The following table sets forth the debt obligations of Southern Union and Panhandle at the dates indicated.

		September 30, 2011				December 31, 2010
		Carrying Amount		Fair Value		Carrying Amount		Fair Value

			(In thousands)

Long-Term Debt Obligations:

Southern Union:
7.60% Senior Notes due 2024		$	359,765	$	446,576	$	359,765	$	392,144
8.25% Senior Notes due 2029			300,000		344,685		300,000		332,922
7.24% to 9.44% First Mortgage Bonds
	due 2020 to 2027		19,500		23,221		19,500		21,473
7.20% Junior Subordinated Notes due 2066			600,000		493,002		600,000		609,743
Term Loan due 2013			250,000		252,188		250,000		249,915
Note Payable			7,876		7,876		8,297		8,297
			1,537,141		1,567,548		1,537,562		1,614,494

Panhandle:
6.05% Senior Notes due 2013			250,000		261,250		250,000		268,988
6.20% Senior Notes due 2017			300,000		341,565		300,000		322,893
8.125% Senior Notes due 2019			150,000		184,533		150,000		169,671
7.00% Senior Notes due 2029			66,305		77,432		66,305		69,911
7.00% Senior Notes due 2018			400,000		470,028		400,000		442,120
Term Loans due 2012			815,391		810,563		815,391		799,084
Net premiums on long-term debt			2,875		2,875		2,731		2,731
			1,984,571		2,148,246		1,984,427		2,075,398

Total Long-Term Debt Obligations			3,521,712		3,715,794		3,521,989		3,689,892

Credit Facilities			165,403		165,400		297,051		301,312

Total consolidated debt obligations			3,687,115	$	3,881,194		3,819,040	$	3,991,204
	Less current portion of long-term debt		816,266				1,083
	Less short-term debt		165,403				297,051
Total long-term debt		$	2,705,446			$	3,520,906

The fair value of the Company's term loans and credit facilities as of September 30, 2011 and December 31, 2010 were determined using the market approach, which utilized reported recent loan transactions for parties of similar credit quality and remaining life, as there is no active secondary market for loans of these types and sizes.

The fair value of the Company's other long-term debt as of September 30, 2011 and December 31, 2010 was also determined using the market approach, which utilized observable market data to corroborate the estimated credit spreads and prices for the Company's non-bank long-term debt securities in the secondary market. Those valuations were based in part upon the reported trades of the Company's non-bank long-term debt securities where available and the actual trades of debt securities of similar credit quality and remaining life where no secondary market trades were reported for the Company's non-bank long-term debt securities.

Interest Rate Swaps. The Company has interest rate swap agreements that effectively fix the interest rate applicable to the floating rate on a portion of the $600 million Junior Subordinated Notes due 2066 (Junior Subordinated Notes). See Note 10 – Derivative Instruments and Hedging Activities – Interest Rate Contracts – Interest Rate Swaps for more information regarding these swap agreements.

Credit Facilities. During the second quarter of 2011, the Company entered into the Seventh Amended and Restated Revolving Credit Agreement with certain banks in the amount of $550 million (2011 Revolver). The 2011 Revolver is an amendment, restatement and refinancing of the Company's $550 million Sixth Amended and Restated Revolving Credit Agreement (Revolver), which was otherwise scheduled to mature on May 28, 2013. The 2011 Revolver will mature on May 20, 2016. Borrowings under the 2011 Revolver are available for the Company's working capital, other general corporate purposes and letter of credit requirements. The interest rate and commitment fee under the 2011 Revolver are calculated using a pricing grid, which is based upon the credit rating for the Company's senior unsecured notes. The annualized interest rate and commitment fee rate bases for the 2011 Revolver at September 30, 2011 were LIBOR plus 162.5 basis points and 25 basis points, respectively.

Retirement of Debt Obligations. The Company expects to refinance and/or extend the $455 million term loan due March 2012 and the $465 million term loan due June 2012 ($360.4 million of which is outstanding at September 30, 2011). Alternatively, should the Company not be successful in its refinancing efforts, the Company may choose to retire such debt upon maturity by utilizing some combination of cash flows from operations, draw downs under existing credit facilities, utilizing a portion of the $455 million to be received from the Citrus Merger, and altering the timing of controllable expenditures, among other things. The Company believes, based on its investment grade credit ratings and general financial condition, successful historical access to capital and debt markets and market expectations regarding the Company's future earnings and cash flows, that it will be able to refinance and/or retire these obligations, as applicable, under acceptable terms prior to their maturity. There can be no assurance, however, that the Company will be able to achieve acceptable refinancing terms in any negotiation of new capital market debt or bank financings. Moreover, there can be no assurance the Company will be successful in its implementation of these refinancing and/or retirement plans and the Company's inability to do so would cause a material adverse effect on the Company's financial condition and liquidity.