NET INCOME PER COMMON UNIT

12 Months Ended

Dec. 31, 2011

NET INCOME PER COMMON UNIT

NET INCOME PER COMMON UNIT

NOTE 9    NET INCOME PER COMMON UNIT

Net income per common unit is computed by dividing net income, after deduction of the General Partner's allocation, by the weighted average number of common units outstanding. The General Partner's allocation is equal to an amount based upon the General Partner's effective two percent general partner interest, plus an amount equal to incentive distributions. Incentive distributions are paid to the General Partner if quarterly cash distributions on the common units exceed levels specified in the Partnership Agreement.

Net income per common unit was determined as follows:

(millions of dollars except per unit)		2011		2010		2009
Net income(a)		157.4		137.1		106.1
North Baja's contribution prior to acquisition		–		–		(8.3	)
Net income allocated to partners(b)		157.4		137.1		97.8
Net income allocated to General Partner:
	General partner interest	(3.1	)	(2.7	)	(1.9	)
	Incentive distribution income allocation	–		–		(5.3	)
		(3.1	)	(2.7	)	(7.2	)
Net income allocable to common units		154.3		134.4		90.6
Weighted average common units outstanding (millions)		51.1		46.2		38.7
Net income per common unit		$3.02		$2.91		$2.34

^(a)

2011 net income includes equity earnings from GTN and Bison from May 3, 2011, date of acquisition, to December 31, 2011. 2009 net income was recast as discussed in Notes 2 and 5.

^(b)

Net income allocated to partners excludes North Baja's earnings prior to the Partnership's acquisition of North Baja on July 1, 2009, as the earnings of North Baja prior to that date were allocated to TransCanada and were not allocable to either the General Partner or common units.