |
| Rockies      Express Pipeline                    |                                   | 16.8    |                        |   | 1,006 | % |   |   | — |   |   | — | % |
| TransColorado      Pipeline                      |                                   | 3.2     |                        |   | 30 | % |   |   | 3.7 |   |   | 30 | % |
| All      Others                                  |                                   | 0.5     |                        |   | 1 | % |   |   | 19.9 |   |   | 28 | % |
| Intrasegment      Eliminations                   |                                   | — |                        |   | — |   |   |   | (2.4 | ) |   | (901 | )% |
| Total      Natural Gas Pipelines                 | $                                      | 52.5    |                        |   | 39 | % |   | $ | 377.1 |   |   | 25 | % |

----

----

|                                                                | Successor      Company                     |   |   | Predecessor      Company                   |
|---------------------------------------------------------------------|--------------------------------------------|--------|--------|--------------------------------------------|
|                                                                | Three      Months EndedMarch      31, 2008 |   |   | Three      Months EndedMarch      31, 2007 |
|                                                                | (In      millions)                         |   |   | (In      millions)                         |
| Operating      Revenues1                                            | $                                          | 319.9  |   |                                       |   | $ | 191.6 |   |
| Operating      Expenses                                             |                                       | (90.7  | )      |                                       |   |   | (70.6 | ) |
| Earnings      from Equity Investments                               |                                       | 5.6    |   |                                       |   |   | 5.2 |   |
| Other      Income (Expense), Net                                    |                                       | (0.2   | )      |                                       |   |   | - |   |
| Income      Tax Expense                                             |                                       | (1.3   | )      |                                       |   |   | (0.8 | ) |
| Segment      Earnings Before DD&A                               | $                                          | 233.3  |   |                                       |   | $ | 125.4 |   |
|                                                           |                                       |   |   |                                       |   |   |   |   |
| Operating      Statistics:                                          |                                       |   |   |                                       |   |   |   |   |
| Carbon      Dioxide Delivery Volumes(Bcf)2                          |                                       | 180.2  |   |                                       |   |   | 165.7 |   |
| SACROC      Oil Production (Gross)(MBbl/d)3                         |                                       | 27.3   |   |                                       |   |   | 29.9 |   |
| SACROC      Oil Production (Net)(MBbl/d)4                           |                                       | 22.8   |   |                                       |   |   | 24.9 |   |
| Yates      Oil Production (Gross)(MBbl/d)3                          |                                       | 28.6   |   |                                       |   |   | 26.1 |   |
| Yates      Oil Production (Net)(MBbl/d)4                            |                                       | 12.7   |   |                                       |   |   | 11.6 |   |
| Natural      Gas Liquids Sales Volumes (Net)(MBbl/d)4               |                                       | 9.5    |   |                                       |   |   | 9.7 |   |
| Realized      Weighted Average Oil Price per Bbl5,6                 | $                                          | 50.03  |   |                                       |   | $ | 35.17 |   |
| Realized      Weighted Average Natural Gas Liquids Price per Bbl6,7 | $                                          | 65.93  |   |                                       |   | $ | 41.71 |   |

| 1 | 2008      amount includes a $33.5 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 (see Note 1(A) of the accompanying Notes      to Consolidated FinancialStatements). |
|---|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 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 approximate 97% working interest in the SACROC unit and an approximate      50% working interest in the Yatesunit. |
|---|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 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 | $                                      | 29.0   |                        |   | 74 | % |   | $ | 31.2 |   |   | 74 | % |
| Oil      and Gas Producing Activities    |                                   | 45.4   |                        |   | 53 | % |   |   | 69.8 |   |   | 43 | % |
| Intrasegment      Eliminations           |                                   | -      |                        |   | - |   |   |   | (6.2 | ) |   | (53 | )% |
| Total                                    | $                                      | 74.4   |                        |   | 59 | % |   | $ | 94.8 |   |   | 49 | % |

----

----

|                                                 | Successor      Company                     |   |   | Predecessor      Company                   |
|------------------------------------------------------|--------------------------------------------|--------|--------|--------------------------------------------|
|                                                 | Three      Months EndedMarch      31, 2008 |   |   | Three      Months EndedMarch      31, 2007 |
|                                                 | (In      millions)                         |   |   | (In      millions)                         |
| Operating      Revenues                              | $                                          | 280.2  |   |                                       |   | $ | 215.1 |   |
| Operating      Expenses                              |                                       | (152.8 | )      |                                       |   |   | (115.8 | ) |
| Other      Income1                                   |                                       | 0.6    |   |                                       |   |   | 2.7 |   |
| Earnings      from Equity Investments                |                                       | 1.0    |   |                                       |   |   | - |   |
| Interest      Income and Other Income (Expense), Net |                                       | 1.3    |   |                                       |   |   | - |   |
| Income      Taxes                                    |                                       | (4.5   | )      |                                       |   |   | (1.5 | ) |
| Segment      Earnings Before DD&A                | $                                          | 125.8  |   |                                       |   | $ | 100.5 |   |
|                                            |                                       |   |   |                                       |   |   |   |   |
| Operating      Statistics:                           |                                       |   |   |                                       |   |   |   |   |
| Bulk      Transload Tonnage (MMtons)2                |                                       | 23.2   |   |                                       |   |   | 23.3 |   |
| Liquids      Leaseable Capacity (MMBbl)              |                                       | 50.6   |   |                                       |   |   | 43.6 |   |
| Liquids      Utilization                             |                                       | 97.5   | %      |                                       |   |   | 98.5 | % |

| 1 | 2007      amount includes an increase in income of $1.8 million from property      casualty gains associated with the 2005 hurricane  season. |
|---|-----------------------------------------------------------------------------------------------------------------------------------------------|

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

|   | · | the      Vancouver Wharves bulk marine terminal, which includes five deep-sea      vessel berths and terminal assets located on the north shore of the Port      of Vancouver’s main harbor. The assets include significant rail      infrastructure, dry bulk and liquid storage, and material handling      systems, and were acquired May 30, 2007;and |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | the      terminal assets and operations acquired from Marine Terminals, Inc., which      are primarily involved in the handling and storage of steel and alloys and      consist of two separate facilities located in Blytheville, Arkansas, and      individual terminal facilities located in Decatur, Alabama; Hertford,      North Carolina; and Berkley, South Carolina. The assets were acquired      September 1, 2007. |
|--------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|                                                 | Successor      Company                     |   |   | Predecessor      Company                   |
|------------------------------------------------------|--------------------------------------------|--------|--------|--------------------------------------------|
|                                                 | Three      Months EndedMarch      31, 2008 |   |   | Three      Months EndedMarch      31, 2007 |
|                                                 | (In      millions)                         |   |   | (In      millions)                         |
| Operating      Revenues                              | $                                          | 43.1   |   |                                       |   | $ | 32.8 |   |
| Operating      Expenses                              |                                       | (15.7  | )      |                                       |   |   | (11.9 | ) |
| Other      Income (Expense)1                         |                                       | 2.1    |   |                                       |   |   | (377.1 | ) |
| Savings      from Equity Investments                 |                                       | 0.1    |   |                                       |   |   | - |   |
| Interest      Income and Other Income (Expense), Net |                                       | -      |   |                                       |   |   | 0.5 |   |
| Income      Tax Benefit (Expense)                    |                                       | 0.6    |   |                                       |   |   | (2.5 | ) |
| Segment      Earnings Before DD&A                | $                                          | 30.2   |   |                                       |   | $ | (358.2 | ) |
|                                            |                                       |   |   |                                       |   |   |   |   |
| Operating      Statistics:                           |                                       |   |   |                                       |   |   |   |   |
| Transport      Volumes (MMBbl)                       |                                       | 19.5   |   |                                       |   |   | 19.8 |   |

| 1 | 2007      amount represents a goodwill impairmentexpense. |
|---|-----------------------------------------------------------|

----

|                                    | Successor      Company                     |   |   | Predecessor      Company                   |   |                             |
|-----------------------------------------|--------------------------------------------|--------|--------|--------------------------------------------|--------|----------------------------------|
|                                    | Three      Months EndedMarch      31, 2008 |   |   | Three      Months EndedMarch      31, 2007 |   | Earnings      Increase(Decrease) |
|                                    | (In      millions)                         |   |   | (In      millions)                         |
| General      and Administrative Expense | $                                          | (86.3  | )      |                                       |   | $                                | (110.4 | ) |   | $ | 24.1 |   |
| Interest      Expense, Net              |                                       | (204.0 | )      |                                       |   |                             | (149.6 | ) |   |   | (54.4 | ) |
| Minority      Interests                 |                                       | (126.2 | )      |                                       |   |                             | (58.2 | ) |   |   | (68.0 | ) |
| Other,      Net                         |                                       | (0.2   | )      |                                       |   |                             | - |   |   |   | (0.2 | ) |
|                                    | $                                          | (416.7 | )      |                                       |   | $                                | (318.2 | ) |   | $ | (98.5 | ) |

----

----

|                                                                                                                                                                                                                                                 | Successor      Company     |                 |              | Predecessor      Company   |
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|----------------------------|----------------------|-------------------|----------------------------|
|                                                                                                                                                                                                                                                 | March      31,             |                 | December      31, |                       |   | December      31, |
|                                                                                                                                                                                                                                                 | 2008                       |                 | 2007              |                       |   | 2006 |   | 2005 |
|                                                                                                                                                                                                                                                 | (Dollars      in millions) |                 |              | (Dollars      in millions) |
| Long-term      Debt:                                                                                                                                                                                                                                 |                       |                 |              |                       |   |   |   |   |   |   |   |   |   |   |   |   |
| Outstanding      Notes and Debentures                                                                                                                                                                                                                | $                          | 9,842.6              |              |                       | $ | 14,714.6 |   |   |   | $ | 10,623.9 |   |   | $ | 6,286.8 |   |
| Deferrable      Interest Debentures Issued toSubsidiary      Trusts                                                                                                                                                                                  |                       | 35.7                 |              |                       |   | 283.1 |   |   |   |   | 283.6 |   |   |   | 283.6 |   |
| Preferred      Interest in General Partners of KMP                                                                                                                                                                                                   |                       | 100.0                |              |                       |   | 100.0 |   |   |   |   | - |   |   |   | - |   |
| Capital      Securities                                                                                                                                                                                                                              |                       | -                    |              |                       |   | - |   |   |   |   | 106.9 |   |   |   | 107.2 |   |
| Value      of Interest Rate Swaps1                                                                                                                                                                                                                   |                       | 294.2                |              |                       |   | 199.7 |   |   |   |   | 46.4 |   |   |   | 51.8 |   |
|                                                                                                                                                                                                                                                 |                       | 10,272.5             |              |                       |   | 15,297.4 |   |   |   |   | 11,060.8 |   |   |   | 6,729.4 |   |
| Minority      Interests                                                                                                                                                                                                                              |                       | 3,524.9              |              |                       |   | 3,314.0 |   |   |   |   | 3,095.5 |   |   |   | 1,247.3 |   |
| Common      Equity, Excluding Accumulated Other Comprehensive Loss                                                                                                                                                                                   |                       | 8,160.8              |              |                       |   | 8,069.2 |   |   |   |   | 3,657.5 |   |   |   | 4,051.4 |   |
|                                                                                                                                                                                                                                                 |                       | 21,958.2             |              |                       |   | 26,680.6 |   |   |   |   | 17,813.8 |   |   |   | 12,028.1 |   |
| Value      of Interest Rate Swaps                                                                                                                                                                                                                    |                       | (294.2               | )                 |                       |   | (199.7 | ) |   |   |   | (46.4 | ) |   |   | (51.8 | ) |
| Capitalization                                                                                                                                                                                                                                       |                       | 21,664.0             |              |                       |   | 26,480.9 |   |   |   |   | 17,767.4 |   |   |   | 11,976.3 |   |
| Short-term      Debt, Less Cash and Cash Equivalents2                                                                                                                                                                                                |                       | 469.4                |              |                       |   | 819.3 |   |   |   |   | 2,046.7 |   |   |   | 841.4 |   |
| Invested      Capital                                                                                                                                                                                                                                | $                          | 22,133.4             |              |                       | $ | 27,300.2 |   |   |   | $ | 19,814.1 |   |   | $ | 12,817.7 |   |
|                                                                                                                                                                                                                                            |                       |                 |              |                       |   |   |   |   |   |   |   |   |   |   |   |   |
| Capitalization:                                                                                                                                                                                                                                      |                       |                 |              |                       |   |   |   |   |   |   |   |   |   |   |   |   |
| Outstanding      Notes and Debentures                                                                                                                                                                                                                |                       | 45.4%                |              |                       |   | 55.5% |   |   |   |   | 59.8% |   |   |   | 52.5% |   |
| Minority      Interests                                                                                                                                                                                                                              |                       | 16.3%                |              |                       |   | 12.5% |   |   |   |   | 17.4% |   |   |   | 10.4% |   |
| Common      Equity                                                                                                                                                                                                                                   |                       | 37.6%                |              |                       |   | 30.5% |   |   |   |   | 20.6% |   |   |   | 33.8% |   |
| Deferrable      Interest Debentures Issued to Subsidiary Trusts                                                                                                                                                                                      |                       |  0.2%           |              |                       |   |  1.1% |   |   |   |   |  1.6% |   |   |   |  2.4% |   |
| Preferred      Interest in General Partners of KMP                                                                                                                                                                                                   |                       |  0.5%           |              |                       |   |  0.4% |   |   |   |   |    -% |   |   |   |    -% |   |
| Capital      Securities                                                                                                                                                                                                                              |                       |    -% |              |                       |   |    -% |   |   |   |   |  0.6% |   |   |   |  0.9% |   |
|                                                                                                                                                                                                                                            |                       |                 |              |                       |   |   |   |   |   |   |   |   |   |   |   |   |
| Invested      Capital:                                                                                                                                                                                                                               |                       |                 |              |                       |   |   |   |   |   |   |   |   |   |   |   |   |
| Net      Debt3,4                                                                                                                                                                                                                                     |                       | 46.6%                |              |                       |   | 56.9% |   |   |   |   | 63.9% |   |   |   | 55.6% |   |
| Common      Equity, Excluding Accumulated Other Comprehensive Loss and Including      Deferrable Interest Debentures Issued to Subsidiary Trusts, Preferred      Interest in General Partners of KMP, Capital Securities and Minority      Interests |                       | 53.4%                |              |                       |   | 43.1% |   |   |   |   | 36.1% |   |   |   | 44.4% |   |

|   | 1 | See      “Significant Financing Transactions”following. |
|--------|---|---------------------------------------------------------------------|

|   | 2 | Cash      and cash equivalents netted against short-term debt were $173.0 million,      $148.6 million, $129.8 million and $116.6 million for March 31, 2008 and      December 31, 2007, 2006 and 2005,respectively. |
|--------|---|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | 3 | Outstanding      notes and debentures plus short-term debt, less cash and cash      equivalents. |
|--------|---|--------------------------------------------------------------------------------------------------|

|   | 4 | Our      ratio of net debt to invested capital, not including the effects of      consolidating Kinder Morgan Energy Partners, was 21.4%, 45.6% and 56.2% at      March 31, 2008 and December 31, 2007 and 2008,    respectively. |
|--------|---|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|                                                              |   | At      March 31, 2008             |   | At      May 5, 2008               |
|-------------------------------------------------------------------|--------|------------------------------------|--------|-----------------------------------|
|                                                              |   | Short-termDebtOutstanding          |   | Available      Borrowing Capacity |   | Short-termDebtOutstanding |   | Available      Borrowing Capacity |
|                                                              |   | (In      millions of U.S. dollars) |
| Credit      Facilities:                                           |   |                               |   |                              |   |   |   |   |   |   |   |   |
| Knight Inc.1                                                      |   |                               |   |                              |   |   |   |   |   |   |   |   |
| $1.0      billion, six-year secured revolver, due May 2013        |   | $                                  | 70.0   |                              | $ | 821.0 |   | $ | 270.0 |   | $ | 621.0 |
|                                                         |   |                               |   |                              |   |   |   |   |   |   |   |   |
| Commercial      Paper:                                            |   |                               |   |                              |   |   |   |   |   |   |   |   |
| Kinder Morgan Energy      Partners2                               |   |                               |   |                              |   |   |   |   |   |   |   |   |
| $1.85      billion, five-year unsecured revolver, due August 2010 |   | $                                  | 296.7  |                              | $ | 825.3 |   | $ | 274.9 |   | $ | 847.1 |

| 1 | On      January 5, 2007, after shareholder approval of the Going Private      transaction was announced, Kinder Morgan, Inc.’s secured senior debt      rating was downgraded by Standard & Poor’s Rating Services to BB- due      to the anticipated increase in debt related to the proposed transaction.      On April 11, 2007 and May 30, 2007, Fitch and Moody’s Investor Services      lowered their ratings to BB and Ba2, respectively, also related to the      transaction. Following the sale of an 80% ownership interest in our NGPL      business segment on February 15, 2008 (see Note 5 of the accompanying      Notes to Consolidated Financial Statements), Standard & Poor’s Rating      Services upgraded Knight Inc.’s secured senior debt to BB, Fitch upgraded      its rating to BB+, and Moody’s Investor Services to Ba1. Because we have a      non-investment grade credit rating, we no longer have access to the      commercial paper market. As a result, we are currently utilizing our $1.0      billion revolving credit facility for Knight Inc.’s short-term borrowing      needs. |
|---|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | As      discussed following, the loan agreements we had in place prior to the      Going Private transaction were cancelled and replaced with a new loan      agreement. Our indentures related to publicly issued notes do not contain      covenants related to maintenance of credit ratings. Accordingly, no such      covenants were impacted by the downgrade in our credit ratings occasioned      by the Going Private transaction. |
|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 2 | On      January 5, 2007, in anticipation of the Going Private transaction closing,      S&P downgraded Kinder Morgan Energy Partners one level to BBB and      removed its rating from credit watch with negative implications. As projected by      Moody’s Investor Services in its credit opinion dated November 15, 2006,      it downgraded Kinder Morgan Energy Partners’ credit rating from Baa1 to      Baa2 on May 30, 2007, following the closing of the going-private      transaction. Additionally, Kinder Morgan Energy Partners’ rating was      downgraded by Fitch Ratings from BBB+ to BBB on April 11, 2007.      Currently, Kinder Morgan Energy Partners’ corporate debt credit      rating is BBB, Baa2 and BBB, respectively, at Standard & Poor’s Rating      Services, Moody’s Investor Services andFitch. |
|---|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

----

----

----

----

|   | · | 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 our tariff rates or those of Kinder Morgan Energy Partners implemented      by the FERC or, with respect to Kinder Morgan Energy Partners, the      California Public UtilitiesCommission; |
|--------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | Kinder      Morgan Energy Partners’ ability and our ability to acquire new businesses      and assets and integrate those operations into existing operations, as      well as the ability to expand our respective  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 or our terminals orpipelines; |
|--------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | Kinder      Morgan Energy Partners’ ability and 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 Kinder Morgan      Energy Partners’ or our services or provide services or products to Kinder      Morgan Energy Partners or us; |
|--------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | crude      oil and natural gas production from exploration and production areas that      we serve, including, among others, the Permian Basin area of West Texas,      the U.S. Rocky Mountains and the Alberta  oilsands; |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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

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

|   | · | our      indebtedness 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      markets conditions; |
|--------|--------|----------------------------------|

|   | · | 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; |
|--------|--------|-------------------------------------------------------------------------------------------------------------------------|

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

|   | · | inflation; |
|--------|--------|------------|

----

|   | · | interest      rates; |
|--------|--------|----------------------|

|   | · | the      pace of deregulation of retail natural gas and  electricity; |
|--------|--------|-----------------------------------------------------------------------|

|   | · | 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.

----

|   | · | limiting      Kinder Morgan Energy Partners’ ability to obtain additional financing to      fund its working capital, capital expenditures, debt service requirements      or potential growth or for otherpurposes; |
|--------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | limiting      Kinder Morgan Energy Partners’ ability to use operating cash flow in other      areas of its business because it must dedicate a substantial portion of      these funds to make payments on itsdebt; |
|--------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | placing      Kinder Morgan Energy Partners at a competitive disadvantage compared to      competitors with less debt; and |
|--------|--------|---------------------------------------------------------------------------------------------------------------------------|

|   | · | increasing      Kinder Morgan Energy Partners’ vulnerability to adverse economic and      industry conditions. |
|--------|--------|----------------------------------------------------------------------------------------------------------------------|

UnregisteredSales of Equity Securities and Use of Proceeds.

Item 3.     DefaultsUpon Senior Securities.

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

None.

----

Item 6.     Exhibits.

|   | 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      15, 2008 | /s/      Kimberly A. Dang                                           |
|              | Kimberly      A. DangVice      President and Chief FinancialOfficer |

----