NOTE 4 INVESTMENTS IN UNCONSOLIDATED AFFILIATES

Great Lakes, Northern Border, GTN and Bison are regulated by FERC and are operated by TransCanada. The Partnership uses the equity method of accounting for its interests in its equity investees.

	Ownership	Equity Earnings from Unconsolidated Affiliates				Investments in Unconsolidated Affiliates
	Interest at	Three months		Six Months
(unaudited)	June 30,	ended June 30,		ended June 30,		June 30,	December 31,
(millions of dollars)	2013	2013	2012	2013	2012	2013	2012

Great Lakes	46.45%	-	8	2	17	671	677
Northern Border (a)	50%	15	16	31	36	500	512
GTN	25%	4	4	9	10	212	216
Bison	25%	3	3	6	6	162	158
		22	31	48	69	1,545	1,563

(a) Equity earnings from Northern Border is net of the 12-year amortization of a $10 million transaction fee paid to the operator of Northern Border at the time of the Partnership’s additional 20 percent interest acquisition in April 2006.

Great Lakes

The Partnership made an equity contribution to Great Lakes of $4 million in the first quarter of 2013. This amount represents the Partnership’s 46.45 percent share of a $9 million cash call from Great Lakes to make a scheduled debt repayment.

The Partnership recorded no undistributed earnings from Great Lakes for the six months ended June 30, 2013 and 2012.

The summarized financial information for Great Lakes is as follows:

(unaudited)
(millions of dollars)	June 30, 2013	December 31, 2012

ASSETS
Current assets	41	56
Plant, property and equipment, net	784	799
	825	855

LIABILITIES AND PARTNERS’ EQUITY
Current liabilities	22	30
Long-term debt, including current maturities	345	354
Partners’ equity	458	471
	825	855

	Three months ended		Six months ended
(unaudited)	June 30,		June 30,
(millions of dollars)	2013	2012	2013	2012

Transmission revenues	29	48	64	97
Operating expenses	(15)	(16)	(30)	(31)
Depreciation	(8)	(8)	(16)	(16)
Financial charges and other	(7)	(7)	(14)	(14)
Net income/(loss)	(1)	17	4	36

Northern Border

In January 2013, FERC gave final approval for the Northern Border Settlement which establishes maximum long-term transportation rates and charges on the Northern Border system effective January 1, 2013. Northern Border’s previous reservation rates were reduced by approximately 11 percent as a result of this settlement.

The Partnership recorded no undistributed earnings from Northern Border for the six months ended June 30, 2013 and 2012.

The summarized financial information for Northern Border is as follows:

(unaudited)
(millions of dollars)	June 30, 2013	December 31, 2012

ASSETS
Cash and cash equivalents	31	28
Other current assets	33	35
Plant, property and equipment, net	1,212	1,234
Other assets	30	31
	1,306	1,328

LIABILITIES AND PARTNERS’ EQUITY
Current liabilities	52	53
Deferred credits and other	18	16
Long-term debt, including current maturities	473	473
Partners’ equity
Partners’ capital	765	789
Accumulated other comprehensive loss	(2)	(3)
	1,306	1,328

	Three months ended		Six months ended
(unaudited)	June 30,		June 30,
(millions of dollars)	2013	2012	2013	2012

Transmission revenues	69	73	141	154
Operating expenses	(19)	(18)	(38)	(36)
Depreciation	(14)	(16)	(29)	(32)
Financial charges and other	(6)	(7)	(11)	(13)
Net income	30	32	63	73

GTN

The Partnership recorded no undistributed earnings from GTN for the six months ended June 30, 2013 and 2012.

The summarized financial information for GTN is as follows:

(unaudited)
(millions of dollars)	June 30, 2013	December 31, 2012

ASSETS
Current assets	51	50
Plant, property and equipment, net	1,152	1,174
Other assets	1	1
	1,204	1,225

LIABILITIES AND MEMBERS’ EQUITY
Current liabilities	13	16
Deferred credits and other	21	20
Long-term debt, including current maturities	325	325
Members’ capital	845	864
	1,204	1,225

	Three months ended		Six months ended
(unaudited)	June 30,		June 30,
(millions of dollars)	2013	2012	2013	2012

Transmission revenues	46	48	95	100
Operating expenses	(12)	(13)	(23)	(24)
Depreciation	(14)	(14)	(27)	(27)
Financial charges and other	(5)	(4)	(9)	(9)
Net income	15	17	36	40

Bison

The Partnership made an equity contribution to Bison of $6 million in the second quarter of 2013. This amount represents the Partnership’s 25 percent share of a $24 million cash call from Bison to repay inter-affiliate debt primarily related to pipeline construction costs, including reclamation and restoration work.

The Partnership recorded no undistributed earnings from Bison for the six months ended June 30, 2013 and 2012.

The summarized financial information for Bison is as follows:

(unaudited)
(millions of dollars)	June 30, 2013	December 31, 2012

ASSETS
Current assets	16	7
Plant, property and equipment, net	640	649
	656	656

LIABILITIES AND MEMBERS’ EQUITY
Current liabilities	7	25
Members’ capital	649	631
	656	656

	Three months ended		Six months ended
(unaudited)	June 30,		June 30,
(millions of dollars)	2013	2012	2013	2012

Transmission revenues	20	20	40	40
Operating expenses	(4)	(4)	(8)	(7)
Depreciation	(5)	(5)	(10)	(10)
Net income	11	11	22	23