EX-12 2 exhibit12.htm EXHIBIT 12 exhibit12.htm  

PANHANDLE EASTERN PIPE LINE COMPANY, LP
                                
                                     
RATIO OF EARNINGS TO FIXED CHARGES
  
                                     
                                     
The following table sets forth the consolidated ratio of earnings to fixed charges on an historical basis for the three months ended March 31, 2010 and the years ended December 31, 2009, 2008, 2007, 2006 and 2005. For the purpose of calculating such ratios, “earnings” consist of pre-tax income from continuing operations before income or loss from equity investees, adjusted to reflect distributed income from equity investments, and fixed charges, less capitalized interest. “Fixed charges” consist of interest costs, amortization of debt discount, premiums and issuance costs and an estimate of interest implicit in rentals. No adjustment has been made to earnings for the amortization of capital interest for the periods presented as such amount is immaterial. Interest on FIN 48 liabilities is excluded from the computation of fixed charges as it is recorded by the Company in income tax expense versus interest expense.
  
                                     
                                     
                                     
                                     
                                     
                                     
                                     
                                     
   
Three Months Ended
    
Year Ended December 31,
  
   
March 31, 2010
    
2009
    
2008
    
2007
    
2006
    
2005
  
   
(In thousands)
  
FIXED CHARGES:
                                    
Interest Expense
   $ 22,026     $ 82,881     $ 90,514     $ 83,748     $ 63,322     $ 49,578  
Net amortization of debt discount, premium and
                                                
  issuance expense
     363       1,615       (1,457 )     (1,197 )     (1,333 )     (1,293 )
Capitalized Interest
     5,637       25,701       18,910       14,203       4,645       8,838  
Interest portion of rental expense
     1,010       4,122       3,050       3,582       3,780       4,284  
                                                 
        Total Fixed Charges
   $ 29,036     $ 114,319     $ 111,017     $ 100,336     $ 70,414     $ 61,407  
                                                 
EARNINGS:
                                                
Consolidated pre-tax income (loss) from continuing
                                                
   operations
   $ 60,178     $ 242,315     $ 247,206     $ 246,742     $ 225,794     $ 166,189  
Earnings of equity investments
     (59 )     (224 )     (304 )     (299 )     (172 )     (226 )
Distributed income from equity investments
     -       -       -       -       174       203  
Capitalized interest
     (5,637 )     (25,701 )     (18,910 )     (14,203 )     (4,645 )     (8,838 )
Minority interest
     -       -       -       -       -       -  
Total fixed charges (from above)
     29,036       114,319       111,017       100,336       70,414       61,407  
                                                 
        Earnings Available for Fixed Charges
   $ 83,518     $ 330,709     $ 339,009     $ 332,576     $ 291,565     $ 218,735  
                                                 
                                                 
Ratio of Earnings to Fixed Charges
     2.9       2.9       3.1       3.3       4.1       3.6