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 nine months ended September 30, 2008, the years ended December 31, 2007, 2006, 2005 and 2004, and for the periods June 12 through December 31, 2003 and January 1 through June 11, 2003. Post-acquisition financial statements reflect a new basis of accounting and pre-acquisition period and post-acquisition period financial results (separated by a heavy black line) are presented but are not comparable. The heavy black line separating January 1 through June 11, 2003 from June 12 through December 31, 2003 relates to the acquisition of Panhandle by Southern Union from CMS Energy, effective June 11, 2003.
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.
	9 Months Ended			Year Ended December 31,												June 12 -			January 1 -
	September 30, 2008			2007			2006			2005			2004			December 31, 2003			June 11, 2003
	(In thousands)
FIXED CHARGES:
Interest Expense	$	67,166		$	83,748		$	63,322		$	49,578		$	52,435		$	29,098		$	37,802
Net amortization of debt discount, premium and
issuance expense		(1,077	)		(1,197	)		(1,333	)		(1,293	)		(4,006	)		(3,561	)		(2,386	)
Capitalized Interest		14,264			14,203			4,645			8,838			4,812			1,624			987
Interest portion of rental expense		2,080			3,582			3,780			4,284			4,453			745			595
Total Fixed Charges	$	82,433		$	100,336		$	70,414		$	61,407		$	57,694		$	27,906		$	36,998
EARNINGS:
Consolidated pre-tax income (loss) from continuing
operations	$	185,740		$	246,742		$	225,794		$	166,189		$	143,989		$	84,773		$	78,543
Earnings of equity investments		(244	)		(299	)		(172	)		(226	)		(216	)		(136	)		(411	)
Distributed income from equity investments		-			-			174			203			174			-			1,066
Capitalized interest		(14,264	)		(14,203	)		(4,645	)		(8,838	)		(4,812	)		(1,624	)		(987	)
SFAS 145 Adjustment		-			-			-			-			-			-			-
Minority interest		-			-			-			-			-			-			-
Total fixed charges (from above)		82,433			100,336			70,414			61,407			57,694			27,906			36,998
Earnings Available for Fixed Charges	$	253,665		$	332,576		$	291,565		$	218,735		$	196,829		$	110,919		$	115,209
Ratio of Earnings to Fixed Charges		3.1			3.3			4.1			3.6			3.4			4.0			3.1