Table of Contents

----

----

| [X] |    | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)OF THE SECURITIES EXCHANGE ACT OF 1934 |
|-----|--------------|----------------------------------------------------------------------------------------|

| [   ] |    | 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.) |

----

|    |                                                                                            | PageNumber |
|--------------|-------------------------------------------------------------------------------------------------|------------|
|         | PART I. FINANCIALINFORMATION                                                                    |       |
|         |                                                                                            |       |
| Item 1.      | Financial Statements. (Unaudited)                                                               |       |
|         | Consolidated Statements of Operations – Three and six months Ended June 30, 2009 and 2008 | 3          |
|         | Consolidated Balance Sheets – June 30, 2009 and December 31, 2008                         | 4          |
|         | Consolidated Statements of Cash Flows – Six Months Ended June 30, 2009 and 2008           | 5          |
|         | Notes to Consolidated Financial Statements                                                      | 7          |
|    |                                                                                            |       |
| Item 2.      | Management’s Discussion and Analysis of Financial Condition and Results of Operations     |       |
|         | General and Basis of Presentation                                                               | 43         |
|         | Critical Accounting Policies and Estimates                                                      | 43         |
|         | Results of Operations                                                                           | 44         |
|         | Kinder Morgan Energy Partners                                                                   | 58         |
|         | Financial Condition                                                                             | 58         |
|         | Recent Accounting Pronouncements                                                                | 62         |
|         | Information Regarding Forward-Looking Statements                                                | 62         |
|    |                                                                                            |       |
| Item 3.      | Quantitative and Qualitative Disclosures About Market Risk.                                     | 64         |
|    |                                                                                            |       |
| Item 4.      | Controls and Procedures.                                                                        | 64         |
|    |                                                                                            |       |
|         | PART II. OTHER INFORMATION                                                                      |       |
|    |                                                                                            |       |
| Item 1.      | Legal Proceedings.                                                                              | 64         |
|    |                                                                                            |       |
| Item 1A.     | Risk Factors.                                                                                   | 64         |
|    |                                                                                            |       |
| Item 2.      | Unregistered Sales of Equity Securities and Use of Proceeds.                                    | 64         |
|    |                                                                                            |       |
| Item 3.      | Defaults Upon Senior Securities.                                                                | 64         |
|    |                                                                                            |       |
| Item 4.      | Submission of Matters to a Vote of Security Holders.                                            | 64         |
|    |                                                                                            |       |
| Item 5.      | Other Information.                                                                              | 64         |
|    |                                                                                            |       |
| Item 6.      | Exhibits.                                                                                       | 65         |
|    |                                                                                            |       |
|         | Signature                                                                                       | 66         |

----

PART I. - FINANCIAL INFORMATION 

Item 1.  Financial Statements. 

KINDER MORGAN, INC. AND SUBSIDIARIES 

|                                                              | Three Months Ended June 30, |    | Six Months Ended June 30, |
|-------------------------------------------------------------------|-----------------------------|---------|---------------------------|
|                                                              | 2009                        |    | 2008                      |   | 2009 |   | 2008 |
| Revenues                                                          |                        |    |                      |   |   |   |   |   |   |   |   |   |   |   |   |
| Natural gas sales                                                 | $                           | 716.9   |                      |   | $ | 2,464.7 |   |   | $ | 1,605.6 |   |   | $ | 4,186.5 |   |
| Services                                                          |                        | 652.1   |                      |   |   | 678.7 |   |   |   | 1,313.5 |   |   |   | 1,486.6 |   |
| Product sales and other                                           |                        | 324.3   |                      |   |   | 417.1 |   |   |   | 603.1 |   |   |   | 782.4 |   |
| Total Revenues                                                    |                        | 1,693.3 |                      |   |   | 3,560.5 |   |   |   | 3,522.2 |   |   |   | 6,455.5 |   |
|                                                         |                        |    |                      |   |   |   |   |   |   |   |   |   |   |   |   |
| Operating Costs, Expenses and Other                               |                        |    |                      |   |   |   |   |   |   |   |   |   |   |   |   |
| Gas purchases and other costs of sales                            |                        | 709.5   |                      |   |   | 2,494.1 |   |   |   | 1,575.1 |   |   |   | 4,254.7 |   |
| Operations and maintenance                                        |                        | 273.0   |                      |   |   | 314.8 |   |   |   | 529.4 |   |   |   | 616.6 |   |
| Depreciation, depletion and amortization                          |                        | 256.8   |                      |   |   | 215.7 |   |   |   | 521.6 |   |   |   | 433.8 |   |
| General and administrative                                        |                        | 84.1    |                      |   |   | 91.8 |   |   |   | 177.0 |   |   |   | 178.1 |   |
| Taxes, other than income taxes                                    |                        | 23.4    |                      |   |   | 51.1 |   |   |   | 62.4 |   |   |   | 103.6 |   |
| Other expense (income)                                            |                        | (0.2    | )                         |   |   | (2.2 | ) |   |   | 0.1 |   |   |   | (2.7 | ) |
| Goodwill impairment                                               |                        | -       |                      |   |   | 4,033.3 |   |   |   | - |   |   |   | 4,033.3 |   |
| Total Operating Costs, Expenses and Other                         |                        | 1,346.6 |                      |   |   | 7,198.6 |   |   |   | 2,865.6 |   |   |   | 9,617.4 |   |
|                                                         |                        |    |                      |   |   |   |   |   |   |   |   |   |   |   |   |
| Operating Income (Loss)                                           |                        | 346.7   |                      |   |   | (3,638.1 | ) |   |   | 656.6 |   |   |   | (3,161.9 | ) |
|                                                         |                        |    |                      |   |   |   |   |   |   |   |   |   |   |   |   |
| Other Income (Expense)                                            |                        |    |                      |   |   |   |   |   |   |   |   |   |   |   |   |
| Earnings from equity investments                                  |                        | 47.7    |                      |   |   | 55.3 |   |   |   | 94.9 |   |   |   | 99.0 |   |
| Interest, net                                                     |                        | (138.7  | )                         |   |   | (141.6 | ) |   |   | (280.2 | ) |   |   | (352.3 | ) |
| Interest income (expense) – deferrable interest debentures  |                        | (0.6    | )                         |   |   | (0.6 | ) |   |   | (1.1 | ) |   |   | 6.1 |   |
| Other, net                                                        |                        | 20.3    |                      |   |   | 10.5 |   |   |   | 30.9 |   |   |   | 13.7 |   |
| Total Other Income (Expense)                                      |                        | (71.3   | )                         |   |   | (76.4 | ) |   |   | (155.5 | ) |   |   | (233.5 | ) |
|                                                         |                        |    |                      |   |   |   |   |   |   |   |   |   |   |   |   |
| Income (Loss) from Continuing Operations Before Income Taxes |                        | 275.4   |                      |   |   | (3,714.5 | ) |   |   | 501.1 |   |   |   | (3,395.4 | ) |
| Income Taxes                                                      |                        | 67.0    |                      |   |   | 19.4 |   |   |   | 147.6 |   |   |   | 106.5 |   |
| Income (Loss) from Continuing Operations                          |                        | 208.4   |                      |   |   | (3,733.9 | ) |   |   | 353.5 |   |   |   | (3,501.9 | ) |
| Income (Loss) from Discontinued Operations, Net of Tax            |                        | 0.7     |                      |   |   | (0.3 | ) |   |   | 0.5 |   |   |   | (0.4 | ) |
| Net Income (Loss)                                                 |                        | 209.1   |                      |   |   | (3,734.2 | ) |   |   | 354.0 |   |   |   | (3,502.3 | ) |
| Net Income attributable to Noncontrolling Interests               |                        | (79.3   | )                         |   |   | (126.4 | ) |   |   | (108.9 | ) |   |   | (252.6 | ) |
|                                                         |                        |    |                      |   |   |   |   |   |   |   |   |   |   |   |   |
| Net Income (Loss) attributable to Kinder Morgan, Inc.        | $                           | 129.8   |                      |   | $ | (3,860.6 | ) |   | $ | 245.1 |   |   | $ | (3,754.9 | ) |

----

KINDER MORGAN, INC. AND SUBSIDIARIES 

|                                                                                                    | June 30,2009 |     | December 31,2008 |
|---------------------------------------------------------------------------------------------------------|--------------|----------|------------------|
| ASSETS                                                                                                  |         |     |             |   |   |   |   |
| Current Assets                                                                                          |         |     |             |   |   |   |   |
| Cash and cash equivalents                                                                               | $            | 167.0    |             |   | $ | 118.6 |   |
| Restricted deposits                                                                                     |         | 21.8     |             |   |   | - |   |
| Accounts, notes and interest receivable, net                                                            |         | 751.2    |             |   |   | 992.5 |   |
| Inventories                                                                                             |         | 55.6     |             |   |   | 44.2 |   |
| Gas imbalances                                                                                          |         | 12.5     |             |   |   | 14.1 |   |
| Gas in underground storage                                                                              |         | 50.0     |             |   |   | - |   |
| Fair value of derivative contracts                                                                      |         | 44.8     |             |   |   | 115.2 |   |
| Other                                                                                                   |         | 93.2     |             |   |   | 32.6 |   |
| Total Current Assets                                                                                    |         | 1,196.1  |             |   |   | 1,317.2 |   |
|                                                                                          |         |     |             |   |   |   |   |
| Property, plant and equipment, net                                                                      |         | 16,424.5 |             |   |   | 16,109.8 |   |
| Investments                                                                                             |         | 2,596.6  |             |   |   | 1,827.4 |   |
| Notes receivable                                                                                        |         | 181.5    |             |   |   | 178.1 |   |
| Goodwill                                                                                                |         | 4,719.0  |             |   |   | 4,698.7 |   |
| Other intangibles, net                                                                                  |         | 246.0    |             |   |   | 251.5 |   |
| Fair value of derivative contracts                                                                      |         | 351.2    |             |   |   | 828.0 |   |
| Deferred charges and other assets                                                                       |         | 211.9    |             |   |   | 234.2 |   |
| Total Assets                                                                                            | $            | 25,926.8 |             |   | $ | 25,444.9 |   |
|                                                                                                    |         |     |             |   |   |   |   |
| LIABILITIES AND STOCKHOLDERS’ EQUITY                                                              |         |     |             |   |   |   |   |
| Current Liabilities                                                                                     |         |     |             |   |   |   |   |
| Current portion of debt                                                                                 | $            | 175.4    |             |   | $ | 302.5 |   |
| Cash book overdrafts                                                                                    |         | 22.8     |             |   |   | 45.2 |   |
| Accounts payable                                                                                        |         | 489.3    |             |   |   | 849.8 |   |
| Accrued interest                                                                                        |         | 263.1    |             |   |   | 241.9 |   |
| Accrued taxes                                                                                           |         | 57.5     |             |   |   | 152.1 |   |
| Deferred revenues                                                                                       |         | 50.8     |             |   |   | 41.2 |   |
| Gas imbalances                                                                                          |         | 25.0     |             |   |   | 12.4 |   |
| Fair value of derivative contracts                                                                      |         | 228.6    |             |   |   | 129.5 |   |
| Other                                                                                                   |         | 186.0    |             |   |   | 240.1 |   |
| Total Current Liabilities                                                                               |         | 1,498.5  |             |   |   | 2,014.7 |   |
| Long-term Liabilities and Deferred Credits                                                              |         |     |             |   |   |   |   |
| Long-term debt                                                                                          |         |     |             |   |   |   |   |
| Outstanding notes and debentures                                                                        |         | 12,004.1 |             |   |   | 11,020.1 |   |
| Deferrable interest debentures issued to subsidiary trusts                                              |         | 35.7     |             |   |   | 35.7 |   |
| Preferred interest in general partner of Kinder Morgan Energy Partners                                  |         | 100.0    |             |   |   | 100.0 |   |
| Value of interest rate swaps                                                                            |         | 487.8    |             |   |   | 971.0 |   |
| Total Long-term Debt                                                                                    |         | 12,627.6 |             |   |   | 12,126.8 |   |
| Deferred income taxes                                                                                   |         | 2,022.9  |             |   |   | 2,081.3 |   |
| Asset retirement obligation                                                                             |         | 83.0     |             |   |   | 74.0 |   |
| Fair value of derivative contracts                                                                      |         | 396.1    |             |   |   | 92.2 |   |
| Other long-term liabilities and deferred credits                                                        |         | 525.0    |             |   |   | 579.0 |   |
| Total Long-term Liabilities and Deferred Credits                                                        |         | 15,654.6 |             |   |   | 14,953.3 |   |
| Total Liabilities                                                                                       |         | 17,153.1 |             |   |   | 16,968.0 |   |
|                                                                                                    |         |     |             |   |   |   |   |
| Commitments and Contingencies (Notes 4 and 11)                                                          |         |     |             |   |   |   |   |
| Stockholders’ Equity                                                                              |         |     |             |   |   |   |   |
| Common stock – authorized and outstanding – 100 shares, par value $0.01 per share |         | -        |             |   |   | - |   |
| Additional paid-in capital                                                                              |         | 7,829.5  |             |   |   | 7,810.0 |   |
| Retained deficit                                                                                        |         | (3,257.1 | )                |   |   | (3,352.3 | ) |
| Accumulated other comprehensive loss                                                                    |         | (174.4   | )                |   |   | (53.4 | ) |
| Total Kinder Morgan, Inc. Stockholder’s Equity                                                    |         | 4,398.0  |             |   |   | 4,404.3 |   |
| Noncontrolling interests                                                                                |         | 4,375.7  |             |   |   | 4,072.6 |   |
| Total Stockholders’ Equity                                                                        |         | 8,773.7  |             |   |   | 8,476.9 |   |
| Total Liabilities and Stockholders’ Equity                                                        | $            | 25,926.8 |             |   | $ | 25,444.9 |   |

----

KINDER MORGAN, INC. AND SUBSIDIARIES 

|                                                                                  | Six Months Ended June 30, |
|---------------------------------------------------------------------------------------|---------------------------|
|                                                                                  | 2009                      |   | 2008 |
| Cash Flows from Operating Activities                                                  |                      |   |   |   |   |   |   |
| Net Income (Loss)                                                                     | $                         | 354.0 |   |   | $ | (3,502.3 | ) |
| Adjustments to reconcile net income to net cash flows from operating activities  |                      |   |   |   |   |   |   |
| Loss from goodwill impairment                                                         |                      | - |   |   |   | 4,033.3 |   |
| Loss on early extinguishment of debt                                                  |                      | - |   |   |   | 23.6 |   |
| Depreciation, depletion and amortization                                              |                      | 521.6 |   |   |   | 433.8 |   |
| Amortization of excess cost of equity investments                                     |                      | 2.9 |   |   |   | 2.9 |   |
| Deferred income taxes                                                                 |                      | 15.8 |   |   |   | 33.6 |   |
| Income from the allowance for equity funds used during construction                   |                      | (20.3 | ) |   |   | - |   |
| Net losses (gains) on sales of assets                                                 |                      | 0.1 |   |   |   | (2.8 | ) |
| Earnings from equity investments                                                      |                      | (97.8 | ) |   |   | (101.9 | ) |
| Mark-to-market interest rate swap gain                                                |                      | - |   |   |   | (19.8 | ) |
| Distributions from equity investments                                                 |                      | 122.7 |   |   |   | 83.7 |   |
| Proceeds from (payment for) termination of interest rate swap agreements              |                      | 144.4 |   |   |   | (2.5 | ) |
| Pension contributions in excess of expense                                            |                      | (13.7 | ) |   |   | - |   |
| Changes in components of working capital                                              |                      |   |   |   |   |   |   |
| Accounts receivable                                                                   |                      | 175.2 |   |   |   | (463.7 | ) |
| Other current assets                                                                  |                      | (73.3 | ) |   |   | (62.2 | ) |
| Inventories                                                                           |                      | (11.2 | ) |   |   | (5.3 | ) |
| Accounts payable                                                                      |                      | (277.2 | ) |   |   | 364.1 |   |
| Accrued interest                                                                      |                      | 21.2 |   |   |   | (22.1 | ) |
| Accrued liabilities                                                                   |                      | (78.7 | ) |   |   | (9.7 | ) |
| Accrued taxes                                                                         |                      | (137.3 | ) |   |   | (371.1 | ) |
| Rate reparations, refunds and litigation reserve adjustments                |                      | (15.5 | ) |   |   | (23.3 | ) |
| Other, net                                                                            |                      | (52.4 | ) |   |   | (7.1 | ) |
| Net Cash Flows Provided by Continuing Operations                                      |                      | 580.5 |   |   |   | 381.2 |   |
| Net Cash Flows Provided by (Used in) Discontinued Operations                          |                      | 0.3 |   |   |   | (0.5 | ) |
| Net Cash Flows Provided by Operating Activities                                       |                      | 580.8 |   |   |   | 380.7 |   |
|                                                                             |                      |   |   |   |   |   |   |
| Cash Flows from Investing Activities                                                  |                      |   |   |   |   |   |   |
| Proceeds from sale of 80% interest in NGPL PipeCo LLC, net of $1.1 cash sold     |                      | - |   |   |   | 2,899.3 |   |
| Proceeds from NGPL PipeCo LLC restricted cash                                         |                      | - |   |   |   | 3,106.4 |   |
| Acquisitions of assets                                                                |                      | (18.5 | ) |   |   | (4.2 | ) |
| Repayments from customers                                                             |                      | 109.6 |   |   |   | - |   |
| Capital expenditures                                                                  |                      | (794.1 | ) |   |   | (1,269.2 | ) |
| Sale of property, plant and equipment, and other net assets net of removal costs |                      | (4.0 | ) |   |   | 113.0 |   |
| Investments in margin deposits                                                        |                      | (24.9 | ) |   |   | (207.1 | ) |
| Contributions to investments                                                          |                      | (803.6 | ) |   |   | (339.4 | ) |
| Distributions from equity investments                                                 |                      | 6.5 |   |   |   | 89.1 |   |
| Natural gas stored underground and natural gas liquids line-fill                      |                      | - |   |   |   | (2.7 | ) |
| Net Cash Flows (Used in) Provided by Investing Activities                             | $                         | (1,529.0 | ) |   | $ | 4,385.2 |   |

----

|                                                                   | Six Months Ended June 30, |
|------------------------------------------------------------------------|---------------------------|
|                                                                   | 2009                      |   | 2008 |
| Cash Flows from Financing Activities                                   |                      |   |   |   |   |   |   |
| Issuance of debt                                                       | $                         | 3,857.0 |   |   | $ | 5,942.0 |   |
| Payment of debt                                                        |                      | (2,996.5 | ) |   |   | (10,826.5 | ) |
| Discount on early extinguishment of debt                               |                      | - |   |   |   | 69.2 |   |
| Repayments from (to) related party                                     |                      | 2.5 |   |   |   | (11.5 | ) |
| Debt issue costs                                                       |                      | (7.4 | ) |   |   | (12.1 | ) |
| Cash book overdrafts                                                   |                      | (22.3 | ) |   |   | 18.5 |   |
| Cash dividends                                                         |                      | (150.0 | ) |   |   | - |   |
| Contributions from noncontrolling interests                            |                      | 669.5 |   |   |   | 384.8 |   |
| Distributions to noncontrolling interests                              |                      | (358.6 | ) |   |   | (300.9 | ) |
| Other, net                                                             |                      | (0.1 | ) |   |   | 3.9 |   |
| Net Cash Flows Provided by (Used in) Financing Activities              |                      | 994.1 |   |   |   | (4,732.6 | ) |
|                                                                   |                      |   |   |   |   |   |   |
| Effect of exchange rate changes on cash                                |                      | 2.5 |   |   |   | (1.0 | ) |
|                                                                   |                      |   |   |   |   |   |   |
| Net Increase in Cash and Cash Equivalents                              |                      | 48.4 |   |   |   | 32.3 |   |
| Cash and Cash Equivalents at Beginning of Period                       |                      | 118.6 |   |   |   | 148.6 |   |
| Cash and Cash Equivalents at End of Period                             | $                         | 167.0 |   |   | $ | 180.9 |   |
|                                                                   |                      |   |   |   |   |   |   |
|                                                                   |                      |   |   |   |   |   |   |
| Noncash Investing and Financing Activities                             |                      |   |   |   |   |   |   |
| Assets acquired by the assumption or incurrence of liabilities         | $                         | 3.7 |   |   | $ | 2.3 |   |
| Assets acquired by contributions from noncontrolling interests         | $                         | 5.0 |   |   | $ | - |   |
| Supplemental Disclosures of Cash Flow Information                      |                      |   |   |   |   |   |   |
| Cash paid during the period for interest (net of capitalized interest) | $                         | 294.0 |   |   | $ | 358.0 |   |
| Cash paid during the period for income taxes                           | $                         | 277.6 |   |   | $ | 399.6 |   |

----

KINDER MORGAN, INC. AND SUBSIDIARIES 

| 1.   General |
|-----------------------------|

| Organization |
|--------------|

----

| 2.   Acquisitions, Joint Ventures and Divestitures |
|-------------------------------------------------------------------|

----

| Goodwill |
|----------|

|                                        | ProductsPipelines–KMP |    | Natural GasPipelines–KMP |   | CO2–KMP |    | Terminals–KMP |   | KinderMorganCanada–KMP |    | Total  |
|---------------------------------------------|-----------------------------|---------|--------------------------------|--------|---------------|---------|---------------------|--------|------------------------------|---------|--------|
| Balance as of December 31, 2008             | $                           | 850.0   |                           |   | $             | 1,349.2 |                |   | $                            | 1,521.7 |   |   | $ | 774.2 |   |   | $ | 203.6 |   |   | $ | 4,698.7 |   |
| Acquisitions and purchase price adjustments |                        | ─ |                           |   |          | ─ |                |   |                         | ─ |   |   |   | 10.6 |   |   |   | ─ |   |   |   | 10.6 |   |
| Currency translation adjustments            |                        | ─ |                           |   |          | ─ |                |   |                         | ─ |   |   |   | ─ |   |   |   | 9.7 |   |   |   | 9.7 |   |
| Balance as of June 30, 2009                 | $                           | 850.0   |                           |   | $             | 1,349.2 |                |   | $                            | 1,521.7 |   |   | $ | 784.8 |   |   | $ | 213.3 |   |   | $ | 4,719.0 |   |

| Other Intangibles |
|-------------------|

|                                             | June 30,2009  |   | December 31,2008 |
|--------------------------------------------------|---------------|--------|------------------|
|                                             | (In millions) |
| Customer relationships, contracts and agreements |          |   |             |   |   |   |   |
| Gross carrying amount                            | $             | 272.5  |             |   | $ | 270.9 |   |
| Accumulated amortization                         |          | (39.6  | )                |   |   | (30.3 | ) |
| Net carrying amount                              |          | 232.9  |             |   |   | 240.6 |   |
|                                             |          |   |             |   |   |   |   |
| Technology-based assets, lease values and other  |          |   |             |   |   |   |   |
| Gross carrying amount                            |          | 14.1   |             |   |   | 11.7 |   |
| Accumulated amortization                         |          | (1.0   | )                |   |   | (0.8 | ) |
| Net carrying amount                              |          | 13.1   |             |   |   | 10.9 |   |
|                                             |          |   |             |   |   |   |   |
| Total other intangibles, net                     | $             | 246.0  |             |   | $ | 251.5 |   |

----

| 4.   Debt |
|--------------------------|

|                                                    | June 30, 2009           |
|---------------------------------------------------------|-------------------------|
|                                                    | Short-termNotes Payable |   | CommercialPaperOutstanding |   | Weighted-AverageInterest Rate |
|                                                    | (In millions)           |
|                                                    |                    |   |   |   |   |   |   |   |   |   |   |   |   |
| Kinder Morgan, Inc. – Secured debt(a)             |                    | $ | 25.0 |   |   | $ | - |   |   |   | 1.45 | % |   |
| Kinder Morgan Energy Partners – Unsecured debt(b) |                    | $ | 100.0 |   |   | $ | - |   |   |   | 0.67 | % |   |

| (a) | The average short-term debt outstanding (and related weighted-average interest rate) was $61.3 million (2.27%) and $91.1 million (2.28%) during the three and six months ended June 30, 2009. |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (b) | The average short-term debt outstanding (and related weighted-average interest rate) was $492.4 million (1.60%) and $379.9 million (1.81%) during the three and six months ended June 30, 2009. |
|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

----

----

----

|                                                                                     | Three Months Ended June 30, |
|------------------------------------------------------------------------------------------|-----------------------------|
|                                                                                     | 2009                        |   | 2008 |
|                                                                                     | KinderMorgan, Inc.          |   | Noncontrolling interests |   | Total |   | KinderMorgan, Inc. |   | Noncontrolling interests |   | Total |
|                                                                                     |                        |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                     |                        |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Beginning Balance                                                                        | $                           | 4,451.3 |   |   | $ | 4,187.4 |   |   | $ | 8,638.7 |   |   | $ | 7,786.4 |   |   | $ | 3,524.9 |   |   | $ | 11,311.3 |   |
| Impact from equity transactions of Kinder Morgan Energy Partners                         |                        | 9.3 |   |   |   | (14.5 | ) |   |   | (5.2 | ) |   |   | - |   |   |   | - |   |   |   | - |   |
| A-1 and B unit amortization                                                              |                        | 1.9 |   |   |   | - |   |   |   | 1.9 |   |   |   | 1.9 |   |   |   | - |   |   |   | 1.9 |   |
| Distributions to noncontrolling interests                                                |                        | - |   |   |   | (183.1 | ) |   |   | (183.1 | ) |   |   | - |   |   |   | (157.5 | ) |   |   | (157.5 | ) |
| Contributions from noncontrolling interests                                              |                        | - |   |   |   | 386.6 |   |   |   | 386.6 |   |   |   | - |   |   |   | 0.3 |   |   |   | 0.3 |   |
| Kinder Morgan Energy Partners’ Express pipeline system acquisition adjustment |                        | - |   |   |   | 0.3 |   |   |   | 0.3 |   |   |   | - |   |   |   | - |   |   |   | - |   |
| Cash dividends                                                                           |                        | (100.0 | ) |   |   | - |   |   |   | (100.0 | ) |   |   | - |   |   |   | - |   |   |   | - |   |
| Other                                                                                    |                        | - |   |   |   | (0.7 | ) |   |   | (0.7 | ) |   |   | - |   |   |   | 7.0 |   |   |   | 7.0 |   |
| Comprehensive income (loss)                                                              |                        |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Net income                                                                               |                        | 129.8 |   |   |   | 79.3 |   |   |   | 209.1 |   |   |   | (3,860.6 | ) |   |   | 126.4 |   |   |   | (3,734.2 | ) |
| Other comprehensive income (loss), net of tax                                  |                        |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Change in fair value of derivatives utilized for hedging purposes                        |                        | (111.3 | ) |   |   | (153.8 | ) |   |   | (265.1 | ) |   |   | (577.3 | ) |   |   | (753.4 | ) |   |   | (1,330.7 | ) |
| Reclassification of change in fair value of derivatives to net income                    |                        | (14.4 | ) |   |   | 14.4 |   |   |   | - |   |   |   | 95.9 |   |   |   | 118.6 |   |   |   | 214.5 |   |
| Foreign currency translation adjustments                                                 |                        | 31.4 |   |   |   | 59.7 |   |   |   | 91.1 |   |   |   | 15.6 |   |   |   | 5.8 |   |   |   | 21.4 |   |
| Adjustments to pension andother postretirement benefit plan liabilities   |                        | - |   |   |   | 0.1 |   |   |   | 0.1 |   |   |   | (0.5 | ) |   |   | (0.1 | ) |   |   | (0.6 | ) |
| Total other comprehensive loss                                                           |                        | (94.3 | ) |   |   | (79.6 | ) |   |   | (173.9 | ) |   |   | (466.3 | ) |   |   | (629.1 | ) |   |   | (1,095.4 | ) |
| Total comprehensive income (loss)                                                        |                        | 35.5 |   |   |   | (0.3 | ) |   |   | 35.2 |   |   |   | (4,326.9 | ) |   |   | (502.7 | ) |   |   | (4,829.6 | ) |
| Ending Balance                                                                           | $                           | 4,398.0 |   |   | $ | 4,375.7 |   |   | $ | 8,773.7 |   |   | $ | 3,461.4 |   |   | $ | 2,872.0 |   |   | $ | 6,333.4 |   |

|                                                                                     | Six Months Ended June 30, |
|------------------------------------------------------------------------------------------|---------------------------|
|                                                                                     | 2009                      |   | 2008 |
|                                                                                     | KinderMorgan, Inc.        |   | Noncontrolling interests |   | Total |   | KinderMorgan, Inc. |   | Noncontrolling interests |   | Total |
|                                                                                     |                      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                     |                      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Beginning Balance                                                                        | $                         | 4,404.3 |   |   | $ | 4,072.6 |   |   | $ | 8,476.9 |   |   | $ | 7,821.5 |   |   | $ | 3,314.0 |   |   | $ | 11,135.5 |   |
| Impact from equity transactions of Kinder Morgan Energy Partners                         |                      | 15.8 |   |   |   | (24.6 | ) |   |   | (8.8 | ) |   |   | (16.0 | ) |   |   | (15.4 | ) |   |   | (31.4 | ) |
| A-1 and B unit amortization                                                              |                      | 3.8 |   |   |   | - |   |   |   | 3.8 |   |   |   | 3.8 |   |   |   | - |   |   |   | 3.8 |   |
| Distributions to noncontrolling interests                                                |                      | - |   |   |   | (359.4 | ) |   |   | (359.4 | ) |   |   | - |   |   |   | (301.9 | ) |   |   | (301.9 | ) |
| Contributions from noncontrolling interests                                              |                      | - |   |   |   | 674.5 |   |   |   | 674.5 |   |   |   | - |   |   |   | 384.8 |   |   |   | 384.8 |   |
| Kinder Morgan Energy Partners’ Express pipeline system acquisition adjustment |                      | - |   |   |   | 3.1 |   |   |   | 3.1 |   |   |   | - |   |   |   | - |   |   |   | - |   |
| Cash dividends                                                                           |                      | (150.0 | ) |   |   | - |   |   |   | (150.0 | ) |   |   | - |   |   |   | - |   |   |   | - |   |
| Other                                                                                    |                      | - |   |   |   | (0.8 | ) |   |   | (0.8 | ) |   |   | - |   |   |   | 5.0 |   |   |   | 5.0 |   |
| Comprehensive income (loss)                                                              |                      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Net income                                                                               |                      | 245.1 |   |   |   | 108.9 |   |   |   | 354.0 |   |   |   | (3,754.9 | ) |   |   | 252.6 |   |   |   | (3,502.3 | ) |
| Other comprehensive income (loss), net of tax                                  |                      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Change in fair value of derivatives utilized for hedging purposes                        |                      | (95.4 | ) |   |   | (136.3 | ) |   |   | (231.7 | ) |   |   | (797.0 | ) |   |   | (943.0 | ) |   |   | (1,740.0 | ) |
| Reclassification of change in fair value of derivatives to net income                    |                      | (34.9 | ) |   |   | 6.0 |   |   |   | (28.9 | ) |   |   | 211.4 |   |   |   | 194.3 |   |   |   | 405.7 |   |
| Foreign currency translation adjustments                                                 |                      | 10.2 |   |   |   | 33.0 |   |   |   | 43.2 |   |   |   | (8.7 | ) |   |   | (19.9 | ) |   |   | (28.6 | ) |
| Adjustments to pension andother postretirement benefit plan liabilities   |                      | (0.9 | ) |   |   | (1.3 | ) |   |   | (2.2 | ) |   |   | 1.3 |   |   |   | 1.5 |   |   |   | 2.8 |   |
| Total other comprehensive loss                                                           |                      | (121.0 | ) |   |   | (98.6 | ) |   |   | (219.6 | ) |   |   | (593.0 | ) |   |   | (767.1 | ) |   |   | (1,360.1 | ) |
| Total comprehensive income (loss)                                                        |                      | 124.1 |   |   |   | 10.3 |   |   |   | 134.4 |   |   |   | (4,347.9 | ) |   |   | (514.5 | ) |   |   | (4,862.4 | ) |
| Ending Balance                                                                           | $                         | 4,398.0 |   |   | $ | 4,375.7 |   |   | $ | 8,773.7 |   |   | $ | 3,461.4 |   |   | $ | 2,872.0 |   |   | $ | 6,333.4 |   |

----

|                          | June 30,2009  |    | December 31,2008 |
|-------------------------------|---------------|---------|------------------|
|                          | (In millions) |
| Kinder Morgan Energy Partners | $             | 2,495.8 |             |   | $ | 2,198.2 |   |
| Kinder Morgan Management      |          | 1,828.2 |             |   |   | 1,826.5 |   |
| Triton Power Company LLC      |          | 41.5    |             |   |   | 39.0 |   |
| Other                         |          | 10.2    |             |   |   | 8.9 |   |
|                          | $             | 4,375.7 |             |   | $ | 4,072.6 |   |

----

| 6.  Risk Management |
|-------------------------------|

----

| Derivatives designated ashedging contractsunder SFAS No. 133 |   | Notional Quantity       |
|--------------------------------------------------------------|--------|-------------------------|
| Crude oil                                                    |   | 28.0 million barrels    |
| Natural gas(a)                                               |   | 43.6 billion cubic feet |

| Derivatives not designated ashedging contractsunder SFAS No. 133 |   | Notional Quantity      |
|------------------------------------------------------------------|--------|------------------------|
| Crude oil                                                        |   | 0.1 million barrels    |
| Natural gas(a)                                                   |   | 7.1 billion cubic feet |

| (a) | Notional quantities are shown net of short positions. |
|-----|-------------------------------------------------------|

----

|                                                               | Asset derivatives                                                     |        |              | Liability derivatives                                                 |
|--------------------------------------------------------------------|-----------------------------------------------------------------------|-------------|-------------------|-----------------------------------------------------------------------|
|                                                               | June 30, 2009                                                         |        | December 31, 2008 |                                                                  |   | June 30, 2009 |   | December 31, 2008 |
|                                                               | Balance sheet    location     | Fairvalue   |              | Balance sheet    location     | Fairvalue |   |   | Balance Sheet    location     | Fairvalue |   |   | Balance sheet    location     | Fairvalue |   |
|                                                               |                                                                  |        |              |                                                                  |   |   |   |   |   |   |   |   |   |   |
| Derivatives designated as hedging contracts under SFAS No. 133     |                                                                  |        |              |                                                                  |   |   |   |   |   |   |
| Energy commodity derivative contracts                              | Current                                                               | $ 42.8 |              | Current                                                               | $113.5 |   |   |   | Current | $(226.7 | ) |   | Current | $(129.4 | ) |
|                                                               | Non-current                                                           | 50.7        |              | Non-current                                                           | 48.9 |   |   |   | Non-current | (234.4 | ) |   | Non-current | (92.2 | ) |
| Subtotal                                                           |                                                                  | 93.5        |              |                                                                  | 162.4 |   |   |   |   | (461.1 | ) |   |   | (221.6 | ) |
| Interest rate swap agreements                                      | Non-current                                                           | 297.1       |              | Non-current                                                           | 747.1 |   |   |   | Non-current | (161.7 | ) |   | Non-current | - |   |
| Cross currency swap agreements                                     | Non-current                                                           | 5.9         |              | Non-current                                                           | 32.0 |   |   |   | Non-current | - |   |   | Non-current | - |   |
| Total                                                              |                                                                  | 396.5       |              |                                                                  | 941.5 |   |   |   |   | (622.8 | ) |   |   | (221.6 | ) |
|                                                               |                                                                  |        |              |                                                                  |   |   |   |   |   |   |   |   |   |   |   |
| Derivatives not designated as hedging contracts under SFAS No. 133 |                                                                  |        |              |                                                                  |   |   |   |   |   |   |
| Energy commodity derivative contracts                              | Current                                                               | 2.0         |              | Current                                                               | 1.8 |   |   |   | Current | (1.9 | ) |   | Current | (0.1 | ) |
| Total derivatives                                                  |                                                                  | $398.5      |              |                                                                  | $943.3 |   |   |   |   | $(624.7 | ) |   |   | $(221.7 | ) |

----

| Derivatives inSFAS No. 133fair valuehedgingrelationships |   | Location ofgain/(loss)recognized inincome onDerivative |   | Amount of gain/(loss)recognized in income on derivative(a) |   |   | Hedged items inSFAS No. 133fair valuehedgingrelationships |   | Location ofgain/(loss)recognized inincome on relatedhedged item |   | Amount of gain/(loss)recognized in income onrelated hedged items(a) |
|----------------------------------------------------------|--------|--------------------------------------------------------|--------|------------------------------------------------------------|--------|--------|-----------------------------------------------------------|--------|-----------------------------------------------------------------|--------|---------------------------------------------------------------------|
|                                                     |   |                                                   |   | Three Months EndedJune 30,                                 |   |   |                                                      |   |                                                            |   | Three Months EndedJune 30,                                          |
|                                                     |   |                                                   |   | 2009                                                       |   | 2008   |                                                      |   |                                                            |   |                                                                |   | 2009 |   | 2008 |
| Interest rate swap agreements                            |   | Interest, net – income/(expense)                 |   | $                                                          | (336.9 | )      |                                                      | $      | (128.2                                                          | )      |                                                                |   | Fixed rate debt  |   | Interest, net – income/(expense) |   | $ | 336.9 |   |   | $ | 128.2 |   |
| Total                                                    |   |                                                   |   | $                                                          | (336.9 | )      |                                                      | $      | (128.2                                                          | )      |                                                                |   | Total |   |   |   | $ | 336.9 |   |   | $ | 128.2 |   |
|                                                     |   |                                                   |   |                                                       |   |   |                                                      |   |                                                            |   |                                                                |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                     |   |                                                   |   | Six Months EndedJune 30,                                   |   |   |                                                      |   |                                                            |   | Six Months EndedJune 30,                                            |
|                                                     |   |                                                   |   | 2009                                                       |   | 2008   |                                                      |   |                                                            |   |                                                                |   | 2009 |   | 2008 |
| Interest rate swap agreements                            |   | Interest, net – income/(expense)                 |   | $                                                          | (467.3 | )      |                                                      | $      | (9.1                                                            | )      |                                                                |   | Fixed rate debt  |   | Interest, net – income/(expense) |   | $ | 467.3 |   |   | $ | 9.1 |   |
| Total                                                    |   |                                                   |   | $                                                          | (467.3 | )      |                                                      | $      | (9.1                                                            | )      |                                                                |   | Total |   |   |   | $ | 467.3 |   |   | $ | 9.1 |   |

| (a) | Amounts reflect the change in the fair value of interest rate swap agreements and the change in the fair value of the associated fixed rate debt, which exactly offset each other as a result of no hedge ineffectiveness. Amounts do not reflect the impact on interest expense from the interest rate swap agreements under which we pay variable rate interest and receive fixed rate interest. |
|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|    Derivatives in   SFAS No. 133   cash flow hedging   relationships |   | Amount of gain/(loss)recognized in OCIon derivative(effective portion) |   | Location ofgain/(loss)reclassified fromaccumulated OCIinto income(effective portion) |   | Amount of gain/(loss)reclassified fromaccumulated OCIinto income(effective portion) |   | Location ofgain/(loss)recognized in incomeon derivative(ineffective portionand amountexcluded fromeffectivenesstesting) |   | Amount of gain/(loss)recognized in incomeon derivative (ineffective portionand amountexcluded fromeffectiveness testing) |
|--------------------------------------------------------------------------------------------------------------|--------|------------------------------------------------------------------------|--------|--------------------------------------------------------------------------------------|--------|-------------------------------------------------------------------------------------|--------|-------------------------------------------------------------------------------------------------------------------------|--------|-------------------------------------------------------------------------------------------------------------------------------|
|                                                                                                         |   | Three Months EndedJune 30,                                             |   |                                                                                 |   | Three Months EndedJune 30,                                                          |   |                                                                                                                    |   | Three Months EndedJune 30,                                                                                                    |
|                                                                                                         |   | 2009                                                                   |   | 2008                                                                                 |   |                                                                                |   | 2009                                                                                                                    |   | 2008                                                                                                                          |   |   |   | 2009 |   | 2008 |
| Energy commodity derivative contracts                                                                        |   | $                                                                      | (111.3 | )                                                                                    |   | $                                                                                   | (577.3 | )                                                                                                                       |   | Revenues-natural gas sales                                                                                               |   | $ | 3.9 |   |   | $ | (5.1 | ) |   | Revenues |   | $ | - |   |   | $ | - |   |
|                                                                                                         |   |                                                                   |   |                                                                                 |   |                                                                                |   |                                                                                                                    |   | Revenues-product sales and other                                                                                              |   |   | 9.6 |   |   |   | (81.8 | ) |   |   |   |   |   |   |   |   |   |   |
|                                                                                                         |   |                                                                   |   |                                                                                 |   |                                                                                |   |                                                                                                                    |   | Gas purchases and other costs of sales                                                                                        |   |   | 0.9 |   |   |   | (9.0 | ) |   | Gas purchases and other costs of sales |   |   | - |   |   |   | (6.9 | ) |
| Total                                                                                                        |   | $                                                                      | (111.3 | )                                                                                    |   | $                                                                                   | (577.3 | )                                                                                                                       |   | Total                                                                                                                         |   | $ | 14.4 |   |   | $ | (95.9 | ) |   | Total |   | $ | - |   |   | $ | (6.9 | ) |
|                                                                                                         |   |                                                                   |   |                                                                                 |   |                                                                                |   |                                                                                                                    |   |                                                                                                                          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                                         |   | Six Months EndedJune 30,                                               |   |                                                                                 |   | Six Months EndedJune 30,                                                            |   |                                                                                                                    |   | Six Months EndedJune 30,                                                                                                      |
|                                                                                                         |   | 2009                                                                   |   | 2008                                                                                 |   |                                                                                |   | 2009                                                                                                                    |   | 2008                                                                                                                          |   |   |   | 2009 |   | 2008 |
| Energy commodity derivative contracts                                                                        |   | $                                                                      | (95.4  | )                                                                                    |   | $                                                                                   | (797.0 | )                                                                                                                       |   | Revenues-natural gas sales                                                                                               |   | $ | 4.4 |   |   | $ | (5.1 | ) |   | Revenues |   | $ | - |   |   | $ | - |   |
|                                                                                                         |   |                                                                   |   |                                                                                 |   |                                                                                |   |                                                                                                                    |   | Revenues-product sales and other                                                                                              |   |   | 29.7 |   |   |   | (197.1 | ) |   |   |   |   |   |   |   |   |   |   |
|                                                                                                         |   |                                                                   |   |                                                                                 |   |                                                                                |   |                                                                                                                    |   | Gas purchases and other costs of sales                                                                                        |   |   | 0.8 |   |   |   | (9.2 | ) |   | Gas purchases and other costs of sales |   |   | - |   |   |   | (8.5 | ) |
| Total                                                                                                        |   | $                                                                      | (95.4  | )                                                                                    |   | $                                                                                   | (797.0 | )                                                                                                                       |   | Total                                                                                                                         |   | $ | 34.9 |   |   | $ | (211.4 | ) |   | Total |   | $ | - |   |   | $ | (8.5 | ) |

----

|    Derivatives in   SFAS No. 133 net   investment hedgingrelationships |   | Amount of gain/(loss)recognized in OCIon derivative(Effective portion) |   | Location ofgain/(loss)reclassified fromaccumulated OCIinto income(Effective portion) |   | Amount of gain/(loss)reclassified fromaccumulated OCIinto income(Effective portion) |   | Location ofgain/(loss)recognized in incomeon derivative(ineffective portionand amountexcluded fromeffectivenesstesting) |   | Amount of gain/(loss)recognized in incomeon derivative (ineffective portion and amount excluded fromeffectiveness testing) |
|------------------------------------------------------------------------------------------------------|--------|------------------------------------------------------------------------|--------|--------------------------------------------------------------------------------------|--------|-------------------------------------------------------------------------------------|--------|-------------------------------------------------------------------------------------------------------------------------|--------|---------------------------------------------------------------------------------------------------------------------------------|
|                                                                                                 |   | Three Months EndedJune 30,                                             |   |                                                                                 |   | Three Months EndedJune 30,                                                          |   |                                                                                                                    |   | Three Months EndedJune 30,                                                                                                      |
|                                                                                                 |   | 2009                                                                   |   | 2008                                                                                 |   |                                                                                |   | 2009                                                                                                                    |   | 2008                                                                                                                            |   |   |   | 2009 |   | 2008 |
| Cross currency swap agreements                                                                       |   | $                                                                      | (20.1  | )                                                                                    |   | $                                                                                   | (20.5  | )                                                                                                                       |   | Other, net                                                                                                                      |   | $ | - |   |   | $ | - |   |   | Revenues |   | $ | - |   |   | $ | - |   |
| Total                                                                                                |   | $                                                                      | (20.1  | )                                                                                    |   | $                                                                                   | (20.5  | )                                                                                                                       |   | Total                                                                                                                           |   | $ | - |   |   | $ | - |   |   | Total |   | $ | - |   |   | $ | - |   |
|                                                                                                 |   |                                                                   |   |                                                                                 |   |                                                                                |   |                                                                                                                    |   |                                                                                                                            |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                                 |   | Six Months EndedJune 30,                                               |   |                                                                                 |   | Six Months EndedJune 30,                                                            |   |                                                                                                                    |   | Six Months EndedJune 30,                                                                                                        |
|                                                                                                 |   | 2009                                                                   |   | 2008                                                                                 |   |                                                                                |   | 2009                                                                                                                    |   | 2008                                                                                                                            |   |   |   | 2009 |   | 2008 |
| Cross currency swap agreements                                                                       |   | $                                                                      | (26.1  | )                                                                                    |   | $                                                                                   | 1.7    |                                                                                                                    |   | Other, net                                                                                                                      |   | $ | - |   |   | $ | - |   |   | Revenues |   | $ | - |   |   | $ | - |   |
| Total                                                                                                |   | $                                                                      | (26.1  | )                                                                                    |   | $                                                                                   | 1.7    |                                                                                                                    |   | Total                                                                                                                           |   | $ | - |   |   | $ | - |   |   | Total |   | $ | - |   |   | $ | - |   |

| Derivatives not designated as hedgingcontracts under SFAS No. 133 |   | Location of gain/(loss) recognizedin income on derivative |   | Amount of gain/(loss) recognizedin income on derivative |
|-------------------------------------------------------------------|--------|-----------------------------------------------------------|--------|---------------------------------------------------------|
|                                                              |   |                                                      |   | Three Months EndedJune 30,                              |
|                                                              |   |                                                      |   | 2009                                                    |   | 2008 |
| Energy commodity derivative contracts                             |   | Gas purchases and other costs of sales                    |   | $                                                       | (1.9 | ) |   | $ | (13.1 | ) |
| Total                                                             |   |                                                      |   | $                                                       | (1.9 | ) |   | $ | (13.1 | ) |
|                                                              |   |                                                      |   |                                                    |   |   |   |   |   |   |
|                                                              |   |                                                      |   | Six Months EndedJune 30,                                |
|                                                              |   |                                                      |   | 2009                                                    |   | 2008 |
| Energy commodity derivative contracts                             |   | Gas purchases and other costs of sales                    |   | $                                                       | (2.3 | ) |   | $ | (13.1 | ) |
| Total                                                             |   |                                                      |   | $                                                       | (2.3 | ) |   | $ | (13.1 | ) |

----

|                                  | Asset position |
|---------------------------------------|----------------|
| Interest rate swap agreements         | $              | 297.1 |   |
| Energy commodity derivative contracts |           | 95.5 |   |
| Cross currency swap agreements        |           | 5.9 |   |
| Gross exposure                        |           | 398.5 |   |
| Netting agreement impact              |           | (76.3 | ) |
| Net exposure                          | $              | 322.2 |   |

| Credit ratings downgraded(a)                           |   | Incrementalobligations |   | Cumulativeobligations(b) |
|--------------------------------------------------------|--------|------------------------|--------|--------------------------|
| One level to BBB-/Baa3                                 |   | $                      | 76.6   |                     |   | $ | 178.4 |   |
| Two levels to below BBB-/Baa3 (Below investment grade) |   | $                      | 79.1   |                     |   | $ | 257.5 |   |

| (a) | If there are split ratings among the independent credit rating agencies, most counterparties use the higher credit rating to determine Kinder Morgan Energy Partners’ incremental collateral obligations, while the remaining use the lower credit rating. Therefore, a one level downgrade to BBB-/Baa3 by one agency would not trigger the entire $76.6 million incremental obligation. |
|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (b) | Includes current posting at current rating. |
|-----|---------------------------------------------|

----

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

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

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

|                                         | Asset fair value measurements using |
|----------------------------------------------|-------------------------------------|
|                                         | Total                               |   | Quoted prices inactive marketsfor identicalassets (Level 1) |   | Significant otherobservableinputs (Level 2) |   | Significantunobservableinputs (Level 3) |
|                                         | (In millions)                       |
| As of June 30, 2009                          |                                |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Energy commodity derivative contracts(a)     | $                                   | 95.5 |   |   | $ | 0.1 |   |   | $ | 44.8 |   |   | $ | 50.6 |   |
| Interest rate swap agreements                |                                | 297.1 |   |   |   | - |   |   |   | 297.1 |   |   |   | - |   |
| Cross currency interest rate swap agreements |                                | 5.9 |   |   |   | - |   |   |   | 5.9 |   |   |   | - |   |
|                                         |                                |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| As of December 31, 2008                      |                                |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Energy commodity derivative contracts(b)     | $                                   | 164.2 |   |   | $ | 0.1 |   |   | $ | 108.9 |   |   | $ | 55.2 |   |
| Interest rate swap agreements                |                                | 747.1 |   |   |   | - |   |   |   | 747.1 |   |   |   | - |   |
| Cross currency interest rate swap agreements |                                | 32.0 |   |   |   | - |   |   |   | 32.0 |   |   |   | - |   |

|                                     | Liability fair value measurements using |
|------------------------------------------|-----------------------------------------|
|                                     | Total                                   |   | Quoted prices inactive marketsfor identicalliabilities(Level 1) |   | Significant otherobservableinputs (Level 2) |   | Significantunobservableinputs (Level 3) |
|                                     | (In millions)                           |
| As of June 30, 2009                      |                                    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Energy commodity derivative contracts(c) | $                                       | (463.0 | ) |   | $ | - |   |   | $ | (436.4 | ) |   | $ | (26.6 | ) |
| Interest rate swap agreements            |                                    | (161.7 | ) |   |   | - |   |   |   | (161.7 | ) |   |   | - |   |
|                                     |                                    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| As of December 31, 2008                  |                                    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Energy commodity derivative contracts(d) | $                                       | (221.7 | ) |   | $ | - |   |   | $ | (210.6 | ) |   | $ | (11.1 | ) |
| Interest rate swap agreements            |                                    | - |   |   |   | - |   |   |   | - |   |   |   | - |   |

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

| (b) | Level 1 consists primarily of NYMEX natural gas futures. Level 2 consists primarily of OTC West Texas Intermediate hedges and |
|-----|-------------------------------------------------------------------------------------------------------------------------------|

----

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

| (c) | Level 2 consists primarily of OTC West Texas Intermediate hedges and OTC natural gas hedges that are settled on NYMEX. Level 3 consists primarily of West Texas Sour hedges, natural gas basis swaps and West Texas Intermediate options. |
|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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

|                                                              | Three Months Ended June 30, |   | Six Months Ended June 30, |
|-------------------------------------------------------------------|-----------------------------|--------|---------------------------|
|                                                              | 2009                        |   | 2008                      |   | 2009 |   | 2008 |
|                                                              | (In millions)               |
| Derivatives-net asset (liability)                                 |                        |   |                      |   |   |   |   |   |   |   |   |   |   |   |   |
| Beginning of Period                                               | $                           | 53.4   |                      |   | $ | (123.8 | ) |   | $ | 44.1 |   |   | $ | (100.3 | ) |
| Realized and unrealized net losses                                |                        | (28.1  | )                         |   |   | (141.5 | ) |   |   | (21.8 | ) |   |   | (186.3 | ) |
| Purchases and settlements                                         |                        | (1.3   | )                         |   |   | 32.3 |   |   |   | 1.7 |   |   |   | 53.6 |   |
| Transfers in (out) of Level 3                                     |                        | -      |                      |   |   | - |   |   |   | - |   |   |   | - |   |
| End of Period                                                     | $                           | 24.0   |                      |   | $ | (233.0 | ) |   | $ | 24.0 |   |   | $ | (233.0 | ) |
|                                                              |                        |   |                      |   |   |   |   |   |   |   |   |   |   |   |   |
| Change in unrealized net losses relating to contracts still       |                        |   |                      |   |   |   |   |   |   |   |   |   |   |   |   |
|     held at end of period | $                           | (29.7  | )                         |   | $ | (123.1 | ) |   | $ | (39.5 | ) |   | $ | (160.8 | ) |

|       | June 30, 2009 |     | December 31, 2008   |
|------------|---------------|----------|---------------------|
|       | CarryingValue |     | EstimatedFair Value |   | CarryingValue |   | EstimatedFair Value |
| Total Debt | $             | 12,315.2 |                |   | $ | 12,142.2 |   |   | $ | 11,458.3 |   |   | $ | 9,813.9 |   |

| 8.   Reportable Segments |
|-----------------------------------------|

|   | · | Products Pipelines–KMP– the transportation and terminaling of refined petroleum products, including gasoline, diesel fuel, jet fuel and natural gas liquids; |
|--------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | Natural Gas Pipelines–KMP– the sale, transport, processing, treating, storage and gathering of natural gas; |
|--------|--------|-------------------------------------------------------------------------------------------------------------------------|

|   | · | CO2–KMP– the production and sale of crude oil from fields in the Permian Basin of West Texas and the transportation and marketing of carbondioxide used as a flooding medium for recovering crude oil from mature oil fields; |
|--------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | Terminals–KMP– the transloading and storing of refined petroleum products and dry and liquid bulk products, including coal, petroleum coke, cement, alumina, salt and other bulk chemicals; |
|--------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|   | · | Kinder Morgan Canada–KMP– the transportation of crude oil and refined products; |
|--------|--------|---------------------------------------------------------------------------------------------|

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

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

|                                                                                                                            | Three Months Ended June 30, |    | Six Months Ended June 30, |
|---------------------------------------------------------------------------------------------------------------------------------|-----------------------------|---------|---------------------------|
|                                                                                                                            | 2009                        |    | 2008                      |   | 2009 |   | 2008 |
|                                                                                                                            | (In millions)               |
| Revenues from external customers                                                                                                |                        |    |                      |   |   |   |   |   |   |   |   |   |   |   |   |
| Products Pipelines–KMP                                                                                                    | $                           | 206.7   |                      |   | $ | 198.6 |   |   | $ | 394.9 |   |   | $ | 396.9 |   |
| Natural Gas Pipelines–KMP                                                                                                 |                        | 860.7   |                      |   |   | 2,644.7 |   |   |   | 1,912.4 |   |   |   | 4,557.2 |   |
| CO2–KMP                                                                                                                   |                        | 282.4   |                      |   |   | 342.6 |   |   |   | 535.6 |   |   |   | 662.4 |   |
| Terminals–KMP                                                                                                             |                        | 263.7   |                      |   |   | 300.4 |   |   |   | 531.4 |   |   |   | 580.4 |   |
| Kinder Morgan Canada–KMP(a)                                                                                               |                        | 56.0    |                      |   |   | 44.2 |   |   |   | 106.0 |   |   |   | 88.1 |   |
| NGPL PipeCo LLC(b)                                                                                                              |                        | -       |                      |   |   | - |   |   |   | - |   |   |   | 132.1 |   |
| Power                                                                                                                           |                        | 12.4    |                      |   |   | 13.2 |   |   |   | 19.0 |   |   |   | 20.7 |   |
| Other                                                                                                                           |                        | 11.4    |                      |   |   | 16.8 |   |   |   | 22.9 |   |   |   | 17.7 |   |
| Total revenues                                                                                                                  | $                           | 1,693.3 |                      |   | $ | 3,560.5 |   |   | $ | 3,522.2 |   |   | $ | 6,455.5 |   |
| Intersegment revenues                                                                                                           |                        |    |                      |   |   |   |   |   |   |   |   |   |   |   |   |
| Terminals–KMP                                                                                                             | $                           | 0.3     |                      |   | $ | 0.3 |   |   | $ | 0.5 |   |   | $ | 0.5 |   |
| NGPL PipeCo LLC(b)                                                                                                              |                        | -       |                      |   |   | - |   |   |   | - |   |   |   | 0.9 |   |
| Other                                                                                                                           |                        | -       |                      |   |   | (0.1 | ) |   |   | - |   |   |   | (0.9 | ) |
| Total intersegment revenues                                                                                                     | $                           | 0.3     |                      |   | $ | 0.2 |   |   | $ | 0.5 |   |   | $ | 0.5 |   |
|                                                                                                                            |                        |    |                      |   |   |   |   |   |   |   |   |   |   |   |   |
| Segment earnings (loss) before depreciation, depletion, amortization and amortization of excess cost of equity investments |                        |    |                      |   |   |   |   |   |   |   |   |   |   |   |   |
| Products Pipelines–KMP                                                                                                    | $                           | 154.7   |                      |   | $ | (977.1 | ) |   | $ | 300.1 |   |   | $ | (836.9 | ) |
| Natural Gas Pipelines–KMP                                                                                                 |                        | 162.0   |                      |   |   | (2,073.0 | ) |   |   | 362.0 |   |   |   | (1,884.6 | ) |
| CO2–KMP                                                                                                                   |                        | 226.9   |                      |   |   | 250.6 |   |   |   | 418.6 |   |   |   | 483.9 |   |
| Terminals–KMP                                                                                                             |                        | 141.0   |                      |   |   | (536.2 | ) |   |   | 275.3 |   |   |   | (410.4 | ) |
| Kinder Morgan Canada–KMP(a)                                                                                               |                        | 46.7    |                      |   |   | 38.8 |   |   |   | 66.2 |   |   |   | 73.4 |   |
| NGPL PipeCo LLC(b)                                                                                                              |                        | 10.1    |                      |   |   | 8.7 |   |   |   | 22.4 |   |   |   | 104.7 |   |
| Power                                                                                                                           |                        | 1.3     |                      |   |   | 0.7 |   |   |   | 2.4 |   |   |   | 2.8 |   |
| Total segment earnings (loss) before DD&A(c)                                                                                |                        | 742.7   |                      |   |   | (3,287.5 | ) |   |   | 1,447.0 |   |   |   | (2,467.1 | ) |
| Depreciation, depletion and amortization                                                                                        |                        | (256.8  | )                         |   |   | (215.7 | ) |   |   | (521.6 | ) |   |   | (433.8 | ) |
| Amortization of excess cost of equity investments                                                                               |                        | (1.5    | )                         |   |   | (1.4 | ) |   |   | (2.9 | ) |   |   | (2.9 | ) |
| NGPL PipeCo LLC fixed fee revenue                                                                                               |                        | 11.4    |                      |   |   | 16.7 |   |   |   | 22.9 |   |   |   | 16.7 |   |
| General and administrative expense                                                                                              |                        | (84.1   | )                         |   |   | (91.8 | ) |   |   | (177.0 | ) |   |   | (178.1 | ) |
| Unallocable interest and other, net(d)                                                                                          |                        | (139.1  | )                         |   |   | (137.1 | ) |   |   | (289.4 | ) |   |   | (341.5 | ) |
| Add back: income taxes included in segments above(c)                                                                            |                        | 2.8     |                      |   |   | 2.3 |   |   |   | 22.1 |   |   |   | 11.3 |   |
| Income (loss) from continuing operations before income taxes                                                               | $                           | 275.4   |                      |   | $ | (3,714.5 | ) |   | $ | 501.1 |   |   | $ | (3,395.4 | ) |

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

----

|                              | June 30,2009  |     | December 31,2008 |
|-----------------------------------|---------------|----------|------------------|
|                              | (In millions) |
| Assets                            |          |     |             |   |   |   |   |
| Products Pipelines–KMP      | $             | 5,558.8  |             |   | $ | 5,526.4 |   |
| Natural Gas Pipelines–KMP   |          | 8,504.4  |             |   |   | 7,748.1 |   |
| CO2–KMP                     |          | 4,337.9  |             |   |   | 4,478.7 |   |
| Terminals–KMP               |          | 4,445.0  |             |   |   | 4,327.8 |   |
| Kinder Morgan Canada–KMP(a) |          | 1,632.1  |             |   |   | 1,583.9 |   |
| NGPL PipeCo LLC(b)                |          | 712.0    |             |   |   | 717.3 |   |
| Power                             |          | 57.8     |             |   |   | 58.9 |   |
| Total segment assets              |          | 25,248.0 |             |   |   | 24,441.1 |   |
| Corporate assets(e)               |          | 678.8    |             |   |   | 1,003.8 |   |
| Total consolidated assets         | $             | 25,926.8 |             |   | $ | 25,444.9 |   |

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

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

| (c) | Income taxes of Kinder Morgan Energy Partners of $2.8 million, $2.3 million, $22.1 million and $11.3 million, respectively, for the three- and six-month periods ended June 30, 2009 and 2008 are included in segment earnings (loss) before DD&A. |
|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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

| (e) | Includes assets of cash and cash equivalents, margin and restricted deposits, unallocable interest receivable, prepaid assets and deferred charges, risk management assets related to the fair value of interest rate swaps and miscellaneous corporate assets (such as information technology and telecommunications equipment) not allocated to individual segments. |
|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|                                                                           | June 30,2009  |   | December 31,2008 |
|--------------------------------------------------------------------------------|---------------|--------|------------------|
|                                                                           | (In millions) |
| Derivatives - asset (liability)                                                |          |   |             |   |   |   |   |
| Current Assets: Fair value of derivative contracts                             | $             | 0.6    |             |   | $ | 60.4 |   |
| Assets: Fair value of derivative contracts                                     | $             | 14.5   |             |   | $ | 20.1 |   |
| Current Liabilities: Fair value of derivative contracts                        | $             | (44.5  | )                |   | $ | (13.2 | ) |
| Long-term Liabilities and Deferred Credits: Fair value of derivative contracts | $             | (142.1 | )                |   | $ | (24.1 | ) |

----

| 10.  Income Taxes |
|-----------------------------|

|               | Three Months EndedJune 30, |   | Six Months EndedJune 30, |
|--------------------|----------------------------|--------|--------------------------|
|               | 2009                       |   | 2008                     |   | 2009 |   | 2008 |
|               | (In millions)              |
| Income taxes       | $                          | 67.0   |                     |   | $ | 19.4 |   |   | $ | 147.6 |   |   | $ | 106.5 |   |
| Effective tax rate |                       | 24.3   | %                        |   |   | 0.5 | % |   |   | 29.5 | % |   |   | 3.1 | % |

| 11.  Litigation, Environmental and Other Contingencies |
|------------------------------------------------------------------|

----

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

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

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

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

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

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

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

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

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

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

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

----

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

|   | · | FERC Docket No. IS08-390—Complainants/Protestants: BP WCP, ExxonMobil, ConocoPhillips, Valero, Chevron, the Airline Complainants—Defendant: SFPP—Subject: West Line rate increase; Initial Decision expected December 2009; |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | FERC Docket No. IS09-375—Complainants/Protestants: BP, XOM, Chevron, Tesoro, ConocoPhillips, Western, Navajo, Valero, Southwest, and Airline Intervenors—Defendant: SFPP—Subject: Protests regarding 2009 indexed rate increases; protests dismissed by FERC; |
|--------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | FERC Docket No. IS09-377—Complainants/Protestants: BP, Chevron, Tesoro, and Airline Intervenors—Defendant: Calnev—Subject: Protests regarding 2009 index-based rate increases; protests dismissed by FERC; |
|--------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | FERC Docket No. OR09-8—Complainants/Protestants: Chevron—Defendant: SFPP—Subject: Complaint against 2008 index-based rate increases; |
|--------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | FERC Docket No. OR09-11—Complainants/Protestants: BP WCP—Defendant: Calnev—Subject: Complaint requesting audit of Page 700 of FERC Form No. 6 for 2007 and 2008; |
|--------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | FERC Docket No. OR09-12—Complainants/Protestants: BP WCP—Defendant: SFPP—Subject: Complaint requesting audit of Page 700 of FERC Form No. 6 for 2007 and 2008; |
|--------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | FERC Docket No. OR09-14—Complainants/Protestants: Tesoro—Defendant: Calnev—Subject: Complaint requesting audit of Page 700 of FERC Form No. 6 for 2007 and 2008; |
|--------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | FERC Docket No. OR09-15—Complainants/Protestants: Tesoro—Defendant: Calnev—Subject: Complaint against all Calnev rates; |
|--------|--------|-------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | FERC Docket No. OR09-16—Complainants/Protestants: Tesoro—Defendant: SFPP—Subject: Complaint requesting audit of Page 700 of FERC Form No. 6 for 2007 and 2008; and |
|--------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | FERC Docket No. OR09-17—Complainants/Protestants: Tesoro—Defendant: SFPP—Subject: Complaint against SFPP rates |
|--------|--------|----------------------------------------------------------------------------------------------------------------------------------|

----

----

----

----

----

----

----

----

----

| 12.  Regulatory Matters |
|-----------------------------------|

----

----

| 13.  Recent Accounting Pronouncements |
|-------------------------------------------------|

----

SFAS No. 142, Goodwill and Other Intangible Assets. For us, this Staff Position was effective January 1, 2009, and the adoption of this Staff Position did not have a material impact on our consolidated financial statements. 

----

----

----

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

General and Basis of Presentation 

Critical Accounting Policies and Estimates 

----

Results of Operations 

|                                                                                                                                          | Three Months Ended June 30,       |   | Earnings Increase/(Decrease) |
|-----------------------------------------------------------------------------------------------------------------------------------------------|-----------------------------------|--------|------------------------------|
|                                                                                                                                          | 2009                              |   | 2008                         |   | Dollars |   | Percent |
|                                                                                                                                          | (In millions, except percentages) |
| Segment earnings (loss) before depreciation, depletion and amortization expense and amortization of excess cost of equity investments(a) |                              |   |                         |   |   |   |   |   |   |   |   |   |   |   |   |
| Products Pipelines–KMP(b)                                                                                                               | $                                 | 154.7  |                         |   | $ | (977.1 | ) |   | $ | 1,131.8 |   |   |   | 116 |  % |
| Natural Gas Pipelines–KMP(c)                                                                                                            |                              | 162.0  |                         |   |   | (2,073.0 | ) |   |   | 2,235.0 |   |   |   | 108 |  % |
| CO2–KMP(d)                                                                                                                              |                              | 226.9  |                         |   |   | 250.6 |   |   |   | (23.7 | ) |   |   | (9 | )% |
| Terminals–KMP(e)                                                                                                                        |                              | 141.0  |                         |   |   | (536.2 | ) |   |   | 677.2 |   |   |   | 126 |  % |
| Kinder Morgan Canada–KMP(f)                                                                                                             |                              | 46.7   |                         |   |   | 38.8 |   |   |   | 7.9 |   |   |   | 20 |  % |
| NGPL PipeCo LLC(g)                                                                                                                            |                              | 10.1   |                         |   |   | 8.7 |   |   |   | 1.4 |   |   |   | 16 |  % |
| Power                                                                                                                                         |                              | 1.3    |                         |   |   | 0.7 |   |   |   | 0.6 |   |   |   | 86 |  % |
| Segment earnings (loss) before DD&A                                                                                                       |                              | 742.7  |                         |   |   | (3,287.5 | ) |   |   | 4,030.2 |   |   |   | 123 |  % |
| Depreciation, depletion and amortization expense                                                                                              |                              | (256.8 | )                            |   |   | (215.7 | ) |   |   | (41.1 | ) |   |   | (19 | )% |
| Amortization of excess cost of equity investments                                                                                             |                              | (1.5   | )                            |   |   | (1.4 | ) |   |   | (0.1 | ) |   |   | (7 | )% |
| NGPL PipeCo LLC fixed fee revenue(h)                                                                                                          |                              | 11.4   |                         |   |   | 16.7 |   |   |   | (5.3 | ) |   |   | (32 | )% |
| General and administrative expense(i)                                                                                                         |                              | (84.1  | )                            |   |   | (91.8 | ) |   |   | 7.7 |   |   |   | 8 |  % |
| Unallocable interest and other, net(j)                                                                                                        |                              | (139.1 | )                            |   |   | (137.1 | ) |   |   | (2.0 | ) |   |   | (1 | )% |
| Income (loss) from continuing operations before income taxes                                                                                  |                              | 272.6  |                         |   |   | (3,716.8 | ) |   |   | 3,989.4 |   |   |   | 107 |  % |
| Unallocable income taxes(a)                                                                                                                   |                              | (64.2  | )                            |   |   | (17.1 | ) |   |   | (47.1 | ) |   |   | (275 | )% |
| Income (loss) from continuing operations                                                                                                      |                              | 208.4  |                         |   |   | (3,733.9 | ) |   |   | 3,942.3 |   |   |   | 106 |  % |
| Income (loss) from discontinued operations, net of tax                                                                                        |                              | 0.7    |                         |   |   | (0.3 | ) |   |   | 1.0 |   |   |   | 333 |  % |
| Net income (loss)                                                                                                                             |                              | 209.1  |                         |   |   | (3,734.2 | ) |   |   | 3,943.3 |   |   |   | 106 |  % |
| Net income attributable to noncontrolling interests                                                                                           |                              | (79.3  | )                            |   |   | (126.4 | ) |   |   | 47.1 |   |   |   | 37 |  % |
| Net income (loss) attributable to Kinder Morgan, Inc.                                                                                         | $                                 | 129.8  |                         |   | $ | (3,860.6 | ) |   | $ | 3,990.4 |   |   |   | 103 |  % |

|                                                                                                                                          | Six Months Ended June 30,         |    | Earnings Increase/(Decrease) |
|-----------------------------------------------------------------------------------------------------------------------------------------------|-----------------------------------|---------|------------------------------|
|                                                                                                                                          | 2009                              |    | 2008                         |   | Dollars |   | Percent |
|                                                                                                                                          | (In millions, except percentages) |
| Segment earnings (loss) before depreciation, depletion and amortization expense and amortization of excess cost of equity investments(a) |                              |    |                         |   |   |   |   |   |   |   |   |   |   |   |   |
| Products Pipelines–KMP(k)                                                                                                               | $                                 | 300.1   |                         |   | $ | (836.9 | ) |   | $ | 1,137.0 |   |   |   | 136 |  % |
| Natural Gas Pipelines–KMP(l)                                                                                                            |                              | 362.0   |                         |   |   | (1,884.6 | ) |   |   | 2,246.6 |   |   |   | 119 |  % |
| CO2–KMP(m)                                                                                                                              |                              | 418.6   |                         |   |   | 483.9 |   |   |   | (65.3 | ) |   |   | (13 | )% |
| Terminals–KMP(n)                                                                                                                        |                              | 275.3   |                         |   |   | (410.4 | ) |   |   | 685.7 |   |   |   | 167 |  % |
| Kinder Morgan Canada–KMP(o)                                                                                                             |                              | 66.2    |                         |   |   | 73.4 |   |   |   | (7.2 | ) |   |   | (10 | )% |
| NGPL PipeCo LLC(g)                                                                                                                            |                              | 22.4    |                         |   |   | 104.7 |   |   |   | (82.3 | ) |   |   | (79 | )% |
| Power                                                                                                                                         |                              | 2.4     |                         |   |   | 2.8 |   |   |   | (0.4 | ) |   |   | (14 | )% |
| Segment earnings before DD&A                                                                                                              |                              | 1,447.0 |                         |   |   | (2,467.1 | ) |   |   | 3,914.1 |   |   |   | 159 |  % |
| Depreciation, depletion and amortization expense                                                                                              |                              | (521.6  | )                            |   |   | (433.8 | ) |   |   | (87.8 | ) |   |   | (20 | )% |
| Amortization of excess cost of equity investments                                                                                             |                              | (2.9    | )                            |   |   | (2.9 | ) |   |   | - |   |   |   | - |   |
| NGPL PipeCo LLC fixed fee revenue(h)                                                                                                          |                              | 22.9    |                         |   |   | 16.7 |   |   |   | 6.2 |   |   |   | 37 |  % |
| General and administrative expense(p)                                                                                                         |                              | (177.0  | )                            |   |   | (178.1 | ) |   |   | 1.1 |   |   |   | 1 |  % |
| Unallocable interest and other, net (q)                                                                                                       |                              | (289.4  | )                            |   |   | (341.5 | ) |   |   | 52.1 |   |   |   | 15 |  % |
| Income (loss) from continuing operations before income taxes                                                                                  |                              | 479.0   |                         |   |   | (3,406.7 | ) |   |   | 3,885.7 |   |   |   | 114 |  % |
| Unallocable income taxes(a)                                                                                                                   |                              | (125.5  | )                            |   |   | (95.2 | ) |   |   | (30.3 | ) |   |   | (32 | )% |
| Income (loss) from continuing operations                                                                                                      |                              | 353.5   |                         |   |   | (3,501.9 | ) |   |   | 3,855.4 |   |   |   | 110 |  % |
| Income (loss) from discontinued operations, net of tax                                                                                        |                              | 0.5     |                         |   |   | (0.4 | ) |   |   | 0.9 |   |   |   | 225 |  % |
| Net income (loss)                                                                                                                             |                              | 354.0   |                         |   |   | (3,502.3 | ) |   |   | 3,856.3 |   |   |   | 110 |  % |
| Net income (loss) attributable to noncontrolling interests(r)                                                                                 |                              | (108.9  | )                            |   |   | (252.6 | ) |   |   | 143.7 |   |   |   | 57 |  % |
| Net income (loss) attributable to Kinder Morgan, Inc.                                                                                         | $                                 | 245.1   |                         |   | $ | (3,754.9 | ) |   | $ | 4,000.0 |   |   |   | 107 |  % |

| (a) | Includes revenues, earnings from equity investments, allocable interest income and other, net, less operating expenses, allocable income taxes, and other expense (income). Operating expenses include natural gas purchases and other costs of sales, operations and maintenance expenses, fuel and power expenses, and taxes, other than income taxes. Segment earnings include Kinder Morgan Energy Partners’ allocableincome taxes of $2.8 million and $2.3 million for the three months ended June 30, 2009 and 2008, respectively, and $22.1 million and $11.3 million for the six months ended June 30, 2009 and 2008, respectively. |
|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

| (b) | 2009 and 2008 amounts include increases in income of $1.0 million and $0.1 million, respectively, resulting from unrealized foreign currency gains on long-term debt transactions. 2009 amount also includes a $3.8 million increase in expense associated with environmental liability adjustments and a $0.3 million decrease in segment earnings related to assets sold, which had been revalued as part of the Going Privatetransaction and recorded in the application of the purchase method of accounting. 2008 amount includes a non-cash goodwill impairment charge of $1,113.9 million. |
|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (c) | 2009 and 2008 amounts include decreases in income of $2.5 million and $13.1 million, respectively, resulting from unrealized mark to market gains and losses due to the discontinuance of hedge accounting at Casper Douglas and increases in segment earnings of $0.2 million and $0.3 million, respectively, resulting from valuation adjustments related to derivative contracts in place at the time of the Going Privatetransaction and recorded in the application of the purchase method of accounting. 2009 amount includes a $ 0.3 million decrease in segment earnings related to assets sold, which had been revalued as part of the Going Private transaction and recorded in the application of the purchase method of accounting. 2008 amount includes a non-cash goodwill impairment charge of $2,242.8 million. |
|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (d) | Amounts include increases in segment earnings resulting from valuation adjustments of $24.2 million and $34.0 million, respectively, for 2009 and 2008 primarily 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. |
|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (e) | 2009 amount includes a $0.5 million decrease in expense associated with legal liability adjustments related to a litigation matter involving the Staten Island liquids terminal; a $0.1 million increase in expense associated with environmental liability adjustments; and a $1.9 million decrease in segment earnings related to assets sold, which had been revalued as part of the Going Private transaction and recordedin the application of the purchase method of accounting. 2008 amounts include a non-cash goodwill impairment charge of $676.6 million. |
|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (f) | 2009 amount includes a $3.7 million decrease in expense due to a certain non-cash accounting change related to book tax accruals and foreign exchange fluctuations. |
|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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

| (h) | See Note 9 of the accompanying Notes to interim Consolidated Financial Statements. |
|-----|------------------------------------------------------------------------------------|

| (i) | Includes unallocated litigation and environmental expenses. 2009 amount also includes a $0.9 million decrease in expense related to capitalized overhead costs associated with the 2008 hurricane season. |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (j) | 2009 and 2008 amounts include increases in imputed interest expense of $0.3 million and $0.5 million, respectively, related to the January 1, 2007 Cochin Pipeline acquisition. |
|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (k) | 2009 and 2008 amounts include a $0.4 million increase in income and a $0.7 million decrease in income, respectively, resulting from unrealized foreign currency gains and losses on long-term debt transactions. 2009 amount also includes a $3.8 million increase in expense associated with environmental liability adjustments and a $0.3 million decrease in segment earnings related to assets sold, which had been revaluedas part of the Going Private transaction and recorded in the application of the purchase method of accounting. 2008 amount includes a non-cash goodwill impairment charge of $1,113.9 million. |
|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (l) | 2009 and 2008 amounts include decreases in income of $3.8 million and $13.1 million, respectively, resulting from unrealized mark to market gains and losses due to the discontinuance of hedge accounting at Casper Douglas and increases in segment earnings of $0.2 million and $0.5 million, respectively, resulting from valuation adjustments related to derivative contracts in place at the time of the Going Privatetransaction and recorded in the application of the purchase method of accounting. 2009 amounts include $1.1 million decrease in segment earnings related to assets sold, which had been revalued as part of the Going Private transaction and recorded in the application of the purchase method of accounting. 2008 amount includes a non-cash goodwill impairment charge of $2,242.8 million. |
|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (m) | Amounts include increases in segment earnings resulting from valuation adjustments of $48.5 million and $67.5 million for 2009 and 2008, respectively, primarily 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. |
|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (n) | 2009 amount includes a $0.5 million decrease in expense associated with legal liability adjustments related to a litigation matter involving the Staten Island liquids terminal; a $0.1 million increase in expense associated with environmental liability adjustments; and a $2.3 million decrease in segment earnings related to assets sold, which had been revalued as part of the Going Private transaction and recordedin the application of the purchase method of accounting. 2008 amount includes a non-cash goodwill impairment charge of $676.6 million. |
|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (o) | 2009 amount includes a $3.7 million decrease in expense due to a certain non-cash accounting change related to book tax accruals and foreign exchange fluctuations, and a $14.9 million increase in expense primarily due to certain non-cash regulatory accounting adjustments to the carrying amount of the previously established deferred tax liability. |
|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (p) | Includes unallocated litigation and environmental expenses. 2009 amount also includes a $0.1 million increase in expense for certain Express pipeline system acquisition costs, and a $1.5 million decrease in expense related to capitalized overhead costs associated with the 2008 hurricane season. |
|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (q) | 2009 and 2008 amounts include increases in imputed interest expense of $0.8 million and $1.0 million, respectively, related to the January 1, 2007 Cochin Pipeline acquisition. |
|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (r) | 2009 amount includes a $0.2 million decrease in net income attributable to noncontrolling interests, related to all of the six month 2009 items previously disclosed in these footnotes. |
|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|                                     | Three Months Ended June 30, |   | Six Months Ended June 30, |
|------------------------------------------|-----------------------------|--------|---------------------------|
|                                     | 2009                        |   | 2008                      |   | 2009 |   | 2008 |
|                                     | (In millions)               |
| Revenues                                 | $                           | 206.7  |                      |   | $ | 198.6 |   |   | $ | 394.9 |   |   | $ | 396.9 |   |
| Operating expenses(a)                    |                        | (60.0  | )                         |   |   | (68.5 | ) |   |   | (109.0 | ) |   |   | (130.9 | ) |
| Other expense(b)                         |                        | (0.3   | )                         |   |   | (0.2 | ) |   |   | (0.3 | ) |   |   | (0.3 | ) |
| Goodwill impairment(c)                   |                        | -      |                      |   |   | (1,113.9 | ) |   |   | - |   |   |   | (1,113.9 | ) |
| Earnings from equity investments         |                        | 5.1    |                      |   |   | 5.5 |   |   |   | 8.6 |   |   |   | 10.3 |   |
| Interest income and other income, net(d) |                        | 3.5    |                      |   |   | 1.3 |   |   |   | 6.3 |   |   |   | 1.8 |   |
| Income tax benefit (expense)             |                        | (0.3   | )                         |   |   | 0.1 |   |   |   | (0.4 | ) |   |   | (0.8 | ) |
| Segment earnings (loss) before DD&A  | $                           | 154.7  |                      |   | $ | (977.1 | ) |   | $ | 300.1 |   |   | $ | (836.9 | ) |
|                                |                        |   |                      |   |   |   |   |   |   |   |   |   |   |   |   |
| Operating statistics (MMBbl)             |                        |   |                      |   |   |   |   |   |   |   |   |   |   |   |   |
| Gasoline                                 |                        | 104.2  |                      |   |   | 100.5 |   |   |   | 199.8 |   |   |   | 198.4 |   |
| Diesel fuel                              |                        | 36.5   |                      |   |   | 41.6 |   |   |   | 72.0 |   |   |   | 80.2 |   |
| Jet fuel                                 |                        | 28.1   |                      |   |   | 29.9 |   |   |   | 54.9 |   |   |   | 59.6 |   |
| Total refined product volumes            |                        | 168.8  |                      |   |   | 172.0 |   |   |   | 326.7 |   |   |   | 338.2 |   |
| Natural gas liquids                      |                        | 7.3    |                      |   |   | 6.1 |   |   |   | 12.2 |   |   |   | 13.0 |   |
| Total delivery volumes(e)                |                        | 176.1  |                      |   |   | 178.1 |   |   |   | 338.9 |   |   |   | 351.2 |   |

| (a) | 2009 amounts include a $3.8 million increase in expense associated with environmental liability adjustments. 2008 amounts include a $3.0 million decrease in expense to the Pacific operations and a $3.0 million increase in expense to the Calnev Pipeline associated with legal liability adjustments. |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (b) | 2009 amounts include a $0.3 million decrease in segment earnings related to assets sold, which had been revalued as part of the Going Private transaction and recorded in the application of the purchase method of accounting. |
|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (c) | 2008 amount includes a non-cash goodwill impairment charge of $1,113.9 million. |
|-----|---------------------------------------------------------------------------------|

| (d) | Three- and six-month 2009 amounts include increases in income of $1.0 million and $0.4 million, respectively, resulting from unrealized foreign currency gains on long-term debt transactions. Three- and six-month 2008 amounts include an increase in income of $0.1 million and a decrease in income of $0.7 million, respectively, resulting from unrealized foreign currency gains and losses on long-term debt transactions. |
|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (e) | Includes Pacific, Plantation, Calnev, Central Florida, Cochin and Cypress pipeline volumes. |
|-----|---------------------------------------------------------------------------------------------|

----

|                               | EBDAIncrease/(Decrease)           |   | RevenuesIncrease/(Decrease) |
|------------------------------------|-----------------------------------|--------|-----------------------------|
|                               | (In millions, except percentages) |
| Cochin Pipeline System             | $                                 | 7.8    |                        |   | 128 |  % |   | $ | 6.2 |   |   | 58 |  % |
| Pacific operations                 |                              | 4.8    |                        |   | 8 |  % |   |   | 1.4 |   |   | 2 |  % |
| West Coast Terminals               |                              | 3.6    |                        |   | 29 |  % |   |   | 4.0 |   |   | 22 |  % |
| Central Florida Pipeline           |                              | 2.6    |                        |   | 24 |  % |   |   | 3.0 |   |   | 22 |  % |
| Plantation Pipeline                |                              | (0.1   | )                           |   | (1 | )% |   |   | (6.1 | ) |   | (56 | )% |
| All other (including eliminations) |                              | 2.4    |                        |   | 7 |  % |   |   | (0.4 | ) |   | (1 | )% |
| Total Products Pipelines           | $                                 | 21.1   |                        |   | 15 |  % |   | $ | 8.1 |   |   | 4 |  % |

|                               | EBDAIncrease/(Decrease)           |   | RevenuesIncrease/(Decrease) |
|------------------------------------|-----------------------------------|--------|-----------------------------|
|                               | (In millions, except percentages) |
| West Coast Terminals               | $                                 | 9.2    |                        |   | 39 |  % |   | $ | 8.6 |   |   | 24 |  % |
| Cochin Pipeline System             |                              | 8.9    |                        |   | 54 |  % |   |   | 2.5 |   |   | 10 |  % |
| Central Florida Pipeline           |                              | 5.1    |                        |   | 24 |  % |   |   | 6.1 |   |   | 24 |  % |
| Pacific Operations                 |                              | 3.7    |                        |   | 3 |  % |   |   | (3.5 | ) |   | (2 | )% |
| Plantation Pipeline                |                              | (2.1   | )                           |   | (9 | )% |   |   | (12.2 | ) |   | (55 | )% |
| All other (including eliminations) |                              | 1.3    |                        |   | 2 |  % |   |   | (3.5 | ) |   | (4 | )% |
| Total Products Pipelines           | $                                 | 26.1   |                        |   | 9 |  % |   | $ | (2.0 | ) |   | (1 | )% |

----

|                                    | Three Months Ended June 30, |   | Six Months Ended June 30, |
|-----------------------------------------|-----------------------------|--------|---------------------------|
|                                    | 2009                        |   | 2008                      |   | 2009 |   | 2008 |
|                                    | (In millions)               |
| Revenues                                | $                           | 860.7  |                      |   | $ | 2,644.7 |   |   | $ | 1,912.4 |   |   | $ | 4,557.2 |   |
| Operating expenses(a)              |                        | (739.1 | )                         |   |   | (2,515.3 | ) |   |   | (1,629.6 | ) |   |   | (4,260.2 | ) |
| Other income (expense)(b)          |                        | (0.3   | )                         |   |   | 2.7 |   |   |   | (1.1 | ) |   |   | 2.7 |   |
| Goodwill impairment(c)             |                        | -      |                      |   |   | (2,242.8 | ) |   |   | - |   |   |   | (2,242.8 | ) |
| Earnings from equity investments        |                        | 29.4   |                      |   |   | 31.3 |   |   |   | 56.0 |   |   |   | 54.8 |   |
| Interest income and other income, net   |                        | 12.6   |                      |   |   | 4.7 |   |   |   | 27.3 |   |   |   | 4.9 |   |
| Income tax benefit (expense)            |                        | (1.3   | )                         |   |   | 1.7 |   |   |   | (3.0 | ) |   |   | (1.2 | ) |
| Segment earnings (loss) before DD&A | $                           | 162.0  |                      |   | $ | (2,073.0 | ) |   | $ | 362.0 |   |   | $ | (1,884.6 | ) |
|                               |                        |   |                      |   |   |   |   |   |   |   |   |   |   |   |   |
| Operating statistics (Trillion Btus)    |                        |   |                      |   |   |   |   |   |   |   |   |   |   |   |   |
| Natural gas transport volumes(d)   |                        | 541.8  |                      |   |   | 502.3 |   |   |   | 1,050.2 |   |   |   | 983.2 |   |
| Natural gas sales volumes(e)       |                        | 198.1  |                      |   |   | 224.9 |   |   |   | 401.8 |   |   |   | 440.0 |   |

----

| (a) | Three- and six-month 2009 amounts include decreases in income of $2.5 million and $3.8 million, respectively, and 2008 amounts include decreases in income of $13.1 million, all resulting from unrealized mark to market gains and losses due to the discontinuance of hedge accounting at Casper Douglas. Amounts also include increases in segment earnings of $0.2 million in 2009, and increases in segment earnings of$0.3 million and $0.5 million for the three- and six-month periods ended June 30, 2008, respectively, 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. |
|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (b) | Three- and six-month 2009 amounts include $ 0.3 million and $1.1 million, respectively, decrease in segment earnings related to assets sold, which had been revalued as part of the Going Private transaction and recorded in the application of the purchase method of accounting. |
|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (c) | 2008 amounts include a non-cash goodwill impairment charge of $2,242.8 million. |
|-----|---------------------------------------------------------------------------------|

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

| (e) | Represents Texas intrastate natural gas pipeline group volumes. |
|-----|-----------------------------------------------------------------|

|                                        | EBDAIncrease/(Decrease)           |   | RevenuesIncrease/(Decrease) |
|---------------------------------------------|-----------------------------------|--------|-----------------------------|
|                                        | (In millions, except percentages) |
| Texas Intrastate Natural Gas Pipeline Group | $                                 | (26.4  | )                           |   | (29 | )% |   | $ | (1,751.4 | ) |   | (69 | )% |
| Rockies Express Pipeline                    |                              | (2.5   | )                           |   | (10 | )% |   |   | - |   |   | - |   |
| Kinder Morgan Louisiana Pipeline            |                              | 7.3    |                        |   | 242 |  % |   |   | - |   |   | - |   |
| Kinder Morgan Interstate Gas Transmission   |                              | 5.2    |                        |   | 19 |  % |   |   | (5.9 | ) |   | (12 | )% |
| All others (including eliminations)         |                              | (1.6   | )                           |   | (5 | )% |   |   | (26.7 | ) |   | (37 | )% |
| Total Natural Gas Pipelines                 | $                                 | (18.0  | )                           |   | (10 | )% |   | $ | (1,784.0 | ) |   | (67 | )% |

|                                        | EBDAIncrease/(Decrease)           |   | RevenuesIncrease/(Decrease) |
|---------------------------------------------|-----------------------------------|--------|-----------------------------|
|                                        | (In millions, except percentages) |
| Texas Intrastate Natural Gas Pipeline Group | $                                 | (28.3  | )                           |   | (14 | )% |   | $ | (2,592.6 | ) |   | (60 | )% |
| Kinder Morgan Louisiana Pipeline            |                              | 15.9   |                        |   | 525 |  % |   |   | - |   |   | - |   |
| Kinder Morgan Interstate Gas Transmission   |                              | 9.5    |                        |   | 17 |  % |   |   | (4.5 | ) |   | (5 | )% |
| Rockies Express Pipeline                    |                              | 2.3    |                        |   | 6 |  % |   |   | - |   |   | - |   |
| All others (including eliminations)         |                              | (3.5   | )                           |   | (5 | )% |   |   | (47.7 | ) |   | (35 | )% |
| Total Natural Gas Pipelines                 | $                                 | (4.1   | )                           |   | (1 | )% |   | $ | (2,644.8 | ) |   | (58 | )% |

----

|                                                              | Three Months Ended June 30, |   | Six Months Ended June 30, |
|-------------------------------------------------------------------|-----------------------------|--------|---------------------------|
|                                                              | 2009                        |   | 2008                      |   | 2009 |   | 2008 |
|                                                              | (In millions)               |
| Revenues(a)                                                       | $                           | 282.4  |                      |   | $ | 342.6 |   |   | $ | 535.6 |   |   | $ | 662.5 |   |
| Operating expenses                                                |                        | (59.3  | )                         |   |   | (96.6 | ) |   |   | (125.9 | ) |   |   | (187.3 | ) |
| Earnings from equity investments                                  |                        | 5.1    |                      |   |   | 5.5 |   |   |   | 10.9 |   |   |   | 11.1 |   |
| Other expense, net                                                |                        | -      |                      |   |   | - |   |   |   | - |   |   |   | (0.2 | ) |
| Income tax expense                                                |                        | (1.3   | )                         |   |   | (0.9 | ) |   |   | (2.0 | ) |   |   | (2.2 | ) |
| Segment earnings before DD&A                                  | $                           | 226.9  |                      |   | $ | 250.6 |   |   | $ | 418.6 |   |   | $ | 483.9 |   |
|                                                         |                        |   |                      |   |   |   |   |   |   |   |   |   |   |   |   |
| Operating statistics                                              |                        |   |                      |   |   |   |   |   |   |   |   |   |   |   |   |
| Carbon dioxide delivery volumes (Bcf)(b)                          |                        | 188.7  |                      |   |   | 178.6 |   |   |   | 401.4 |   |   |   | 358.8 |   |
| SACROC oil production (gross)(MBbl/d)(c)                          |                        | 31.1   |                      |   |   | 27.5 |   |   |   | 30.6 |   |   |   | 27.4 |   |
| SACROC oil production (net)(MBbl/d)(d)                            |                        | 25.9   |                      |   |   | 22.9 |   |   |   | 25.5 |   |   |   | 22.8 |   |
| Yates oil production (gross)(MBbl/d)(c)                           |                        | 26.8   |                      |   |   | 28.1 |   |   |   | 26.6 |   |   |   | 28.3 |   |
| Yates oil production (net)(MBbl/d)(d)                             |                        | 11.9   |                      |   |   | 12.5 |   |   |   | 11.8 |   |   |   | 12.6 |   |
| Natural gas liquids sales volumes (net)(MBbl/d)(d)                |                        | 9.6    |                      |   |   | 9.1 |   |   |   | 9.2 |   |   |   | 9.3 |   |
| Realized weighted average oil price per Bbl(e)(f)                 | $                           | 49.47  |                      |   | $ | 53.01 |   |   | $ | 46.71 |   |   | $ | 51.52 |   |
| Realized weighted average natural gas liquids price per Bbl(f)(g) | $                           | 34.02  |                      |   | $ | 77.28 |   |   | $ | 31.20 |   |   | $ | 71.48 |   |

| (a) | Amounts include increases in segment earnings resulting from valuation adjustments of $24.2 million and $48.5 million, respectively, for the three- and six-month periods ended June 30, 2009, and $34.0 million and $67.5 million, respectively, for the three- and six- month periods ended June 30, 2008, primarily related to derivative contracts in place at the time of the Going Private transaction and recorded inthe application of the purchase method of accounting. |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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

| (c) | Represents 100% of the production from the field. Kinder Morgan Energy Partners owns an approximately 97% working interest in the |
|-----|-----------------------------------------------------------------------------------------------------------------------------------|

----

|   | SACROC unit and an approximately 50% working interest in the Yates unit. |
|--------|--------------------------------------------------------------------------|

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

| (e) | Includes all of Kinder Morgan Energy Partners’ crude oil production properties. |
|-----|---------------------------------------------------------------------------------------|

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

| (g) | 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 | $                                 | (23.1  | )                           |   | (32 | )% |   | $ | (19.8 | ) |   | (25 | )% |
| Oil and gas producing activities    |                              | 9.2    |                        |   | 6 |  % |   |   | (41.6 | ) |   | (17 | )% |
| Intrasegment eliminations           |                              | -      |                        |   | - |   |   |   | 11.0 |   |   | 55 |  % |
| Total                               | $                                 | (13.9  | )                           |   | (6 | )% |   | $ | (50.4 | ) |   | (16 | )% |

|                                | EBDAIncrease/(Decrease)           |   | RevenuesIncrease/(Decrease) |
|-------------------------------------|-----------------------------------|--------|-----------------------------|
|                                | (In millions, except percentages) |
| Sales and transportation activities | $                                 | (29.9  | )                           |   | (21 | )% |   | $ | (25.8 | ) |   | (17 | )% |
| Oil and gas producing activities    |                              | (16.4  | )                           |   | (6 | )% |   |   | (96.7 | ) |   | (20 | )% |
| Intrasegment eliminations           |                              | -      |                        |   | - |   |   |   | 14.6 |   |   | 39 |  % |
| Total                               | $                                 | (46.3  | )                           |   | (11 | )% |   | $ | (107.9 | ) |   | (18 | )% |

----

----

|                                    | Three Months Ended June 30, |   | Six Months Ended June 30, |
|-----------------------------------------|-----------------------------|--------|---------------------------|
|                                    | 2009                        |   | 2008                      |   | 2009 |   | 2008 |
|                                    | (In millions)               |
| Revenues                                | $                           | 264.0  |                      |   | $ | 300.7 |   |   | $ | 531.9 |   |   | $ | 580.9 |   |
| Operating expenses(a)                   |                        | (123.9 | )                         |   |   | (156.0 | ) |   |   | (257.5 | ) |   |   | (308.8 | ) |
| Other income (expense)(b)               |                        | 0.8    |                      |   |   | (0.2 | ) |   |   | 1.3 |   |   |   | 0.4 |   |
| Goodwill Impairment(c)                  |                        | -      |                      |   |   | (676.6 | ) |   |   | - |   |   |   | (676.6 | ) |
| Earnings from equity investments        |                        | -      |                      |   |   | 0.7 |   |   |   | 0.1 |   |   |   | 1.7 |   |
| Interest income and other income, net   |                        | 1.2    |                      |   |   | 1.4 |   |   |   | 1.1 |   |   |   | 2.7 |   |
| Income tax expense                      |                        | (1.1   | )                         |   |   | (6.2 | ) |   |   | (1.6 | ) |   |   | (10.7 | ) |
| Segment earnings (loss) before DD&A | $                           | 141.0  |                      |   | $ | (536.2 | ) |   | $ | 275.3 |   |   | $ | (410.4 | ) |
|                               |                        |   |                      |   |   |   |   |   |   |   |   |   |   |   |   |
| Operating statistics                    |                        |   |                      |   |   |   |   |   |   |   |   |   |   |   |   |
| Bulk transload tonnage (MMtons)(d)      |                        | 18.2   |                      |   |   | 27.7 |   |   |   | 36.9 |   |   |   | 51.6 |   |
| Liquids leaseable capacity (MMBbl)      |                        | 55.1   |                      |   |   | 52.4 |   |   |   | 55.1 |   |   |   | 52.4 |   |
| Liquids utilization                     |                        | 96.9   | %                         |   |   | 98.1 | % |   |   | 96.9 | % |   |   | 98.1 | % |

| (a) | 2009 amounts include a $0.5 million decrease in expense associated with legal liability adjustments related to a litigation matter involving the Staten Island liquids terminal, and a $0.1 million increase in expense associated with environmental liability adjustments. |
|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (b) | For the three- and six-month periods ended June 30, 2009, amounts include $1.9 million and $2.3 million, respectively, decrease in segment earnings related to assets sold, which had been revalued as part of the Going Private transaction and recorded in the application of the purchase method of accounting. |
|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (c) | 2008 amounts include a non-cash goodwill impairment charge of $676.6 million. |
|-----|-------------------------------------------------------------------------------|

| (d) | Volumes for acquired terminals are included for both periods. |
|-----|---------------------------------------------------------------|

----

|                                | EBDAIncrease/(Decrease)           |   | RevenuesIncrease/(Decrease) |
|-------------------------------------|-----------------------------------|--------|-----------------------------|
|                                | (In millions, except percentages) |
| Lower River (Louisiana)             | $                                 | 8.2    |                        |   | 149 |  % |   | $ | (3.9 | ) |   | (14 | )% |
| Gulf Coast                          |                              | 1.8    |                        |   | 5 |  % |   |   | (0.4 | ) |   | (1 | )% |
| West                                |                              | 1.2    |                        |   | 12 |  % |   |   | (2.1 | ) |   | (10 | )% |
| Mid River                           |                              | (5.0   | )                           |   | (57 | )% |   |   | (13.1 | ) |   | (53 | )% |
| Ohio Valley                         |                              | (3.7   | )                           |   | (53 | )% |   |   | (6.9 | ) |   | (38 | )% |
| Mid-Atlantic                        |                              | (2.5   | )                           |   | (21 | )% |   |   | (8.2 | ) |   | (28 | )% |
| All others (including eliminations) |                              | 0.6    |                        |   | 1 |  % |   |   | (7.0 | ) |   | (5 | )% |
| Total Terminals                     | $                                 | 0.6    |                        |   | - |   |   | $ | (41.6 | ) |   | (14 | )% |

|                                | EBDAIncrease/(Decrease)           |   | RevenuesIncrease/(Decrease) |
|-------------------------------------|-----------------------------------|--------|-----------------------------|
|                                | (In millions, except percentages) |
| Lower River (Louisiana)             | $                                 | 11.5   |                        |   | 85 |  % |   | $ | (6.8 | ) |   | (13 | )% |
| Northeast                           |                              | 3.6    |                        |   | 10 |  % |   |   | 4.7 |   |   | 8 |  % |
| Texas Petcoke                       |                              | 3.1    |                        |   | 10 |  % |   |   | (2.3 | ) |   | (4 | )% |
| Gulf Coast                          |                              | 3.0    |                        |   | 4 |  % |   |   | 2.2 |   |   | 2 |  % |
| Mid River                           |                              | (7.9   | )                           |   | (52 | )% |   |   | (22.1 | ) |   | (47 | )% |
| Ohio Valley                         |                              | (4.6   | )                           |   | (43 | )% |   |   | (9.9 | ) |   | (32 | )% |
| All others (including eliminations) |                              | (0.1   | )                           |   | - |   |   |   | (22.1 | ) |   | (9 | )% |
| Total Terminals                     | $                                 | 8.6    |                        |   | 3 |  % |   | $ | (56.3 | ) |   | (10 | )% |

----

|                                    | Three Months Ended June 30, |   | Six Months Ended June 30, |
|-----------------------------------------|-----------------------------|--------|---------------------------|
|                                    | 2009                        |   | 2008                      |   | 2009 |   | 2008 |
|                                    | (In millions)               |
| Revenues                                | $                           | 56.0   |                      |   | $ | 44.2 |   |   | $ | 106.0 |   |   | $ | 88.1 |   |
| Operating expenses                      |                        | (18.1  | )                         |   |   | (17.4 | ) |   |   | (33.3 | ) |   |   | (33.1 | ) |
| Earnings (loss) from equity investment  |                        | (0.6   | )                         |   |   | 5.0 |   |   |   | (0.3 | ) |   |   | 8.6 |   |
| Interest income and other income, net   |                        | 8.2    |                      |   |   | 4.0 |   |   |   | 8.9 |   |   |   | 6.2 |   |
| Income tax benefit (expense)(a)         |                        | 1.2    |                      |   |   | 3.0 |   |   |   | (15.1 | ) |   |   | 3.6 |   |
| Segment earnings before DD&A        | $                           | 46.7   |                      |   | $ | 38.8 |   |   | $ | 66.2 |   |   | $ | 73.4 |   |
|                               |                        |   |                      |   |   |   |   |   |   |   |   |   |   |   |   |
| Operating statistics                    |                        |   |                      |   |   |   |   |   |   |   |   |   |   |   |   |
| TransMountain transport volumes (MMBbl) |                        | 24.3   |                      |   |   | 21.5 |   |   |   | 46.9 |   |   |   | 40.9 |   |

| (a) | 2009 amounts include a $3.7 million decrease in expense due to a certain non-cash accounting change related to book tax accruals and foreign exchange fluctuations related to the Express pipeline system. Six-month 2009 amount also includes a $14.9 million increase in expense primarily due to certain non-cash regulatory accounting adjustments to Trans Mountain’s carrying amount of the previously establisheddeferred tax liability. |
|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|                             | Three Months Ended June 30, |   | Six Months Ended June 30, |
|----------------------------------|-----------------------------|--------|---------------------------|
|                             | 2009                        |   | 2008                      |   | 2009 |   | 2008 |
|                             | (In millions)               |
| Segment earnings before DD&A | $                           | 10.1   |                      |   | $ | 8.7 |   |   | $ | 22.4 |   |   | $ | 104.7 |   |

|                                            | Three Months Ended June 30, |   | Six Months Ended June 30, |
|-------------------------------------------------|-----------------------------|--------|---------------------------|
|                                            | 2009                        |   | 2008                      |   | 2009 |   | 2008 |
|                                            | (In millions)               |
| Revenues                                        | $                           | 12.4   |                      |   | $ | 13.2 |   |   | $ | 19.0 |   |   | $ | 20.7 |   |
| Operating expenses and noncontrolling interests |                        | (11.1  | )                         |   |   | (12.5 | ) |   |   | (16.6 | ) |   |   | (17.9 | ) |
| Segment earnings before DD&A                | $                           | 1.3    |                      |   | $ | 0.7 |   |   | $ | 2.4 |   |   | $ | 2.8 |   |

----

|                                                                  | Three Months Ended June 30,      |   | EarningsIncrease/Decrease |
|-----------------------------------------------------------------------|----------------------------------|--------|---------------------------|
|                                                                  | 2009                             |   | 2008                      |   | Dollars |   | Percent |
|                                                                  | (In millions except percentages) |
| Kinder Morgan, Inc. general and administrative expense                | $                                | (11.5  | )                         |   | $ | (19.0 | ) |   | $ | 7.5 |   |   |   | 39.5 |  % |
| Kinder Morgan Energy Partners general and administrative expense |                             | (72.6  | )                         |   |   | (72.8 | ) |   |   | 0.2 |   |   |   | 0.3 |  % |
| Consolidated general and administrative expense                       | $                                | (84.1  | )                         |   | $ | (91.8 | ) |   | $ | 7.7 |   |   |   | 8.4 |  % |
|                                                                  |                             |   |                      |   |   |   |   |   |   |   |   |   |   |   |   |
| Interest expense, net                                                 | $                                | (138.7 | )                         |   | $ | (141.6 | ) |   | $ | 2.9 |   |   |   | 2.0 |  % |
| Interest expense – deferrable interest debentures               |                             | (0.6   | )                         |   |   | (0.6 | ) |   |   | - |   |   |   | - |   |
| Other, net(a)                                                         |                             | 0.2    |                      |   |   | 5.1 |   |   |   | (4.9 | ) |   |   | (96.1 | )% |
| Total interest expense and other, net                                 | $                                | (139.1 | )                         |   | $ | (137.1 | ) |   | $ | (2.0 | ) |   |   | (1.5 | )% |

|                                                                  | Six Months Ended June 30,        |   | EarningsIncrease/Decrease |
|-----------------------------------------------------------------------|----------------------------------|--------|---------------------------|
|                                                                  | 2009                             |   | 2008                      |   | Dollars |   | Percent |
|                                                                  | (In millions except percentages) |
| Kinder Morgan, Inc. general and administrative expense                | $                                | (21.9  | )                         |   | $ | (28.5 | ) |   | $ | 6.6 |   |   |   | 23.2 |  % |
| Kinder Morgan Energy Partners general and administrative expense |                             | (155.1 | )                         |   |   | (149.6 | ) |   |   | (5.5 | ) |   |   | (3.7 | )% |
| Consolidated general and administrative expense                       | $                                | (177.0 | )                         |   | $ | (178.1 | ) |   | $ | 1.1 |   |   |   | 0.6 |  % |
|                                                                  |                             |   |                      |   |   |   |   |   |   |   |   |   |   |   |   |
| Interest expense, net                                                 | $                                | (280.2 | )                         |   | $ | (352.3 | ) |   | $ | 72.1 |   |   |   | 20.5 |  % |
| Interest expense – deferrable interest debentures               |                             | (1.1   | )                         |   |   | 6.1 |   |   |   | (7.2 | ) |   |   | (118.0 | )% |
| Other, net(a)                                                         |                             | (8.1   | )                         |   |   | 4.7 |   |   |   | (12.8 | ) |   |   | (272.3 | )% |
| Total interest expense and other, net                                 | $                                | (289.4 | )                         |   | $ | (341.5 | ) |   | $ | 52.1 |   |   |   | 15.3 |  % |

| (a) | “Other, net” primarily represents offset to noncontrolling interests and interest income shown above and included in segment earnings. |
|-----|----------------------------------------------------------------------------------------------------------------------------------------------------|

----

Kinder Morgan Energy Partners 

Financial Condition 

|   | · | We have generated $580.8 in cash from operations in the first half of 2009. |
|--------|--------|-----------------------------------------------------------------------------|

|   | · | Kinder Morgan Energy Partners has demonstrated its continued access to the equity market by raising approximately $712.5 million in net proceeds from equity offerings of an aggregate of 14.8 million common units from January 1 through July 31, 2009. |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | Kinder Morgan Energy Partners has demonstrated substantial flexibility in the debt market by issuing $1.0 billion in principal amount of long-term senior notes in the second quarter of 2009 that generated $993.3 million in net proceeds. |
|--------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | We had available credit capacity of approximately $0.9 billion and Kinder Morgan Energy Partners had available credit capacity of approximately $1.4 billion under existing credit facilities as of June 30, 2009. |
|--------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

----

|                                                         | At June 30, 2009          |
|--------------------------------------------------------------|---------------------------|
|                                                         | Short-termDebtOutstanding |   | AvailableBorrowingCapacity |
|                                                         | (In millions)             |
| Credit Facilities                                            |                      |   |   |   |   |   |   |
| Kinder Morgan, Inc.                                          |                      |   |   |   |   |   |   |
| $1.0 billion, six-year secured revolver, due May 2013        | $                         | 25.0 |   |   | $ | 912.2 |   |
|                                                    |                      |   |   |   |   |   |   |
| Kinder Morgan Energy Partners                                |                      |   |   |   |   |   |   |
| $1.85 billion, five-year unsecured revolver, due August 2010 | $                         | 100.0 |   |   | $ | 1,377.9 |   |

|                                      | Six Months Ended June 30,         |     | Increase(Decrease) |   | %      |
|-------------------------------------------|-----------------------------------|----------|--------------------|--------|--------|
|                                      | 2009                              |     | 2008               |   |   |
|                                      | (In millions, except percentages) |
| Net cash provided by (used in):           |                              |     |               |   |   |   |   |   |   |   |   |   |   |   |   |
| Operating activities                      | $                                 | 580.8    |               |   | $      | 380.7 |   |   | $ | 200.1 |   |   |   | 52.6 |  % |
| Investing activities                      |                              | (1,529.0 | )                  |   |   | 4,385.2 |   |   |   | (5,914.2 | ) |   |   | (134.9 | )% |
| Financing activities                      |                              | 994.1    |               |   |   | (4,732.6 | ) |   |   | 5,726.7 |   |   |   | 121.0 |  % |
|                                      |                              |     |               |   |   |   |   |   |   |   |   |   |   |   |   |
| Effect of exchange rate changes on cash   |                              | 2.5      |               |   |   | (1.0 | ) |   |   | 3.5 |   |   |   | 350.0 |  % |
|                                      |                              |     |               |   |   |   |   |   |   |   |   |   |   |   |   |
| Net increase in cash and cash equivalents | $                                 | 48.4     |               |   | $      | 32.3 |   |   | $ | 16.1 |   |   |   | 49.8 |  % |

----

|   | · | a $188.7 million increase in cash inflows relative to net changes in working capital items, primarily driven by lower income tax payments in 2009 which were partially offset by reductions in customer deposits, lower net cash inflows from the collection and payment of trade and related party receivables and payables (including collections and payments on natural gas transportation and exchange imbalance receivablesand payables), and higher payments in 2009 to settle certain refined product imbalance liabilities owed to U.S. military customers of our Products Pipelines business segment; |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | a $144.4 million receipt of cash in January 2009 for the termination of a Kinder Morgan Energy Partners’ interest rate swap agreement having a notional principal amount of $300 million and a maturity date of March 15, 2031 compared to a $2.5 million payment we made to terminate an interest rate swap agreement in 2008; |
|--------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | a $39.0 million increase in cash related to higher distributions received from equity investments—chiefly due to incremental distributions of $43.1 million received from Kinder Morgan Energy Partners’ West2East Pipeline LLC, the sole owner of Rockies Express Pipeline LLC and incremental distributions of $8.9 million from NGPL PipeCo LLC; |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | a $124.1 million decrease in net income, net of non-cash items. The year-to-year decrease in income from our seven reportable business segments in the first six months of 2009 and 2008 is discussed in “Results of Operations” above (including all of the certain items disclosed in the associated table footnotes); |
|--------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | a $20.0 million pension contribution made in 2009, offset slightly by $6.3 million of pension expenses; and |
|--------|--------|-------------------------------------------------------------------------------------------------------------|

|   | · | a $37.5 million decrease in cash relative to changes in other non-current assets and liabilities primarily driven by reductions in Kinder Morgan Energy Partners’ Trans Mountain Pipeline’s deferred revenue obligations and by higher payments for natural gas storage on Kinder Morgan Energy Partners’ Kinder Morgan Interstate Gas Transmission system. |
|--------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | a $2,899.3 million cash inflow in 2008 for net cash proceeds received from the sale of an 80% interest in NGPL PipeCo LLC; |
|--------|--------|----------------------------------------------------------------------------------------------------------------------------|

|   | · | a $3,106.4 million cash inflow in 2008 for proceeds received from NGPL PipeCo restricted cash; |
|--------|--------|------------------------------------------------------------------------------------------------|

|   | · | a $464.2 million increase in cash used due to higher contributions paid to equity investees in the first half of 2009, relative to the first six months a year ago.  The increase was primarily driven by incremental contributions paid to West2East Pipeline LLC, Midcontinent Express Pipeline LLC, and Fayetteville Pipeline LLC to partially fund their respective Rockies Express, Midcontinent Express, andFayetteville Express Pipeline construction and/or pre-construction costs. |
|--------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | a $89.1 million return of capital received from Midcontinent Express Pipeline LLC in 2008 compared to $6.5 million received from our equity investment, NGPL PipeCo LLC, in 2009; |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | a $117.0 million decrease in cash relative to 2008, due to lower net proceeds received from the sales of investments, property, plant and equipment, and other net assets (net of salvage and removal costs). The decrease in cash sales proceeds was driven primarily by $63.1 million received for the sale of our interest in three natural gas-fired power plants in Colorado in the first quarter of 2008 and the approximately$50.7 million received in the second quarter of 2008 for the sale of Kinder Morgan Energy Partners’ 25% equity ownership interest in Thunder Creek Gas Services, LLC; |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|   | · | a $475.1 decrease in the use of cash for capital expenditures largely due to the higher investment undertaken by Kinder Morgan Energy Partners in the first half of 2008 to construct its Kinder Morgan Louisiana Pipeline and to expand its Trans Mountain crude oil and refined petroleum products pipeline system; |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | a $182.2 million decrease in cash used for margin and restricted deposits in 2009 compared to 2008, associated largely with our utilization of derivative contracts to hedge (offset) against the volatility of energy commodity price risks; and |
|--------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | a $109.6 million increase in cash due to the full repayment received during the first six months of 2009 from a $109.6 million loan Kinder Morgan Energy Partners made in December 2008 to a single customer of its Texas intrastate natural gas pipeline group. |
|--------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | a $5,694.5 million decrease in cash used for overall debt financing activities, which include issuances and payments of debt and debt issuance costs. The period-to-period decrease in cash used for overall financing activities was primarily due to (i) a $4,941.2 million decrease in cash used due to lower net issuances and repayments of long-term debt; (ii) a $739.3 million decrease in cash used due to a net reductionin short-term borrowings through our and Kinder Morgan Energy Partners’ credit facilities. |
|--------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | a $284.7 million increase in cash from noncontrolling interest contributions primarily related to Kinder Morgan Energy Partners’ issuances totaling 13,972,747 common units in 2009 receiving combined net proceeds (after underwriting commissions and expenses) of $669.5 million versus issuances totaling 6,830,000 common units in 2008 receiving combined net proceeds (after underwriting commissions and expenses)of $384.3 million; |
|--------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | a $150.0 million cash used in 2009 to pay dividends; |
|--------|--------|------------------------------------------------------|

|   | · | a $57.7 million increase in cash used for noncontrolling interest distributions, primarily due to an increase of $57.2 million in Kinder Morgan Energy Partners’ cash distributions to its common unit owners; and |
|--------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | a $40.8 million increase in cash used for net changes in cash book overdrafts—resulting from timing differences on checks issued but not yet endorsed. |
|--------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------|

Recent Accounting Pronouncements 

Information Regarding Forward-Looking Statements 

----

|   | · | 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 North America; |
|--------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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

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

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

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

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

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

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

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

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

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

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

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

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

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

|   | · | capital and credit markets conditions, inflation and interest rates; |
|--------|--------|----------------------------------------------------------------------|

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

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

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

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

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

|   | · | 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 new wells; |
|--------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | 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 and Qualitative Disclosures about Market Risk. 

Item 4.  Controls and Procedures. 

PART II – OTHER INFORMATION 

Item 1.     Legal Proceedings. 

Item 1A.   Risk Factors. 

Unregistered Sales of Equity Securities and Use of Proceeds. 

Item 3.     Defaults Upon Senior Securities. 

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

Item 5.      Other Information. 

----

Item 6.      Exhibits. 

|               |   3.1*—        | Amended and Restated Articles of Incorporation of Kinder Morgan, Inc.                                                                                                                                                                                                                                                                                                                                                                                                                    |
|--------------------|-------------------------------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|               |   41.1 —  | Certain instruments with respect to the long-term debt of Kinder Morgan, Inc. and its consolidated subsidiaries that relate to debt that does not exceed 10% of the total assets of Kinder Morgan, 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. Kinder Morgan,Inc. hereby agrees to furnish supplementally to the Securities and Exchange Commission a copy of each such instrument upon request.  |
|     | 31.1*—                   | Certification by CEO pursuant to Rule 13a-14 or 15d-14 of the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.                                                                                                                                                                                                                                                                                                                     |
|               | 31.2*—                   | Certification by CFO pursuant to Rule 13a-14 or 15d-14 of the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.                                                                                                                                                                                                                                                                                                                     |
|               | 32.1*—                   | Certification by CEO pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.                                                                                                                                                                                                                                                                                                                                                           |
|               | 32.2*—                   | Certification by CFO pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.                                                                                                                                                                                                                                                                                                                                                                |

----

SIGNATURE 

|       | KINDER MORGAN, INC.(Registrant)                                                    |
|-----------------|--------------------------------------------------------------------------------------------------------|
| August 11, 2009 | /s/ Kimberly A. Dang                                                                                   |
|            | Kimberly A. DangVice President and Chief Financial Officer(Principal Financial and Accounting Officer) |

----