The total limited partner units represent our limited partners' interest and an effective 98% interest in us, exclusive of our general partner's incentive distribution rights. Our general partner has an effective 2% interest in us, excluding its right to receive incentive distributions.

As of September 30, 2011, our total common units consisted of 214,472,667 units held by third parties, 14,646,428 units held by KMI and its consolidated affiliates (excluding our general partner), and 1,724,000 units held by our general partner. As of December 31, 2010, our total common units consisted of 202,509,675 units held by third parties, 14,646,428 units held by KMI and its consolidated affiliates (excluding our general partner), and 1,724,000 units held by our general partner.

As of both September 30, 2011 and December 31, 2010, all of our i-units were held by KMR. Our i-units are a separate class of limited partner interests in us and are not publicly traded. The number of i-units we distribute to KMR is based upon the amount of cash we distribute to the owners of our common units. When cash is paid to the holders of our common units, we issue additional i-units to KMR. The fraction of an i-unit paid per i-unit owned by KMR will have a value based on the cash payment on the common units.

	Three Months Ended September 30,
	2011									2010
	KMP			Noncontrolling Interests			Total			KMP			Noncontrolling interests			Total

Beginning Balance	$	7,616.2		$	87.7		$	7,703.9		$	7,023.1		$	83.1		$	7,106.2

Units issued for cash		107.5			-			107.5			203.5			-			203.5
Distributions paid in cash		(566.5	)		(7.0	)		(573.5	)		(333.7	)		(4.7	)		(338.4	)
Noncash compensation expense allocated from KMI(a)		-			-			-			1.0			-			1.0
Cash contributions		-			2.3			2.3			-			3.0			3.0
Other adjustments		(4.1	)		-			(4.1	)		(0.2	)		-			(0.2	)

Comprehensive income:
Net Income		214.5			1.8			216.3			320.8			1.6			322.4
Other comprehensive income:
Change in fair value of derivatives utilized for hedging purposes		382.7			3.9			386.6			(82.5	)		(0.8	)		(83.3	)
Reclassification of change in fair value of derivatives to net income		48.5			0.5			49.0			47.2			0.4			47.6
Foreign currency translation adjustments		(161.8	)		(1.7	)		(163.5	)		62.2			0.7			62.9
Adjustments to pension and other postretirement benefit plan liabilities		-			-			-			0.3			-			0.3
Total other comprehensive income		269.4			2.7			272.1			27.2			0.3			27.5
Comprehensive income		483.9			4.5			488.4			348.0			1.9			349.9

Ending Balance	$	7,637.0		$	87.5		$	7,724.5		$	7,241.7		$	83.3		$	7,325.0

	Nine Months Ended September 30,
	2011									2010
	KMP			Noncontrolling Interests			Total			KMP			Noncontrolling interests			Total

Beginning Balance	$	7,210.7		$	81.8		$	7,292.5		$	6,644.5		$	79.6		$	6,724.1

Units issued as consideration pursuant to common unit compensation plan for non-employee directors		0.2			-			0.2			0.2			-			0.2
Units issued as consideration in the acquisition of assets		23.7			-			23.7			81.7			-			81.7
Units issued for cash		813.3			-			813.3			636.6			-			636.6
Distributions paid in cash		(1,638.8	)		(20.5	)		(1,659.3	)		(1,282.7	)		(16.7	)		(1,299.4	)
Noncash compensation expense allocated from KMI(a)		89.0			0.9			89.9			3.7			-			3.7
Cash contributions		-			15.4			15.4			-			10.2			10.2
Other adjustments		(2.9	)		-			(2.9	)		(0.2	)		-			(0.2	)

Comprehensive income:
Net Income		782.8			6.3			789.1			907.3			7.6			914.9
Other comprehensive income:
Change in fair value of derivatives utilized for hedging purposes		285.9			2.9			288.8			83.5			0.9			84.4
Reclassification of change in fair value of derivatives to net income		186.9			1.9			188.8			133.3			1.3			134.6
Foreign currency translation adjustments		(100.8	)		(1.0	)		(101.8	)		35.9			0.4			36.3
Adjustments to pension and other postretirement benefit plan liabilities		(13.0	)		(0.2	)		(13.2	)		(2.1	)		-			(2.1	)
Total other comprehensive income		359.0			3.6			362.6			250.6			2.6			253.2
Comprehensive income		1,141.8			9.9			1,151.7			1,157.9			10.2			1,168.1

Ending Balance	$	7,637.0		$	87.5		$	7,724.5		$	7,241.7		$	83.3		$	7,325.0

On February 25, 2011, we entered into a second amended and restated equity distribution agreement with UBS Securities LLC to provide for the offer and sale of common units having an aggregate offering price of up to $1.2 billion (up from an aggregate offering price of up to $600 million under our first amended and restated agreement) from time to time through UBS, as our sales agent. During the three and nine months ended September 30, 2011, we issued 1,553,285 and 3,930,581, respectively, of our common units pursuant to this equity distribution agreement. After commissions of $0.9 million and $2.2 million, respectively, we received net proceeds of $107.5 million and $279.4 million, respectively, from the issuance of these common units. We used the proceeds to reduce the borrowings under our commercial paper program. For additional information regarding our equity distribution agreement, see Note 10 to our consolidated financial statements included in our 2010 Form 10-K/A.

On June 10, 2011, we issued 324,961 common units as part of our purchase price for the petroleum coke terminal assets we acquired from TGS Development, L.P. We valued the common units at $23.7 million, determining the units' value based on the $73.01 closing market price of the common units on the New York Stock Exchange on the June 10, 2011 acquisition date. For more information on this acquisition, see Note 2.

On June 17, 2011, we issued, in a public offering, 6,700,000 of our common units at a price of $71.44 per unit, less commissions and underwriting expenses. At the time of the offering, we granted the underwriters a 30-day option to purchase up to an additional 1,005,000 common units from us on the same terms and conditions, and upon the underwriters' exercise of this option in full, we issued the additional 1,005,000 common units on June 27, 2011. We received net proceeds, after deducting the underwriter discount, of $533.9 million from the issuance of these 7,705,000 common units, and we used the proceeds to reduce the borrowings under our commercial paper program.

In October 2011, we issued 58,092 of our common units for the settlement of sales made on or before September 30, 2011 pursuant to our equity distribution agreement. We received net proceeds of $4.0 million for the issuance of these 58,092 common units, and we used the proceeds to reduce the borrowings under our commercial paper program.

For the purposes of maintaining partner capital accounts, our partnership agreement specifies that items of income and loss shall be allocated among the partners, other than owners of i-units, in accordance with their percentage interests. Normal allocations according to percentage interests are made, however, only after giving effect to any priority income allocations in an amount equal to the incentive distributions that are allocated 100% to our general partner. Incentive distributions are generally defined as all cash distributions paid to our general partner that are in excess of 2% of the aggregate value of cash and i-units being distributed, and we determine the allocation of incentive distributions to our general partner by the amount quarterly distributions to unitholders exceed certain specified target levels, according to the provisions of our partnership agreement.

On August 12, 2011, we paid a cash distribution of $1.15 per unit to our common unitholders and to our Class B unitholder for the quarterly period ended June 30, 2011. KMR, our sole i-unitholder, received a distribution of 1,701,916 i-units from us on August 12, 2011, based on the $1.15 per unit distributed to our common unitholders on that date. The distributions were declared on July 20, 2011, payable to unitholders of record as of August 1, 2011.

On August 13, 2010, we paid a cash distribution of $1.09 per unit to our common unitholders and our Class B unitholders for the quarterly period ended June 30, 2010. KMR, our sole i-unitholder, received a distribution of 1,625,869 i-units from us on August 13, 2010, based on the $1.09 per unit distributed to our common unitholders on that date. The distributions were declared on July 21, 2010, payable to unitholders of record as of July 30, 2010.

Our August 12, 2011 incentive distribution payment to our general partner for the quarterly period ended June 30, 2011 totaled $292.8 million; however, this incentive distribution was affected by a waived incentive distribution amount equal to $7.1 million related to common units issued to finance a portion of our May 2010 acquisition of a 50% ownership interest in KinderHawk Field Services LLC. Beginning with our distribution payments for the quarterly period ended June 30, 2010 (discussed following), our general partner has agreed not to take incentive distributions related to this joint venture acquisition through year-end 2011.

On August 13, 2010, we paid an incentive distribution to our general partner for the second quarter of 2010 totaling $89.8 million. Based on a limited partner distribution of $1.09 per unit to our common unitholders, our general partner would expect to receive an incentive distribution in the amount of $263.4 million; however, this incentive distribution was reduced by a combined $173.6 million, including (i) a waived incentive amount equal to $5.3 million related to our May 2010 KinderHawk acquisition; and (ii)a reduced incentive amount equal to $168.3 million due to a portion of our available cash distribution for the second quarter of 2010 being a distribution of cash from interim capital transactions, rather than a distribution of cash from operations (including the general partner's 2% general partner interest, its total cash distributions were reduced by $170.0 million).

Our distribution of cash for the second quarter of 2010 (which we paid in the third quarter of 2010) from interim capital transactions totaled $177.1 million (approximately $0.56 per limited partner unit), and pursuant to the provisions of our partnership agreement, our general partner receives no incentive distribution on distributions of cash from interim capital transactions; accordingly, this distribution from interim capital transactions helped preserve our cumulative excess cash coverage. In the first nine months of 2011 and 2010, we made incentive distribution payments to our general partner totaling $847.4 million and $581.5 million, respectively.

On October 19, 2011, we declared a cash distribution of $1.16 per unit for the quarterly period ended September 30, 2011. The distribution will be paid on November 14, 2011, to unitholders of record as of October 31, 2011. Our common unitholders and our Class B unitholder will receive cash. KMR will receive a distribution of 1,701,781 additional i-units based on the $1.16 distribution per common unit. For each outstanding i-unit that KMR holds, a fraction of an i-unit (0.017579) will be issued. This fraction was determined by dividing:

Our declared distribution for the third quarter of 2011 of $1.16 per unit will result in an incentive distribution to our general partner of $299.0 million (including the effect of a waived incentive distribution amount of $7.2 million related to our May 2010 KinderHawk acquisition). Comparatively, our distribution of $1.11 per unit paid on November 12, 2010 for the third quarter of 2010 resulted in an incentive distribution payment to our general partner in the amount of $266.7 million. The increased incentive distribution to our general partner for the third quarter of 2011 over the incentive distribution for the third quarter of 2010 reflects the increase in the amount distributed per unit as well as the issuance of additional units. For additional information about our 2010 partnership distributions, see Notes 10 and 11 to our consolidated financial statements included in our 2010 Form 10-K/A.