Exhibit 12
Williams Partners L.P.
Computation of Ratio of Earnings to Fixed Charges
Computation of Ratio of Earnings to Fixed Charges
Years Ended December 31, | Three Months Ended March 31, | |||||||||||||||||||||||
2005 | 2006 | 2007 | 2008 | 2009 | 2010 | |||||||||||||||||||
(Dollars in millions) | ||||||||||||||||||||||||
Earnings: | ||||||||||||||||||||||||
Income from continuing operations before income taxes and cumulative effect of change in accounting principles | $ | 698 | $ | 940 | $ | 1,305 | $ | 1,150 | $ | 1,035 | $ | 313 | ||||||||||||
Less: | ||||||||||||||||||||||||
Equity earnings, excluding proportionate share from 50% owned investees and unconsolidated majority-owned investees | (27 | ) | (35 | ) | (51 | ) | (55 | ) | (55 | ) | (15 | ) | ||||||||||||
Income from continuing operations before income taxes and cumulative effect of change in accounting principles and equity earnings | 671 | 905 | 1,254 | 1,095 | 980 | 298 | ||||||||||||||||||
Add: | ||||||||||||||||||||||||
Fixed charges: | ||||||||||||||||||||||||
Interest accrued, including proportionate share from 50% owned investees and unconsolidatcd majority-owned investees | 124 | 146 | 224 | 246 | 258 | 81 | ||||||||||||||||||
Rental expense representative of interest factor | 12 | 11 | 13 | 11 | 8 | 2 | ||||||||||||||||||
Total fixed charges | 136 | 157 | 237 | 257 | 266 | 83 | ||||||||||||||||||
Distributed income of equity-method investees, excluding proportionate share from 50% owned investees and unconsolidated majority-owned investees | 54 | 64 | 48 | 64 | 133 | 16 | ||||||||||||||||||
Less: Capitalized Interest | (5 | ) | (11 | ) | (23 | ) | (36 | ) | (56 | ) | (12 | ) | ||||||||||||
Total earnings as adjusted | $ | 856 | $ | 1,115 | $ | 1,516 | $ | 1,380 | $ | 1,323 | $ | 385 | ||||||||||||
Fixed charges | 136 | 157 | 237 | 257 | 2.66 | 83 | ||||||||||||||||||
Ratio of earnings to fixed charges | 6.29 | 7.10 | 6.40 | 5.37 | 4.97 | 4.64 | ||||||||||||||||||
As described in Note 1. of Notes to Consolidated Financial Statements, because the entities acquired in the Dropdown were affiliates of Williams at the time of the acquisition, this transaction is accounted for as a combination of entities under common control, similar to a pooling of interests, whereby the assets and liabilities of the acquired entities are combined with ours at their historical amounts. As a result, income from continuing operations before income taxes shown above includes net income applicable to pre-partnership operations, which is fully allocated to our general partner.