----

**UNITED      STATES SECURITIES AND EXCHANGE COMMISSION**

**WASHINGTON,      D. C. 20549**

**_______________**

**FORM      10-Q**

**Quarterly      Report Pursuant to Section 13 or 15 (d) of the Securities Exchange Act of      1934**

**For      the quarterly period ended**

**March      31, 2007**

**Commission      File No. 1-2921**

**_______________**

**PANHANDLE      EASTERN PIPE LINE COMPANY, LP**

| **Delaware**                                            | **44-0382470**                     |
|---------------------------------------------------------|------------------------------------|
| (State                or other jurisdiction of          | (I.R.S.                Employer    |
| incorporation                or organization)           | Identification                No.) |
|                                                    |                               |
|                                                    |                               |
| **5444                Westheimer Road**                 | **77056-5306**                     |
| **Houston,                Texas**                       | (Zip                Code)          |
| (Address                of principal executive offices) |                               |

**      (713) 989-7000**

| Title                of each Class                   |   | Name                of each exchange in which registered |
|------------------------------------------------------|--------|----------------------------------------------------------|
| 4.80%                Senior Notes due 2008, Series B |   | New                York Stock Exchange                   |
| 6.05%                Senior Notes due 2013, Series B |   | New                York Stock Exchange                   |

**P**

**P**

** **
**P**

----

**PANHANDLE      EASTERN PIPE LINE COMPANY, LP**

**FORM      10-Q**

**March      31, 2007**

**Table      of Contents**

| **PART                I. FINANCIAL INFORMATION:** | Page(s)                                                                                                                      |
|---------------------------------------------------|------------------------------------------------------------------------------------------------------------------------------|
|                                              |                                                                                                                         |
|                                              | ITEM                1. Financial Statements (Unaudited):                                                                     |   |
|                                              |                                                                                                                         |
|                                              | Condensed                consolidated statement of                operations.                                                | 2 |
|                                              |                                                                                                                         |
|                                              | Condensed                consolidated balance sheet.                                                                         | 3-4 |
|                                              |                                                                                                                         |
|                                              | Condensed                consolidated statement of cash                flows.                                                | 5 |
|                                              |                                                                                                                         |
|                                              | Condensed                consolidated statement of partners’ capital and                comprehensive income.          | 6 |
|                                              |                                                                                                                         |
|                                              | Notes                to condensed consolidated financial                statements.                                          | 7 |
|                                              |                                                                                                                         |
|                                              | ITEM                2. Management's Discussion and Analysis of Financial                Condition and Results of Operations. | 20 |
|                                              |                                                                                                                         |
|                                              | ITEM                3. Quantitative and Qualitative Disclosures About                Market Risk.                            | 22 |
|                                              |                                                                                                                         |
|                                              | ITEM                4. Controls and Procedures.                                                                              | 23 |
|                                              |                                                                                                                         |
| **PART                II. OTHER INFORMATION:**    |                                                                                                                         |
|                                              |                                                                                                                         |
|                                              | ITEM                1. Legal Proceedings.                                                                                    | 24 |
|                                              |                                                                                                                         |
|                                              | ITEM                1A. Risk Factors.                                                                                        | 24 |
|                                              |                                                                                                                         |
|                                              | ITEM                2. Unregistered Sales of Equity Securities and Use of                Proceeds.                           | 24 |
|                                              |                                                                                                                         |
|                                              | ITEM                3. Defaults Upon Senior                Securities.                                                       | 25 |
|                                              |                                                                                                                         |
|                                              | ITEM                4. Submission of Matters to a Vote of Security                Holders.                                   | 25 |
|                                              |                                                                                                                         |
|                                              | ITEM                5. Other Information.                                                                                    | 25 |
|                                              |                                                                                                                         |
|                                              | ITEM                6. Exhibits.                                                                                             | 25 |
|                                              |                                                                                                                         |
|                                              | SIGNATURES                                                                                                                   | 27 |
|                                              |                                                                                                                         |

----

Table          of Contents

**PANHANDLE        EASTERN PIPE LINE COMPANY, LP**

**CONDENSED        CONSOLIDATED STATEMENT OF OPERATIONS**

**(UNAUDITED)**

|                                                             |   | **Three                  Months Ended March 31,** |    |
|------------------------------------------------------------------|--------|---------------------------------------------------|---------|
|                                                             |   | **2007**                                          |    | **2006** |   |
|                                                             |   | (In                  thousands of dollars)        |    |
| **Operating                  revenue**                           |   |                                              |    |   |   |   |   |
| Transportation                  and storage of natural gas  |   | $                                                 | 133,705 |   | $ | 121,332 |   |
| LNG                  terminalling revenue                   |   |                                              | 32,902  |   |   | 19,555 |   |
| Other                  revenue                              |   |                                              | 2,423   |   |   | 3,756 |   |
| Total                  operating revenue                         |   |                                              | 169,030 |   |   | 144,643 |   |
|                                                             |   |                                              |    |   |   |   |   |
| **Operating                  expenses**                          |   |                                              |    |   |   |   |   |
| Operation,                  maintenance and general         |   |                                              | 56,280  |   |   | 46,098 |   |
| Depreciation                  and amortization              |   |                                              | 20,709  |   |   | 17,474 |   |
| Taxes,                  other than on income                |   |                                              | 7,795   |   |   | 7,350 |   |
| Total                  operating expenses                        |   |                                              | 84,784  |   |   | 70,922 |   |
|                                                             |   |                                              |    |   |   |   |   |
|                                                             |   |                                              |    |   |   |   |   |
| **Operating                  income**                            |   |                                              | 84,246  |   |   | 73,721 |   |
|                                                             |   |                                              |    |   |   |   |   |
| **Other                  income (expense)**                      |   |                                              |    |   |   |   |   |
| Interest                  expense, net                      |   |                                              | (22,026 | ) |   | (12,875 | ) |
| Other,                  net                                 |   |                                              | 11,057  |   |   | 3,241 |   |
| Total                  other income (expense)                    |   |                                              | (10,969 | ) |   | (9,634 | ) |
|                                                             |   |                                              |    |   |   |   |   |
| **Earnings                  before income taxes**                |   |                                              | 73,277  |   |   | 64,087 |   |
|                                                             |   |                                              |    |   |   |   |   |
| **Income                  taxes**                                |   |                                              | 28,796  |   |   | 25,022 |   |
|                                                             |   |                                              |    |   |   |   |   |
|                                                             |   |                                              |    |   |   |   |   |
| **Net                  earnings**                                |   | $                                                 | 44,481  |   | $ | 39,065 |   |
|                                                             |   |                                              |    |   |   |   |   |

----

Table          of Contents

**PANHANDLE        EASTERN PIPE LINE COMPANY, LP**

**CONDENSED        CONSOLIDATED BALANCE SHEET**

**(UNAUDITED)**

|                                                                                                             |   | **March                  31, 2007**        |      | **December                  31, 2006** |        |
|------------------------------------------------------------------------------------------------------------------|--------|--------------------------------------------|-----------|----------------------------------------|--------|
| **Assets**                                                                                                       |   | (In                  thousands of dollars) |      |
|                                                                                                             |   |                                       |      |                                   |   |   |   |
| **Current                  assets**                                                                              |   |                                       |      |                                   |   |   |   |
| Cash                  and cash equivalents                                                                  |   | $                                          | 427       |                                   | $      | 531 |   |
| Accounts                  receivable, less allowances of $1,176 and $1,176, respectively                    |   |                                       | 62,518    |                                   |   | 61,047 |   |
| Accounts                  receivable - related parties (Note 5)                                             |   |                                       | 7,658     |                                   |   | 17,994 |   |
| Gas                  imbalances - receivable                                                                |   |                                       | 106,294   |                                   |   | 68,013 |   |
| System                  gas and operating supplies (Note 3)                                                 |   |                                       | 126,024   |                                   |   | 127,303 |   |
| Deferred                  income taxes, net                                                                 |   |                                       | 3,410     |                                   |   | 3,117 |   |
| Note                  receivable - CrossCountry Citrus                                                      |   |                                       | 11,806    |                                   |   | 6,664 |   |
| Other                                                                                                       |   |                                       | 8,381     |                                   |   | 10,691 |   |
| Total                  current assets                                                                            |   |                                       | 326,518   |                                   |   | 295,360 |   |
|                                                                                                             |   |                                       |      |                                   |   |   |   |
| **Property,                  plant and equipment**                                                               |   |                                       |      |                                   |   |   |   |
| Plant                  in service                                                                           |   |                                       | 2,465,776 |                                   |   | 2,418,917 |   |
| Construction                  work-in-progress                                                              |   |                                       | 163,446   |                                   |   | 166,085 |   |
|                                                                                                             |   |                                       | 2,629,222 |                                   |   | 2,585,002 |   |
| Less                  accumulated depreciation and amortization                                             |   |                                       | 225,700   |                                   |   | 207,606 |   |
| Net                  property, plant and equipment                                                               |   |                                       | 2,403,522 |                                   |   | 2,377,396 |   |
|                                                                                                             |   |                                       |      |                                   |   |   |   |
| **Investment                  in affiliate**                                                                     |   |                                       | 1,604     |                                   |   | 1,457 |   |
|                                                                                                             |   |                                       |      |                                   |   |   |   |
|                                                                                                             |   |                                       |      |                                   |   |   |   |
| Note                  receivable - Southern Union                                                           |   |                                       | 168,205   |                                   |   | 148,655 |   |
| Note                  receivable - CrossCountry Citrus                                                      |   |                                       | 446,530   |                                   |   | 458,336 |   |
| Intangibles,                  net                                                                           |   |                                       | 7,532     |                                   |   | 7,618 |   |
| Debt                  issuance cost                                                                         |   |                                       | 3,651     |                                   |   | 2,376 |   |
| Non-current                  system gas (Note 3)                                                            |   |                                       | 13,222    |                                   |   | 14,850 |   |
| Other                                                                                                       |   |                                       | 2,306     |                                   |   | 2,472 |   |
|                                                                                                             |   |                                       |      |                                   |   |   |   |
| **Total                  assets**                                                                           |   | $                                          | 3,373,090 |                                   | $      | 3,308,520 |   |
|                                                                                                             |   |                                       |      |                                   |   |   |   |

----

Table          of Contents

**PANHANDLE      EASTERN PIPE LINE COMPANY, LP**

**CONDENSED      CONSOLIDATED BALANCE SHEET**

**(UNAUDITED)**

|                                                                   |   | **March                  31, 2007**        |      | **December                  31, 2006** |   |
|------------------------------------------------------------------------|--------|--------------------------------------------|-----------|----------------------------------------|--------|
|                                                                   |   | (In                  thousands of dollars) |      |
| **Partners'                  Capital**                                 |   |                                       |      |                                   |   |   |   |
| Partners'                  capital                                |   | $                                          | 1,086,204 |                                   | $      | 1,041,723 |   |
| Accumulated                  other comprehensive income (Note 8)  |   |                                       | 14,570    |                                   |   | 15,477 |   |
| Tax                  sharing note receivable - Southern Union     |   |                                       | (16,431   | )                                      |   | (16,431 | ) |
| Total                  partners' capital                               |   |                                       | 1,084,343 |                                   |   | 1,040,769 |   |
|                                                                   |   |                                       |      |                                   |   |   |   |
| Long-term                  debt (Note 7)                          |   |                                       | 1,627,905 |                                   |   | 1,185,391 |   |
| Total                  capitalization                                  |   |                                       | 2,712,248 |                                   |   | 2,226,160 |   |
|                                                                   |   |                                       |      |                                   |   |   |   |
| **Current                  liabilities**                               |   |                                       |      |                                   |   |   |   |
| Current                  portion of long-term debt (Note 7)       |   |                                       | 11,806    |                                   |   | 461,011 |   |
| Accounts                  payable                                 |   |                                       | 3,087     |                                   |   | 6,679 |   |
| Accounts                  payable - overdrafts                    |   |                                       | 6,567     |                                   |   | 23,776 |   |
| Accounts                  payable - related parties (Note 5)      |   |                                       | 27,584    |                                   |   | 15,962 |   |
| Gas                  imbalances - payable                         |   |                                       | 190,772   |                                   |   | 144,137 |   |
| Accrued                  taxes                                    |   |                                       | 37,111    |                                   |   | 12,030 |   |
| Accrued                  interest                                 |   |                                       | 8,516     |                                   |   | 19,669 |   |
| Retained                  fuel obligation                         |   |                                       | 6,920     |                                   |   | 12,418 |   |
| Labor                  and benefit accruals                       |   |                                       | 8,110     |                                   |   | 16,868 |   |
| Other                  operating expense accruals                 |   |                                       | 7,030     |                                   |   | 9,832 |   |
| Capital                  accruals                                 |   |                                       | 20,121    |                                   |   | 26,929 |   |
| Other                                                             |   |                                       | 17,579    |                                   |   | 20,623 |   |
| Total                  current liabilities                             |   |                                       | 345,203   |                                   |   | 769,934 |   |
|                                                                   |   |                                       |      |                                   |   |   |   |
| Deferred                  income taxes, net                       |   |                                       | 248,932   |                                   |   | 243,697 |   |
| Post-retirement                  benefits                         |   |                                       | 2,824     |                                   |   | 4,436 |   |
| Other                                                             |   |                                       | 63,883    |                                   |   | 64,293 |   |
| Commitments                  and contingencies (Note 11)          |   |                                       |      |                                   |   |   |   |
|                                                                   |   |                                       |      |                                   |   |   |   |
| **Total                  partners' capital and liabilities**      |   | $                                          | 3,373,090 |                                   | $      | 3,308,520 |   |
|                                                                   |   |                                       |      |                                   |   |   |   |

----

Table          of Contents

**PANHANDLE      EASTERN PIPE LINE COMPANY, LP**

**CONDENSED      CONSOLIDATED STATEMENT OF CASH FLOWS**

**(UNAUDITED)**

|                                                                                                                  |   | **Three                  Months Ended March 31,** |     |
|-----------------------------------------------------------------------------------------------------------------------|--------|---------------------------------------------------|----------|
|                                                                                                                  |   | **2007**                                          |     | **2006** |   |
|                                                                                                                  |   | (In                  thousands of dollars)        |     |
| **Cash                  flows provided by (used in) operating activities:**                                           |   |                                              |     |   |   |   |   |
| Net                  earnings                                                                                         |   | $                                                 | 44,481   |   | $ | 39,065 |   |
| Adjustments                  to reconcile net earnings to net cash provided by operating                  activities: |   |                                              |     |   |   |   |   |
| Depreciation                  and amortization                                                                        |   |                                              | 20,709   |   |   | 17,474 |   |
| Deferred                  income taxes                                                                                |   |                                              | 5,319    |   |   | 12,952 |   |
| Gain                  on sale of assets                                                                               |   |                                              | -        |   |   | (1,654 | ) |
| Debt                  premium and discount amortization, net                                                          |   |                                              | (109     | ) |   | (323 | ) |
| Changes                  in operating assets and liabilities                                                          |   |                                              | 21,531   |   |   | (4,107 | ) |
| Net                  cash flows provided by operating activities                                                      |   |                                              | 91,931   |   |   | 63,407 |   |
|                                                                                                                  |   |                                              |     |   |   |   |   |
| **Cash                  flows provided by (used in) investing activities:**                                           |   |                                              |     |   |   |   |   |
| Net                  increase in note receivable - Southern Union                                                     |   |                                              | (19,550  | ) |   | (36,050 | ) |
| Capital                  and investment expenditures                                                                  |   |                                              | (53,527  | ) |   | (30,469 | ) |
| Sale                  of assets                                                                                       |   |                                              | -        |   |   | 2,450 |   |
| Decrease                  in note receivable - CrossCountry Citrus                                                    |   |                                              | 6,664    |   |   | - |   |
| Other                                                                                                                 |   |                                              | (599     | ) |   | (229 | ) |
| Net                  cash flows used in investing activities                                                          |   |                                              | (67,012  | ) |   | (64,298 | ) |
|                                                                                                                  |   |                                              |     |   |   |   |   |
| **Cash                  flows provided by (used in) financing activities:**                                           |   |                                              |     |   |   |   |   |
| Increase                  (decrease) in bank overdrafts                                                               |   |                                              | (17,209  | ) |   | 442 |   |
| Debt                  issuance                                                                                        |   |                                              | 455,000  |   |   | - |   |
| Debt                  retirements                                                                                     |   |                                              | (462,289 | ) |   | - |   |
| Debt                  issuance costs                                                                                  |   |                                              | (525     | ) |   | - |   |
| Net                  cash flows provided by (used in) financing activities                                            |   |                                              | (25,023  | ) |   | 442 |   |
|                                                                                                                  |   |                                              |     |   |   |   |   |
| Change                  in cash and cash equivalents                                                                  |   |                                              | (104     | ) |   | (449 | ) |
|                                                                                                                  |   |                                              |     |   |   |   |   |
| Cash                  and cash equivalents at beginning of period                                                     |   |                                              | 531      |   |   | 585 |   |
| **Cash                  and cash equivalents at end of period**                                                       |   | $                                                 | 427      |   | $ | 136 |   |
|                                                                                                                  |   |                                              |     |   |   |   |   |

----

Table          of Contents

**PANHANDLE      EASTERN PIPE LINE COMPANY, LP**

**CONDENSED      CONSOLIDATED STATEMENT OF PARTNERS’ CAPITAL AND COMPREHENSIVE      INCOME**

**(UNAUDITED)**

|                                                                 |   | **Partners'                  Capital**     |      | **Accumulated                  Other Comprehensive Income** |   | **Tax                  Sharing Note Receivable-Southern Union** |    | **Total** |    |
|----------------------------------------------------------------------|--------|--------------------------------------------|-----------|-------------------------------------------------------------|--------|-----------------------------------------------------------------|---------|-----------|---------|
|                                                                 |   | (In                  thousands of dollars) |      |
|                                                                 |   |                                       |      |                                                        |   |                                                            |    |      |    |   |   |   |   |
| Balance                  January 1, 2007                             |   | $                                          | 1,041,723 |                                                        | $      | 15,477                                                          |    | $         | (16,431 | ) | $ | 1,040,769 |   |
|                                                                 |   |                                       |      |                                                        |   |                                                            |    |      |    |   |   |   |   |
| Comprehensive                  income:                          |   |                                       |      |                                                        |   |                                                            |    |      |    |   |   |   |   |
| Net                  earnings                                        |   |                                       | 44,481    |                                                        |   | -                                                               |    |      | -       |   |   | 44,481 |   |
| Recognized                  prior service credit related to other    |   |                                       |      |                                                        |   |                                                            |    |      |    |   |   |   |   |
| postretirement                  plan, net of tax                     |   |                                       | -         |                                                        |   | (678                                                            | )  |      | -       |   |   | (678 | )  |
| Net                  gain related to interest rate swaps, net of tax |   |                                       | -         |                                                        |   | (229                                                            | )       |      | -       |   |   | (229 | ) |
| Comprehensive                  income                                |   |                                       | 44,481    |                                                        |   | (907                                                            | )       |      | -       |   |   | 43,574 |   |
|                                                                 |   |                                       |      |                                                        |   |                                                            |    |      |    |   |   |   |   |
| Balance                  March 31, 2007                              |   | $                                          | 1,086,204 |                                                        | $      | 14,570                                                          |    | $         | (16,431 | ) | $ | 1,084,343 |   |
|                                                                 |   |                                       |      |                                                        |   |                                                            |    |      |    |   |   |   |   |

----

Table          of Contents

**PANHANDLE          EASTERN PIPE LINE COMPANY, LP**

**NOTES          TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**(UNAUDITED)**

**ITEM      1. Financial Statements**

*PEPL*
*Panhandle*
*the      Company*
*SEC*
*GAAP*

**1.      Corporate Structure**

*LNG*
*FERC*

|   | · | PEPL,                an indirect wholly-owned subsidiary of Southern Union Company                (*Southern                Union Company*                and together with its subsidiaries, *Southern                Union*); |
|--------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | Trunkline                Gas Company, LLC (*Trunkline*),                a direct wholly-owned subsidiary of                PEPL; |
|--------|--------|----------------------------------------------------------------------------------------------------------------------------------|

|   | · | Sea                Robin Pipeline Company, LLC (*Sea                Robin*),                an indirect wholly-owned subsidiary of                PEPL; |
|--------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | Trunkline                LNG Holdings, LLC (*LNG                Holdings*),                an indirect wholly-owned subsidiary of                PEPL; |
|--------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | Trunkline                LNG Company, LLC (*Trunkline                LNG*),                a direct wholly-owned subsidiary of LNG Holdings;                and |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | Pan                Gas Storage, LLC (d.b.a. *Southwest                Gas Storage*),                a direct wholly-owned subsidiary of                PEPL. |
|--------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------|

*Bcf/d*
*Bcf*

**2.      New Accounting Principles**

***Accounting      Principles Recently Adopted.***

***FIN      48, “Accounting for Uncertainty in Income Taxes - an Interpretation of FASB      Statement 109” (FIN 48):***
*FASB*
*Accounting      for Income Taxes*
*Note      10 - Accounting for Uncertainty in Income Taxes*

----

Table          of Contents

**PANHANDLE          EASTERN PIPE LINE COMPANY, LP**

**NOTES          TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**(UNAUDITED)**

***Accounting      Principles Not Yet Adopted.***

***FASB      Statement No. 157, “Fair Value Measurements”***
**:**

***FASB      Statement No. 159, “The Fair Value Option for Financial Assets and Financial      Liabilities - Including an Amendment of FASB Statement No.      115”***
**:**

**3.      System Gas and Operating Supplies**

*MMBtu*

**4.      Regulatory Matters**

*Construction      work-in-progress*

*Construction      work-in-progress *

----

Table          of Contents

**PANHANDLE          EASTERN PIPE LINE COMPANY, LP**

**NOTES          TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**(UNAUDITED)**

*CIAC*
*Energy      Transfer*
*Construction      work-in-progress *

*HCAs*

----

Table          of Contents

**PANHANDLE          EASTERN PIPE LINE COMPANY, LP**

**NOTES          TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**(UNAUDITED)**

**5.      Related Party Transactions**

|                                                       |   |                                    |   |
|------------------------------------------------------------|--------|-----------------------------------------|--------|
|                                                       |   | **Three                  Months Ended** |   |
|                                                       |   | **March                  31,**          |   |
| **Related                  Party Transactions**            |   | **2007**                                |   | **2006** |   |
|                                                       |   | (In                  thousands)         |   |
|                                                       |   |                                    |   |   |   |   |   |
| Transportation                  and storage of natural gas |   | $                                       | 1,393  |   | $ | 1,456 |   |
| Operation                  and maintenance:                |   |                                    |   |   |   |   |   |
| Management                  and royalty fees               |   |                                    | 4,225  |   |   | 3,616 |   |
| Other                  expenses                            |   |                                    | 7,912  |   |   | 4,565 |   |
| Other                  income, net                         |   |                                    | 10,488 |   |   | 1,480 |   |
|                                                       |   |                                    |   |   |   |   |   |

*Other,      net*
*Note      receivable - Southern Union*
*Note      receivable - Southern Union *

*CrossCountry      Citrus*
*2006      Term Loan*
*Other,      net*
*Note      receivable - CrossCountry Citrus*

*Partners      Capital*
*IRS*

*Accrued      taxes*

----

Table          of Contents

**PANHANDLE          EASTERN PIPE LINE COMPANY, LP**

**NOTES          TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**(UNAUDITED)**

| **Related                  Party**                          |   | **March                  31, 2007** |   | **December                  31, 2006** |   |
|-------------------------------------------------------------|--------|-------------------------------------|--------|----------------------------------------|--------|
|                                                        |   | (In                  thousands)     |   |
| **Accounts                  receivable - related parties:** |   |                                |   |                                   |   |   |   |
| Southern                  Union (1)                         |   | $                                   | -      |                                   | $      | 14,448 |   |
| Other                  (2)                                  |   |                                | 7,658  |                                   |   | 3,546 |   |
|                                                        |   |                                | 7,658  |                                   |   | 17,994 |   |
| **Accounts                  payable - related parties:**    |   |                                |   |                                   |   |   |   |
| Southern                  Union (3)                         |   | $                                   | 24,198 |                                   | $      | 14,978 |   |
| Other                  (4)                                  |   |                                | 3,386  |                                   |   | 984 |   |
|                                                        |   | $                                   | 27,584 |                                   | $      | 15,962 |   |
|                                                        |   |                                |   |                                   |   |   |   |

| (1) | Primarily                related to expenditures made on behalf of Southern Union and interest                associated with the Note receivable - Southern                Union. |
|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (2) | Primarily                related to interest from CrossCountry Citrus in 2007 and CrossCountry                Energy transition service costs in                2006. |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (3) | Primarily                related to corporate services and payroll funding provided by Southern                Union and reimbursable medical and insurance costs paid by Southern                Union                on behalf of the Company. |
|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (4) | Primarily                related to various administrative and operating costs paid by other                affiliate companies on behalf of the                Company. |
|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

**6.      Derivatives Instruments and Hedging Activities**

*Accumulated      other comprehensive income*
*Accumulated      other comprehensive income*

*Note      7 - Debt.*

----

Table          of Contents

**PANHANDLE          EASTERN PIPE LINE COMPANY, LP**

**NOTES          TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**(UNAUDITED)**

**7.      Debt**

| **Long-term                  Debt Obligations**           |   | **March                  31, 2007** |      | **December                  31, 2006** |   |
|-----------------------------------------------------------|--------|-------------------------------------|-----------|----------------------------------------|--------|
|                                                      |   | (In                  thousands)     |      |
|                                                      |   |                                |      |                                   |   |   |   |
| 2.75%                  Senior Notes due 2007              |   | $                                   | -         |                                   | $      | 200,000 |   |
| 4.80%                  Senior Notes due 2008              |   |                                | 300,000   |                                   |   | 300,000 |   |
| 6.05%                  Senior Notes due 2013              |   |                                | 250,000   |                                   |   | 250,000 |   |
| 6.50%                  Senior Notes due 2009              |   |                                | 60,623    |                                   |   | 60,623 |   |
| 8.25%                  Senior Notes due 2010              |   |                                | 40,500    |                                   |   | 40,500 |   |
| 7.00%                  Senior Notes due 2029              |   |                                | 66,305    |                                   |   | 66,305 |   |
| Term                  Loan due 2007                       |   |                                | -         |                                   |   | 255,626 |   |
| Term                  Loan due 2008                       |   |                                | 458,336   |                                   |   | 465,000 |   |
| Term                  Loan due 2012                       |   |                                | 455,000   |                                   |   | - |   |
| Net                  premiums on long-term debt           |   |                                | 8,947     |                                   |   | 9,613 |   |
| Total                  debt outstanding                   |   |                                | 1,639,711 |                                   |   | 1,647,667 |   |
| Current                  portion of long-term debt        |   |                                | (11,806   | )                                      |   | (461,011 | ) |
| Interest                  rate swaps (2.75% Senior Notes) |   |                                | -         |                                   |   | (1,265 | ) |
| Total                  long-term debt                     |   | $                                   | 1,627,905 |                                   | $      | 1,185,391 |   |
|                                                      |   |                                |      |                                   |   |   |   |

*2012      Term Loan*

----

Table          of Contents

**PANHANDLE          EASTERN PIPE LINE COMPANY, LP**

**NOTES          TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**(UNAUDITED)**

**Retirement      of Debt Obligations**

**8.      Accumulated Other Comprehensive Income**

|                                                                                       |   | **Three                  Months**    |   |
|--------------------------------------------------------------------------------------------|--------|--------------------------------------|--------|
|                                                                                       |   | **Ended                  March 31,** |   |
|                                                                                       |   | **2007**                             |   | **2006** |   |
|                                                                                       |   | (In                  thousands)      |   |
|                                                                                       |   |                                 |   |   |   |   |   |
| Net                  earnings                                                              |   | $                                    | 44,481 |   | $ | 39,065 |   |
|                                                                                       |   |                                 |   |   |   |   |   |
| Realized                  (gain) loss on cash flow hedging                                 |   |                                 |   |   |   |   |   |
| activities,                  net of taxes of $(155) and $(185), respectively               |   |                                 | (229   | ) |   | (276 | ) |
| Reclassification                  of prior service credit relating to other postretirement |   |                                 |   |   |   |   |   |
| benefits                  into earnings, net of taxes of $(222) and $0, respectively       |   |                                 | (678   | )  |   | - |   |
| Unrealized                  gain (loss) on cash flow hedging                               |   |                                 |   |   |   |   |   |
| activities                  net of taxes of $0 and $0, respectively                        |   |                                 | -      |   |   | (2 | ) |
| Total                  other comprehensive income (loss)                                   |   |                                 | (907   | ) |   | (278 | ) |
|                                                                                       |   |                                 |   |   |   |   |   |
| Total                  comprehensive income                                                |   | $                                    | 43,574 |   | $ | 38,787 |   |
|                                                                                       |   |                                 |   |   |   |   |   |

*Accumulated      other comprehensive income*

|                                                                                                                                   |   | **March                  31,**  |   | **December                  31,** |   |
|----------------------------------------------------------------------------------------------------------------------------------------|--------|---------------------------------|--------|-----------------------------------|--------|
| **Components                  in Accumulated Other Comprehensive Income (loss)**                                                       |   | **2007**                        |   | **2006**                          |   |
|                                                                                                                                   |   | (In                  thousands) |   |
|                                                                                                                                   |   |                            |   |                              |   |   |   |
| Other                  postretirement plan - net actuarial loss and prior service credit,                  net of                  tax |   | $                               | 14,570 |                              | $      | 15,248 |   |
| Interest                  rate hedges, net of tax                                                                                      |   |                            | -      |                              |   | 229 |   |
| Total                  Accumulated other comprehensive income, net of tax                                                              |   | $                               | 14,570 |                              | $      | 15,477 |   |
|                                                                                                                                   |   |                            |   |                              |   |   |   |

----

Table          of Contents

**PANHANDLE          EASTERN PIPE LINE COMPANY, LP**

**NOTES          TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**(UNAUDITED)**

**9.      Postretirement Benefits**

|                                               |   | **Postretirement                  Benefits** |   |
|----------------------------------------------------|--------|----------------------------------------------|--------|
|                                               |   | **Three                  Months Ended**      |   |
|                                               |   | **March                  31,**               |   |
|                                               |   | **2007**                                     |   | **2006** |   |
|                                               |   | (In                  thousands)              |   |
|                                               |   |                                         |   |   |   |   |   |
| Service                  cost                      |   | $                                            | 336    |   | $ | 440 |   |
| Interest                  cost                     |   |                                         | 511    |   |   | 544 |   |
| Expected                  return on plan assets    |   |                                         | (483   | ) |   | (344 | ) |
| Prior                  service credit amortization |   |                                         | (900   | ) |   | (911 | ) |
| Recognized                  actuarial loss         |   |                                         | -      |   |   | 127 |   |
| Net                  periodic benefit cost         |   | $                                            | (536   | ) | $ | (144 | ) |
|                                               |   |                                         |   |   |   |   |   |

**10.      Accounting for Uncertainty in Income Taxes**

*.      *

*Partners’      capital*

**11.      Commitments and Contingencies**

***Litigation.***
** **
*Accounting      for Contingencies*

----

Table          of Contents

**PANHANDLE          EASTERN PIPE LINE COMPANY, LP**

**NOTES          TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**(UNAUDITED)**

*Hope      Land*

*MMS*

***Environmental      Matters.***
*Environmental      Remediation Liabilities*

----

Table          of Contents

**PANHANDLE          EASTERN PIPE LINE COMPANY, LP**

**NOTES          TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**(UNAUDITED)**

***Environmental      Remediation.***
*PCB*

*PRP*

*U.S.      EPA*

*IEPA*

----

Table          of Contents

**PANHANDLE          EASTERN PIPE LINE COMPANY, LP**

**NOTES          TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**(UNAUDITED)**

*MDEQ*

|                                             |   | **March                  31,**  |   | **December                  31,** |   |
|--------------------------------------------------|--------|---------------------------------|--------|-----------------------------------|--------|
|                                             |   | **2007**                        |   | **2006**                          |   |
|                                             |   | (In                  thousands) |   |
|                                             |   |                            |   |                              |   |   |   |
| Current                                          |   | $                               | 1,962  |                              | $      | 1,962 |   |
| Noncurrent                                       |   |                            | 6,845  |                              |   | 6,760 |   |
| Total                  Environmental Liabilities |   | $                               | 8,807  |                              | $      | 8,722 |   |
|                                             |   |                            |   |                              |   |   |   |

***Air      Quality Control.***
*NOx      SIP Call*
*NOx*

*(IPCB)      *

----

Table          of Contents

**PANHANDLE          EASTERN PIPE LINE COMPANY, LP**

**NOTES          TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**(UNAUDITED)**

*MACT*
*HAPs*

***Spill      Control.***
*** ***

***Other      Commitments and Contingencies.***

***Kaplan      Compressor Station Damage.***
*Construction      work in progress*

***Hurricane      Damage.***

----

Table          of Contents

**PANHANDLE          EASTERN PIPE LINE COMPANY, LP**

**NOTES          TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**(UNAUDITED)**

***Energy      Transfer Commitment.***

***Controlled      Group Pension Liabilities.***

----

Table          of Contents

**ITEM      2. Management's Discussion and Analysis of Results of Operations      and Financial Condition**

**Overview**

*Bcf/d*
*Bcf*

*TBtu*

----

Table          of Contents

**Results      of Operations**

|                                                       |   |                                              |    |     |   |       |   |
|------------------------------------------------------------|--------|---------------------------------------------------|---------|----------|--------|------------|--------|
|                                                       |   | **Three                  Months Ended March 31,** |    |     |   |
|                                                       |   | **2007**                                          |    | **2006** |   | **Change** |   |
|                                                       |   | (In                  thousands)                   |    |
|                                                       |   |                                              |    |     |   |       |   |   |   |   |
| **Operating                  revenue:**                    |   |                                              |    |     |   |       |   |   |   |   |
| Transportation                  and storage of natural gas |   | $                                                 | 133,705 |     | $      | 121,332    |   | $ | 12,373 |   |
| LNG                  terminalling revenue                  |   |                                              | 32,902  |     |   | 19,555     |   |   | 13,347 |   |
| Other                  revenue                             |   |                                              | 2,423   |     |   | 3,756      |   |   | (1,333 | ) |
| Total                  operating revenue              |   |                                              | 169,030 |     |   | 144,643    |   |   | 24,387 |   |
|                                                       |   |                                              |    |     |   |       |   |   |   |   |
| **Operating                  expenses:**                   |   |                                              |    |     |   |       |   |   |   |   |
| Operation,                  maintenance and general        |   |                                              | 56,280  |     |   | 46,098     |   |   | 10,182 |   |
| Depreciation                  and amortization             |   |                                              | 20,709  |     |   | 17,474     |   |   | 3,235 |   |
| Taxes,                  other than on income               |   |                                              | 7,795   |     |   | 7,350      |   |   | 445 |   |
| Total                  operating expenses             |   |                                              | 84,784  |     |   | 70,922     |   |   | 13,862 |   |
| **Operating                  income**                      |   |                                              | 84,246  |     |   | 73,721     |   |   | 10,525 |   |
|                                                       |   |                                              |    |     |   |       |   |   |   |   |
| **Other                  income (expense):**               |   |                                              |    |     |   |       |   |   |   |   |
| Interest                  expense, net                     |   |                                              | (22,026 | )        |   | (12,875    | )      |   | (9,151 | ) |
| Other,                  net                                |   |                                              | 11,057  |     |   | 3,241      |   |   | 7,816 |   |
| Total                  other expense, net             |   |                                              | (10,969 | )        |   | (9,634     | )      |   | (1,335 | ) |
|                                                       |   |                                              |    |     |   |       |   |   |   |   |
| **Earnings                  before income taxes**          |   |                                              | 73,277  |     |   | 64,087     |   |   | 9,190 |   |
|                                                       |   |                                              |    |     |   |       |   |   |   |   |
| **Income                  taxes**                          |   |                                              | 28,796  |     |   | 25,022     |   |   | 3,774 |   |
|                                                       |   |                                              |    |     |   |       |   |   |   |   |
|                                                       |   |                                              |    |     |   |       |   |   |   |   |
| **Net                  earnings**                          |   | $                                                 | 44,481  |     | $      | 39,065     |   | $ | 5,416 |   |
|                                                       |   |                                              |    |     |   |       |   |   |   |   |

***Operating      Revenue***
**.**

| · | A                $13.3 million increase in LNG terminalling revenue due to a capacity                increase on the BG LNG Services contract as a result of the Trunkline                LNG                Phase I and Phase II expansions, which were placed in service in                April,                2006 and July, 2006, respectively, as well as higher volumes resulting                from an increase in LNG cargoes;                and |
|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| · | Increased                transportation and storage revenue of $12.4 million due to higher                parking                revenues of $4.7 million, higher reservation revenues of $4.3 million,                which were primarily driven by higher average rates on contracts,                higher                storage revenues of $2.3 million due to increased contracted capacity                and                higher commodity revenues of $1.1 million due to higher                volumes. |
|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

***Operating      Expenses.***

| · | Increased                depreciation and amortization expense of $3.2 million due to an                increase in property, plant and equipment placed in service, including                the                Trunkline LNG Phase I and Phase II                expansions; |
|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| · | An                increase in operation, maintenance and general expenses of $10.2                million                primarily due to: |
|--------|--------------------------------------------------------------------------------------------------------------------------------------------|

|   | o | a                $3.8                million increase in corporate costs due to Southern Union’s disposition of                certain assets during 2006 resulting in a larger allocation of corporate                costs to the remaining business                units; |
|--------|---|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | o | a                $2.1                million increase in LNG power costs resulting from increased                cargoes; |
|--------|---|---------------------------------------------------------------------------------------------------------------------------|

|   | o | a                $1.2                million increase in Sea Robin fuel tracker costs due to an under                recovery                in the first quarter of 2007; |
|--------|---|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | o | a                $1                million increase in labor and                benefits; |
|--------|---|-------------------------------------------------------------------------------------------|

|   | o | a                $500,000                increase in legal costs; |
|--------|---|-------------------------------------------------------------------|

----

Table          of Contents

|   | o | a                $600,000                increase in insurance expense due to higher premiums and higher workers’                compensation losses; and |
|--------|---|-----------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | o | a                $500,000                increase in contract storage costs primarily due to an increase in                leased                capacity and overrun charges. |
|--------|---|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

***Other      Expense, Net.***

***Income      Taxes.***

**OTHER      MATTERS**

***Contingencies***

*PART      I, ITEM 1. Financial Statements (Unaudited), Note 11 - Commitments and      Contingencies*
*Note      4 - Regulatory Matters*

***Regulatory***

*PART      I, ITEM 1. Financial Statements (Unaudited), Note 4 - Regulatory      Matters*

***Insurance***

***Debt      Refinancing***

**ITEM      3. Quantitative and Qualitative Disclosures About Market      Risk**

----

Table          of Contents

**ITEM      4. Controls and Procedures **

***Evaluation      of Disclosure Controls and Procedures***

*Exchange      Act*
*COO*
*CFO*

***Changes      in Internal Controls***

**Cautionary      Statement Regarding Forward-Looking Information**

|   | · | changes                in demand for natural gas by the Company’s customers, in the composition                of the Company’s customer base and in the sources of natural gas available                to the Company; |
|--------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | additional                level of competition potentially increasing the number of discounted                revenue transactions; |
|--------|--------|-------------------------------------------------------------------------------------------------------------------------------------|

----

Table          of Contents

|   | · | the                effects of inflation and the timing and extent of changes in the                prices                and overall demand for and availability of natural gas as well as                electricity, oil, coal and other bulk materials and                chemicals; |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | adverse                weather conditions, such as warmer than normal weather in the Company’s                service territories, and the operational impact of disasters such                as                Hurricanes Katrina and Rita; |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | changes                in laws or regulations, third-party relations and approvals, decisions                of                courts, regulators and governmental bodies affecting or involving                the                Company, including deregulation initiatives and the impact of rate                and                tariff proceedings before FERC and various state regulatory                commissions; |
|--------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | the                speed and degree to which additional competition is introduced to                the                Company’s business and the resulting effect on                revenues; |
|--------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | the                outcome of pending and future                litigation; |
|--------|--------|-----------------------------------------------------------------------------|

|   | · | the                Company’s ability to comply with or to challenge successfully existing or                new environmental regulations; |
|--------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | unanticipated                environmental liabilities; |
|--------|--------|---------------------------------------------------------|

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

|   | · | the                Company’s ability to control costs successfully and achieve operating                efficiencies, including the purchase and implementation of new                technologies for achieving such                efficiencies; |
|--------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | the                impact of factors affecting operations such as maintenance or repairs,                environmental incidents, gas pipeline system constraints and relations                with labor unions representing bargaining-unit                employees; |
|--------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | exposure                to customer concentration with a significant portion of revenues                realized                from a relatively small number of customers and any credit risks                associated with the financial position of those                customers; |
|--------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | changes                in the ratings of the Company’s debt securities or any of its                subsidiaries; |
|--------|--------|-------------------------------------------------------------------------------------------------------------------------|

|   | · | changes                in interest rates and other general capital markets conditions, and                in the                Company’s ability to continue to access the capital                markets; |
|--------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | acts                of nature, sabotage, terrorism or other acts causing damage greater                than                the Company’s insurance coverage                limits; |
|--------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | market                risks beyond the Company’s control affecting its risk management                activities including market liquidity, commodity price volatility                and                counterparty creditworthiness; and |
|--------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | other                risks and unforeseen events. |
|--------|--------|---------------------------------------------------|

**PART      II. OTHER INFORMATION**

**ITEM      1. Legal Proceedings**

*ITEM      1. Financial Statements (Unaudited), Note 11 - Commitments and      Contingencies*
*ITEM      2. Management’s Discussion and Analysis of Financial Condition and Results of      Operations*
*Part      I. Financial Information*

**ITEM      1A. Risk Factors**

**ITEM      2. Unregistered Sales of Equity Securities and Use of      Proceeds**

----

Table          of Contents

**ITEM      3. Defaults Upon Senior Securities**

**ITEM      4. Submission of Matters to a Vote of Security      Holders**

**ITEM      5. Other Information**

**ITEM      6. Exhibits**

| **                  Exhibit No.** | **                  Description**                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |
|---------------------------------------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|                                        |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |
| 3(a)                                        | Certificate                of Formation of Panhandle Eastern Pipe Line  Company,                LP. (Filed as Exhibit 3.A to the Form 10-K for the year ended December                31,                2004 and incorporated herein by reference.)                                                                                                                                                                                                                                                                                                      |
|                                        |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |
| 3(b)                                        | Limited                Partnership Agreement of Panhandle Eastern Pipe Line Company, LP,                dated as                of June 29, 2004, between Southern Union Company and Southern Union                Panhandle LLC. (Filed as Exhibit 3.B to the Form 10-K for the year                ended                December 31, 2004 and incorporated herein by                reference.)                                                                                                                                                              |
|                                        |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |
| 4(a)                                        | Indenture                dated as of March 29, 1999, among CMS Panhandle Holding                Company,Panhandle                Eastern Pipe Line Company and NBD Bank, as Trustee. (Filed as Exhibit                4(a)                to the Form 10-Q for the quarter ended March 31, 1999, and incorporated                herein by reference.)                                                                                                                                                                                                         |
|                                        |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |
| 4(b)                                        | 1st                Supplemental Indenture dated as of March 29, 1999, among CMS Panhandle                Holding Company, Panhandle Eastern Pipe Line Company and NBD Bank,                as                Trustee, including a form of Guarantee by Panhandle Eastern Pipe                Line                Company of the obligations of CMS Panhandle Holding Company. (Filed                as                Exhibit 4(b) to the Form 10-Q for the quarter ended March 31, 1999,                and                incorporated herein by reference.) |
|                                        |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |
| 4(c)                                        | 2nd                Supplemental Indenture dated as of March 27, 2000, between Panhandle,                as                Issuer and Bank One Trust Company, National Association, as Trustee.                (Filed as Exhibit 4(e) to the Form S-4 filed on June 22, 2000, and                incorporated herein by reference.)                                                                                                                                                                                                                             |
|                                        |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |
| 4(d)                                        | 3rd                Supplemental Indenture dated as of August 18, 2003, between Panhandle,                as                Issuer and Bank One Trust Company, National Association, as Trustee                (Filed                as Exhibit 4(d) to the Form 10-Q for the quarter ended September                30, 2003,                and incorporated herein by reference.)                                                                                                                                                                            |
|                                        |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |
| 4(e)                                        | 4th                Supplemental Indenture dated as of March 12, 2004, between Panhandle,                as                Issuer and J.P. Morgan Trust Company, National Association, as Trustee.                (Filed as Exhibit 4.E to the Form 10-K for the year ended December                31,                2004 and incorporated herein by reference.)                                                                                                                                                                                              |
|                                        |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |
| 4(f)                                        | Indenture                dated as of February 1, 1993, between Panhandle and Morgan Guaranty                Trust                Company effective January 1, 1982, as amended December 3, 1999. (Filed                as                Exhibit 4 to the Form S-3 filed February 19, 1993, and incorporated                herein                by reference.)                                                                                                                                                                                               |
|                                        |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |

----

Table          of Contents

| 10                (a)   | Credit                Agreement between Trunkline LNG Holdings, LLC, as borrower, Panhandle                Eastern Pipe Line Company, LP and Trunkline LNG Company, LLC, as                guarantors, the financial institutions listed therein and Bayerische                Hypo-                Und Vereinsbank AG, New York Branch, as administrative agent, dated                as of                March 15, 2007. (Filed as Exhibit 10.1 to Panhandle’s Current Report on                Form 8-K filed on March 21, 2007 and incorporated herein by                reference.) |
|-----------------------------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|                              |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |
| 10(b)                             | Credit                Agreement between Trunkline LNG Holdings, LLC, as borrower, Panhandle                Eastern Pipe Line Company, LP and CrossCountry Citrus, LLC, as guarantors,                the financial institutions listed therein and Bayerische Hypo- Und                Vereinsbank AG, New York Branch, as administrative agent, dated as                of                December 1, 2006. (Filed as Exhibit 10.1 to Panhandle’s Current Report on                Form 8-K filed on December 7, 2006 and incorporated herein by                reference.)              |
|                              |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |
| 10(c)                             | $465,000,000                Promissory Note made by CrossCountry Citrus, LLC, as borrower, in                favor of                Trunkline LNG Holdings LLC, as holder, dated as of December 1, 2006.                (Filed as Exhibit 10.2 to Panhandle’s Current Report on Form 8-K filed on                December 7, 2006 and incorporated herein by reference.)                                                                                                                                                                                                                 |
|                              |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |
| 31.1                              | Certificate                by President and Chief Operating Officer pursuant to Rule 13a - 14(a)                or                15d - 14(a) promulgated under the Securities Exchange Act of 1934,                as                adopted pursuant to Section 302 of the Sarbanes-Oxley Act of                2002.                                                                                                                                                                                                                                                                         |
|                              |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |
| 31.2                              | Certificate                by Senior Vice President and Chief Financial Officer pursuant to                Rule 13a                - 14(a) or 15d - 14(a) promulgated under the Securities Exchange                Act of                1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act                of                2002.                                                                                                                                                                                                                                              |
|                              |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |
| 32.1                              | Certificate                by President and Chief Operating Officer pursuant to Rule 13a - 14(b)                or                15d - 14(b) promulgated under the Securities Exchange Act of 1934                and                Section 906 of the Sarbanes-Oxley Act of 2002, 18 U.S.C. Section                1350.                                                                                                                                                                                                                                                                     |
|                              |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |
| 32.2                              | Certificate                by Senior Vice President and Chief Financial Officer pursuant to                Rule 13a                - 14(b) or 15d - 14(b) promulgated under the Securities Exchange                Act of                1934 and Section 906 of the Sarbanes-Oxley Act of 2002, 18 U.S.C.                Section                1350.                                                                                                                                                                                                                                          |

----

Table          of Contents

**SIGNATURES**

|                              | PANHANDLE                EASTERN PIPE LINE COMPANY, LP                                                                                                                                                                                                                                                                                  |
|-----------------------------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|                              |                                                                                                                                                                                                                                                                                                                                    |
|                              |                                                                                                                                                                                                                                                                                                                                    |
|                              |                                                                                                                                                                                                                                                                                                                                    |
|                              |                                                                                                                                                                                                                                                                                                                                    |
| Date:                May 10, 2007 | By:                /s/                ROBERT O. BOND                                                                                                                                                                                                                                                                                    |
|                              | Robert                O. Bond President                and Chief Operating Officer(authorized                officer)      /s/                GARY W. LEFELARGary                W. LefelarSenior                Vice President and Chief Accounting Officer(principal                accounting officer) |
|                              |                                                                                                                                                                                                                                                                                                                                    |
|                              |                                                                                                                                                                                                                                                                                                                                    |
|                              |                                                                                                                                                                                                                                                                                                                                    |
|                              |                                                                                                                                                                                                                                                                                                                                    |

----