I would like to welcome everyone to the New Jersey Resources second quarter fiscal 2008 conference call. (Operator Instructions) Thank you. Mr. Puma, you can begin your conference.

Good afternoon everyone and welcome to the New Jersey Resources second quarter fiscal 2008 conference call and webcast. I am joined by Larry Downes, our Chairman and CEO; Glenn Lockwood, our CFO; as well as other members of our senior management team. As you know, certain statements in our news release and in today’s call contain estimates or other forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. We wish to caution readers of our news release and listeners to this call that the assumptions forming the basis of forward-looking statements and include many factors that are beyond NJR's ability to control or estimate precisely which could cause results to materially differ from the Company's expectations. A list of these items can be found but is not limited to items in the forward-looking statements section of today’s news release filed on Form 8-K, or Form 10-K filed on December 10, 2007 and on Form 10-Q which we expect to file within a day. All of these items can be found in sec.gov. NJR does not by including the statement assume any obligation to review or revise any particular forward-looking statement referenced here in light of future events. With that being said, I would like to turn this call over to our Chairman and CEO Larry Downes. Larry?

Thanks Dennis. Good afternoon everyone and thank you for being with us here today. As you know, this morning, we have released our earnings for the first six months of fiscal 2008 and I am pleased to report that we are on track to record another year of excellent financial performance this fiscal year. On a GAAP basis, our earnings which include the impact of changes in the value of the derivatives that we use in our non-utility businesses increased by 14% to $42.7 million for the six months and that was $1.02 per base of share. That number compares with $37.4 million which was $0.90 per base of share for the same period of six months last year. Our net financial earnings which is a non-GAAP measure that excludes the impact of changes in the value of the derivative instruments that are used in our non-regulated subsidiaries rose by 5.2% to $114.3 million which was $2.74 per basic share. That number compared with $108.7 million which was $2.61 per basic share during the same six month period last year. We believe that net financial earnings is a better measure for assessing our financial performance. Our results this quarter and for the six months were driven by the strong results of NJR Energy Services which recorded higher earnings due primarily to a larger portfolio of transportation capacity as well as lower state taxes and as we have reportedly previously, it’s our current expectation that NJRES will contribute between 40% and 45% of our total earnings during fiscal 2008. I just want to update you on a couple of other items before I turn it over to Glenn. During the quarter, we completed our three-for-two stock split with shareholders of record receive one additional share of NJR stock for every two…

Thanks Larry and good afternoon everyone. As Larry mentioned, this morning, on a GAAP basis, we announced the 14% increase in earnings for the six months of fiscal 2008 of $42.7 million or $1.02 per share compared with $37.4 million or $0.90 per basic share last year. On a net financial earnings basis, our non-GAAP measures which excludes certain mark-to-market activities related to derivative instruments and our non-regulatory operations, earnings increased to $114.3 million or $2.74 per basic share compared with $108.7 million or $2.61 per basic share in the same period last year. We believe that net financial earnings which exclude unrealized gains or losses related to the Company’s unregulated subsidiaries and certain realized gains and losses related to natural gas and storage at NJR Energy Services are more reflective of operations, provides some sound investors and enable period -to-period comparability of financial performance. We have included a definition of this measure as well as reconciliations to the most comparable GAAP measures in our news release which I encourage you to read closely. For the remainder of the call, we will discuss all financial terms and net financial earnings. Fiscal 2008 year-to-date earnings at New Jersey Natural Gas, our utility subsidiary were $50.8 million compared with $53.1 million last year. The primary reason for the lower earnings were lower gross margin from incentive based programs and higher operation and maintenance expenses which offset higher firm gross margin. For the six months ended March 31, 2008, gross margin from our BPU approved incentive programs which include office and sales, capacity release, storage optimization and financial risk management programs totaled $3.6 million compared with $4.2 million for the same period last year. The decrease was due primarily to opportunities that existed in the first quarter of last year to generate margin…

(Operator Instructions) Your first question comes from Jim Likens.

Just a couple of questions; first of all regarding Steckman ridge it was kind of an assumption that you guys would have received a FERC certificate by now. I am just wondering if you are on track with construction in June and then possibly injections in May of next year.

It’s Rick Gardner here, how are you doing Jim?

Good Rick, how are you?

Good. We do think we are still on track although we went on the targets for the April meeting. We do believe we are in the notational phase where it’s working around right now looking for the approval and we expect to have the FERC Certificate any day now.

Okay, so that means that you do still think you will begin construction in June.

We are planning to have contractors there in June if we have that certificate and there is a rig lined up that will begin drilling in July.

Okay, great. And kind of switching gears, customer growth -- I was wondering if you guys could break that between what was the conversions and what you saw on the organic side and maybe could you just give us a little color on what’s happening with the conversions right now as well?

Jim I don’t have the conversion mix handy. We will make sure we provide that at the AJ Conference and make sure it’s posted for FD purposes. I can tell you that the conversion market has continued and it has not been impacted as much as the new construction market and so we feel that is also true for the commercial market. It has been stronger than the impact that we are seeing on the new construction residential market.

I think that the important point there Larry -- I think the important point there is always -- I mean obviously we have seen the challenges nationwide for a variety of factors but we still feel pretty good about the longer-term potential as we have said publicly and continue to spend a lot of time understanding what the long-term potential for growth is and when we look at the demographics in the service territory, our outlook is still positive.

Okay, great. All right, that’s all I got for now and I guess I will see you guys down in Miami.

Thank you Jim.

And your next question comes from the line of Daniel Fidell of Brean Murray, Carret.

Just a couple of quick questions. First, in terms of the rate case; you said hearings are this summer. Is the expectation having worse last settlement sometime anytime for the bulk of fiscal 2009?

It will be premature to speculate on settlement or anything like. So I wouldn’t go near that one Dan, but I would say, we would expect impact in fiscal 2009, absolutely. I think we have set out the procedural schedule assuming that the case weren’t the litigated rev.

Okay. Second question on the set; Is it functioning as intended? So far year-to-date, is it matching up with what your internal modeling was telling you going in?

It’s working well not only from the rate design perspective but I think just importantly, the dollars and the savings that customers are receiving from both the fixed demand charges that they get annually $10.6 million but even more significantly than that, the commodity savings and as Glenn laid out, the margin impact has been helpful as well to deal with the non-weather related issues primarily usage.

Okay, great. And can you refresh my memory in terms of the set. Is that something that is being reviewed as part of this rate case or is this extended for a longer period of time before it’s looked at?

It will be -- its part of the rate case and we expect the rate design come out of the rate case to adjust if you will all the factors that currently are picked up in the CIP itself.

That’s one of the proposals in the rate case. The CIP itself of course was a pilot that regulates us through a normal course, we will be looking at that as well. To come back the original question though is that it was designed to do -- to help a variety of stake holders and that’s certainly been the case.

Okay and then may be just a final question, I’ll let’s some one else ask a question. Just in terms of your CapEx plans for the remainder of 2008 on target with your previous expectations and how do you think things will layout for 2009 assumes stock in the region and if everything proceeds on track.

Right now what we disclosed for 2008, 2009 we still think those are good numbers, so this year going will be a new order $18 million and that doesn’t include MGP which is covered by a separate writer and then I think next year we are what in the high 70’s again, it’s the public disclosure, so right now those are still numbers we are working with. As far as the component to that it’s what you first talked about before, the customer growth, system integrity pipeline, pipeline integrities and things like that and then segment of course.

Your next question comes from the line of Joanne Fairechio of Janney Montgomery.

Good afternoon guys. Jim and Dan asked most of my questions but let me just follow up on Jim’s question on conversions. Would you anticipate may be the rate of conversion to increase a little bit in the summer time as customers or consumers get ready for the upcoming winter in light of where oil prices have been in the past couple of months and then do you normally see a pick up in conversions in the summer time.

Joanne I am going to ask Tom Massaro who is our Vice President of Marketing to answer that one.

Joanne we will see the number of conversions rated towards the end of the summer and into the fall heating season, so that is driven. We see that in the new customer editions number in total. We usually see it peak up as you start looking towards the heating season.

Right okay.

One of the things that lets us enjoy it is that even with the gas prices moving up we still have a price advantage over the competing fuel.

And my second question is you mentioned there was an increase in employees was that the gas Company or at the energy services business.

It’s been across the board

Okay

It’s relative to overall business.

Right. Now how many -- I know you also opened an office I believe in Huston this past quarter, how many employees do you have there?

Currently there is only one active employee in Huston and as that business picks up then we may increase it over time, so that was still in our slow.

(Operator Instructions) and your next question comes from the line of Brooke Mullin of J.P. Morgan.

Thank you. Most of my questions have been asked, just one clarification. Do you have the corporate tax rate for the year? I know you put in what the adjustment would be for energy services but on a consolidated basis?

No the only change from prior years would be this one segment but I haven’t -- we haven’t figured out the impacted on an consolidated rate. I can tell that it’s the only segment we expect to have any change in the rate based on the tax issue.

And would that tax issue extend beyond 2008?

Oh yes, we have in the release that we expect on an ongoing basis the current estimate would be to use about 38.9% overall effective tax rate in that business segment.

(Operator Instructions) and there are no questions.