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UNITED STATES SECURITIES AND EXCHANGE COMMISSION
 Washington, D.C. 20549
 Form 10-K
 (Mark One)
 þ
    
    ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THESECURITIES EXCHANGE ACT OF 1934
 For the fiscal year ended December 31, 2006
 OR
 o
    
    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THESECURITIES EXCHANGE ACT OF 1934
 For
the transition period from
           to            .
 Commission File Number 1-7320
 ANR Pipeline Company
  Delaware
    
    38-1281775(State or Other Jurisdiction of 
Incorporation or Organization)
    
    (I.R.S. Employer
Identification No.)El Paso Building 
1001 Louisiana Street 
Houston, Texas
(Address of Principal Executive Offices)
    
    77002
(Zip Code)
 Telephone Number: (713) 420-2600
 Securities registered pursuant to Section 12(b) of the Act:
 Name of each exchangeTitle of each class
    
    on which registered9.625% Debentures, due 20217.375% Debentures, due 2024
    
    New York Stock Exchange7% Debentures, due 2025
 Securities registered pursuant to Section 12(g) of the Act: None
 o þ
 o þ
 þ o
 þ
  o o þ
 o þ
 State the aggregate market value of the voting stock held by non-affiliates of the registrant:
None
 Indicate the number of shares outstanding of each of the registrants classes of common stock,
as of the latest practicable date.
  ANR PIPELINE COMPANY MEETS THE CONDITIONS OF GENERAL INSTRUCTION I (1)(a) AND (b) TO FORM 10-K
AND IS THEREFORE FILING THIS REPORT WITH A REDUCED DISCLOSURE FORMAT AS PERMITTED BY SUCH
INSTRUCTION.
 Documents Incorporated by Reference: None




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##### 



ANR PIPELINE COMPANY
  
 TABLE OF CONTENTS
 Caption
    
    PagePART IItem 1.
    
    Business
    
    
    3Item 1A.
    
    Risk Factors
    
    
    6Item 1B.
    
    Unresolved Staff Comments
    
    
    9Item 2.
    
    Properties
    
    
    9Item 3.
    
    Legal Proceedings
    
    
    9Item 4.
    
    Submission of Matters to a Vote of Security Holders
    
    
    *PART IIItem 5.
    
    Market for Registrants Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities
    
    
    9Item 6.
    
    Selected Financial Data
    
    
    *Item 7.
    
    Managements Discussion and Analysis of Financial Condition and Results of Operations
    
    
    10Item 7A.
    
    Quantitative and Qualitative Disclosures About Market Risk
    
    
    14Item 8.
    
    Financial Statements and Supplementary Data
    
    
    15Item 9.
    
    Changes in and Disagreements with Accountants on Accounting and Financial Disclosure
    
    
    34Item 9A.
    
    Controls and Procedures
    
    
    34Item 9B.
    
    Other Information
    
    
    34PART IIIItem 10.
    
    Directors, Executive Officers and Corporate Governance
    
    
    *Item 11.
    
    Executive Compensation
    
    
    *Item 12.
    
    Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters
    
    
    *Item 13.
    
    Certain Relationships and Related Transactions, and Director Independence
    
    
    *Item 14.
    
    Principal Accountant Fees and Services
    
    
    34PART IVItem 15.
    
    Exhibits and Financial Statement Schedules
    
    
    35Signatures
    
    
    45IndentureFirst Supplemental IndentureCertification Pursuant to Section 302Certification Pursuant to Section 302Certification Pursuant to Section 906Certification Pursuant to Section 906
  
 *
    
    We have not included a response to this item in this document since no response is required
pursuant to the reduced disclosure format permitted by General Instruction I to Form 10-K.  /d 
BBtu 
Bcf
    
    = per day
= billion British thermal units
= billion cubic feet
    
    LNG
MMcf
NGL
    
    = liquefied natural gas
= million cubic feet
= natural gas liquids
   2




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PART I
 
 ITEM 1. BUSINESS
 Overview and Strategy
    
    
    Optimizing our contract portfolio;
    
    Managing market segmentation and differentiation;
    
    Focusing on efficiency initiatives;
    
    Expanding both ends of our pipeline system; and
    
    Seeking new business opportunities.
  The ANR System.
 The Great Lakes L.P. System.
 Storage Facilities.
  3




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Markets and Competition
       Customer Information
    
    Contract Information
    
    CompetitionApproximately 290 firm
and interruptible
customers 
Major Customer:
We Energies
(799 BBtu/d)
    
    Approximately 670 firm
transportation contracts.
Weighted average
contract term between five and six
years.
Expire in 20072016.

    
    In our market areas, we compete with other
interstate and intrastate pipeline
companies and local distribution companies
to provide natural gas transportation and
storage services in the midwest. We compete
directly with other interstate pipelines,
including Guardian Pipeline, which is
constructing an expansion of its
facilities, for markets in Wisconsin. We
also compete directly with other interstate
pipelines in the northeast market to serve
electric generation and local distribution
companies.In our supply areas, we compete directly
with numerous pipelines and gathering
systems for access to new supply sources.
Our principal supply sources are the
Rockies and mid-continent production
accessed in Kansas and Oklahoma, western
Canadian production delivered to Wisconsin
and the Chicago area and Gulf of Mexico
sources, including deepwater production and
LNG imports.
 4




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Regulatory Environment
  
    
    rates and charges for natural gas transportation, storage and related services;
    
    certification and construction of new facilities;
    
    extension or abandonment of services and facilities;
    
    maintenance of accounts and records;
    
    relationships between pipelines and certain affiliates;
    
    terms and conditions of services;
    
    depreciation and amortization policies;
    
    acquisition and disposition of facilities; and
    
    initiation and discontinuation of services.
   Environmental
  Employees
  5




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ITEM 1A. RISK FACTORS
 CAUTIONARY STATEMENT FOR PURPOSES OF THE SAFE HARBOR PROVISIONS
OF THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995
   Our success depends on factors beyond our control.
  
    
    service area competition;
    
    expiration or turn back of significant contracts;
    
    changes in regulation and actions of regulatory bodies;
    
    weather conditions that impact throughput and storage levels;
    
    price competition;
    
    drilling activity and availability of natural gas;
    
    continued development of additional sources of gas supply that can be accessed;
    
    decreased natural gas demand due to various factors, including increases in prices and
the increased availability or popularity of alternative energy sources such as coal and fuel
oil;
    
    availability and increased cost of capital to fund ongoing maintenance and growth projects;
    
    opposition to energy infrastructure development, especially in environmentally sensitive areas;
    
    adverse general economic conditions; and
    
    unfavorable movements in natural gas prices in supply and demand areas.
 The revenues of our pipeline business are generated under contracts that must be renegotiated
periodically.
  6




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We face competition that could adversely affect our operating results.
  Fluctuations in energy commodity prices could adversely affect our business.
  
    
    regional, domestic and international supply and demand;
    
    availability and adequacy of transportation facilities;
    
    energy legislation;
    
    federal and state taxes, if any, on the transportation and storage of natural gas and NGL;
    
    abundance of supplies of alternative energy sources; and
    
    political unrest among oil producing countries.
 The agencies that regulate us and our customers affect our profitability.
    7




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Environmental compliance and remediation costs and the costs of environmental liabilities could
exceed our estimates.
  
    
    The uncertainties in estimating pollution control and clean up costs, including sites
where only preliminary site investigation or assessments have been completed;
    
    The discovery of new sites or additional information at existing sites;
    
    The uncertainty in quantifying liability under environmental laws that impose joint and
several liability on all potentially responsible parties; and
    
    The nature of environmental laws and regulations, including the interpretation and
enforcement thereof.
   Our operations are subject to operational hazards and uninsured risks.
   One of our customers accounts for a significant portion of our firm transportation capacity.
  The expansion of our business by constructing new facilities subjects us to construction and other
risks that may adversely affect our financial results.
  
    
    our ability to obtain necessary approvals and permits by regulatory agencies on a timely
basis and on terms that are acceptable to us;
    
    the ability to obtain continued access to sufficient capital to fund expansion projects;
    
    potential changes in federal, state and local statutes and regulations, including environmental requirements, that prevent a
 8




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project from proceeding or increase the anticipated cost of the project;
    
    impediments on our ability to acquire rights-of-way or land rights on a timely basis on
terms that are acceptable to us;
    
    our ability to construct projects within anticipated costs, including the risk that we
may incur cost overruns resulting from inflation or increased costs of equipment, materials
or labor, or other factors beyond our control, that may be material;
    
    lack of anticipated future growth in natural gas supply; and
    
    lack of transportation, storage or throughput commitments.
  Our business requires the retention and recruitment of a skilled workforce and the loss of
employees could result in the failure to implement our business plan.
  
 ITEM 1B. UNRESOLVED STAFF COMMENTS
  
 ITEM 2. PROPERTIES
   
 ITEM 3. LEGAL PROCEEDINGS
  
 ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
  
 PART II
 
 ITEM 5.
    MARKET FOR REGISTRANTS COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER
PURCHASES OF EQUITY SECURITIES
   
 ITEM 6. SELECTED FINANCIAL DATA
  9




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ITEM 7. MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
   Overview
  Percent of Total RevenuesType
    
    Description
    
    in 2006Reservation
    
    Reservation revenues are
from customers (referred to
as firm customers) that
reserve capacity on our
pipeline systems and
storage facilities. These
firm customers are
obligated to pay a monthly
reservation or demand
charge, regardless of the
amount of natural gas they
transport or store, for the
term of their contracts.
    
    
    82Usage
    
    Usage revenues are from
both firm customers and
interruptible customers
(those without reserved
capacity) who pay usage
charges and provide fuel
in-kind based on the volume
of gas actually
transported, stored,
injected or withdrawn.
    
    
    18
     Percent of TotalBBtu/d
    
    Contracted Capacity2007
    
    
    1,298
    
    
    
    192008
    
    
    1,268
    
    
    
    182009
    
    
    1,348
    
    
    
    192010 and beyond
    
    
    3,044
    
    
    
    44Total
    
    
    6,958
    
    
    
    100
 10




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Results of Operations
  2006
    
    
    2005(In millions,except volumes)Operating revenues
    
    $
    540
    
    
    $
    548Operating expenses
    
    
    (306
    )
    
    
    (331
    )Operating income
    
    
    234
    
    
    
    217Earnings from unconsolidated affiliate
    
    
    58
    
    
    
    59Other income, net
    
    
    3
    
    
    
    2EBIT
    
    
    295
    
    
    
    278Interest and debt expense
    
    
    (65
    )
    
    
    (67
    )Affiliated interest income, net
    
    
    32
    
    
    
    21Income taxes
    
    
    (110
    )
    
    
    (84
    )Income before cumulative effect of accounting change
    
    
    152
    
    
    
    148Cumulative effect of accounting change, net of income taxes
    

    
    
    
    
    
    (1
    )Net income
    
    $
    152
    
    
    $
    147Throughput volumes (BBtu/d)(1)
    
    
    5,076
    
    
    
    5,288
 
 (1)
    
    Throughput volumes include billable transportation throughput volumes for
storage withdrawal and volumes associated with our proportionate share of our 50 percent
equity investment in Great Lakes L.P.  EBITRevenue
    
    
    Expense
    
    
    Other
    
    
    ImpactFavorable (Unfavorable)(In millions)Contract restructuring/settlements
    
    $
    (43
    )
    
    $
    (2
    )
    
    $
    (1
    )
    
    $
    (46
    )Higher services revenues
    
    
    35
    
    
    
    
    
    
    
    
    
    
    
    35Revaluations of imbalances
    
    
    (1
    )
    
    
    10
    
    
    
    
    
    
    
    9Cashout adjustment
    
    
    
    
    
    
    32
    
    
    
    
    
    
    
    32Higher maintenance and other costs
    
    
    
    
    
    
    (6
    )
    
    
    
    
    
    
    (6
    )Impact of Hurricane Rita
    
    
    
    
    
    
    (4
    )
    
    
    
    
    
    
    (4
    )Other(1)
    
    
    1
    
    
    
    (5
    )
    
    
    1
    
    
    
    (3
    )Total impact on EBIT
    
    $
    (8
    )
    
    $
    25
    
    
    $
    
    
    
    $
    17
 
 (1)
    
    Consists of individually insignificant items.  Contract Restructuring/Settlements.
 Higher Services Revenues.
 11




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Revaluations of Imbalances.
 Cashout Adjustment.
 Higher Maintenance and Other Costs.
 Impact of Hurricane Rita.
 Expansion.
 Affiliated Interest Income, Net
  Income Taxes
 Year EndedDecember 31,2006
    
    2005(In millions,except for rates)Income taxes
    
    $
    110
    
    
    $
    84Effective tax rate
    
    
    42
    %
    
    
    36
    %
  12




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Liquidity and Capital Expenditures
 Liquidity Overview
  Accounting for Transfers and Servicing of Financial Assets and Extinguishments of
Liabilities
  Debt
  Capital Expenditures
  2006
    
    
    2005(In millions)Maintenance
    
    $
    74
    
    
    $
    79Expansion
    
    
    53
    
    
    
    44Hurricanes(1)
    
    
    41
    
    
    
    2Total
    
    $
    168
    
    
    $
    125
 
 (1)
    
    Amounts shown are net of insurance proceeds received of approximately $8
million and less than $1 million for 2006 and 2005, respectively. Hurricanes
  Recoverable
    
    
    UnrecoverableCosts
    
    
    Costs(1)
    
    
    Total( In millions)Cumulative
costs through
December 31,
2006
    
    $
    45
    
    
    $
    20
    
    
    $
    65Estimated
remaining
    
    
    10
    
    
    
    5
    
    
    
    15Total
costs
    
    $
    55
    
    
    $
    25
    
    
    $
    80Less: Reimbursements to
date
    
    
    10Expected
future
reimbursements
    
    $
    45
    (2)
 
 (1)
    
    Approximately $15 million of these costs are capital
costs. (2)
    
    Reimbursement will be retained by El Paso subsequent to the closing of our
sale. 13




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Commitments and Contingencies
  New Accounting Pronouncements Issued But Not Yet Adopted
 New Accounting
Pronouncements Issued But Not Yet Adopted
 
 ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
  December 31, 2006
    
    
    December 31, 2005Expected Fiscal Year of Maturity of Carrying AmountsFair
    
    
    Carrying
    
    
    Fair2010
    
    
    Thereafter
    
    
    Total
    
    
    Value
    
    
    Amount
    
    
    Value(In millions, except for rates)Liabilities:Long-term debt  fixed rate
    
    $
    310
    (1)
    
    $
    431
    
    
    $
    741
    
    
    $
    875
    
    
    $
    740
    
    
    $
    844Average effective interest rate
    
    
    9.3
    %
    
    
    9.0
    %
 
 (1)
    
    In January 2007, we made a cash tender offer to purchase our $300
million, 8.875% notes due March 15, 2010. In February 2007, approximately $269 million of the
notes were tendered. 14




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ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
 
 Report of Independent Registered Public Accounting Firm
     Employers Accounting for
Defined Benefit Pension and Other Postretirement Plans  An Amendment of FASB Statements No. 87,
88, 106, and 132(R).
  
 15




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Report of Independent Registered Public Accounting Firm
 
  Accounting for Conditional Asset Retirement Obligations,
  
 16




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ANR PIPELINE COMPANY
 
 CONSOLIDATED STATEMENTS OF INCOME
 (In millions)
 Year
Ended December 31,2006
    
    
    2005
    
    
    2004Operating revenues
    
    $
    540
    
    
    $
    548
    
    
    $
    470Operating expensesOperation and maintenance
    
    
    242
    
    
    
    267
    
    
    
    236Depreciation, depletion and amortization
    
    
    37
    
    
    
    40
    
    
    
    37Taxes, other than income taxes
    
    
    27
    
    
    
    24
    
    
    
    23306
    
    
    
    331
    
    
    
    296Operating income
    
    
    234
    
    
    
    217
    
    
    
    174Earnings from unconsolidated affiliate
    
    
    58
    
    
    
    59
    
    
    
    65Other income, net
    
    
    3
    
    
    
    2
    
    
    
    4Interest and debt expense
    
    
    (65
    )
    
    
    (67
    )
    
    
    (69
    )Affiliated interest income, net
    
    
    32
    
    
    
    21
    
    
    
    12Income before income taxes
    
    
    262
    
    
    
    232
    
    
    
    186Income taxes
    
    
    110
    
    
    
    84
    
    
    
    69Income before cumulative effect of accounting change
    
    
    152
    
    
    
    148
    
    
    
    117Cumulative effect of accounting change, net of income taxes
    
    
    
    
    
    
    (1
    )
    
    
    Net income
    
    $
    152
    
    
    $
    147
    
    
    $
    117
  17




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ANR PIPELINE COMPANY
 
 CONSOLIDATED BALANCE SHEETS
 (In millions, except share amounts)
 December 31,2006
    
    
    2005ASSETSCurrent assetsCash and cash equivalents
    
    $
    
    
    
    $
    Accounts and notes receivableCustomer, net of allowance of $2 in 2005
    
    
    17
    
    
    
    85Affiliates
    
    
    830
    
    
    
    8Other
    
    
    9
    
    
    
    8Materials and supplies
    
    
    22
    
    
    
    21Deferred income taxes
    
    
    
    
    
    
    12Other
    
    
    22
    
    
    
    6Total current assets
    
    
    900
    
    
    
    140Property, plant and equipment, at cost
    
    
    3,931
    
    
    
    3,777Less accumulated depreciation, depletion and amortization
    
    
    2,128
    
    
    
    2,146Total property, plant and equipment, net
    
    
    1,803
    
    
    
    1,631Other assetsNotes receivable from affiliates
    
    
    
    
    
    
    527Investment in unconsolidated affiliate
    
    
    
    
    
    
    300Other
    
    
    46
    
    
    
    1946
    
    
    
    846Total assets
    
    $
    2,749
    
    
    $
    2,617LIABILITIES AND STOCKHOLDERS EQUITYCurrent liabilitiesAccounts payableTrade
    
    $
    44
    
    
    $
    56Affiliates
    
    
    23
    
    
    
    37Other
    
    
    14
    
    
    
    21Taxes payable
    
    
    86
    
    
    
    72Other accrued liabilities
    
    
    33
    
    
    
    Accrued interest
    
    
    16
    
    
    
    16Deferred taxes
    
    
    280
    
    
    
    Other
    
    
    52
    
    
    
    32Total current liabilities
    
    
    548
    
    
    
    234Long-term debt
    
    
    741
    
    
    
    740Other liabilitiesDeferred income taxes
    
    
    306
    
    
    
    370Affiliate payable
    
    
    163
    
    
    
    172Other
    
    
    42
    
    
    
    54511
    
    
    
    596Commitments and contingenciesStockholders equityCommon stock, par value $1 per share; 1,000 shares authorized, issued and outstanding
    
    
    
    
    
    
    Additional paid-in capital
    
    
    931
    
    
    
    597Retained earnings
    
    
    602
    
    
    
    450Accumulated other comprehensive income
    
    
    10
    
    
    
    Notes
receivable from affiliates
    
    
    (594
    )
    
    
    Total stockholders equity
    
    
    949
    
    
    
    1,047Total liabilities and stockholders equity
    
    $
    2,749
    
    
    $
    2,617
  18




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ANR PIPELINE COMPANY
 
 CONSOLIDATED STATEMENTS OF CASH FLOWS
 (In millions)
 Year Ended December 31,2006
    
    
    2005
    
    
    2004Cash flows from operating activitiesNet income
    
    $
    152
    
    
    $
    147
    
    
    $
    117Adjustments to reconcile net income to net cash from operating activitiesDepreciation, depletion and amortization
    
    
    37
    
    
    
    40
    
    
    
    37Cumulative effect of accounting change
    
    
    
    
    
    
    1
    
    
    
    Deferred income taxes
    
    
    34
    
    
    
    22
    
    
    
    33Earnings from unconsolidated affiliates, adjusted for cash distributions
    
    
    6
    
    
    
    16
    
    
    
    9Other non-cash income items
    
    
    2
    
    
    
    1
    
    
    
    2Asset and liability changesAccounts receivable
    
    
    29
    
    
    
    (33
    )
    
    
    7Accounts payable
    
    
    (50
    )
    
    
    25
    
    
    
    22Taxes payable
    
    
    16
    
    
    
    24
    
    
    
    (5
    )Other
    
    
    (9
    )
    
    
    10
    
    
    
    (20
    )Net cash provided by operating activities
    
    
    217
    
    
    
    253
    
    
    
    202Cash flows from investing activitiesAdditions to property, plant and equipment
    
    
    (168
    )
    
    
    (125
    )
    
    
    (143
    )Net proceeds from the sale of investment
    
    
    815
    
    
    
    
    
    
    
    42Net change in affiliate advances
    
    
    (863
    )
    
    
    (60
    )
    
    
    (100
    )Other
    
    
    (1
    )
    
    
    
    
    
    
    (26
    )Net cash used in investing activities
    
    
    (217
    )
    
    
    (185
    )
    
    
    (227
    )Cash flows from financing activitiesPayments to retire long-term debt
    
    
    
    
    
    
    (68
    )
    
    
    Net cash used in financing activities
    
    
    
    
    
    
    (68
    )
    
    
    Net change in cash and cash equivalents
    
    
    
    
    
    
    
    
    
    
    (25
    )Cash and cash equivalentsBeginning of period
    
    
    
    
    
    
    
    
    
    
    25End of period
    
    $
    
    
    
    $
    
    
    
    $
    
  19




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ANR PIPELINE COMPANY
 
 CONSOLIDATED STATEMENTS OF STOCKHOLDERS EQUITY
 (In millions, except share amounts)
 Accumulated
    
    
    NotesAdditional
    
    
    
    
    
    
    other
    
    
    receivable
    
    
    TotalCommon stock
    
    
    paid-in
    
    
    Retained
    
    
    comprehensive
    
    
    from
    
    
    stockholdersShares
    
    
    Amount
    
    
    capital
    
    
    earnings
    
    
    income
    
    
    affiliates
    
    
    equityJanuary 1, 2004
    
    
    1,000
    
    
    $
    
    
    
    $
    597
    
    
    $
    186
    
    
    $
    
    
    
    $
    
    
    
    $
    783Net income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    117
    
    
    
    
    
    
    
    
    
    
    
    117December 31, 2004
    
    
    1,000
    
    
    
    
    
    
    
    597
    
    
    
    303
    
    
    
    
    
    
    
    
    
    
    
    900Net income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    147
    
    
    
    
    
    
    
    
    
    
    
    147December 31, 2005
    
    
    1,000
    
    
    
    
    
    
    
    597
    
    
    
    450
    
    
    
    
    
    
    
    
    
    
    
    1,047Capital contribution
    
    
    
    
    
    
    
    
    
    
    334
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    334Net income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    152
    
    
    
    
    
    
    
    
    
    
    
    152Adoption of SFAS No. 158, net of
taxes of $6
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    10
    
    
    
    
    
    
    
    10Notes
receivable from affiliates
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (594
    )
    
    
    (594
    )December 31, 2006
    
    
    1,000
    
    
    $
    
    
    
    $
    931
    
    
    $
    602
    
    
    $
    10
    
    
    $
    (594
    )
    
    $
    949
  20




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ANR PIPELINE COMPANY
 
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
 1. Summary of Significant Accounting Policies
 Basis of Presentation and Principles of Consolidation
    Use of Estimates
  Regulated Operations
 Accounting for the Effects of Certain
Types of Regulation
 Cash and Cash Equivalents
  Allowance for Doubtful Accounts
  Material and Supplies
  Natural Gas Imbalances
  21




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##### Table of Contents



Property, Plant and Equipment
      Asset and Investment Impairments
  Revenue Recognition
  22




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##### Table of Contents



Environmental Costs and Other Contingencies
 Environmental Costs
  Other Contingencies
 Income Taxes
   Accounting for Asset Retirement Obligations
 Accounting
for Asset Retirement Obligations Accounting for Conditional Asset Retirement Obligations.
   23




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##### Table of Contents



Pension and Other Postretirement Benefits
 Employers Accounting for
Defined Benefit Pension and Other Postretirement Plans  An Amendment of FASB Statements No. 87,
88, 106, and 132(R). Note 7.
 Evaluation of Prior Period Misstatements in Current Financial Statements
 Considering the Effects of Prior Year Misstatements When Quantifying Misstatements in Current Year Financial Statements.
 New Accounting Pronouncements Issued But Not Yet Adopted
  Accounting for Uncertainty in Income Taxes. Accounting for Uncertainty in Income Taxes Accounting for
Income Taxes,
 Fair Value Measurements. Fair Value
Measurements
 Measurement Date of Other Postretirement Benefits
 2. Divestitures
  3. Income Taxes
 Components of Income Taxes.
 2006
    
    
    2005
    
    
    2004(In millions)CurrentFederal
    
    $
    65
    
    
    $
    59
    
    
    $
    33State
    
    
    11
    
    
    
    3
    
    
    
    376
    
    
    
    62
    
    
    
    36DeferredFederal
    
    
    37
    
    
    
    20
    
    
    
    30State
    
    
    (3
    )
    
    
    2
    
    
    
    334
    
    
    
    22
    
    
    
    33Total income taxes
    
    $
    110
    
    
    $
    84
    
    
    $
    69
 24




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##### Table of Contents



Effective Tax Rate Reconciliation.
 2006
    
    
    2005
    
    
    2004(In millions, exceptfor rates)Income taxes at the statutory federal rate of 35%
    
    $
    92
    
    
    $
    81
    
    
    $
    65State income taxes, net of federal income tax effect
    
    
    5
    
    
    
    3
    
    
    
    3Deferred
taxes recorded on sales(1)
    
    
    14
    
    
    
    
    
    
    
    Other
    
    
    (1
    )
    
    
    
    
    
    
    1Income taxes
    
    $
    110
    
    
    $
    84
    
    
    $
    69Effective tax rate
    
    
    42
    %
    
    
    36
    %
    
    
    37
    %
 
 (1)
    
    Relates to our sale of Great Lakes and El Pasos
announced sale of us. Deferred Tax Assets and Liabilities.
 2006
    
    
    2005(In millions)Deferred tax liabilitiesProperty, plant and equipment
    
    $
    364
    
    
    $
    342Investment in unconsolidated affiliate
    
    
    307
    
    
    
    103Other assets
    
    
    29
    
    
    
    23Total deferred tax liability
    
    
    700
    
    
    
    468Deferred tax assetsLease liability
    
    
    66
    
    
    
    69Other liabilities
    
    
    48
    
    
    
    41Total deferred tax asset
    
    
    114
    
    
    
    110Net deferred tax liability
    
    $
    586
    
    
    $
    358
  4. Financial Instruments
  2006
    
    2005Carrying
    
    Fair
    
    Carrying
    
    FairAmount
    
    Value
    
    Amount
    
    Value(In millions)Balance sheet financial instruments:Long-term debt (1)
    
    $
    741
    
    
    $
    875
    
    
    $
    740
    
    
    $
    844
 
 (1)
    
    We estimated the fair value of our debt with fixed interest rates based on
quoted market prices for the same or similar issues.  5. Debt and Other Credit Facilities
 Debt
  2006
    
    
    2005(In millions)8.875% Notes due March 2010
    
    $
    300
    
    
    $
    30013.75% Notes due March 2010
    
    
    12
    
    
    
    129.625% Debentures due November 2021
    
    
    300
    
    
    
    3007.375% Debentures due February 2024
    
    
    125
    
    
    
    1257.00% Debentures due June 2025
    
    
    7
    
    
    
    7Less:
    
    
    744
    
    
    
    744Unamortized discount
    
    
    3
    
    
    
    4Total long-term debt
    
    $
    741
    
    
    $
    740
 25




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Credit Facilities
    6. Commitments and Contingencies
 Legal Proceedings
 Gas Measurement Cases. re: Natural Gas Royalties
Qui Tam Litigation,
 Will Price, et
al. v. Gas Pipelines and Their Predecessors, et al.,
   Environmental Matters
  26




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##### Table of Contents









Balance at January 1, 2006
    
    $
    27Additions/adjustments for remediation activities
    
    
    5Payments for remediation activities
    
    
    (7
    )Balance at December 31, 2006
    
    $
    25




Comprehensive Environmental Response, Compensation and Liability Act (CERCLA) Matters.




Capital Commitments and Purchase Obligations




Operating Leases




Year EndingDecember 31,
    
    (In millions)2007
    
    $
    52008
    
    
    42009
    
    
    42010
    
    
    42011
    
    
    3Thereafter
    
    
    16Total
    
    $
    36




Other Commercial Commitments




27



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##### Table of Contents



7. Retirement Benefits
 Pension and Retirement Benefits.
 Postretirement Benefits
  Change in Accumulated Postretirement Benefit Obligation, Plan Assets and Funded Status.
 2006
    
    
    2005(In millions)Change in Accumulated Postretirement benefit obligation:Accumulated Postretirement benefit obligation at beginning of period
    
    $
    49
    
    
    $
    53Interest cost
    
    
    3
    
    
    
    3Participant contributions
    
    
    2
    
    
    
    2Actuarial gain
    
    
    
    
    
    
    (3
    )Benefits paid
    
    
    (6
    )
    
    
    (6
    )Other
    
    
    3
    
    
    
    Accumulated Postretirement benefit obligation at end of period
    
    $
    51
    
    
    $
    49Change in plan assets:Fair value of plan assets at beginning of period
    
    $
    67
    
    
    $
    57Actual return on plan assets
    
    
    5
    
    
    
    5Employer contributions
    
    
    9
    
    
    
    9Participant contributions
    
    
    2
    
    
    
    2Benefits paid
    
    
    (6
    )
    
    
    (6
    )Fair value of plan assets at end of period
    
    $
    77
    
    
    $
    67Reconciliation of funded status:Fair value of plan assets at September 30
    
    $
    77
    
    
    $
    67Less: Accumulated postretirement benefit obligation, end of period
    
    
    51
    
    
    
    49Funded status at September 30
    
    
    26
    
    
    
    18Fourth quarter contributions and income
    
    
    2
    
    
    
    2Unrecognized actuarial gains(1)
    
    
    
    
    
    
    (15
    )Net asset at December 31
    
    $
    28
    
    
    $
    5
 
 (1)
    
    Amounts were reclassified to accumulated other comprehensive income upon the
adoption of SFAS No. 158 in 2006. 28




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##### Table of Contents



Expected Payment of Future Benefits.
 Year EndingDecember 31,2007
    
    $
    52008
    
    
    52009
    
    
    52010
    
    
    52011
    
    
    52012-2016
    
    
    20Total
    
    $
    45
 Components of Net Benefit Cost.
 2006
    
    
    2005
    
    
    2004(In millions)Interest cost
    
    $
    3
    
    
    $
    3
    
    
    $
    3Expected return on plan assets
    
    
    (4
    )
    
    
    (3
    )
    
    
    (2
    )Net postretirement benefit cost
    
    $
    (1
    )
    
    $
    
    
    
    $
    1
 Actuarial Assumptions and Sensitivity Analysis.
 2006
    
    2005
    
    2004(Percent)Assumptions related to benefit obligations at September 30:Discount rate
    
    
    5.50
    
    
    
    5.25Assumptions related to benefit costs at December 31:Discount rate
    
    
    5.25
    
    
    
    5.75
    
    
    
    6.00Expected return on plan assets(1)
    
    
    8.00
    
    
    
    7.50
    
    
    
    7.50
 
 (1)
    
    The expected return on plan assets is a pre-tax rate (before a tax rate of 35
percent on postretirement benefits) that is primarily based on an expected risk-free
investment return, adjusted for historical risk premiums and specific risk adjustments
associated with the debt and equity securities. These expected returns were then weighted
based on the target asset allocations of our investment portfolio.  2006
    
    2005(In millions)One percentage point increase:Accumulated postretirement benefit obligation
    
    $
    2
    
    
    $
    2One percentage point decrease:Accumulated postretirement benefit obligation
    
    $
    (2
    )
    
    $
    (2
    )
 Plan Assets.
 Actual
    
    ActualAsset Category
    
    2006
    
    2005(Percent)Equity securities
    
    
    61
    
    
    
    61Debt securities
    
    
    33
    
    
    
    31Other
    
    
    6
    
    
    
    8Total
    
    
    100
    
    
    
    100
  29




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8. Transactions with Major Customer
  2006
    
    2005
    
    2004(In millions)We Energies
    
    $
    54
    
    
    $
    56
    
    
    $
    59
 9. Supplemental Cash Flow Information
  2006
    
    2005
    
    2004(In millions)Interest paid, net of capitalized interest
    
    $
    65
    
    
    $
    70
    
    
    $
    68Income tax payments
    
    
    61
    
    
    
    38
    
    
    
    41
 10. Investment in Unconsolidated Affiliate and Transactions with Affiliates
 Investment in Unconsolidated Affiliate
   2006
    
    2005
    
    2004(In millions)Operating results data:Operating revenues
    
    $
    123
    
    
    $
    131
    
    
    $
    133Operating expenses
    
    
    55
    
    
    
    60
    
    
    
    56Income from continuing operations and net income(1)
    
    
    38
    
    
    
    38
    
    
    
    43
 2005(In millions)Financial position data:Current assets
    
    $
    56Non-current assets
    
    
    581Short-term debt
    
    
    5Other current liabilities
    
    
    34Long-term debt
    
    
    210Other non-current liabilities
    
    
    154Equity in net assets(1)
    
    
    234
 
 (1)
    
    Our proportionate share of Great Lakes net income and equity in net assets
includes our share of taxes recorded by Great Lakes. Our earnings from unconsolidated
affiliate recognized in our income statements are presented before these taxes.  Transactions with Affiliates
 Cash Management Program.
 Accounts Receivable Sales Program. Accounting for Transfers and Servicing of Financial Assets and Extinguishments of
Liabilities
 30




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##### Table of Contents



Taxes.
 Other.
  Other Affiliate Balances.
 2006
    
    2005(In millions)Accounts and notes receivable  other
    
    $
    
    
    
    $
    4Contractual deposits
    
    
    1
    
    
    
    1
 Affiliate Revenues and Expenses.
     2006
    
    2005
    
    2004(In millions)Revenues from affiliates
    
    $
    2
    
    
    $
    4
    
    
    $
    10Operation and maintenance expense from affiliates
    
    
    112
    
    
    
    117
    
    
    
    113Reimbursement of operating expenses charged to affiliates
    
    
    3
    
    
    
    6
    
    
    
    4
 31




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11. Supplemental Selected Quarterly Financial Information (Unaudited)
  Quarters EndedMarch 31
    
    June 30
    
    September 30
    
    December 31
    
    Total(In millions)2006Operating revenues
    
    $
    180
    
    
    $
    114
    
    
    $
    111
    
    
    $
    135
    
    
    $
    540Operating income
    
    
    107
    
    
    
    33
    
    
    
    34
    
    
    
    60
    
    
    
    234Net income
    
    
    72
    
    
    
    25
    
    
    
    26
    
    
    
    29
    
    
    
    1522005Operating revenues
    
    $
    184
    
    
    $
    119
    
    
    $
    112
    
    
    $
    133
    
    
    $
    548Operating income
    
    
    102
    
    
    
    47
    
    
    
    33
    
    
    
    35
    
    
    
    217Income before cumulative effect of accounting change
    
    
    66
    
    
    
    32
    
    
    
    23
    
    
    
    27
    
    
    
    148Cumulative effect of accounting change, net of income taxes
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (1
    )
    
    
    (1
    )Net income
    
    
    66
    
    
    
    32
    
    
    
    23
    
    
    
    26
    
    
    
    147
 32




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SCHEDULE II
 ANR PIPELINE COMPANY
VALUATION AND QUALIFYING ACCOUNTS
 Years Ended December 31, 2006, 2005 and 2004
(In millions)
 Balance at
    
    Charged to
    
    
    
    
    
    Charged to
    
    BalanceBeginning
    
    Costs and
    
    
    
    
    
    Other
    
    at EndDescription
    
    of Period
    
    Expenses
    
    Deductions
    
    Accounts
    
    of Period2006Allowance for doubtful accounts
    
    $
    2
    
    
    $
    
    
    
    $
    (1
    )
    
    $
    (1
    )(1)
    
    $
    Environmental reserves
    
    
    27
    
    
    
    5
    
    
    
    (7
    )(2)
    
    
    
    
    
    
    252005Allowance for doubtful accounts
    
    $
    3
    
    
    $
    
    
    
    $
    
    
    
    $
    (1
    )
    
    $
    2Environmental reserves
    
    
    27
    
    
    
    4
    
    
    
    (4
    )(2)
    
    
    
    
    
    
    272004Allowance for doubtful accounts
    
    $
    3
    
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    $
    3Environmental reserves
    
    
    29
    
    
    
    2
    
    
    
    (4
    )(2)
    
    
    
    
    
    
    27
 
 (1)
    
    Due to the accounts receivable sales program.(2)
    
    Primarily payments made for environmental remediation activities. 33




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##### Table of Contents



ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE
  
 ITEM 9A. CONTROLS AND PROCEDURES
 Evaluation of Disclosure Controls and Procedures
  Changes in Internal Control Over Financial Reporting
  
 ITEM 9B. OTHER INFORMATION
  
 PART III
  
 ITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES
 Audit Fees
  All Other Fees
  Policy for Approval of Audit and Non-Audit Fees
  34




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##### Table of Contents



PART IV
 
 ITEM 15. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES
 (a) The following documents are filed as part of this report:
   PageANR Pipeline CompanyReports of Independent Registered Public Accounting Firms
    
    
    15Consolidated Statements of Income
    
    
    17Consolidated Balance Sheets
    
    
    18Consolidated Statements of Cash Flows
    
    
    19Consolidated Statements of Stockholders Equity
    
    
    20Notes to Consolidated Financial Statements
    
    
    21
  PageGreat Lakes Gas Transmission Limited PartnershipReport of Independent Registered Public Accounting Firm
    
    
    36Consolidated Statements of Income and Partners Capital
    
    
    37Consolidated Balance Sheets
    
    
    38Consolidated Statements of Cash Flows
    
    
    39Notes to Consolidated Financial Statements
    
    
    402. Financial statement schedules.Schedule II  Valuation and Qualifying Accounts
    
    
    33
    Undertaking
  35




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##### Table of Contents



Report of Independent Registered Public Accounting Firm
 
    
 
 36




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##### Table of Contents



Consolidated Statements of
Income and Partners Capital
 Years Ended December 31  (Thousands of Dollars)
 2006
    
    
    2005
    
    
    2004Transportation RevenuesAffiliated Revenues
    
    $
    161,605
    
    
    
    173,796
    
    
    
    185,391Non Affiliated Revenues
    
    
    110,652
    
    
    
    106,947
    
    
    
    98,936272,257
    
    
    
    280,743
    
    
    
    284,327Operating ExpensesOperation and Maintenance
    
    
    34,083
    
    
    
    41,312
    
    
    
    34,723Depreciation
    
    
    57,612
    
    
    
    57,693
    
    
    
    57,756Income Taxes Payable by Partners
    
    
    44,076
    
    
    
    43,253
    
    
    
    47,058Property and Other Taxes
    
    
    25,965
    
    
    
    26,756
    
    
    
    23,265161,736
    
    
    
    169,014
    
    
    
    162,802Operating Income
    
    
    110,521
    
    
    
    111,729
    
    
    
    121,525Other Income (Expense)Interest on Long Term Debt
    
    
    (35,970
    )
    
    
    (36,844
    )
    
    
    (37,718
    )Other, Net
    
    
    3,723
    
    
    
    1,917
    
    
    
    1,373(32,247
    )
    
    
    (34,927
    )
    
    
    (36,345
    )Net Income
    
    $
    78,274
    
    
    
    76,802
    
    
    
    85,180Partners CapitalBalance at Beginning of Year
    
    $
    376,713
    
    
    
    420,501
    
    
    
    452,007Contributions by General Partners
    
    
    
    
    
    
    30,976
    
    
    
    29,398Net Income
    
    
    78,274
    
    
    
    76,802
    
    
    
    85,180Current Income Taxes Payable by
Partners Charged to Earnings
    
    
    39,259
    
    
    
    33,237
    
    
    
    31,536Distributions to Partners
    
    
    (132,099
    )
    
    
    (184,803
    )
    
    
    (177,620
    )Balance at End of Year
    
    $
    362,147
    
    
    
    376,713
    
    
    
    420,501
 The accompanying notes are an integral part of these statements.
 37




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Consolidated Balance Sheets
 As of December 31  (Thousands of Dollars)
 2006
    
    
    
    2005
 ASSETSCurrent AssetsCash and Cash Equivalents
    
    $
    78,368
    
    
    
    59,280Accounts Receivable (net of allowance of
$1,000 in 2006 and $1,200 in 2005)
    
    
    16,327
    
    
    
    33,804Receivable from Affiliates
    
    
    18,954
    
    
    
    16,721Materials and Supplies, at Average Cost
    
    
    10,908
    
    
    
    9,664Prepayments
    
    
    4,286
    
    
    
    2,746Other
    
    
    310
    
    
    
    361129,153
    
    
    
    122,576Gas Utility PlantProperty, Plant and Equipment
    
    
    2,038,123
    
    
    
    2,025,196Less Accumulated Depreciation
    
    
    1,030,059
    
    
    
    970,7371,008,064
    
    
    
    1,054,459$
    1,137,217
    
    
    
    1,177,035LIABILITIES & PARTNERS CAPITALCurrent LiabilitiesCurrent Maturities of Long Term Debt
    
    $
    10,000
    
    
    
    10,000Accounts Payable
    
    
    16,306
    
    
    
    30,671Payable to Affiliates
    
    
    2,362
    
    
    
    4,755Property Taxes
    
    
    17,793
    
    
    
    19,149Other Non Income Taxes
    
    
    3,939
    
    
    
    5,299Accrued Interest
    
    
    9,289
    
    
    
    9,435Other
    
    
    4,136
    
    
    
    3,97663,825
    
    
    
    83,285Long Term Debt
    
    
    440,000
    
    
    
    450,000Other LiabilitiesAmounts Equivalent to Deferred Income Taxes
    
    
    270,515
    
    
    
    266,192Other
    
    
    730
    
    
    
    845271,245
    
    
    
    267,037Partners Capital
    
    
    362,147
    
    
    
    376,713$
    1,137,217
    
    
    
    1,177,035
 The accompanying notes are an integral part of these statements.
 38




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Consolidated Statements of Cash Flows
 Years Ended December 31  (Thousands of Dollars)
 2006
    
    
    2005
    
    
    2004Cash Flow Increase (Decrease) from:Operating ActivitiesNet Income
    
    $
    78,274
    
    
    
    76,802
    
    
    
    85,180Adjustments to Reconcile Net Income to
Operating Cash Flows:Depreciation
    
    
    57,612
    
    
    
    57,693
    
    
    
    57,756Amounts Equivalent to Deferred Income Taxes
    
    
    4,323
    
    
    
    9,233
    
    
    
    15,678Allowance for Funds Used During Construction
    
    
    (386
    )
    
    
    (135
    )
    
    
    (157
    )Changes in Current Assets and Liabilities:Accounts Receivable
    
    
    17,477
    
    
    
    (2,516
    )
    
    
    (15,848
    )Receivable from Affiliates
    
    
    (2,233
    )
    
    
    (3,872
    )
    
    
    6,458Accounts Payable
    
    
    (14,365
    )
    
    
    5,675
    
    
    
    11,957Payable to Affiliates
    
    
    (2,393
    )
    
    
    1,767
    
    
    
    1,177Property and Other Non Income Taxes
    
    
    (2,716
    )
    
    
    341
    
    
    
    (970
    )Other
    
    
    (2,834
    )
    
    
    1,950
    
    
    
    (3,076
    )132,759
    
    
    
    146,938
    
    
    
    158,155Investing ActivitiesInvestment in Utility Plant
    
    
    (18,953
    )
    
    
    (16,102
    )
    
    
    (15,136
    )Insurance Proceeds
    
    
    8,122
    
    
    
    
    
    
    
    2,545(10,831
    )
    
    
    (16,102
    )
    
    
    (12,591
    )Financing ActivitiesRepayment of Long Term Debt
    
    
    (10,000
    )
    
    
    (10,000
    )
    
    
    (10,000
    )Contributions by General Partners
    
    
    
    
    
    
    30,976
    
    
    
    29,398Current Income Taxes Payable by
Partners Charged to Earnings
    
    
    39,259
    
    
    
    33,237
    
    
    
    31,536Distribution to Partners
    
    
    (132,099
    )
    
    
    (184,803
    )
    
    
    (177,620
    )(102,840
    )
    
    
    (130,590
    )
    
    
    (126,686
    )Change in Cash and Cash Equivalents
    
    
    19,088
    
    
    
    246
    
    
    
    18,878Cash and Cash Equivalents:Beginning of Year
    
    
    59,280
    
    
    
    59,034
    
    
    
    40,156End of Year
    
    $
    78,368
    
    
    
    59,280
    
    
    
    59,034Supplemental Disclosure of Cash Flow Information
Cash Paid During the Year for Interest(Net of Amounts Capitalized of $153,
$47 and $48, Respectively)
    
    $
    36,132
    
    
    
    37,018
    
    
    
    37,903
 The accompanying notes are an integral part of these statements.
 39




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##### Table of Contents



Notes to Consolidated Financial Statements
 1 Organization and Management
  Ownership %Partner (Parent Company)
    
    2006
    
    
    2005General Partners:El Paso Great Lakes Company, LLC (El Paso Corporation)
    
    
    46.45
    
    
    
    46.60TransCanada GL, Inc. (TransCanada PipeLines Ltd.)
    
    
    46.45
    
    
    
    46.60Limited Partner:Great Lakes Gas Transmission Company (TransCanada
    
    
    7.10
    
    
    
    6.80PipeLines Ltd. and El Paso Corporation)
   2 Summary of Significant Accounting Policies
 Principles of Consolidation and Basis of Presentation
     Regulation
 Accounting for the Effects of Certain Types of Regulation
 Revenue and Accounts Receivable
   40




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##### Table of Contents



Notes to Consolidated Financial Statements
 2 Summary of Significant Accounting Policies, Continued
 Natural Gas Imbalances
   Gas Utility Plant and Depreciation
   Asset Retirement Obligations
 Accounting for Conditional Asset Retirement Obligations. Accounting for Asset Retirement Obligations,
 Accounting for Pipeline Integrity Costs
 Accounting for Pipeline Assessment Costs
 Uncertain Income Tax Positions
  41




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##### Table of Contents



Notes to Consolidated Financial Statements
 2 Summary of Significant Accounting Policies, Continued
 Fair Value Measurements
  Income Taxes
   3 Affiliated Company Transactions
  (In Thousands)2006
    
    
    2005
    
    
    2004Transportation revenues:TransCanada PipeLines Limited and affiliates
    
    $
    150,067
    
    
    
    156,561
    
    
    
    164,810El Paso Corporation and affiliates
    
    
    11,538
    
    
    
    17,235
    
    
    
    20,581
    42




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##### Table of Contents



Notes to Consolidated Financial Statements
 3 Affiliated Company Transactions, Continued
  (In Thousands)2006
    
    
    2005
    
    
    2004Pension
    
    $
    (2,186
    )
    
    
    (297
    )
    
    
    (743
    )Post-Retirement
    
    
    151
    
    
    
    179
    
    
    
    202
 4 Debt
 (In Thousands)2006
    
    
    2005Senior Notes, unsecured, interest due
semiannually, principal due as follows:8.74% series, due 2007 to 2011
    
    $
    50,000
    
    
    
    60,0009.09% series, due 2012 to 2021
    
    
    100,000
    
    
    
    100,0006.73% series, due 2009 to 2018
    
    
    90,000
    
    
    
    90,0006.95% series, due 2019 to 2028
    
    
    110,000
    
    
    
    110,0008.08% series, due 2021 to 2030
    
    
    100,000
    
    
    
    100,000450,000
    
    
    
    460,000Less current maturities
    
    
    10,000
    
    
    
    10,000Total long term debt less current maturities
    
    $
    440,000
    
    
    
    450,000
    43




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##### Table of Contents



Notes to Consolidated Financial Statements
 5 Income Taxes Payable by Partners
  (In Thousands)2006
    
    
    2005
    
    
    2004CurrentFederal
    
    $
    37,579
    
    
    
    31,815
    
    
    
    30,187State
    
    
    1,680
    
    
    
    1,422
    
    
    
    1,34939,259
    
    
    
    33,237
    
    
    
    31,536DeferredFederal
    
    
    4,611
    
    
    
    9,588
    
    
    
    14,833State
    
    
    206
    
    
    
    428
    
    
    
    6894,817
    
    
    
    10,016
    
    
    
    15,522$
    44,076
    
    
    
    43,253
    
    
    
    47,058
   (In Thousands)2006
    
    
    2005Deferred tax assets  other
    
    $
    4,924
    
    
    
    4,674Deferred tax liabilities  utility plant
    
    
    (258,537
    )
    
    
    (254,752
    )Deferred tax liabilities  other
    
    
    (16,902
    )
    
    
    (16,114
    )Net deferred tax liability
    
    $
    (270,515
    )
    
    
    (266,192
    )
  44




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##### Table of Contents



SIGNATURES
 st
 ANR PIPELINE COMPANYBy:
    
    /S/ STEPHEN C. BEASLEYStephen C. BeasleyPresident
  Signature
    
    Title
    
    Date/S/       STEPHEN C. BEASLEY

          Stephen C. Beasley
    
    President and Director(Principal Executive Officer)
    
    February 21, 2007/S/       JOHN R. SULT

           John R. Sult
    
    Senior Vice President,
Chief FinancialOfficer and Controller(Principal Accounting and Financial Officer)
    
    February 21, 2007/S/       JAMES C. YARDLEY
    
    Chairman of the Board
    
    February 21, 2007James C. Yardley/S/       DANIEL B. MARTIN
    
    Senior Vice President and Director
    
    February 21, 2007Daniel B. Martin/S/       GARY C. CHARETTE
    
    Vice President and Director
    
    February 21, 2007Gary C. Charette
 45




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##### Table of Contents



ANR PIPELINE COMPANY
 
 EXHIBIT INDEX
December 31, 2006
  ExhibitNumber
    
    Description3.A
    
    Amended and Restated Certificate of Incorporation dated March 7, 2002 (Exhibit 3.A to our 2001 Form 10-K).3.B
    
    By-laws dated June 24, 2002 (Exhibit 3.B to our 2002 Form 10-K).*4.A
    
    Indenture dated as of May 13, 1991 between ANR Pipeline Company and The Bank of New York Trust Company,
N.A., successor to Manufacturers Bank, N.A., as Trustee.*4.A.1
    
    First supplemental indenture dated as of November 4, 1991 between ANR Pipeline Company and The Bank of
New York Trust Company, N.A., successor to Manufacturers Bank, N.A., as Trustee.4.B
    
    Indenture dated as of February 15, 1994 and First Supplemental Indenture dated as of February 15, 1994
(Exhibit 4.A to our 2004 Form 10-K).4.C
    
    Indenture dated as of March 5, 2003 between ANR Pipeline Company and The Bank of New York Trust Company,
N.A., successor to The Bank of New York, as Trustee (Exhibit 4.1 to our Form 8-K filed March 5, 2003).4.D
    
    First Supplemental Indenture dated as of January 29, 2007, by and between ANR Pipeline Company and The
Bank of New York Trust Company, N.A., as Trustee to indenture dated as of March 5, 2003 (Exhibit 10.A to
our Form 8-K filed February 21, 2007).10.A
    
    First Tier Receivables Sale Agreement dated August 31, 2006 between ANR Pipeline Company, and ANR Finance
Company, L.L.C. (Exhibit 10.A to our Form 8-K filed September 8, 2006).10.B
    
    Second Tier Receivables Sale Agreement dated August 31, 2006 between ANR Finance Company, L.L.C. and ANR
Funding Company, L.L.C. (Exhibit 10.B to our Form 8-K filed September 8, 2006).10.C
    
    Receivables Purchase Agreement dated August 31, 2006 among ANR Funding Company, L.L.C., as Seller, ANR
Pipeline Company, as Servicer, Starbird Funding Corporation, as the initial Conduit Investor and
Committed Investor, the other investors from time to time parties thereto, BNP Paribas, New York Branch,
as the initial Managing Agent, the other Managing Agents from time to time parties thereto, and BNP
Paribas, New York Branch, as Program Agent (Exhibit 10.C to our Form 8-K filed September 8, 2006).10.D
    
    Purchase and Sale Agreement dated December 21, 2006, by and between ANR Capital Corporation and Seafarer
U.S. Pipeline System, Inc. (Exhibit 10.A to our Form 8-K filed December 28, 2006).21
    
    Omitted pursuant to the reduced disclosure format permitted by General Instruction I to Form 10-K.*31.A
    
    Certification of Principal Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.*31.B
    
    Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.*32.A
    
    Certification of Principal Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.*32.B
    
    Certification of Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
 46