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## Fair Value 

The fair value of financial instruments represents an approximation of amounts that would have been received from or paid to counterparties, calculated at the reporting date, to settle these instruments. The carrying amounts of all financial instruments classified as current approximate fair value because of the short maturities of these instruments. The estimated fair values of all other financial instruments are based on quoted market prices or, in the absence of specific market prices, on quoted market prices for similar instruments and other valuation techniques. 

The carrying amounts of all financial instruments, except as shown below, approximate fair value. 

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## Off Balance Sheet Financial Instruments 

The fair values of derivatives have been estimated using year-end market rates. These fair values approximate the amount that the Company would receive or pay to terminate the contracts at the year-end date. 

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As the Company did not settle hedging instruments in advance of the hedged transactions, there were no gains or losses deferred in relation to any of the Company’s off balance sheet hedges of anticipated transactions at December 31, 2000 and 1999. 

## Trade Credit Risk 

Trade receivables relating to Energy Transportation consist primarily of amounts due from companies operating in the oil and gas industry and are collateralized by the crude oil and other products contained in the Company’s pipeline and storage facilities. Credit risk with respect to trade receivables of the remaining operating segments is reduced by the large and diversified customer base, and, for rate-regulated operations, the ability to recover an estimate for doubtful accounts through the ratemaking process. The allowance for doubtful accounts amounted to $15.3 million at December 31, 2000 (1999 — $16.4 million). 

