PRO FORMA

FERC GAS TARIFF

ORIGINAL VOLUME NO. 1

of

MID-ATLANTIC EXPRESS, L.L.C.

filed with the

FEDERAL ENERGY REGULATORY COMMISSION

Communications concerning this Tariff should be addressed to:

Ed Cahill

Mid-Atlantic Express, L.L.C.

140 Professional Parkway

Suite A

Lockport, NY 14094

Phone: 716-493-1273

Fax: 716-434-7514

TABLE OF CONTENTS

DESCRIPTION SHEET NO.

TABLE OF CONTENTS 1

PRELIMINARY STATEMENT 6

SYSTEM MAP 7

STATEMENT OF RATES 8

RATE SCHEDULE FTS, FIRM TRANSPORTATION SERVICE 13

RATE SCHEDULE ITS, INTERRUPTIBLE TRANSPORTATION SERVICE 26

RATE SCHEDULE PALS, PARKING AND LENDING SERVICE 40

GENERAL TERMS AND CONDITIONS 50

1\. APPLICABILITY [51](#applicability)

2\. DEFINITIONS [51](#definitions-2)

3\. QUALITY [64](#quality)

4\. PRESSURE [66](#pressure)

5\. MEASUREMENT & MEASUREMENT EQUIPMENT
[67](#measurement-measurement-equipment)

6\. WARRANTY OF TITLE [73](#warranty-of-title)

7\. POSSESSION OF NATURAL GAS [73](#possession-of-natural-gas)

8\. BILLING AND PAYMENT [74](#billing-and-payment)

9\. NOTICES [77](#notices)

10\. SERVICE REQUESTS AND CONTRACTING FOR SERVICE
[77](#service-requests-and-contracting-for-service)

11\. NOMINATIONS [83](#nominations)

12\. SERVICE SCHEDULING, SERVICE PRIORITY AND IMPAIRMENT OF

DELIVERIES
[86](#service-scheduling-service-priority-and-impairment-of-deliveries)

13\. DETERMINATION OF RECEIPTS AND DELIVERIES
[91](#determination-of-receipts-and-deliveries-2)

14\. SCHEDULING CHARGES AND PENALTIES
[93](#scheduling-charges-and-penalties)

15\. UNIFORM RATES OF FLOW [94](#uniform-rates-of-flow)

16\. INSTALLATION OF FLOW CONTROL EQUIPMENT
[95](#installation-of-flow-control-equipment)

17\. POINT(S) OF RECEIPT AND POINT(S) OF DELIVERY
[95](#points-of-receipt-and-points-of-delivery)

18\. OPERATIONAL FLOW ORDERS [97](#operational-flow-orders)

19\. RESOLUTION OF IMBALANCES [99](#resolution-of-imbalances)

20\. WEBSITE [102](#website)

21\. CAPACITY RELEASE [103](#capacity-release)

22\. MARKETING FEES [114](#marketing-fees)

23\. RIGHT OF FIRST REFUSAL AND PREGRANTED ABANDONMENT OF FIRM SERVICE
AGREEMENTS
[114](#right-of-first-refusal-and-pregranted-abandonment-of-firm-service-agreements)

24\. FORCE MAJEURE [117](#force-majeure)

25\. MARKETING AFFILIATES [118](#marketing-affiliates)

26\. DISCOUNTS, NEGOTIATED RATES, RATE CHANGES, AND ADJUSTMENTS
[119](#discounts-negotiated-rates-rate-changes-and-adjustments)

27\. POLICY WITH RESPECT TO FEES AND CONSTRUCTION OF LATERAL, DELIVERY
AND RECEIPT FACILITIES
[122](#policy-with-respect-to-fees-and-construction-of-lateral-delivery-and-receipt-facilities)

28\. WAIVERS [124](#waivers)

29\. AGENCY [125](#agency)

30\. ANNUAL CHARGE ADJUSTMENT ("ACA")
[125](#annual-charge-adjustment-aca)

31\. TRANSPORTER'S USE GAS ADJUSTMENT
[126](#transporters-use-gas-adjustment)

32\. NORTH AMERICAN ENERGY STANDARDS BOARD ("NAESB")

STANDARDS [127](#north-american-energy-standards-board-naesb-standards)

33\. FLOW THROUGH OF CASH-OUT REVENUES AND PENALTIES IN EXCESS OF COSTS
[129](#flow-through-of-cash-out-revenues-and-penalties-in-excess-of-costs)

34\. CREDITING OF REVENUES FROM INTERRUPTIBLE TRANSPORTATION SERVICE AND
AUTHORIZED OVERRUN SERVICE 130

35\. MISCELLANEOUS 131

FORM OF SERVICE AGREEMENT FOR RATE SCHEDULE FTS 151

FORM OF SERVICE AGREEMENT FOR RATE SCHEDULE ITS 157

FORM OF SERVICE AGREEMENT FOR RATE SCHEDULE PALS 162

FORM OF SERVICE AGREEMENT FOR ELECTRONIC COMMUNICATION

SERVICE 173

CAPACITY RELEASE FORM OF SERVICE AGREEMENT 178

SHEETS RESERVED FOR FUTURE USE

Sheet Nos. 3-5 are reserved for future use.

PRELIMINARY STATEMENT

Mid-Atlantic Express, L.L.C. (hereinafter called "Transporter") is a
natural gas transmission company engaged in the business of transporting
natural gas. It is authorized to operate open access transportation
facilities located in Maryland and Pennsylvania as shown on the System
Map on Sheet No. 7.

SYSTEM MAP

A System Map reflecting the pipeline route as constructed will be set
forth on this tariff sheet.

STATEMENT OF RATES

FOR TRANSPORTATION SERVICE

(All Rates in \$/Dth)

Transporter's Rate Schedule\*

Firm Services:

FTS

Monthly Reservation Usage Usage Authorized Transporter's

Max. Min. Max. Min. Overrun\*\* Use Gas %\*\*\*

\$3.1585/Dth \$0.00 \$0.00 \$0.00 \_\_\_\_\_\_\_\_\_\_ 0.00%

Interruptible Services:

ITS

Usage Rate Transporter's

Max. Min. Use Gas %\*\*\*

\$0.1038/Dth \$0.00 0.00%

PALS

Daily Parking and Lending Rate

Max. Min.

\$0.1038 \$0.00

Other Charges\*\*\*\*

ACA \$0.00

Section 33.1 Surcharge \$\_\_\_\_

\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_

\* Shipper and Transporter may mutually agree to a negotiated rate
pursuant to Section 26 of the General Terms and Conditions. A Negotiated
Rate shall be stipulated in the Shipper's executed Service Agreement.

\*\* The Authorized Overrun charge is only applicable under the
conditions specified in Rate Schedule FTS of this FERC Gas Tariff, and
is the maximum firm volumetric rate applicable for capacity release.

\*\*\*The Transporter's Use Gas % comprises a lost and unaccounted for
gas component only.

\*\*\*\* Pursuant to the General Terms and Conditions of this FERC Gas
Tariff, the above maximum rates shall be adjusted to include any
applicable surcharges.

SHEETS RESERVED FOR FUTURE USE

Sheet Nos. 9-12 are reserved for future use.

RATE SCHEDULE FTS

FIRM TRANSPORTATION SERVICE

#  DEFINITIONS

> The terms used in this Rate Schedule shall have the meaning set forth
> in Section 2 of the GT&C, unless otherwise defined herein.

#  AVAILABILITY

## This Rate Schedule is available to any Person that has (a) requested service under this Rate Schedule; (b) satisfied the requirements of Section 10 of the GT&C; and (c) entered into a Service Agreement with Transporter for firm service under this Rate Schedule, and thus is a Shipper.

## Transporter shall accept written transportation requests for service under this Rate Schedule in accordance with Section 10 of the GT&C.

#  APPLICABILITY AND CHARACTER OF SERVICE

## Service under this Rate Schedule shall be available on a daily basis for the receipt at Point(s) of Receipt of Natural Gas up to the MDQ set forth on Exhibit "A" to Shipper's FTS Service Agreement, the transportation of such quantities of Natural Gas, and the delivery at Point(s) of Delivery of Natural Gas up to such MDQ. All such quantities shall be received by Transporter at the Point(s) of Receipt and Thermally Equivalent Quantities shall be delivered to Shipper or for Shipper's account at the Point(s) of Delivery. Service under this Rate Schedule shall be firm up to Shipper's MDQ except as provided in this Rate Schedule, the GT&C, and the executed Service Agreement. Conditions that may cause the transportation quantity to be less than Shipper's MDQ include curtailment or interruption under GT&C Section 12.3, an emergency situation under GT&C 12.4, an OFO situation pursuant to GT&C Section 18, or an event of Force Majeure pursuant to GT&C Section 24. Service under this Rate Schedule shall not commence until Transporter and Shipper have executed an FTS Service Agreement.

## Except as agreed to by Transporter pursuant to Section 27 of the GT&C, Transporter shall have no obligation to add any facilities or to expand the capacity of its Pipeline Facilities in order to provide transportation service under this Rate Schedule. 

## Nominations and scheduling of service under this Rate Schedule shall be in accordance with the procedures set out in Sections 11 and 12 of the GT&C.

## Allocations of capacity shall be determined in accordance with Section 10 of the GT&C.

#  POINTS OF RECEIPT AND DELIVERY, AND UNIFORM QUANTITIES

## The Primary Point(s) of Receipt into Transporter's Pipeline Facilities shall be specified on Exhibit "A" to Shipper's FTS Service Agreement. Upon the agreement of Transporter and Shipper, Exhibit "A" to Shipper's FTS Service Agreement may be superseded from time to time by a new Exhibit "A" to add or delete specific Primary Point(s) of Receipt or to make other changes thereto. Transporter shall not be obligated to accept any additional Primary Point(s) of Receipt or to make other changes to Exhibit "A" if to do so would impair Transporter's ability to satisfy existing firm obligations under this Rate Schedule or any other firm service Rate Schedule that Transporter may have in effect. Total volumes at the Primary Point(s) of Receipt shall not exceed Shipper's MDQ as set out on Exhibit "A" to Shipper's FTS Service Agreement. All Points of Receipt not specified on Exhibit "A" shall be available to Shipper on a secondary basis in accordance with the GT&C.

## The Primary Point(s) of Delivery out of Transporter's Pipeline Facilities shall be specified on Exhibit "A" to Shipper's FTS Service Agreement. Upon the agreement of Transporter and Shipper, Exhibit "A" to Shipper's FTS Service Agreement may be superseded by a new Exhibit "A" to add or delete specific Primary Point(s) of Delivery or to make other changes thereto. Transporter shall not be obligated to accept any additional Primary Point(s) of Delivery or to make other changes to Exhibit "A" if to do so would impair Transporter's ability to satisfy existing firm obligations under this Rate Schedule or any other firm service Rate Schedule that Transporter may have in effect. Total volumes at the Primary Point(s) of Delivery shall not exceed Shipper's MDQ as set out on Exhibit "A" to Shipper's FTS Service Agreement. All Points of Delivery not specified on Exhibit "A" shall be available to Shipper on a secondary basis in accordance with the GT&C of Transporter's Tariff.

## Shipper shall deliver or cause to be delivered into Transporter's Pipeline Facilities Natural Gas at uniform rates of flow in accordance with Section 15 of the GT&C.

#  RATES AND CHARGES

## The applicable maximum and minimum rates for service under this Rate Schedule are set forth on the currently effective Sheet No. 8 of Transporter's Tariff and are incorporated herein by reference. The rates under this Rate Schedule are subject to discount, negotiation, change and adjustment pursuant to Section 26 of the GT&C and pursuant to Shipper's effective Rate Schedule FTS Service Agreement. Pursuant to the provisions of Section 26 of the GT&C, Transporter and Shipper may mutually agree to a Negotiated Rate that is higher, lower or of a different rate design than reflected in the rates shown on Sheet No. 8 of Transporter's Tariff, and for the length of term negotiated. Unless Transporter and Shipper otherwise agree in writing, the applicable rate for service under this Rate Schedule shall be the maximum rate shown on the currently effective Sheet No. 8 of Transporter's Tariff.

## Service hereunder shall be subject to the following charges:

### A Monthly reservation charge equal to the product of the applicable maximum Rate Schedule FTS Reservation Rate shown on the currently effective Sheet No. 8 of Transporter's Tariff or such other reservation rate agreed to by Shipper and Transporter pursuant to Section 26.1 of the GT&C, and the MDQ specified in Shipper's executed FTS Service Agreement;

### A usage charge equal to the product of the applicable maximum Rate Schedule FTS Usage Rate shown on the currently effective Sheet No. 8 of Transporter's Tariff or such other usage rate agreed to by Shipper and Transporter pursuant to Section 26 of the GT&C, and the quantity of Natural Gas delivered by Transporter for Shipper or for Shipper's account on each Day in the Month;

### A new facilities charge equal to an amount agreed upon between Shipper and Transporter for facilities constructed at Shipper's request in order to provide transportation service under this Rate Schedule as provided in Section 27 of the GT&C;

### Incidental charges, as approved by the FERC, necessary to recoup regulatory filing fees or similar fees incurred by Transporter in rendering service under this Rate Schedule;

### Applicable charges for Authorized Overrun volumes, if any, equal to the maximum Authorized Overrun rates shown on the currently effective Sheet No. 8 of Transporter's Tariff or such other overrun rate to which Transporter specifically agrees multiplied by the quantity of Natural Gas delivered for Shipper or Shipper's account on each Day in the Month as Authorized Overrun; and

### Any other applicable surcharges, penalties, or other charges due to Transporter under the terms of this Rate Schedule, including Section 7 herein, Shipper's Rate Schedule FTS Service Agreement, and the GT&C including, but not limited to, Sections 12.3(f), 12.4(c), 14.1, 14.2, 18.5, 30 and 33.

#  AUTHORIZED OVERRUN

> On any Day, Shipper may elect, with the prior approval of Transporter,
> to receive, ship and deliver quantities in excess of its MDQ, MDRO or
> MDDO. Such quantities in excess of Shipper's total MDQ, MDRO or MDDO
> shall be deemed to be Authorized Overrun and shall be separately
> nominated by Shipper. Unless specifically agreed to by Transporter on
> a not unduly discriminatory basis, the rate for Authorized Overrun
> volumes shall be the 100 percent load factor equivalent of the maximum
> FTS rate applied only to those quantities in excess of MDQ, and shall
> be set forth on Sheet No. 8 of Transporter's Tariff.

#  UNAUTHORIZED OVERRUN

> To the extent that Shipper delivers to or receives from Transporter
> quantities of Natural Gas on any Day in excess of Shipper's total MDQ
> without prior approval of Transporter, such quantities shall be deemed
> to be Unauthorized Overrun. Shipper shall pay for each Dekatherm of
> Unauthorized Overrun a charge, in addition to the authorized overrun
> charge set forth on Sheet No. 8 of Transporter's Tariff, equal to two
> (2) times the maximum rate for Rate Schedule ITS. When such
> Unauthorized Overrun impairs reliable service, Transporter shall
> provide Shipper with notice to cease immediately such Unauthorized
> Overrun. In the event Transporter has issued a notice pursuant to this
> Section 7, Shipper thereafter shall pay for each Dekatherm of
> Unauthorized Overrun a charge equal to the greater of \$10 or
> two-hundred percent (200%) of the Gas Price Index for the flow date on
> which the Gas is transported.

#  TRANSPORTER'S USE GAS

> Shipper shall provide at the Point(s) of Receipt Transporter's Use Gas
> in-kind, as may be set forth and in effect from time to time on Sheet
> No. 8 of Transporter's Tariff.

#  MONTHLY BILL

> The monthly bill for Natural Gas transportation under this Rate
> Schedule shall be equal to the sum of the charges set forth in Section
> 5 of this Rate Schedule.

#  RELEASE OF FIRM CAPACITY

> Any Shipper receiving service under this Rate Schedule FTS shall have
> the right on a permanent or temporary basis to release its firm
> capacity rights in accordance with Section 21 of the GT&C.

#  DETERMINATION OF RECEIPTS AND DELIVERIES

> Receipts and deliveries of Natural Gas under this Rate Schedule FTS
> shall be determined in accordance with the provisions of Section 13 of
> the GT&C.

#  IMPAIRMENT OF RECEIPTS AND DELIVERIES

> In the event that Transporter, on any Day, is unable to receive and/or
> deliver the total confirmed nominations of all Shippers under any Rate
> Schedule of Transporter's Tariff, Transporter shall limit receipts
> and/or deliveries of Natural Gas in accordance with Section 12 of the
> GT&C.

#  OPERATIONAL INTEGRITY

> Transporter reserves the right to take actions as may be required to
> preserve the integrity of Transporter's Pipeline Facilities, including
> maintenance of service to other firm Shippers in accordance with
> Section 12 of the GT&C.

#  GOVERNMENTAL AUTHORIZATIONS

> Transportation service under this Rate Schedule and effective Service
> Agreement(s) shall be implemented pursuant to any applicable
> authorizations or program of the FERC for which Transporter has filed
> or in which Transporter has agreed to participate.

#  GENERAL TERMS AND CONDITIONS

> The GT&C of which this Rate Schedule is a part are applicable to this
> Rate Schedule and service hereunder and are made a part hereof to the
> extent that such terms and conditions are not contradicted by any
> provision herein. In the event of a conflict between the GT&C and the
> provisions of this Rate Schedule or a Service Agreement under this
> Rate Schedule, the specific provisions of this Rate Schedule or a
> Service Agreement under this Rate Schedule shall control, except that
> such Rate Schedule, Service Agreement, and the GT&C shall be construed
> in a manner to be consistent unless the context clearly indicates
> otherwise.

SHEETS RESERVED FOR FUTURE USE

Sheet Nos. 18-25 are reserved for future use.

RATE SCHEDULE ITS

INTERRUPTIBLE TRANSPORTATION SERVICE

# DEFINITIONS

> The terms used in this Rate Schedule shall have the meanings set forth
> in Section 2 of the GT&C, unless otherwise defined herein.

#  AVAILABILITY

## This Rate Schedule is available to any Person that has (a) requested transportation service under this Rate Schedule; (b) satisfied the requirements of Section 10 of the GT&C; and (c) entered into a Service Agreement with Transporter for interruptible transportation service under this Rate Schedule, and thus is a Shipper.

## Transporter shall accept written transportation requests for service under this Rate Schedule in accordance with Section 10 of the GT&C.

#  APPLICABILITY AND CHARACTER OF SERVICE

## This Rate Schedule shall apply to the transportation of Natural Gas, on an interruptible basis, when and to the extent that Transporter determines that capacity is available in its existing Pipeline Facilities and at its existing Points of Receipt and Points of Delivery sufficient to provide service up to the quantity nominated by Shipper.

## Service under this Rate Schedule shall be available on a daily basis for the receipt at Point(s) of Receipt of Natural Gas, the transportation of quantities of Natural Gas and the delivery at Point(s) of Delivery of Natural Gas up to the quantity nominated by Shipper under its ITS Service Agreement. All such nominated quantities that Transporter confirms and schedules shall be received by Transporter at the nominated Point(s) of Receipt, and Thermally Equivalent Quantities shall be delivered to Shipper or for Shipper's account at the nominated Point(s) of Delivery. Service under this Rate Schedule shall be interruptible. Service under this Rate Schedule shall not commence until Transporter and Shipper have executed an ITS Service Agreement.

## Except as agreed by Transporter pursuant to Section 27 of the GT&C, Transporter shall have no obligation to add any facilities or expand the capacity of its Pipeline Facilities in order to provide transportation service under this Rate Schedule.

## Nominations and scheduling of service under this Rate Schedule shall be in accordance with the procedures set forth in Sections 11 and 12 of the GT&C.

#  POINTS OF RECEIPT AND DELIVERY, AND UNIFORM QUANTITIES

## All Points of Receipt into Transporter's Pipeline Facilities shall be available on an interruptible basis for nomination by Shippers who have executed an ITS Service Agreement.

## All Points of Delivery out of Transporter's Pipeline Facilities shall be available on an interruptible basis for nomination by Shippers who have executed an ITS Service Agreement.

## Shipper shall deliver or cause to be delivered into Transporter's Pipeline Facilities Natural Gas at uniform rates of flow in accordance with Section 15 of the GT&C.

#  RATES AND CHARGES

## The applicable maximum and minimum rates for service under this Rate Schedule are set forth on the currently effective Sheet No. 8 of Transporter's Tariff and are incorporated herein by reference. The rates under this Rate Schedule are subject to discount, negotiation, change and adjustment pursuant to Section 26 of the GT&C and pursuant to Shipper's effective Rate Schedule ITS Service Agreement. Unless Transporter and Shipper otherwise agree in writing, the applicable rate for service under this Rate Schedule shall be the maximum rate shown on the currently effective Sheet No. 8 of Transporter's Tariff.

## Service hereunder shall be subject to the following charges:

### A usage charge equal to the product of the applicable maximum Rate Schedule ITS Rate shown on the currently effective Sheet No. 8 of Transporter's Tariff, or such other rate agreed to by Shipper and Transporter pursuant to Section 26 of the GT&C, and the quantity of Natural Gas received by Transporter from Shipper or for Shipper's account in the Month;

### Incidental charges, as approved by the FERC, necessary to recoup regulatory filing fees or similar fees incurred by Transporter in rendering service under this Rate Schedule; and

### Any other applicable surcharges, penalties, or other charges due to Transporter under the terms of this Rate Schedule, Shipper's Rate Schedule ITS Service Agreement, and the GT&C including, but not limited to, Sections 12.3(f), 12.4(c), 14.1, 14.2, 18.5, 30 and 33.

#  TRANSPORTER'S USE GAS

> Shipper shall provide at the Point(s) of Receipt Transporter's Use Gas
> in-kind, as may be set forth and in effect from time to time on Sheet
> No. 8 of Transporter's Tariff.

#  MONTHLY BILL

> The monthly bill for Natural Gas transportation under this Rate
> Schedule shall be equal to the sum of the applicable charges set forth
> in Section 5.

#  DETERMINATION OF RECEIPTS AND DELIVERIES

> Receipts and deliveries of Natural Gas under this Rate Schedule ITS
> shall be determined in accordance with the provisions of Section 13 of
> the GT&C.

#  IMPAIRMENT OF RECEIPTS AND DELIVERIES

> In the event that Transporter, on any Day, is unable to receive and/or
> deliver the total confirmed nominations of all Shippers under any Rate
> Schedule of Transporter's Tariff, Transporter shall limit receipts
> and/or deliveries of Natural Gas in accordance with Section 12 of the
> GT&C.

#  OPERATIONAL INTEGRITY

> Transporter reserves the right to take actions as may be required to
> preserve the integrity of Transporter's Pipeline Facilities, including
> maintenance of service to firm Shippers in accordance with Section 12
> of the GT&C.

#  GOVERNMENTAL AUTHORIZATIONS

> Transportation service under this Rate Schedule and effective Service
> Agreement(s) shall be implemented pursuant to any applicable
> authorizations or program of the FERC for which Transporter has filed
> or in which Transporter has agreed to participate.

#  GENERAL TERMS AND CONDITIONS

> The GT&C of which this Rate Schedule is a part are applicable to this
> Rate Schedule and service hereunder and are made a part hereof to the
> extent that such terms and conditions are not contradicted by any
> provision herein. In the event of a conflict between the GT&C and the
> provisions of this Rate Schedule or a Service Agreement under this
> Rate Schedule, the specific provisions of this Rate Schedule or a
> Service Agreement under this Rate Schedule shall control, except that
> such Rate Schedule, Service Agreement, and the GT&C shall be construed
> in a manner to be consistent unless the context clearly indicates
> otherwise.

SHEETS RESERVED FOR FUTURE USE

Sheet Nos. 29-39 are reserved for future use.

RATE SCHEDULE PALS

PARKING AND LENDING SERVICE

# AVAILABILITY

## This Rate Schedule is available to any Person that has (a) requested service under this Rate Schedule; (b) satisfied the requirements of Section 10 of the GT&C; and (c) entered into a Service Agreement with Transporter for service under this Rate Schedule, and thus is a Shipper.

## Transporter shall accept written requests for service under this Rate Schedule in accordance with Section 10 of the GT&C.

# APPLICABILITY AND CHARACTER OF SERVICE

## The interruptible service provided hereunder permits Shipper to nominate Natural Gas, made available to Transporter by Shipper or by Transporter to Shipper in connection with a Service Agreement for service under this Rate Schedule PALS, up to the maximum quantity set forth in the Service Agreement, and subject to the GT&C and the further provisions of the Service Agreement. The service provided hereunder is an interruptible service and shall be provided only after all other services offered by Transporter are scheduled and only to the extent operationally feasible by Transporter's system. Transporter shall not be required to receive or deliver quantities of Natural Gas on any Day for which there is insufficient available capacity under Shipper's Service Agreement to deliver Natural Gas or to receive Natural Gas from the point(s) of service. Parking and lending service shall not impede Transporter's ability to meet its firm and interruptible service requirements, including Transporter's system requirements. Transporter is not obligated to provide any service hereunder which would require the construction or acquisition of new facilities or the modification or expansion of existing facilities.

## Transporter shall establish and maintain a Parking and Lending Account for each Shipper utilizing the service herein. A credit balance indicates Natural Gas parked on Transporter's pipeline system; whereas, a debit balance indicates Natural Gas loaned by Transporter to the Shipper. The Parking and Lending balance will be stated in Dekatherms. 

## Parking service is an interruptible service which provides for (1) receipt by Transporter of Gas quantities delivered by Shipper to point specified in Shipper's Rate Schedule PALS Service Agreement; (2) Transporter holding the parked quantities on Transporter's pipeline system; and (3) return of the parked quantities to Shipper at the agreed upon time and at the point specified in the PALS Service Agreement; provided, however, that Transporter is not obligated to return parked quantities on the same Day the Gas is parked. 

## Lending Service is an interruptible service which provides for: (1) Shipper receiving Gas quantities from Transporter at the points specified in the PALS Service Agreement for delivery of loaned quantities of Gas; and (2) the subsequent return of the loaned quantities of Gas to Transporter at the agreed upon time and at the same points; provided, however, that Transporter is not obligated to accept return of loaned Gas on the same Day the Gas is loaned.

## Transportation service to and from the designated point(s) of service for parking and lending shall be solely the Shipper's responsibility. If the Shipper and Transporter agree that Shipper may receive parked quantities or return loaned quantities at points other than at the point(s) specified for service in the PALS Service Agreement, then Shipper and Transporter shall enter into a separate Transportation Agreement(s) to effectuate receipt or delivery of Gas from or to the new point(s).

## If Shipper desires to utilize the parking and lending service under this Rate Schedule, Shipper shall provide a nomination to Transporter in accordance with the nomination procedures in Section 11 of the GT&C. Subject to Sections 2.7 and 2.8, Natural Gas may be parked or loaned for a minimum of one Day and a maximum of one (1) Month and such period may be extended by Transporter as permitted by system operating conditions.

## Shipper shall be required, upon notification from Transporter, to cease or reduce deliveries to or receipts from its parking service within the Day or to receive from parking all, or any part, of its parked quantity under this Rate Schedule PALS as rapidly as is consistent with Transporter's operating capabilities. Any parked quantity not removed in accordance with Transporter's notice within five (5) Days of Transporter giving Shipper such notice shall become the property of Transporter at no cost to Transporter, free and clear of any adverse claims; provided, however, that Transporter shall extend the time available for Shipper to remove its parked quantity by one Day for every Day that Shipper has been unable to remove Natural Gas due to operational conditions on Transporter's system. 

## Shipper shall be required, upon notification from Transporter, to return all, or any part, of loaned quantities under this Rate Schedule PALS as rapidly as is consistent with Transporter's operating capabilities. Any loaned quantity of Natural Gas not returned in accordance with Transporter's notice within three (3) Days of Transporter giving Shipper such notice shall be sold to Shipper at 150% of the average of the Gas Price Index for each Day in such Month, as defined in Section 2 of Transporter's GT&C, unless otherwise agreed.

## Not more than thirty (30) Days after the termination or expiration of the PALS Service Agreement executed by Shipper under this PALS Rate Schedule, Transporter will notify Shipper of Shipper's Parking and Lending Account balance. If there is a balance remaining, Shipper will nominate for withdrawal or return such quantities within thirty (30) Days of Transporter's notice. Any parked quantities not withdrawn in accordance with Transporter's notice shall become the property of Transporter at no cost to Transporter, free and clear of any adverse claims; provided, however, that Transporter shall extend the time available for Shipper to remove its parked quantity by one Day for every Day that Shipper has been unable to remove Natural Gas due to operational conditions on Transporter's system. Any loaned quantities not returned in accordance with Transporter's notice shall be sold to Shipper at 150% of the average of the Gas Price Index for each Day in such Month, as defined in Section 2 of Transporter's GT&C, unless otherwise agreed. 

# RATES

> The rates and charges for service under this Rate Schedule PALS shall
> be as follows:

## Daily Parking Charge and Daily Lending Charge

> The applicable maximum and minimum rates for Parking and Lending
> Service are set forth on the currently effective Tariff Sheet No. 8.
> The rates shall be paid Monthly for each Dekatherm of Gas parked or
> loaned at each point of service for or on behalf of the account of
> Shipper at the end of any Day during the Month.

## Range of Rates

> Unless otherwise agreed to in writing between Shipper and Transporter,
> any rate applicable to a Shipper for service hereunder shall be the
> applicable maximum rate as set forth on the effective Tariff Sheet No.
> 8, as may be applicable from time to time. Shipper and Transporter may
> mutually agree, pursuant to Section 26.2 of the General Terms and
> Conditions, to a Negotiated Rate, which rate shall be less than, equal
> to, or greater than the maximum rate. Transporter shall be responsible
> for compliance with any reporting requirements prescribed by the FERC.
> Transporter shall not be required to enter into any Service Agreement
> for Parking and Lending Service at a rate less than the maximum rate.

# GENERAL TERMS AND CONDITIONS

> The GT&C of which this Rate Schedule is a part are applicable to this
> Rate Schedule and service hereunder and are made a part hereof to the
> extent that such terms and conditions are not contradicted by any
> provision herein. In the event of a conflict between the GT&C and the
> provisions of this Rate Schedule or a Service Agreement under this
> Rate Schedule, the specific provisions of this Rate Schedule or a
> Service Agreement under this Rate Schedule shall control, except that
> such Rate Schedule, Service Agreement, and the GT&C shall be construed
> in a manner to be consistent unless the context clearly indicates
> otherwise.

SHEETS RESERVED FOR FUTURE USE

Sheet Nos. 43-49 are reserved for future use.

GENERAL TERMS AND CONDITIONS

TABLE OF CONTENTS

Sheet No.

1.  Applicability 51

2.  Definitions 51

3.  Quality 64

4.  Pressure 66

5.  Measurement & Measurement Equipment 67

6.  Warranty of Title 73

7.  Possession of Natural Gas 73

8.  Billing and Payment 74

9.  Notices 77

10. Service Requests and Contracting for Service 77

11. Nominations 83

12. Service Scheduling, Service Priority and Impairment of Deliveries 86

13. Determination Of Receipts And Deliveries 91

14. Scheduling Charges and Penalties 93

15. Uniform Rates of Flow 94

16. Installation of Flow Control Equipment 95

17. Point(s) of Receipt and Point(s) of Delivery 95

18. Operational Flow Orders 97

19. Resolution of Imbalances 99

20. Website 102

21. Capacity Release 103

22. Marketing Fees 114

23. Right of First Refusal and Pregranted Abandonment of Firm Service
    Agreements 114

24. Force Majeure 117

25. Marketing Affiliates 118

26. Discounts, Negotiated Rates, Rate Changes, and Adjustments 119

27. Policy With Respect to Fees and Construction of Lateral, Delivery
    and Receipt Facilities 122

28. Waivers 124

29. Agency 125

30. Annual Charge Adjustment ("ACA") 125

31. Transporter's Use Gas Adjustment 126

32. North American Enerty Standards Board ("NAESB") Standards 127

33. Flow Through of Cash-Out Revenues and Penalties in Excess of Costs
    129

34. Crediting Of Revenues From Interruptible Transportation Service and
    Authorized Overrun Service 130

35. Miscellaneous 131

GENERAL TERMS AND CONDITIONS

# APPLICABILITY

> These General Terms and Conditions are incorporated in and are part of
> each of Transporter's Rate Schedules and Service Agreements.

# DEFINITIONS

> The following terms, when used herein or in any Rate Schedule
> contained in this Tariff or in any executed Service Agreement for
> service under a Rate Schedule contained in this Tariff, have the
> following meanings:

### "Affiliate" means any Person which controls, is controlled by, or is under common control with Transporter.

### "Affiliate Guarantor" means an Affiliate that executes a corporate guarantee satisfactory to Transporter for Shipper's obligations under a Service Agreement.

### "British thermal unit" and "Btu" mean the amount of heat required to raise the temperature of one avoirdupois pound of pure water from fifty-eight and five-tenths degrees (58.5°) Fahrenheit to fifty-nine and five-tenths degrees (59.5°) Fahrenheit at a constant pressure of 14.73 psia.

### "Business Day" means Monday through Friday, excluding Federal Banking Holidays for transactions in the United States and similar holidays for transactions occurring in Canada and Mexico.

### "Central Clock Time" and "CCT" mean central daylight time when daylight savings time is in effect and central standard time when daylight savings time is not in effect.

### "Commission" and the "FERC" mean the Federal Energy Regulatory Commission or any successor regulatory authority having jurisdiction over Transporter under the Natural Gas Act or supervening legislation.

### "Connecting Party" means the operator of the facilities immediately upstream or downstream of Transporter's Pipeline Facilities.

### "Contract Path" means the portion of Transporter's Pipeline Facilities from Shipper's Primary Point of Receipt to Shipper's Primary Point of Delivery, such that the Contract Path includes that portion of Transporter's Pipeline Facilities for which Shipper pays a reservation charge pursuant to Section 5.2(a) of Rate Schedule FTS.

### "Cubic Foot" means the volume of Natural Gas which occupies one (1) cubic foot of space, measured according to Boyle's and Charles' Laws for the measurement of Natural Gas under varying pressures with deviation therefrom as provided in Section 5 and on the measurement basis likewise specified in Section 5. One Cubic Foot equals 0.02832 m^3^.

### "Day" or "Gas Day" means a period of twenty-four (24) consecutive hours, beginning and ending at 9:00 a.m. CCT. Standard time for the Gas Day is 9 a.m. to 9 a.m. (Central Clock Time).

### "Dekatherm" or "Dth" means the quantity of heat energy that is equivalent to one million British Thermal Units. One "Dekatherm" or "Dth" of gas means the quantity of gas which contains one Dekatherm of heat energy.

### "Gas" or "Natural Gas" means any mixture of hydrocarbons, consisting essentially of methane, and inert or noncombustible gases which are extracted from the subsurface of the earth in their natural state, and which meets the quality and pressure specifications set forth in Sections 3 and 4.

### "Gas Price Index" means for each reported Day, the average of the midpoints in the range of prices reported for "Transco, Zone 6 non-NY" and "Texas Eastern, M-3", as published in Gas Daily, or, if no longer published, an equivalent index or indicator, which substitution shall be posted on Transporter's Website, and Transporter shall revise this definition to reflect such substitute index or indicator. 

### "GT&C" means the General Terms and Conditions of Transporter's Tariff, as revised and effective from time to time. 

### "Maximum Parked Quantity" means the maximum quantity of Gas that Transporter is required to hold for the account of Shipper for a period of time as set forth in Shipper's PALS Service Agreement.

### "Mcf" means 1,000 Cubic Feet of Natural Gas.

### "MMBtu" means one million Btu's. An MMBtu is the heat energy equivalent of a Dth.

### "Maximum Daily Delivery Obligation (MDDO)" means the maximum quantity of Gas assigned to a specific Primary Point of Delivery, as set forth on Exhibit A to Shipper's Service Agreement, that Transporter is obligated to deliver to Shipper at that point on any Day. The total of all MDDO for Points of Delivery shall equal the MDQ as set forth on Exhibit A to the Shipper's Service Agreement.

### "Maximum Daily Quantity" and "MDQ" mean the maximum daily quantity of Natural Gas that Transporter is required to transport for Shipper or for the account of Shipper under a firm Service Agreement, including from all Primary Point(s) of Receipt and to all Primary Point(s) of Delivery. Shipper's MDQ shall be set forth on Exhibit "A" to Shipper's Service Agreement.

### "Maximum Daily Receipt Obligation (MDRO)" means the maximum quantity of Gas assigned to a specific Primary Point of Receipt, as set forth on Exhibit A to Shipper's Service Agreement, that Transporter is obligated to receive from Shipper at that point on any Day. The total of all MDRO for Points of Receipt shall equal the MDQ as set forth on Exhibit A to the Shipper's Service Agreement.

### "Month" means the period beginning at 9:00 a.m. CCT on the first Day of the calendar month and ending 9:00 a.m. CCT on the first Day of the next succeeding calendar month.

### "NAESB" means the North American Energy Standards Board.

### "NAESB Standard" means a standard issued by NAESB and adopted by the Commission.

### "Negotiated Rate" means a rate or formula for computing a rate for transportation service which may be greater than, equal to or less than the Recourse Rate, but which may not be less than the minimum rate(s) as set forth on the currently effective Sheet No. 8 of this Tariff. A Negotiated Rate must be mutually agreed upon by Transporter and Shipper for a specific time period, and may be based on a rate design other than the rate design used to compute Transporter's currently effective rates.

### "Net Present Value" shall mean the calculation of net present value of the reservation charge that requestor would pay at the rates requestor has bid, which shall not be less than the minimum rate nor greater than the maximum rate, as stated on the currently effective Tariff Sheet governing such service, over the term of service specified in the request, utilizing as the discount factor the FERC-approved interest rate as such rate may be in effect from time to time.

### "Operational Balancing Agreement" or "OBA" means a contract between two parties which specifies the procedures to manage operating variances at an interconnect.

### "Operational Flow Order" or "OFO" means an order issued to alleviate conditions, inter alia, which threaten or could threaten the safe operations or system integrity of Transporter's Pipeline Facilities, or to maintain operations required to provide efficient and reliable firm service. Whenever Transporter experiences these conditions, any pertinent order should be referred to as an Operational Flow Order.

### "Parked Quantity" means the quantity of Gas held for the account of Shipper at a specific Parking Point at any point in time.

### "Parking" means the receipt by Transporter of Gas from or for the account of Shipper, the holding of such Gas for a period of time and the subsequent redelivery to Shipper.

### "Person" means an individual or any corporation, joint venture, limited liability company, partnership, association, business trust, or organized group of persons, whether incorporated or not.

### "Pipeline Facilities" means Transporter's pipeline and associated facilities extending from an interconnection with the natural gas import, storage and re-gasification terminal located on the Sparrows Point peninsula in Baltimore County, Maryland, to interconnections with interstate natural gas pipeline systems near Eagle, Pennsylvania.

### "Point(s) of Delivery" means the point or points on Transporter's Pipeline Facilities where Transporter delivers Natural Gas to or for the account of Shipper.

### "Point(s) of Receipt" means the point or points on Transporter's Pipeline Facilities where Transporter receives from Shipper or for Shipper's account Natural Gas to be transported through Transporter's Pipeline Facilities. 

### "Pre-arranged Replacement Shipper" and "PRS" mean the entity designated by Releasing Shipper prior to the released capacity being posted on the Website system in accordance with Section 21 of these GT&C.

### "Primary Point(s) of Delivery" means the Point(s) of Delivery set forth on Exhibit "A" to Shipper's Rate Schedule FTS Service Agreement.

### "Primary Point(s) of Receipt" means the Point(s) of Receipt set forth on Exhibit "A" to Shipper's Rate Schedule FTS Service Agreement.

### "Psia" means pounds per square inch absolute. One psia equals 6.896 kiloPascal (kPa) absolute.

### "Psig" means pounds per square inch gauge. One psig equals 6.896 kiloPascal (kPa) gauge.

### "Recourse Rate" means the maximum reservation rate and/or usage rate (plus surcharges), as applicable, as currently shown on Sheet No. 8 of this Tariff.

### "Releasing Shipper" means a Shipper receiving service pursuant to a Service Agreement under Rate Schedule FTS of Transporter's Tariff that releases firm capacity in accordance with Transporter's capacity release program as set forth in Section 21 of these GT&C.

### "Replacement Shipper" means any Person who obtains released capacity in accordance with Transporter's capacity release program as set forth in Section 21 of these GT&C.

### "Request" means a request for service which meets the requirements of Section 10 of these GT&C.

### "Request Date" means the date on which a Request is considered valid under Section 10 of these GT&C.

### "Scheduled Quantity" means the quantity of Natural Gas that Shipper nominates in accordance with Section 11 of these GT&C, and that is confirmed in accordance with Section 11.3 of these GT&C.

### "Secondary Point(s) of Delivery" means the point or points on Transporter's Pipeline Facilities where Transporter delivers Natural Gas to or for the account of Shipper, which Point(s) are not set forth on Exhibit "A" to Shipper's Rate Schedule FTS Service Agreement, and are thus not Primary Point(s) of Delivery.

### "Secondary Point(s) of Receipt" means the point or points on Transporter's Pipeline Facilities where Transporter receives from Shipper or for Shipper's account Natural Gas to be transported through Transporter's Pipeline Facilities, which Point(s) are not set forth on Exhibit "A" to Shipper's Rate Schedule FTS Service Agreement, and are thus not Primary Point(s) of Receipt.

### "Service Agreement" means the agreement executed by the Shipper and Transporter under any Rate Schedule of Transporter's Tariff and any exhibits, attachments, and/or amendments thereto.

### "Shipper" means a Person who executes a Service Agreement with Transporter for transportation service under any Rate Schedule of Transporter's Tariff or, for purposes of Section 10 of these GT&C, a Person who submits a Request to Transporter.

### "Tariff" means Transporter's FERC Gas Tariff, including but not limited to Rate Sheets, Rate Schedules, General Terms & Conditions, and Forms of Service Agreement, as may be revised and effective from time to time.

### "Thermally Equivalent Quantities" means the thermal quantities of Natural Gas received by Transporter at the Point(s) of Receipt less Transporter's Use Gas.

### "Total Heating Value" means the number of Btu's produced by the complete combustion with air, at constant pressure, of 1 anhydrous (dry) Cubic Foot of Natural Gas, at a temperature of sixty degrees (60°) Fahrenheit and under a pressure of 14.73 psia, and when the products of combustion are cooled to the initial temperature of the Natural Gas and air and all water formed by combustion is condensed to the liquid state.

### "Transporter" means Mid-Atlantic Express, L.L.C..

### "Transporter's Use Gas" means the amount of Natural Gas used in Transporter's operations including all Natural Gas used for compression or heaters, or otherwise used, lost or unaccounted for, and gas tendered as compensation for fuel (if any) and losses to others who provided transportation and/or compression services (if any) for or on behalf of Transporter. 

### "Website" means Transporter's site on the Internet at \<http://www.mid-atlanticexpress.com\>, through which Transporter's electronic communication service is accessible. 

SHEETS RESERVED FOR FUTURE USE

### Sheet Nos. 57-63 are reserved for future use. {#sheet-nos.-57-63-are-reserved-for-future-use. .unnumbered}

#  QUALITY

> The quality specifications herein shall apply to all Natural Gas
> delivered to Transporter by Shipper or for Shipper's account under
> Rate Schedule FTS, Rate Schedule ITS, and any other Rate Schedule
> pursuant to which Transporter may be authorized to provide service.

## Total Heating Value

### Natural Gas delivered hereunder shall have a Btu content of not less than 1000 Btu per Cubic Foot.

### The heating value of the Natural Gas shall be determined by gas chromatographic analysis using AGA 3-1994 factors or any revision thereof or by any other method(s) of analysis mutually agreed upon by Connecting Party and Transporter.

## Specifications

> All Natural Gas delivered or caused to be delivered by Shipper or for
> Shipper's account to Transporter shall conform to the following
> quality specifications:

### shall be free from objectionable odors, solid matter, dust, gums, and gum forming constituents, or any other substance which might interfere with the merchantability of the gas stream, or cause interference with proper operation of the lines, meters, regulators, or other appliances through which it may flow;

### shall contain not more than seven (7) pounds of water vapor per one thousand (1,000) MCF;

### shall contain not more than one quarter (1/4) grain of hydrogen sulfide per one hundred (100) Cubic Feet of Gas;

### shall contain not more than ten (10) grains of total sulfur per one hundred (100) Cubic Feet of Gas;

### shall contain not more than a combined total three percent (3%) by volume of carbon dioxide and/or nitrogen;

###  shall contain not more than one quarter percent (¼%) by volume of oxygen;

### shall have a temperature of not more than one hundred twenty (120) degrees Fahrenheit; and

### shall not have a hydrocarbon dewpoint of greater than twenty-five (25) degrees Fahrenheit at any operating pressure. The hydrocarbon dewpoint shall be determined in accordance with approved methods in use in the gas industry, using apparatus approved by Transporter. 

## Testing

> Testing to determine constituents shall be made by approved standard
> methods in general use in the gas industry or as mutually agreed upon.
> Such testing shall be performed by Transporter at intervals of not
> more than every twelve (12) months; provided, however, that Shipper
> shall have the right to be present at the time of any such testing.

## Failure to Conform

### If the Natural Gas tendered by Shipper or for Shipper's account to Transporter at the Point(s) of Receipt shall fail at any time to conform to any of the specifications set forth in Sections 3.1 and 3.2 or in Transporter's reasonable judgment may cause harm to its Pipeline Facilities or diminish the quality of Natural Gas in Transporter's Pipeline Facilities, then Transporter shall notify Shipper of any such failure to conform and Transporter shall have the right to refuse to accept all or any portion of such quality-deficient Natural Gas. In the event Transporter refuses to accept Natural Gas tendered by Shipper or for Shipper's account because such Natural Gas does not conform to the specifications set forth herein, Shipper shall not be relieved of its obligation to pay any reservation charges under Rate Schedule FTS. If the Natural Gas tendered by Transporter to Shipper or for Shipper's account at the Point(s) of Delivery shall fail at any time to conform to any of the specifications set forth in this Section 3, then Shipper shall notify Transporter of such deficiency and Transporter shall make a diligent effort to correct such failure by treatment consistent with prudent operations and by means that are economically feasible in Transporter's opinion so as to deliver Gas conforming to the specifications set forth in this Section 3. If Transporter is unable to redeliver Gas conforming to the above specifications, Shipper may at its option suspend delivery of all or a portion of the Gas to be transported.

### Nothing in this Section 3 shall limit Transporter's right, to be exercised on a not unduly discriminatory basis, to waive any quality specifications set forth in this Section 3, where the acceptance of non-conforming Gas will not in the reasonable judgment of Transporter adversely impact Transporter's Pipeline Facilities or operations.

### Shipper shall indemnify and hold harmless Transporter from any loss, cost, damage, or expense incurred by Transporter as a direct or indirect result of Shipper's failure to comply with the provisions of this Section 3.

## Injected Condensates

> Transporter shall have no obligation to accept into its Pipeline
> Facilities injected condensates.

## Commingling

> Transporter shall have the unqualified right to commingle Natural Gas
> transported hereunder with Natural Gas from other sources and to treat
> and handle all such Natural Gas as its own. It is recognized that
> Natural Gas delivered at the Point(s) of Delivery may not be the same
> molecules of Natural Gas as those received at the Point(s) of Receipt.
> The quantities of Natural Gas delivered hereunder at the Point(s) of
> Delivery shall be Thermally Equivalent Quantities of the Natural Gas
> received at the Point(s) of Receipt. To the extent Shipper or any
> other Person elects not to exercise its rights, if any, to process its
> Natural Gas for the removal of liquids and liquefiable hydrocarbons,
> Transporter shall have the unqualified right to process or cause to be
> processed such Natural Gas for the purpose of retaining, among other
> things, liquids and liquefiable hydrocarbons and ownership of such
> liquids and liquefiable hydrocarbons shall be vested in Transporter so
> long as Transporter redelivers Thermally Equivalent Quantities of
> Natural Gas to Shipper. For any period for which Shipper elects to
> process or cause to be processed its Natural Gas, Shipper shall
> process all quantities of Natural Gas shipped hereunder.

#  PRESSURE

## Receipt Pressure Obligations

> Shipper shall deliver or cause to be delivered Natural Gas to
> Transporter at pressures sufficient to enter Transporter's Pipeline
> Facilities at such working pressures maintained by Transporter at each
> Point of Receipt; provided, however, that such pressure shall not
> exceed the maximum allowable operating pressure ("MAOP") at such
> Point(s) of Receipt.

## Delivery Pressure Obligations

> Transporter shall deliver Natural Gas hereunder to Shipper or for
> Shipper's account at the Point of Delivery at the prevailing line
> pressure in Transporter's Pipeline Facilities as such prevailing line
> pressure may vary from time to time, unless otherwise agreed in
> writing between Transporter and Shipper.

#  MEASUREMENT & MEASUREMENT EQUIPMENT

## Determination of Quantity

> The quantity of Natural Gas received and delivered by Transporter to
> Shipper or for Shipper's account hereunder shall be measured according
> to Boyle's and Charles' Laws for the measurement of Natural Gas under
> varying pressures and temperatures with deviations therefrom as
> provided in Section 5.1(i) and shall be determined as follows.

### The unit of measurement for the purpose of service under any of Transporter's Rate Schedules shall be one (1) Dth, which is the heat energy equivalent of one (1) MMBtu. The number of MMBtu's delivered shall be determined by multiplying the number of Cubic Feet of Natural Gas received or delivered, measured on the measurement basis hereinafter specified, by the Total Heating Value of such Natural Gas, in Btu's per Cubic Foot, and by dividing the product by one million (1,000,000).

### The unit of quantity for the purposes of measurement shall be one (1) Cubic Foot of Natural Gas at a temperature of sixty degrees (60º) Fahrenheit, at a pressure of 14.73 psia. 

### The unit of weight for the purpose of measurement hereunder shall be one (1) pound mass of Natural Gas.

### The average absolute atmospheric pressure shall be assumed to be 14.4 psia.

### The flowing temperature of the Natural Gas shall be determined in accordance with industry standards for the purposes of measured volume correction.

### The specific gravity of the Natural Gas flowing through the meters shall be determined by Natural Gas chromatographic analysis of representative composite samples, or continuous sampling methods, unless otherwise mutually agreed upon by Connecting Party and Transporter.

### When orifice meters are used, the computation of quantities of Natural Gas delivered shall be in accordance with the published recommendations of the AGA's Report No. 3 (ANSI/API 2530), as revised September 1992, and as such report may be further revised, and any subsequent amendments thereof, or as may be mutually agreed upon by Connecting Party and Transporter. 

### The Total Heating Value shall be measured, unless otherwise agreed by Transporter and Connecting Party, by methods in accordance with acceptable industry practice such as, but not limited to, Natural Gas chromatograph(s) located at appropriate points. 

### The deviation of the Natural Gas delivered hereunder from Boyle's and Charles' Laws shall be determined in accordance with, but not limited to, the published recommendations of the AGA's Report No. 3, as revised 1992 and as such report may hereafter be further revised, and the American National Standards Institute as Transporter deems to be in accordance with accepted industry practice.

## Measurement Operations and Equipment

> Measurement operations shall include, but not be limited to, the
> operation, calibration, and testing of transducers, chart records,
> meter runs, Natural Gas quality monitoring devices, and control
> valves, as well as the responsibility for quantity calculations for
> the measurement facility. Transporter may allow third parties the
> right to perform measurement operations; provided, however that such
> third party furnishes to Transporter all data required for flow
> computations and can meet Transporter's measurement and operating
> standards; provided further, each third party which performs such
> measurement operations shall be responsible for any and all associated
> costs of such measurement operations unless otherwise agreed to by
> Transporter and such third party. Measurement equipment shall consist
> of the necessary metering devices, designed and installed in
> accordance with the current published recommendations of the American
> Gas Association or as mutually agreed upon by Connecting Party and
> Transporter; provided, however, Transporter shall have the right to
> require and may install or cause to be installed electronic Natural
> Gas measurement and control equipment at all points.

### Where orifice measurement equipment is to be used, orifice meter installation shall conform to the recommendations for design and installation contained in AGA Report No. 3, as revised September 1992 and as such report may hereafter be further revised or as may be mutually agreed upon by Connecting Party and Transporter.

### Turbine meter installation shall conform to the recommendations for design and installation contained in Natural Gas Measurement Committee Report No. 7 of the AGA, as published in 1996 and as such report may hereafter be further revised or as may be mutually agreed upon by Connecting Party and Transporter.

### Positive displacement meter installation shall conform to generally accepted engineering practices in the industry or as may be mutually agreed upon by Connecting Party and Transporter.

### Use of ultrasonic measurement equipment, to the extent Transporter employs ultrasonic metering devices, will conform to recommendations for the design and installation of such equipment contained in AGA Report No. 9, as published in 1998 and as such report may hereafter be further revised or as may be mutually agreed upon by Connecting Party and Transporter.

## Access to Equipment and Records

> Transporter and Connecting Party shall have the right to be present at
> the time of any installing, reading, cleaning, changing, repairing,
> inspecting, testing, calibrating, or adjusting done in connection with
> the other's equipment used in measuring receipts and deliveries
> hereunder. The records from such measurement equipment shall remain
> the property of their owner, but upon request each will submit to the
> other its records and charts, together with calculations therefrom,
> for inspection and verification, subject to return within thirty (30)
> days after receipt thereof.

## Check Measurement Equipment

> Connecting Party may install, operate, and maintain, at its own
> expense, such check measurement equipment as it shall desire,
> provided, however, that such equipment shall be so installed
> immediately upstream of the Point(s) of Receipt or immediately
> downstream of the Point(s) of Delivery so as not to interfere with the
> operation of other, including Transporter's, measurement equipment or
> to increase any risk of damage to Transporter's Pipeline Facilities or
> of injury to any person. Transporter shall have access to such check
> measurement equipment at all reasonable hours, but the reading,
> calibrating, and adjusting thereof and the changing of charts shall be
> done only by Connecting Party.

## Pressure Protection

> Pressure regulation, pressure over-ride, and pressure relief valve or
> other pressure limiting devices installed and operated by Transporter
> at the measuring station or near each interconnection of Transporter's
> Pipeline Facilities with facilities of third parties shall only be for
> the purpose of operation and protection of Transporter's measurement
> equipment and Transporter's Pipeline Facilities.

## Test of Meters

> The accuracy of Transporter's and Connecting Party's measurement
> equipment shall be verified by Transporter and Connecting Party at
> reasonable intervals and, if requested, in the presence of
> representatives of Transporter and Connecting Party.

### Transporter and Connecting Party shall not be required to verify the accuracy of meter equipment including natural gas chromatograph equipment more frequently than once in any thirty (30) day period, or in accordance with the requirements of the agency(ies) having jurisdiction, or in accordance with Shipper's Service Agreement, whichever of these requirements is more stringent.

### Subject to the provisions of paragraph (a) of this Section 5.6, either Transporter or Connecting Party, after written request, may secure a prompt verification of the other's measurement equipment, provided that the expense of any special test shall be borne by the requesting party if the measurement equipment is found to be in error by not more than one percent (1%).

### Any errors or discrepancies found during testing shall be corrected immediately whenever possible or as soon thereafter as procurement of repair parts, materials, and tools can be arranged.

## Measurement Equipment Inaccuracy and Failure

> The quantity of Natural Gas received and delivered by Transporter and
> delivered to Shipper or for Shipper's account hereunder during periods
> when the measurement equipment is out of service or registering
> inaccurately shall be estimated as follows:

### If, upon test, any measurement equipment, the readings of which are used in the registration, integration, or computation of quantities of Natural Gas hereunder, is found to be in error to the extent that it introduces not more than one percent (1%) measurement error in the individual measurement equipment affected, previous records of such equipment shall be considered accurate.

### If, upon test, any such above measurement equipment is found to be in error, to the extent that it causes the registered or computed quantities of the instrument(s) so affected to be in error by an amount exceeding one percent (1%), such instrument(s) affected shall be corrected to zero (0) error for any part of the period since the last test in which such error is known to have existed or which may be agreed upon by representatives of Transporter and Connecting Party. In case the period of such error is not known definitely or agreed upon, such correction shall be for a period of one-half (½) of the elapsed time since the date of the last test, but not exceeding a correction period of thirty (30) days.

### If no tests have been performed to determine the degree of inaccuracy, or measurement equipment is out of service, the quantity of Natural Gas shall be estimated as follows:

> \(1\) by using the registration of any existing and agreed upon check
> equipment considered by Transporter or Connecting Party to be
> registering accurately, or in the absence of such equipment,
>
> \(2\) by correcting the error, if the quantity of percentage of error
> is ascertainable by calibration, test, or mathematical calculation, or
> if neither of the two foregoing procedures are applicable,
>
> \(3\) by relating the quantity of receipt or delivery to receipts or
> deliveries during periods under similar conditions when the
> measurement equipment was deemed to have been registering accurately.

## Electronic Natural Gas Measurement ("EGM") Technical Requirements

### Accuracy. Where EGM is used, the system shall use instruments designed to provide overall measurement accuracy of ±1.0% of flow, taking into account all the sources of error, including calibrated span of instruments, linearity, hysteresis, repeatability, ambient temperature, stability, vibration, and power supply fluctuation. 

### Computation. The Remote Terminal Unit (RTU) shall, at a minimum, perform flow calculations per AGA-3, AGA-7 and AGA-9 requirements, as appropriate. As the flow calculation methods are revised from time to time, new releases shall be implemented within twelve (12) months from the release date. At Transporter's option, Transporter may use other methods of computation which are generally accepted in the industry.

### Calibration and Testing Equipment. All test and calibration equipment shall be certified and maintained pursuant to Transporter's current published standard operating procedures as revised from time to time.

## Preservation of Records

> Each party shall preserve for a period of at least two (2) years, or
> such longer period as may be required by the Federal Energy Regulatory
> Commission, all test data, charts, and other similar records.

## Control of Flow

> Transporter shall control flow of Natural Gas into and out of its
> Pipeline Facilities at all measurement facilities, but may allow the
> following, if all of Transporter's operating standards and
> requirements, including the requirements of Section 15, are met: (a)
> third parties to control flow into Transporter's Pipeline Facilities
> and (b) third parties to control flow out of Transporter's Pipeline
> Facilities, but Transporter reserves the right to override the
> third-party's flow control equipment.

## Maintenance

### Major maintenance shall include, but not be limited to, the repair or replacement of major components and equipment required to support the measurement operations. For measurement facilities that a Connecting Party owns and for which Transporter performs measurement operations, such Connecting Party shall be responsible for any and all associated costs of such major maintenance unless otherwise agreed by Transporter and Connecting Party.

### Routine maintenance shall be the normal day-to-day maintenance required to support the measurement operations as necessary to upkeep the measurement facility and shall include but not be limited to, replacement of minor parts for instrumentation, measurement equipment, and minor valves and piping. The entity (Transporter or Connecting Party) which performs the measurement operations for the measurement facility shall also be responsible for such routine maintenance and any and all associated costs of such routine maintenance unless otherwise agreed by Transporter and Connecting Party.

## Prior Period Adjustments

> The cutoff for the closing of measurement data is five (5) Business
> Days after the business month, unless any downstream pipeline to which
> Natural Gas is delivered by Transporter requires such data in a
> shorter period, in which case such shorter period shall be the
> deadline, as agreed by Transporter and the downstream pipeline.
> Missing or late measurement data shall be estimated by the measuring
> party. Any measurement data or corrections received by Transporter
> after it has closed the previous month of flow shall be handled as a
> prior period adjustment. Transporter shall process late measurement
> data or corrections of measurement errors as soon as practicable.
> Measurement data corrections should be processed within six (6) months
> of the production month with a three (3) month rebuttal period. This
> standard shall not apply in the case of deliberate omission or
> misrepresentation or mutual mistake of fact. The other statutory or
> contractual rights of Transporter or Shipper shall not otherwise be
> diminished by this standard. The correction shall be made to the Month
> of flow with a restated line item and a new total quantity of gas for
> the specific Day(s) and the respective Month.

#  WARRANTY OF TITLE

> Shipper warrants for itself, its successors, and assigns, that it will
> have, at the time of delivery of Natural Gas to Transporter for
> transportation hereunder, good and merchantable title to the Natural
> Gas to be delivered to Transporter's Pipeline Facilities and that all
> such Natural Gas shall be free and clear of all liens, encumbrances,
> and claims whatsoever, or good right to tender Natural Gas for
> transportation (and all necessary authorizations related thereto).
> Transporter warrants for itself, its successors, and assigns, that the
> Natural Gas it delivers hereunder to or for the account of Shipper
> shall be free and clear of all liens, encumbrances, and claims
> whatsoever arising out of or relating to Transporter's transportation
> of Natural Gas. Each party will indemnify the other and save it
> harmless from all suits, actions, debts, accounts, damages, costs,
> losses, and expenses arising from or out of the indemnifying party's
> breach of the foregoing warranty, including adverse claims of any and
> all Persons to said Natural Gas and/or to royalties, taxes, license
> fees, or charges thereon which are applicable for such delivery of
> Natural Gas, and that each will indemnify the other and save it
> harmless from all taxes or assessments which may be levied and
> assessed upon such delivery and which are by law payable by, and the
> obligation of, the party making such delivery. If Shipper's title or
> right to deliver Natural Gas to Transporter is questioned or involved
> in any action, Shipper shall not qualify for, and shall be ineligible
> to continue to receive, service until such time as Shipper's title or
> right to deliver is free from question; provided, however, Transporter
> shall allow Shipper to qualify for or continue receiving service under
> this Tariff if Shipper furnishes a bond and undertakings as to title
> satisfactory to Transporter. Title to the Natural Gas received by
> Transporter at the Point(s) of Receipt shall not pass to Transporter
> except that title to Transporter's Use Gas shall pass to Transporter
> at the Point(s) of Receipt.

#  POSSESSION OF NATURAL GAS

## Control of Natural Gas

> Transporter shall be deemed to be in control and possession of the
> Natural Gas upon receipt of such Natural Gas at the Point(s) of
> Receipt until it shall have been delivered to Shipper or for Shipper's
> account at the Point(s) of Delivery. Transporter shall not be deemed
> to be in control or possession of such Natural Gas either prior to
> such receipt by Transporter or after such delivery.

## Responsibility

> Transporter shall have no responsibility with respect to any Natural
> Gas or on account of anything which may be done, happen, or arise with
> respect to such Natural Gas before receipt of such Natural Gas by
> Transporter or after delivery of such Natural Gas by Transporter, and
> Shipper shall have no responsibility with respect to any Natural Gas
> or on account of anything which may be done, happen, or arise with
> respect to such Natural Gas while such Natural Gas is in Transporter's
> possession so long as such Natural Gas meets Transporter's
> specifications under Sections 3 and 4. The party deemed to be in
> control and possession of the Natural Gas to be transported shall be
> responsible for and shall indemnify the other party with respect to
> any losses, claims, liabilities, or damages (except punitive or
> consequential damages) arising therefrom.

#  BILLING AND PAYMENT 

## Billing

### On or before the ninth (9th) Business Day of each Month, Transporter shall render Shipper an invoice and any required backup data setting forth the total quantity of Natural Gas, stated in Dekatherms, received from or for the account of Shipper for transportation through Transporter's Pipeline Facilities and all applicable charges for transportation services rendered in the preceding month chargeable to Shipper under the applicable Rate Schedule and Service Agreement. Invoices will be based on actuals (if available) or best available data. If actual quantities are not available by the ninth (9th) Business Day of the month, Transporter may invoice based on best available data subject to adjustment to actuals at a later date. Unless otherwise agreed, transportation invoices should state the net billing rate, rather than the maximum discount tariff rate and the discount amount. The imbalance statement should be rendered prior to or with the invoice, and the transportation invoice should be prepared on or before the ninth (9th) Business Day after the end of the production month. Rendered is defined as postmarked, time-stamped, and delivered to the designated site. {#on-or-before-the-ninth-9th-business-day-of-each-month-transporter-shall-render-shipper-an-invoice-and-any-required-backup-data-setting-forth-the-total-quantity-of-natural-gas-stated-in-dekatherms-received-from-or-for-the-account-of-shipper-for-transportation-through-transporters-pipeline-facilities-and-all-applicable-charges-for-transportation-services-rendered-in-the-preceding-month-chargeable-to-shipper-under-the-applicable-rate-schedule-and-service-agreement.-invoices-will-be-based-on-actuals-if-available-or-best-available-data.-if-actual-quantities-are-not-available-by-the-ninth-9th-business-day-of-the-month-transporter-may-invoice-based-on-best-available-data-subject-to-adjustment-to-actuals-at-a-later-date.-unless-otherwise-agreed-transportation-invoices-should-state-the-net-billing-rate-rather-than-the-maximum-discount-tariff-rate-and-the-discount-amount.-the-imbalance-statement-should-be-rendered-prior-to-or-with-the-invoice-and-the-transportation-invoice-should-be-prepared-on-or-before-the-ninth-9th-business-day-after-the-end-of-the-production-month.-rendered-is-defined-as-postmarked-time-stamped-and-delivered-to-the-designated-site. .unnumbered}

## Payment

> Shipper shall make payment to Transporter for the services performed
> or charges levied hereunder during the preceding calendar month by
> wire transfer to such address as Transporter may hereafter designate,
> no later than ten (10) Days after the postmark or time-stamp on
> Transporter's billing statement. If the tenth (10th) day shall fall
> upon a weekend or legal holiday, then such payment shall be made on
> the last regular Business Day prior to such tenth (10th) day. The
> party making payment should submit supporting documentation; the party
> receiving payment should apply payment per supporting documentation
> provided by the paying party; and if payment differs from invoiced
> amount, remittance detail should be provided with the payment except
> when payment is made by electronic funds transfer (EFT), in which
> case, the remittance detail is due within two (2) Business Days of the
> payment due date. Shipper shall identify invoice number(s) on all
> payments.

## Disputed Invoice

## If any invoice is in dispute, Shipper shall pay the portion not in dispute and provide documentation identifying the basis for the dispute. Such payment shall not be deemed to be a waiver of any right of Shipper to recoup any overpayment, nor shall acceptance of any payment be deemed to be a waiver by Transporter of its right to collect any underpayment. The parties shall cooperate in good faith to resolve such dispute as expeditiously as possible, and the portion, if any, of such disputed amount eventually determined to be due shall bear interest at the rate stated in Section 8.4 from the original due date until the date actually paid. {#if-any-invoice-is-in-dispute-shipper-shall-pay-the-portion-not-in-dispute-and-provide-documentation-identifying-the-basis-for-the-dispute.-such-payment-shall-not-be-deemed-to-be-a-waiver-of-any-right-of-shipper-to-recoup-any-overpayment-nor-shall-acceptance-of-any-payment-be-deemed-to-be-a-waiver-by-transporter-of-its-right-to-collect-any-underpayment.-the-parties-shall-cooperate-in-good-faith-to-resolve-such-dispute-as-expeditiously-as-possible-and-the-portion-if-any-of-such-disputed-amount-eventually-determined-to-be-due-shall-bear-interest-at-the-rate-stated-in-section-8.4-from-the-original-due-date-until-the-date-actually-paid. .unnumbered}

##  Interest on Unpaid Amounts

> Should Shipper fail to pay any amount when due, interest on the unpaid
> amount shall accrue at the rate equal to the rate then set forth in
> Section 154.501(d) of the Commission's Regulations from the date
> payment was due until payment is made.

## Suspension and Termination of Transportation Service in the Event of Default

### Suspension of Service

### If Shipper's failure to make payment continues for twenty (20) Days or more, Transporter may suspend the further transportation of Natural Gas upon fifteen (15) Days' prior written notice to Shipper and the Commission, and the exercise of such right shall be in addition to any other remedy available to Transporter; provided, however, that if Shipper, in good faith, shall dispute the amount of any such bills or parts thereof and shall pay to Transporter in a timely manner such amounts as it concedes to be correct (accompanied by supporting documentation, including invoice number, remittance detail which Transporter shall follow in applying such payment, and the basis for dispute) and, at any time thereafter within thirty (30) Days of a demand made by Transporter, shall furnish a good and sufficient surety bond in an amount and with sureties satisfactory to Transporter conditioned upon the payment of any amounts ultimately found due after a final determination, which may be reached either by agreement or by an arbitration award or a judgment of the courts, as the case may be, then Transporter shall not be entitled to suspend further delivery of Natural Gas unless and until default be made in the conditions on such bond. In the event it is finally determined or agreed that no payments were due from Shipper on such disputed bills, then Transporter will reimburse Shipper for the cost of procuring the surety bond within ten (10) Days after receipt of a detailed invoice thereof from Shipper. {#if-shippers-failure-to-make-payment-continues-for-twenty-20-days-or-more-transporter-may-suspend-the-further-transportation-of-natural-gas-upon-fifteen-15-days-prior-written-notice-to-shipper-and-the-commission-and-the-exercise-of-such-right-shall-be-in-addition-to-any-other-remedy-available-to-transporter-provided-however-that-if-shipper-in-good-faith-shall-dispute-the-amount-of-any-such-bills-or-parts-thereof-and-shall-pay-to-transporter-in-a-timely-manner-such-amounts-as-it-concedes-to-be-correct-accompanied-by-supporting-documentation-including-invoice-number-remittance-detail-which-transporter-shall-follow-in-applying-such-payment-and-the-basis-for-dispute-and-at-any-time-thereafter-within-thirty-30-days-of-a-demand-made-by-transporter-shall-furnish-a-good-and-sufficient-surety-bond-in-an-amount-and-with-sureties-satisfactory-to-transporter-conditioned-upon-the-payment-of-any-amounts-ultimately-found-due-after-a-final-determination-which-may-be-reached-either-by-agreement-or-by-an-arbitration-award-or-a-judgment-of-the-courts-as-the-case-may-be-then-transporter-shall-not-be-entitled-to-suspend-further-delivery-of-natural-gas-unless-and-until-default-be-made-in-the-conditions-on-such-bond.-in-the-event-it-is-finally-determined-or-agreed-that-no-payments-were-due-from-shipper-on-such-disputed-bills-then-transporter-will-reimburse-shipper-for-the-cost-of-procuring-the-surety-bond-within-ten-10-days-after-receipt-of-a-detailed-invoice-thereof-from-shipper. .unnumbered}

### Termination of Service Agreement

> In addition to Transporter's right to suspend service under paragraph
> (a) above, if Shipper fails to make the payments due to Transporter
> under any Rate Schedule in accordance with this Section 8 of these
> GT&C, then following sixty (60) Days' notice to Shipper by Transporter
> of its intent to terminate Shipper's Service Agreement for reason of
> such non-payment, Transporter shall have the right, in addition to any
> and all other remedies available at law or in equity, to terminate
> Shipper's Service Agreement hereunder if Shipper fails to cure such
> non-payment within such sixty (60) Day period; provided, however, if
> Shipper, in good faith, disputes the amount of any such bill or
> portion thereof and pays to Transporter in a timely manner such
> amounts as it concedes to be correct, Transporter shall not have the
> right to terminate Shipper's Service Agreement; and provided further,
> Transporter shall have all of the rights set out in this Section 8 of
> these GT&C.

## Prepayment in the Event of Default

> Upon default in payment for a period in excess of twenty (20) Days,
> Transporter may require as a condition to the continuation or
> recommencement of transportation services a deposit or other
> acceptable credit arrangement in an amount equal to not more than
> three (3) estimated maximum monthly bills for transportation services
> at the rates stated in Shipper's Service Agreement, which estimated
> maximum monthly bills shall be based on Shipper's actual bills for
> transportation services received from Transporter during the preceding
> three (3) months.

## Right to Audit 

## Both Transporter and Shipper shall have the right at their own expense to examine and audit at any reasonable time the books, records (including measurement, billing and payment) and charts of the other to the extent necessary to verify the accuracy of any statements or charges made under or pursuant to any of the provisions of Shipper's Service Agreement. Upon request, Shipper shall also make available to Transporter for audit purposes any relevant records of the Transporter to which Shipper has access. A formal audit of accounts shall not be made more often than once each Contract Year. Any inaccuracy will be promptly corrected when discovered; provided, however, that neither Transporter nor Shipper shall be required to maintain books, records, or charts for a period of more than two (2) Contract Years following the end of the Contract Year to which they are applicable. Neither Transporter nor Shipper shall have any right to question or contest any charge or credit if the matter is not called to the attention of the other in writing within two (2) years after the end of the Contract Year in which the applicable charge or credit occurs. {#both-transporter-and-shipper-shall-have-the-right-at-their-own-expense-to-examine-and-audit-at-any-reasonable-time-the-books-records-including-measurement-billing-and-payment-and-charts-of-the-other-to-the-extent-necessary-to-verify-the-accuracy-of-any-statements-or-charges-made-under-or-pursuant-to-any-of-the-provisions-of-shippers-service-agreement.-upon-request-shipper-shall-also-make-available-to-transporter-for-audit-purposes-any-relevant-records-of-the-transporter-to-which-shipper-has-access.-a-formal-audit-of-accounts-shall-not-be-made-more-often-than-once-each-contract-year.-any-inaccuracy-will-be-promptly-corrected-when-discovered-provided-however-that-neither-transporter-nor-shipper-shall-be-required-to-maintain-books-records-or-charts-for-a-period-of-more-than-two-2-contract-years-following-the-end-of-the-contract-year-to-which-they-are-applicable.-neither-transporter-nor-shipper-shall-have-any-right-to-question-or-contest-any-charge-or-credit-if-the-matter-is-not-called-to-the-attention-of-the-other-in-writing-within-two-2-years-after-the-end-of-the-contract-year-in-which-the-applicable-charge-or-credit-occurs. .unnumbered}

## Prior Period Adjustments

> In the event an error is discovered in any invoice rendered by
> Transporter pursuant to a Service Agreement, Transporter or Shipper,
> whichever discovered the error, must identify to the other such error,
> including the amount, in writing within the prior period adjustment
> time limits; otherwise the invoice will be deemed correct. Prior
> period adjustment time limits should be six (6) months from the date
> of the initial transportation invoice and seven (7) months from the
> date of initial sales invoice with a three (3) month rebuttal period,
> excluding government-required rate changes. This standard shall not
> apply in the case of deliberate omission or misrepresentation or
> mutual mistake of fact. Parties' other statutory or contractual rights
> shall not otherwise be diminished by this standard.

#  NOTICES

## General Notices

> Except as otherwise provided in these GT&C, any notice, request, or
> demand concerning service under any Service Agreement shall be given
> in writing and sent by First-Class U.S. mail, registered mail, or
> certified mail postage prepaid, or by overnight courier service to the
> address specified in the Service Agreement; provided, however, that
> such notices, reports, or other communications shall be deemed to be
> in writing and properly sent if given by electronic mail (e-mail),
> telephone, fax, or through Transporter's Website as provided in
> Section 20 or other electronic measures, provided further, that in the
> event notice is communicated by e-mail, telephone, fax, or on
> Transporter's Website it shall be confirmed by delivery of the
> communication by overnight courier service, provided further, that
> notices of OFOs shall be issued in accordance with Section 18.4 of
> these GT&C.

## Alternative Notice

> Transporter and Shipper may agree in writing to an alternative method
> of giving notice to those specified in Section 9.1. Any such agreed
> upon alternative method of giving notice shall remain effective until
> rescinded by either party by giving prior written notice to the other
> party.

#  SERVICE REQUESTS AND CONTRACTING FOR SERVICE

## Requests for Service

### Transporter shall accept written transportation Requests for firm service under Rate Schedule FTS in accordance with this Section 10.1, provided that Transporter shall not be obligated to provide service at less than the applicable maximum rate.

### The transportation service Request Date for all Requests for firm transportation service under Rate Schedule FTS shall be the date Transporter receives a valid request pursuant to this Section 10, as such date is evidenced on Shipper's Service Request Form by a postmark, delivery service datemark or, if by electronic communication, the date of receipt shown on Transporter's computer. All such requests received on the same Day shall be deemed to have the same date, and if the sum of all Requests for firm service under Rate Schedule FTS exceeds the certificated capacity of Transporter's Pipeline Facilities, then the available firm capacity shall be allocated in the order of the highest economic value of the bids to Transporter on a Net Present Value basis, using as a discount factor the FERC-approved interest rate as such rate may be in effect from time to time. All capacity related to such unsatisfied Requests for firm service under Rate Schedule FTS having the same economic value to Transporter shall be allocated among Shippers on a pro rata basis.

## Information Required

### All Shippers seeking service from Transporter must provide the information required by this Section 10 and must submit a Service Request Form, available on Transporter's Website, containing the information described therein. Requests will be entered on Transporter's log, as required by the Commission's regulations, and Natural Gas will be scheduled for receipt or delivery provided the preceding requirements have been satisfied and Shipper's credit evaluation pursuant to Section 10.4 is satisfactory. In the event Transporter determines that Shipper's Request does not comply with this Section 10.2, or if Shipper's credit evaluation does not comply with Section 10.4, Transporter shall notify Shipper of the deficiencies and the additional information or changes required to complete the Request. Transporter shall undertake reasonable efforts to provide such notice of deficiency within fourteen (14) Days of receipt of Shipper's Request for service. Shipper shall have the right for a period of fourteen (14) Days after such notice to supplement Shipper's Request as required to comply with this Section 10. If Shipper's Request, as supplemented within said fourteen (14) Days after such notice, is satisfactory, then Shipper's original Request Date shall be utilized for purposes of Transporter's log, as required by the Commission's regulations. If Shipper's Request, as supplemented within said fourteen (14) Days, remains incomplete and deficient, then Shipper's Request shall be rejected, without prejudice to Shipper submitting a new Request in compliance with this Section 10.2. 

### If Shipper's Request for service and credit evaluation comply with this Section 10 and Transporter accepts Shipper's Request, Transporter will tender a Service Agreement to Shipper. In the event the Service Agreement is not executed by Shipper and returned within ten (10) days following the date on which Transporter tendered the Service Agreement to Shipper, Transporter shall consider the Request invalid and the Service Agreement shall be void and Transporter shall refund any prepayment paid or return any security given by Shipper pursuant to Section 10.3 plus the accrued interest from the date payment is received until the refund is sent to Shipper. Such accrued interest shall be computed in a manner consistent with Section 154.501(d) of the Commission's Regulations.

### In addition to any specific requirements set forth in the applicable Rate Schedule, all firm transportation Requests shall be subject to the following conditions:

> \(1\) No Request for transportation from a Point of Receipt or to a
> Point of Delivery shall be considered valid or be granted if to do so
> would impair Transporter's ability to render existing services to
> Shippers pursuant to Transporter's Rate Schedule FTS.
>
> \(2\) Subject to the provisions of Section 10.2(c)(1), the addition of
> or changes to Primary Point(s) of Receipt or Primary Point(s) of
> Delivery to a firm Service Agreement within Shipper's MDQ will not be
> considered a new transportation service for purposes of complying with
> this Section 10. Any Shipper receiving permission from Transporter to
> use any new Primary Point(s) of Receipt or new Primary Point(s) of
> Delivery within Shipper's MDQ shall be deemed to have complied with
> the requirements of this Section 10 for purposes of receiving priority
> in contracting for such new Primary Point(s) of Receipt or new Primary
> Point(s) of Delivery for firm transportation over any third-party
> subsequently requesting firm transportation under a firm Rate Schedule
> at that Point of Receipt or Point of Delivery as a Primary Point of
> Receipt or Primary Point of Delivery if, at the time of Shipper's
> request, said third party's request has not been accepted by
> Transporter. The priority for such new Primary Point(s) of Receipt or
> Primary Point(s) of Delivery shall be determined in accordance with
> this Section 10.

### No Requests will be processed until Shipper has provided to Transporter a completed Service Request Form, including information regarding any specific affiliation with Transporter. All completed Service Requests Forms must be sent using Transporter's Website or by U.S. Postal Service, by express mail, by courier, or by facsimile, to

MID-ATLANTIC EXPRESS, L.L.C.

\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_

\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_

\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_

\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_

\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_(Facsimile)

### Submission of the Request shall constitute certification of the following:

> \(1\) Shipper has or will have title or a current contractual right to
> acquire title to or to ship the Natural Gas to be transported by
> Transporter.
>
> \(2\) Prior to the commencement of service, Shipper has or will enter
> into all necessary third-party agreements to transport the Natural Gas
> to the Point(s) of Receipt on Transporter's Pipeline Facilities and
> from the Point(s) of Delivery on Transporter's Pipeline Facilities to
> the party ultimately receiving the Natural Gas.
>
> \(3\) If Shipper is requesting service hereunder to be implemented
> pursuant to Section 311 of the Natural Gas Policy Act of 1978,
> certification must be executed by the local distribution company or
> the intrastate pipeline company, on whose behalf the transportation
> will be performed, whether or not such local distribution company or
> intrastate pipeline is the Shipper, that the local distribution
> company or intrastate pipeline (1) will have physical custody of and
> transport the Natural Gas at some point during the transaction of
> which the transportation by Transporter is a part; or (2) will hold
> title to the Natural Gas at some point for a purpose related to its
> status and functions as a local distribution company or intrastate
> pipeline; or (3) that the Natural Gas will be delivered to a Shipper
> that is located within the local distribution company's service area
> and the transportation is being provided on its behalf; or (4) that
> the Natural Gas will be delivered to a Shipper that is physically able
> to receive direct deliveries of Natural Gas from the intrastate
> pipeline and the transportation is being provided on its behalf.

## Prepayment

> If requesting any firm service, Shipper shall make a prepayment by
> wire transfer in an amount equal to the lesser of the reservation
> charge for one month of service or \$10,000. The prepayment, plus the
> accrued interest from the date payment is received until the date
> service commences, shall be applied to the first month's invoice, and
> to the invoices of subsequent month(s), as necessary, until the amount
> is fully credited. The accrued interest herein shall be computed in a
> manner consistent with Section 154.501(d) of the Commission's
> Regulations.

## Creditworthiness

> Transporter shall apply, on a non-discriminatory basis, consistent
> financial evaluation standards to determine the acceptability of a
> Shipper's overall financial condition. Such credit appraisal and any
> further or ongoing credit appraisal as may be necessary shall be based
> mainly upon the information and criteria listed in (a)-(c) below. A
> Shipper with an ongoing business relationship with Transporter shall
> have no delinquent balances outstanding for services made previously
> by Transporter, and Shipper must have paid its account according to
> the established terms and not made deductions or withheld payment for
> claims not authorized by contract.

### Shipper shall provide any reasonable information required by Transporter in connection with transportation services pursuant to this Tariff, including information relating to the Shipper's supply of Natural Gas, the deliverability of such Natural Gas and upstream transportation arrangements.

### Shipper shall provide Transporter within one hundred twenty (120) days after the end of each fiscal year of Shipper, current audited financial statements, annual reports, 10-K reports, or other filings with regulatory agencies which discuss Shipper's financial status; a list of all corporate affiliates, parent companies, and subsidiaries; and any reports from credit reporting and bond rating agencies which are available. Transporter may accept unaudited consolidated financial statements. Transporter shall determine the acceptability of the Shipper's overall financial condition.

### Upon execution and delivery of the Service Agreements, Shipper will comply with one of the following creditworthiness requirements:

> \(1\) The Shipper, or an Affiliate Guarantor, has a credit rating of
> at least "Ba1" by Moody's Investors Service LLC, or a rating of at
> least "BB" by Standard & Poor's Corporation. A Shipper who qualifies
> under this category initially but is later downgraded to a lower
> credit rating, or whose Affiliate Guarantor qualifies under this
> category initially but is later downgraded to a lower credit rating,
> will be required to qualify under another category below.
>
> \(2\) A Shipper, or an Affiliate Guarantor, whose long term senior
> unsecured debt does not have a rating from a recognized rating agency
> equivalent to that listed in Section 10.4(c)(1), above, will be
> accepted as creditworthy if Transporter determines that, based on
> individual circumstances, Shipper or the Affiliate Guarantor has
> demonstrated creditworthiness through a letter of credit or other
> financial security or credit assurance deemed sufficient by
> Transporter, or through proofs such as good credit history, credit
> references, banking relationships, and/or net worth and cash flow, to
> be deemed acceptable by Transporter. Shipper will not be subject to
> having its acceptance under this category revoked unless there has
> been a material adverse change in the financial criteria relied on at
> the time of acceptance.

## Failure to Meet Creditworthiness Criteria 

### Transporter shall notify a Shipper in writing of its failure to satisfy the creditworthiness criteria, and the reasons therefor, within ten (10) Days of Transporter's creditworthiness determination and provide recourse for Shipper to challenge such determination. 

### Upon written notification by Transporter that Shipper has failed to satisfy the credit criteria, such Shipper may still obtain credit approval by Transporter if it elects to provide:

> \(1\) within thirty (30) Days, a Letter of Credit or a cash deposit,
> in an amount equal to the sum of three (3) months' anticipated
> reservation charge revenues from Shipper based on the rates in
> Shipper's Service Agreement for service pursuant to its Firm
> Transportation Service Agreement. Transporter will accrue interest for
> the account of Shipper on any cash deposit at the simple prime rate of
> interest for the application period offered by Citibank N.Y. or any
> successor of Citibank N.Y. A Letter of Credit must be in a form
> reasonably acceptable to Transporter. Such security shall be adjusted
> annually to reflect any change in the anticipated reservation charge
> revenues for the succeeding twelve (12) months; and
>
> \(2\) within five (5) Days, payment for one month of service in
> advance.
>
> Any Shipper who qualifies under paragraphs (1) or (2) above by virtue
> of an Affiliate guaranteeing the obligations of the Shipper shall
> provide an irrevocable undertaking from the Affiliate to guarantee the
> Shipper, and shall provide the undertaking to guarantee concurrently
> with the execution of a Service Agreement. Such guarantee shall be in
> a form acceptable to Transporter.

### If Shipper's credit standing ceases to meet Transporter's credit requirements during the period of service, then Transporter has the right to require security or a deposit as specified in Section 10.5(b). If Shipper does not tender the required security or a deposit within the time period(s) specified in Section 10.5(b), then Transporter is not required to continue service. If Shipper is unable to maintain acceptable credit, the executed Service Agreement may be terminated after thirty (30) Days' written notice to the Shipper and the FERC. 

#  NOMINATIONS

## Nomination Procedures

### General

> \(1\) Shipper shall nominate Natural Gas for transportation under its
> Service Agreement(s) by notifying Transporter of the daily quantity of
> Natural Gas expressed in Dth (including Transporter's Use Gas) it has
> available for transportation at each Point of Receipt and of the daily
> quantity of Natural Gas it desires to have delivered at each Point of
> Delivery, in accordance with the nomination cycles set forth in
> Section 11.1(b). Quantities nominated at Point(s) of Receipt less
> Transporter's Use Gas shall equal the nominated quantities at Point(s)
> of Delivery; provided, however, if the nomination is to cure an
> imbalance, such nomination shall not be required to be balanced.
>
> \(2\) All nominations should include Shipper defined begin dates and
> end dates. All nominations excluding intraday nominations should have
> roll-over options. Specifically, Shippers should have the ability to
> nominate for several days, months or years, provided the nomination
> begin and end dates are within the term of Shipper's contract. Unless
> Shipper wishes to change its nomination, Shipper shall not be required
> to resubmit its nomination during the period bounded by the begin date
> and end date.
>
> \(3\) Nominations shall be submitted to Transporter through
> Transporter's Website. Transporter shall not be obligated to accept
> nominations in excess of Shipper's MDQ; provided, however, Shipper
> shall nominate at each Point of Receipt a quantity sufficient to
> include any Transporter's Use Gas that Shipper is required to tender
> to Transporter in accordance with this Tariff.
>
> \(5\) For the purposes of this Section 11, "provide" shall mean, for
> transmittal pursuant to NAESB Standard No. 1.4.x, receipt at the
> designated site, and for purposes of other forms of transmittal, it
> shall mean send or post.

### The standard nominations timeline cycles are as follows:

### (1) The Timely Nomination Cycle: 11:30 a.m. for nominations leaving control of the nominating party; 11:45 a.m. for receipt of nominations by Transporter (including from Title Transfer Tracking Service Providers (TTTSPs)); noon to send Quick Response; 3:30 p.m. for receipt of completed confirmations by Transporter from upstream and downstream Connected Parties; 4:30 p.m. for receipt of scheduled quantities by Shipper and point operator (Central Clock Time on the day prior to flow). {#the-timely-nomination-cycle-1130-a.m.-for-nominations-leaving-control-of-the-nominating-party-1145-a.m.-for-receipt-of-nominations-by-transporter-including-from-title-transfer-tracking-service-providers-tttsps-noon-to-send-quick-response-330-p.m.-for-receipt-of-completed-confirmations-by-transporter-from-upstream-and-downstream-connected-parties-430-p.m.-for-receipt-of-scheduled-quantities-by-shipper-and-point-operator-central-clock-time-on-the-day-prior-to-flow. .unnumbered}

> \(2\) The Evening Nomination Cycle: 6:00 p.m. for nominations leaving
> control of the nominating party; 6:15 p.m. for receipt of nominations
> by the Transporter (including from TTTSPs); 6:30 p.m. to send Quick
> Response; 9:00 p.m. for receipt of completed confirmations by
> Transporter from upstream and downstream Connected Parties; 10:00 p.m.
> for Transporter to provide scheduled quantities to affected shippers
> and point operators, and to provide scheduled quantities to bumped
> parties (notice to bumped parties), (Central Clock Time on the day
> prior to flow). Scheduled quantities resulting from an Evening
> Nomination that does not cause another Service Requester on
> Transporter to receive notice that it is being bumped should be
> effective at 9:00 a.m. on Gas Day; and when an Evening Nomination
> causes another Service Requester on Transporter to receive notice that
> it is being bumped, the scheduled quantities should be effective at
> 9:00 a.m. on Gas Day.
>
> \(3\) The Intraday 1 Nomination Cycle: 10:00 a.m. for nominations
> leaving control of the nominating party; 10:15 a.m. for receipt of
> nominations by the Transporter (including from TTTSPs); 10:30 a.m. to
> send Quick Response; 1:00 p.m. for receipt of completed confirmations
> by Transporter from upstream and downstream Connected Parties; 2:00
> p.m. for Transporter to provide scheduled quantities to affected
> shippers and point operators, and to provide scheduled quantities to
> bumped parties (notice to bumped parties), (Central Clock Time on the
> Gas Day). Scheduled quantities resulting from Intraday 1 Nominations
> should be effective at 5:00 p.m. on Gas Day.
>
> \(4\) The Intraday 2 Nomination Cycle: 5:00 p.m. for nominations
> leaving control of the nominating party; 5:15 p.m. for receipt of
> nominations by Transporter (including from TTTSPs); 5:30 p.m. to send
> Quick Response; 8:00 p.m. for receipt of completed confirmations by
> Transporter from upstream and downstream Connected Parties; 9:00 p.m.
> for Transporter to provide scheduled quantities to affected shippers
> and point operators (Central Clock Time on the Gas Day). Scheduled
> quantities resulting from Intraday 2 Nominations should be effective
> at 9:00 p.m. on Gas Day. Bumping is not allowed during the Intraday 2
> Nomination Cycle.

### Nominations received after nomination deadline should be scheduled after the nominations received before the nomination deadline.

### All nominations should be considered original nominations and should be replaced to be changed. When a nomination for a date range is received, each day within that range is considered an original nomination. When a subsequent nomination is received for one or more days within that range, the previous nomination is superseded by the subsequent nomination only to the extent of the days specified. The days of the previous nomination outside the range of the subsequent nomination are unaffected. Nominations have a prospective effect only.

### Make-up Nominations: Transporter will accept a nomination to make-up an estimated imbalance under Section 19, as long as the available information (e.g., metered volumes, estimated production reports, or confirmed nominations) indicates that an imbalance has been incurred, but if it is ultimately determined that no imbalance was incurred, Transporter will not be responsible in any manner to Shipper for accepting its make-up nomination.

### Transporter may accept in a not unduly discriminatory manner a nomination submitted by Shipper that does not comply with the requirements of this Section 11.1 if, in Transporter's reasonable judgment, the acceptance of such nomination will not adversely affect the timely processing by Transporter of all other Shippers' nominations which do comply hereunder and sufficient capacity is available to provide the requested service.

### The sending party should adhere to nomination, confirmation, and scheduling deadlines. It is the party receiving the request who has the right to waive the deadline.

## Intraday Nominations

### Shipper may revise its nomination in effect for any Day by submitting to Transporter a revised daily nomination in accordance with the intra-day nomination timeline. 

### An intra-day nomination is a nomination submitted after the nomination deadline whose effective time is no earlier than the beginning of the Gas Day and runs through the end of that Gas Day. Intra-day nominations can be used to request increases or decreases in total flow, changes to receipt points, or changes to delivery points of scheduled Gas.

### All nominations , including intraday nominations, should be based on a daily quantity; thus, an intraday nominator need not submit an hourly nomination. Intraday nominations should include an effective date and time. The interconnected parties should agree on the hourly flows of the intraday nomination, if not otherwise addressed in Transporter's contract or tariff.

### Intraday nominations do not rollover (i.e. intraday nominations span one day only). Intraday nominations do not replace the remainder of a standing nomination. There is no need to re-nominate if intraday nomination modifies existing nomination.

## Confirmation

Nominations will not become effective and are not eligible for
scheduling until Transporter has confirmed nominated receipts and
deliveries with Connecting Parties. It is Shipper's responsibility to
provide information necessary to enable Transporter to confirm the
nomination with Connecting Parties. If such confirmation cannot be
obtained, transportation service will be delayed until it is obtained.

## Ranking

> Shipper shall provide a predetermined priority (Rank) for all of the
> Point(s) of Delivery and associated quantities nominated under a
> Transportation Service Agreement in the event of an interruption or
> reduction in the receipts of Shipper's Gas by Shipper or third parties
> on Shipper's behalf at the Point of Delivery. Shipper shall also
> provide a predetermined priority at all Point(s) of Receipt at which
> Shipper has nominated Gas to be transported under a Transportation
> Service Agreement to be used by Transporter to limit the receipts of
> Gas from Shipper at the Point(s) of Receipt in the event of an
> interruption or reduction in the quantities of Gas that Shipper
> delivers or has delivered on Shipper's behalf to Transporter at
> Point(s) of Receipt. If Shipper fails to submit a Rank for a
> nomination, Transporter will assign to the nomination, by default, the
> lowest ranking.

# SERVICE SCHEDULING, SERVICE PRIORITY AND IMPAIRMENT OF DELIVERIES

## Scheduling

> Service is deemed scheduled after Shipper submits a nomination in
> accordance with Section 11 and Transporter confirms the nominated
> receipt of Natural Gas into the Pipeline Facilities and the nominated
> delivery of Natural Gas to Shipper or for Shipper's account. Until
> Transporter has informed Shipper that its nomination is confirmed,
> such Natural Gas quantities will not be deemed scheduled.

## Service Priority

### The quantities nominated for transportation by Shipper shall be scheduled by Transporter for receipt and delivery in the following order.

> \(1\) Firm transportation of Natural Gas from a Shipper's Primary
> Point(s) of Receipt and to its Primary Point(s) of Delivery.
>
> \(2\) Firm transportation of Natural Gas within the Contract Path from
> a Shipper's Secondary Point(s) of Receipt and/or Secondary Point(s) of
> Delivery.
>
> \(3\) Firm transportation of Natural Gas outside the Contract Path
> from a Shipper's Secondary Point(s) of Receipt and/or Secondary
> Point(s) of Delivery.
>
> \(4\) Interruptible transportation and transportation of Natural Gas
> shipped as Authorized Overrun in sequence starting with the rate most
> proximate to the maximum rate (expressed as a percentage of the
> maximum rate).
>
> \(5\) Quantities nominated for PALS Service in sequence starting with
> the daily parking rate most proximate to the maximum rate (expressed
> as a percentage of the maximum rate).

### Once service is nominated and scheduled during any Day under any Rate Schedule, such service shall not be bumped for the purpose of scheduling other quantities with equal or lower priority during the Day, except as further provided in Sections 12.3(a) and (b).

### In the event a tie for capacity exists within category 12.2(a)(4) or (5), quantities will be scheduled on a pro rata basis of nominated quantities.

### If Shipper fails to or otherwise is unable to accept the quantities of Natural Gas tendered at the confirmed Point(s) of Delivery on any Day, then Transporter may refuse to receive Natural Gas at the Point(s) of Receipt on such Day. Should Shipper fail to or otherwise be unable to tender quantities of Natural Gas at the Point(s) of Receipt on any Day, then Transporter may refuse to deliver Natural Gas at the confirmed Point(s) of Delivery on such Day.

## Impairment of Service

### Transporter shall have the unqualified right to interrupt transportation services until 5:00 p.m. CCT, unless such bumping affects transactions on another pipeline, under Rate Schedules ITS or PALS to provide service under Transporter's Firm Rate Schedule FTS. Interruptible services shall be interrupted in sequence starting with interruptible service charged the rate least proximate to the applicable maximum rate. Within each rate category of interruptible service, service shall be interrupted in sequence starting with the service most recently requested and, if necessary, pro rata by Request Date; provided, however, interruptible service charged the maximum rate shall be interrupted on a pro rata basis.

### Transporter shall have the right to curtail or discontinue transportation services under any Rate Schedule, in whole or in part, on all or a portion of its Pipeline Facilities, at any time for reasons of Force Majeure or when capacity or operating conditions so require. Routine repairs and maintenance will not disrupt confirmed service but will be planned through scheduling. Transporter shall provide Shipper such notice of the curtailment as is reasonable under the circumstances.

### In the event of curtailment pursuant to Section 12.3(b) caused by an event occurring on Transporter's Pipeline Facilities, excluding an event at a specific Point of Receipt or Point of Delivery, service shall be curtailed in the reverse order in which such service was scheduled in accordance with Section 12.2; provided, however, all firm transportation service shall be curtailed pro rata based on MDQ, among all Shippers receiving this service, provided a Shipper's entitlement to service shall not exceed its nomination. 

### If curtailment or interruption is caused by an event occurring at a specific Point of Receipt or Point of Delivery on Transporter's Pipeline Facilities, quantities will be curtailed based on the utilization of that Point as primary firm, secondary firm, or interruptible and in the reverse order in which such service was scheduled in accordance with Section 12.2; provided, however, all firm transportation service at the specific Point of Receipt or Point of Delivery shall be curtailed pro rata based on MDQ, among all Shippers receiving this service at the specific Point of Receipt or Point of Delivery, provided a Shipper's entitlement to service shall not exceed its nomination. 

### Without regard to any other remedy provided by law or by the provisions hereof, Transporter shall be entitled to seek an order from the Commission or any other appropriate tribunal requiring compliance with a curtailment or interruption order by Transporter in compliance with this Section 12, or any directive from any governmental authority having jurisdiction in the premises.

### All quantities received and/or taken in violation of Transporter's curtailment, OFO, or interruption orders (Excess Quantity) shall constitute unauthorized receipts or deliveries of Natural Gas for which a charge per Dth as determined below shall be assessed in addition to any other applicable rate, charge, or penalty. Such charge shall be applicable to all such unauthorized receipts and deliveries following notification of curtailment or interruption pursuant to Section 12.3(g), which may be given by telephone (and confirmed by either facsimile transmission or posted on Transporter's Website), or by any other reasonable means.

\% Excess Quantity

(Excess Quantity divided

by quantity specified in

Transporter's order with Charge per Dth

[result multiplied by 100)]{.underline} [of Excess Quantity]{.underline}

\*greater than zero and

equal to or less than 2 \$10

\*greater than 2: Higher of \$15 or 200% of the Gas Price

Index for the flow date on which the

Gas is transported.

### Transporter shall provide Shipper with notice of curtailment or interruption at a time and in a manner that is reasonable under then existing conditions, and shall in any event confirm in writing or by facsimile transmission the notice given if originally provided telephonically. Transporter shall also post the notice on its Website. Shipper shall have the responsibility to inform its end-users, suppliers, gatherers, other transporters, and all other parties involved in the transaction as to any curtailment or interruption.

### Shipper shall indemnify Transporter against and hold Transporter harmless from any and all damages, claims, suits, actions, or proceedings whatsoever threatened or initiated as a result of any curtailment or interruption of Shipper's service invoked by Transporter, which shall include any curtailment or interruptions described in any part of this Section 12 except if such damages, claims, suits, actions or proceedings are due to Transporter's gross negligence, undue discrimination, or willful misconduct, provided that Transporter shall be responsible for direct damages, if any, resulting from Transporter's own negligence.

## Emergency Situation

### In the event Transporter is advised by a Shipper that, absent adjustment of the curtailment level contemplated by Section 12.3(g), the Shipper will be unable for the duration indicated by the Shipper to avoid irreparable injury to life or property (including environmental emergencies) ("Emergency Situation"), then Transporter shall adjust its curtailment of all other Shippers on a pro rata basis as necessary to deliver the quantities required to avoid or mitigate the threatened or existing Emergency Situation to the extent practicable. While Transporter will make adjustments in curtailment promptly upon written notification by Shipper, Shipper must provide to Transporter within twenty-four (24) hours of notification a sworn statement including:

> \(1\) A detailed explanation of and an estimated duration of the
> Emergency Situation; and
>
> \(2\) Affirmation that, if the Emergency Situation is an environmental
> emergency, the Shipper has made and continues to make all feasible
> efforts to resolve the environmental emergency, including requests for
> waiver, exemption, and other relief from any regulation, directive,
> order, or other mandate of a governmental body.
>
> Shipper shall provide Transporter immediate written notice of the
> cessation of the Emergency Situation.

### Transporter shall provide notice to any Shipper that is further curtailed as a result of a request submitted by another Shipper under the Emergency Situation relief provisions of Section 12.4(a). Such notice shall be provided in a time and manner that is reasonable under then existing conditions but no later than within twenty-four (24) hours of such curtailment. In the event the Shipper requesting Emergency Situation relief provides the sworn statement required by Section 12.4(a), Transporter shall provide a copy of the sworn statement at the request of any Shipper curtailed to a lower quantity as a result of the anticipated sworn statement.

### Transporter shall not be liable for granting exceptions to the curtailment provisions of this Section 12 for any Shipper based upon a request submitted by any Shipper to Transporter under the Emergency Situation relief provisions of this Section 12.4. In the event Shipper does not provide the sworn statement as required by Section 12.4(a), then all quantities attributable to the adjustments made by Transporter shall be billed to that Shipper, in addition to all other charges, at a rate equal to three-hundred percent (300%) of the Gas Price Index. All revenues attributable to such charge shall be credited, pro rata, on the basis of the increase in curtailment caused by the invocation of Section 12.4(a) to those Shippers curtailed to a lower quantity as a result of the anticipated sworn statement. Notwithstanding any provision of this Section 12, however, Shipper shall not be entitled to relief under Section 12.4(a) to the extent that (1) an Emergency Situation is due to the Shipper's failure to have adequate transportation arrangements in effect for the delivery of Shipper's Natural Gas at the Point(s) of Receipt and Point(s) of Delivery in effect hereunder during the relevant period, or (2) the quantity of Natural Gas required to meet such Emergency Situation exceeds such Shipper's firm contractual rights.

### If Transporter is requested to grant relief under Section 12.4(a), then the requesting Shipper's bill for such Month shall be adjusted upward by an amount equal to the aggregate curtailment adjustment quantity requested by the Shipper, pursuant to Section 12.4(a), multiplied by the maximum reservation charge for Rate Schedule FTS. All revenues attributable to such adjustment shall be credited, on a pro rata basis, based on each Shipper's additional curtailment quantity due to the Emergency Situation, divided by the aggregate of all Shippers' additional curtailment quantities due to the Emergency Situation, to those Shippers curtailed as a result of the Emergency Situation.

### Natural Gas delivered to Transporter's Pipeline Facilities in violation of a notice of curtailment, OFO or interruption order shall constitute unauthorized receipts. Transporter shall provide Shipper reasonable notice of such curtailment or interruption orders, and Shipper shall be permitted three (3) hours, or such lesser time as is necessary, to maintain the physical and/or operational integrity of Transporter's Pipeline Facilities, to reduce its tenders in compliance with the curtailment or interruption orders. If Shipper does not reduce its deliveries to Transporter within such notice period, then Transporter shall have the right to seize and retain such unauthorized receipts, without any liability whatsoever for such action.

#  DETERMINATION OF RECEIPTS AND DELIVERIES

## Allocation of Actual Quantities at Point(s) of Receipt

### The upstream party providing the point confirmation should submit the pre-determined allocation to the allocating party after or during confirmation and before the start of the Gas Day. The allocation statement shall allocate the actual quantities of gas in Dth received each Day for the account of the Shippers at all of the various Points of Receipt onto Transporter. The allocation methodology types agreed upon are as follows (ranked, pro rata, percentage, swing and operator provided value): 

> \(1\) ranked by the order in which the Transportation Service
> Agreements are to be allocated to the extent Natural Gas is available;
>
> \(2\) pro rata based on confirmed nominations;
>
> \(3\) percentage of the Gas available for delivery at the Point of
> Receipt;
>
> \(4\) designation of a "swing" contract for receipt volume imbalances;
> or
>
> \(5\) operator provided value.

### If no predetermined allocation is received at a point, Transporter shall allocate quantities of Gas pro rata based on scheduled quantities.

### Each predetermined allocation statement and revision thereto must be received by Transporter, by facsimile or through Transporter's Website, prior to the time Transporter completes the confirmation of that Day's nominations. If there are no additions in nominations by a Shipper at a Point of Receipt or other changes, the current predetermined allocation statement will stay in effect as submitted until it is changed pursuant to the foregoing procedures.

### Transporter shall have the right to rely conclusively on the foregoing predetermined allocation for the purpose of determining the daily quantities of Natural Gas received by Transporter for the account of Shipper at each Point of Receipt.

### When the allocation method incorporated is pursuant to Section 13.1(a)(1), (3), or (4), a change in a nomination could require a change in the detail of the then existing allocation.

## Allocation of Actual Quantities at Point(s) of Delivery

### The downstream party providing the point confirmation should submit the pre-determined allocation to the allocating party after or during confirmation and before the start of the Gas Day. The allocation statement shall allocate the actual quantities of Gas in Dth delivered each Day for the account of the Shippers at all of the various Points of Delivery. The allocation methodology types agreed upon are as follows (ranked, pro rata, percentage, swing and operator provided value):

> \(1\) ranked by the order in which the Transportation Service
> Agreements are to be allocated to the extent Natural Gas is available;
>
> \(2\) pro rata based on confirmed nominations;
>
> \(3\) percentage of the Gas available for delivery at the Point of
> Delivery;
>
> \(4\) designation of a "swing" contract for receipt volume imbalances;
> or
>
> \(5\) operator provided value.

### If no predetermined allocation is received at a point, Transporter shall allocate quantities of Gas pro rata based on scheduled quantities.

### Each predetermined allocation statement and revision thereto must be received by Transporter, by facsimile or through Transporter's Website, prior to the time Transporter completes the confirmation of that Day's nominations. If there are no additions in nominations by a Shipper at a Point of Delivery or other changes, the current predetermined allocation statement will stay in effect as submitted until it is changed pursuant to the foregoing procedures.

### Transporter shall have the right to rely conclusively on the foregoing predetermined allocation for the purpose of determining the daily quantities of Natural Gas received by Transporter for the account of Shipper at each Point of Delivery.

### When the allocation method incorporated is pursuant to Section 13.2(a) (1), (3) or (4), a change in a nomination could require a change in the detail of the then existing allocation.

## Prior Period Adjustments

> Any allocation data or corrections received by Transporter after it
> has closed the previous month of flow shall be handled as a prior
> period adjustment. Transporter shall process late allocation data or
> corrections of allocation errors as soon as practicable but no later
> than the time limitation for disputes of allocations. The time
> limitation for disputes of allocations should be six (6) months from
> the date of the initial month-end allocation with a three (3) month
> rebuttal period. This standard shall not apply in the case of
> deliberate omission or misrepresentation or mutual mistake of fact.
> Any other statutory or contractual rights of Transporter or Shipper
> shall not otherwise be diminished by this standard. The correction
> shall be made to the month of flow with a restated line item and a new
> total quantity of Gas for the specific Day(s) and the respective
> Month.

#  SCHEDULING CHARGES AND PENALTIES

## If during any Day of the Month the actual daily quantity received by Shipper, in aggregate, at Point(s) of Receipt or the actual daily quantity delivered by Transporter to Shipper, in aggregate, at Point(s) of Delivery, varies in either case by more than five percent (5%) from the scheduled quantities at the applicable points in aggregate, a scheduling charge shall be assessed in each case on volumes in excess of 5%; provided, however, the scheduling charge shall not be assessed if the variance occurs solely because of Transporter's inability to accept or deliver Natural Gas, whichever is applicable. The scheduling charge shall be an additional charge equal to the maximum rate in effect under the Rate Schedule, multiplied by the quantities in excess of the allowed aggregate variance at Point(s) of Receipt and Point(s) of Delivery as applicable, provided that such charges shall not be applicable to the extent Shipper is subject to unauthorized overrun charges pursuant to Rate Schedule FTS, Section 7, for such quantities.

## If Transporter is experiencing capacity constraints or operational difficulties at certain Point(s) of Receipt or Point(s) of Delivery because of the variance between Shippers' scheduled quantities (including nominations for Authorized Overrun Service) and actual receipts and/or deliveries to or for Shippers' accounts, unless otherwise required to protect the integrity of the pipeline facilities, Transporter will give Shippers twenty-four (24) hours' notice prior to the start of the Day to which the notice applies that each Shipper must reduce its variance to five percent (5%) or less, and that Transporter will assess the scheduling penalty set forth in this Section 14.2. The notice shall list all Point(s) of Receipt and/or Point(s) of Delivery where the scheduling penalty will be assessed, and will remain in effect until Shippers are notified to the contrary. In the event that Transporter has issued a Notice pursuant to this Section 14.2, the scheduling penalty shall be the higher of \$15.00 or 200% of the Gas Price Index for the flow date on which the Gas is transported, multiplied by the quantities in excess of the allowed variance at Point(s) of Receipt and Point(s) of Delivery, as applicable. 

## Transporter shall provide Shipper reasonable notice and Shipper shall be permitted three (3) hours, or such lesser time as is necessary to maintain the physical and/or operational integrity of Transporter's Pipeline Facilities, to reduce its variance in compliance with the notice. If Shipper does not reduce its deliveries to Transporter within such notice period, then Transporter shall further have the right, without any liability whatsoever for such action, to seize and retain Natural Gas delivered to Transporter's Pipeline Facilities in violation of a notice provided pursuant to Section 14.2, or Section 18.4 if such action is necessary to maintain the physical and/or operational integrity of Transporter's Pipeline Facilities.

#  UNIFORM RATES OF FLOW

> All Natural Gas shall be delivered by Shipper or for the account of
> Shipper into Transporter's Pipeline Facilities at rates as constant as
> operationally feasible throughout the Day. Transporter shall not be
> obligated to accept or deliver Natural Gas under any Rate Schedule in
> excess of a uniform hourly rate of flow equivalent to 1/24th of the
> applicable daily nomination.

#  INSTALLATION OF FLOW CONTROL EQUIPMENT

> Transporter may elect to construct, install, and operate flow control
> equipment at any location on its Pipeline Facilities whenever it
> determines that such equipment will contribute to the safe, reliable,
> efficient, and orderly operation of its Pipeline Facilities in a
> manner that is consistent with its obligations to provide service
> under all of its Rate Schedules.

#  POINT(S) OF RECEIPT AND POINT(S) OF DELIVERY

## Addition of Primary Point(s) of Receipt and Delivery

### Subject to the terms of Section 10 of these GT&C and with the consent of Transporter, any Shipper receiving service under Rate Schedule FTS may request to add or delete Primary Point(s) of Receipt or Primary Point(s) of Delivery at any time during the term of such Shipper's Service Agreement, pursuant to the procedures in Section 17.1(b), and to the extent possible given the configuration of Transporter's system. 

### (1) A Shipper desiring to change its Primary Point(s) of Receipt and/or Primary Point(s) of Delivery shall notify Transporter on or before 5:00 p.m. CCT two (2) Days prior to the Gas Day on which it wants the change to be effective.

> \(2\) Shipper's notification shall include (i) the Primary Point(s) of
> Receipt and/or Primary Point(s) of Delivery to which it desires to
> designate as its Primary Point(s), (ii) the date on which it wants the
> change to be effective, (iii) the portion of its MDQ to be allocated
> to such Primary Point(s) of Receipt and/or Primary Point(s) of
> Delivery. Shipper's notification shall also include the Primary
> Point(s) of Receipt and/or Delivery from which it desires to change
> and the MDRO and/or MDDO to be changed for each such point.
>
> \(3\) Transporter shall advise Shipper on or before 10:30 a.m. CCT of
> the Day following Shipper's notification whether the requested
> change(s) in Primary Point(s) of Receipt and Primary Point(s) of
> Delivery are confirmed and satisfy Section 17.2(c).
>
> \(4\) Upon the receipt of Transporter's confirmation in Section
> 17.1(b)(3), the change(s) in Primary Point(s) of Receipt and/or
> Primary Point(s) of Delivery shall be effective on the date(s)
> requested by Shipper.
>
> \(5\) Upon the effectiveness of the change(s) in Point(s) of Receipt
> and/or Point(s) of Delivery, any such change(s) shall not have the
> effect of increasing or decreasing the contractual MDQ. After such
> change(s), any existing nominations shall be subject to scheduling
> under Section 12.

### Additions or deletions of Primary Point(s) of Receipt or Primary Point(s) of Delivery by a Shipper pursuant to Section 17.1 shall be permitted only to the extent that sufficient capacity exists to accommodate such request without impairing Transporter's ability to meet its existing obligations and provided further that such request, if granted, shall not cause Shipper's reservation charges paid to Transporter to decrease. Construction of new or physical expansion of existing Primary Point(s) of Receipt or Primary Point(s) of Delivery to Transporter's Pipeline Facilities will only be made pursuant to the terms of Section 27 of these GT&C.

## Secondary Point(s) of Receipt and Secondary Point(s) of Delivery

### Any Shipper receiving firm transportation service under Rate Schedule FTS shall be permitted to nominate service on a secondary basis at all Point(s) of Receipt and Point(s) of Delivery on Transporter's Pipeline Facilities in accordance with these GT&C and to the extent possible given the configuration of Transporter's system. Nominations for the receipt or delivery of Natural Gas at Secondary Point(s) of Receipt or Secondary Point(s) of Delivery shall be permitted only to the extent that: (1) sufficient capacity exists at such Point(s); and (2) Transporter's Pipeline Facilities can operationally accommodate such receipt or delivery.

### Any transportation from a Secondary Point of Receipt and/or to a Secondary Point of Delivery shall be at applicable maximum rates, unless Transporter shall agree otherwise. 

### For any Shipper receiving service under Rate Schedule FTS, the sum of the quantities of Natural Gas nominated at all Primary and Secondary Points of Receipt and at all Primary and Secondary Points of Delivery may not exceed the MDQ specified in each such Shipper's Service Agreement within the same segment of Transporter's system such that Shipper shall not transport a quantity of gas in excess of its MDQ at any Point of Delivery, Point of Receipt or within any one segment of Transporter's Pipeline Facilities.

## Segmentation of Capacity

### Any Shipper receiving firm transportation service may segment, to the extent operationally feasible and to the extent possible given the configuration of Transporter's system, either on a forward-haul or backhaul basis, its firm capacity rights for its own use or in connection with a capacity release pursuant to Section 21 of these GT&C. Service using segmented Point(s) of Receipt and Point(s) of Delivery shall not exceed Shipper's firm capacity rights on a forward-haul basis. There must be sufficient forward-haul to permit a requested segmented backhaul. 

### Shippers using segmented capacity may make forward haul and backhaul deliveries to the same point. In such a segmented transaction, the Shipper may exceed its MDQ at the same Point of Receipt or the same Point of Delivery and may nominate quantities of Gas in each segment up to Shipper's MDQ assigned to such segment. Shippers using segmented capacity may not make nominations in which the total of the segmentation of nominations on any overlapping segment exceeds the firm entitlements to the underlying segmented Service Agreement. If the Releasing Shipper and the Replacement Shipper nominate quantities of Gas in segments that overlap, the quantities shall be scheduled in accordance with Section 12.2(a) of these GT&C. If the quantities have equal priority and the sum of the quantities cannot be scheduled, the quantities shall be scheduled pro rata unless the Releasing Shipper specifies otherwise in its release notice. 

#  OPERATIONAL FLOW ORDERS

## General

> Transporter may issue OFOs to preserve the integrity of Transporter's
> Pipeline Facilities, to ensure adequate operating pressures, to have
> adequate supplies in the Pipeline Facilities, to assure adequate
> Transporter's Use Gas, to maintain firm services, and to optimize the
> operation of the system. Transporter may also issue OFOs on a not
> unduly discriminatory basis to respond to other unforeseen
> circumstances. To the extent possible, Transporter will identify
> discrete Shipper(s) whose action(s) require Transporter to issue an
> OFO(s) and Transporter will limit the applicability of the OFO(s) to
> such Shipper(s). Notwithstanding the foregoing, if Transporter is
> unable to identify discrete Shipper(s) whose action(s) require
> issuance of an OFO, any OFO will be applicable to all Shippers on the
> affected Pipeline Facilities.

## Circumstances Under Which an OFO May be Issued

> Transporter may issue an OFO in any circumstance which would, in
> Transporter's reasonable judgment, impair Transporter's ability to
> receive or deliver quantities of Gas in accordance with its service
> obligations including, but not limited to, when:

### operating pressures on the affected portion of the system are significantly less than or greater than normal system operating pressures despite Transporter's efforts to maintain normal pressures and a further decline or increase in operating pressures would impair Transporter's ability to receive or deliver Scheduled Quantities;

### a Shipper fails to maintain receipts or deliveries as required in this Tariff;

### unscheduled pipeline maintenance and repairs affect capacity;

### wells or pipelines or other essential equipment freeze to the extent that such freezing damages or destroys or otherwise impairs Transporter's essential facilities or ability to monitor and control essential facilities or results in the loss of supplies of Natural Gas from other pipelines or producers of Gas;

### a loss of Gas supply from producers, storage providers or other suppliers reduces pressure or supplies available for delivery;

### Federal or state rules, regulations, orders, such as safety inspection orders and environmental safety orders, require Transporter to reduce operating pressures in, or remove from service, a portion of Transporter's Pipeline Facilities;

### a mechanical or physical failure affects Transporter's ability to deliver or receive gas, including, but not limited to, pipeline failure, compressor failure, regulator failure, or other similar mechanical or physical failure;

### a partial or total failure of electronic and communications systems impairs Transporter's ability to monitor or control Transporter's system;

### external operations, including but not limited to highway construction, require Transporter to reduce operating pressures in, or remove from service, a portion of Transporter's Pipeline Facilities; or

### a Shipper's failure to comply with the provisions of this Tariff that adversely affects the operations of Pipeline Facilities including, but not limited to, a Shipper's failure to adhere to the quality of gas specifications set forth in Section 3 of these General Terms and Conditions.

## Transporter should attempt to minimize the use of operational flow orders and the declaration of critical periods and, when possible, should direct an operational flow order to the specific party(s) creating the operating condition. Actions to minimize the issuance and adverse consequences of an OFO may include, but are not limited to, requiring firm Shippers to utilize Primary Points of Receipt and Delivery and compliance with the provisions of this Tariff and the Service Agreement.

## Notices

> If Transporter is required to issue an OFO, Transporter will post a
> notice of such OFO on its Website, telecopy or e-mail the notice to
> all affected Shippers, with an explanation of the necessity of such
> order, the Shipper(s) to which the order is directed, and the
> anticipated duration of such order. To the extent discrete Shipper(s)
> are not identified in any notice of an OFO, such order will be
> applicable to all Shippers. Unless otherwise required to protect the
> integrity of the Pipeline Facilities, Transporter will post any notice
> of an OFO at least twenty-four (24) hours prior to such order becoming
> effective. Transporter will provide updated information concerning the
> need for the OFO on its Website and will post a notice informing
> Shipper(s) when any OFO in effect will be canceled. Within a
> reasonable time after the OFO terminates, Transporter will post on its
> Website a report detailing the conditions that required the issuance
> and termination of the OFO.

## OFO Penalties

> To the extent Transporter issues an operational flow order and
> Shipper(s) does not comply with such order, Transporter will assess
> and Shipper will be obligated to pay a charge pursuant to Section
> 12.3(f) for failure to comply with such order. Such fee will be
> assessed on each Dth of Natural Gas received into or delivered out of
> Transporter's Pipeline Facilities when such receipts and/or deliveries
> are not in compliance with any operational flow order in effect.
> Transporter shall provide Shipper reasonable notice of the OFO and
> Shipper shall be permitted three (3) hours, or such lesser time as is
> necessary to maintain the physical and/or operational integrity of
> Transporter's Pipeline Facilities, to reduce its tenders or receipts
> in compliance with the OFO. If Shipper does not reduce its deliveries
> to Transporter within such notice period, then Transporter shall have
> the right, without any liability whatsoever for such action, to seize
> and retain Natural Gas delivered to Transporter's Pipeline Facilities
> in violation of an operational flow order.

#  RESOLUTION OF IMBALANCES

## Shipper's Duty to Control Imbalances

> Subject to Section 14 of these GT&C, a Shipper receiving any
> transportation service from Transporter will use, or will cause any
> party receiving or delivering Shipper's Natural Gas to use, all
> reasonable efforts to ensure that receipts and deliveries of Natural
> Gas are equal to the quantities scheduled by Transporter.

## Imbalance Netting and Trading

> All daily imbalances accrued by Shipper during a Month under each of
> its Service Agreements will be combined to derive a "Net Monthly
> Imbalance" (NMI) (in Dth) for purposes of the calculations in Section
> 19.3. Shippers will be permitted to offset imbalances across contracts
> and trade imbalances amongst themselves when such imbalances have
> similar operational impact on the Transporter's Pipeline Facilities.
> If Transporter determines and can document that such trading will
> cause a loss of transportation revenue, Transporter will implement an
> appropriate charge such that it is made whole for all transportation
> charges. The following procedures will apply to imbalance trading
> amongst Shippers.

### Shipper may authorize contract imbalances under Shipper's Service Agreements to be posted for trading.

### Authorizations to post imbalances that are received by Transporter by 11:45 a.m. shall be effective by 8:00 a.m. the next Business Day (Central Clock Time). Imbalances previously authorized for posting shall be posted on or before the ninth (9th) Business Day of the Month.

### Transporter shall provide the ability to post and trade imbalances until at least the close of the seventeenth (17th) Business Day of the Month.

### Contract imbalances must be traded with contract imbalances in the opposite direction and such trade must move Shipper's imbalance closer to zero. When trading imbalances, a quantity must be specified.

### Transporter shall enable the imbalance trading process by:

> \(1\) Receiving the request for imbalance trade;
>
> \(2\) Receiving the imbalance trade confirmation;
>
> \(3\) Sending the imbalance trade notification; and
>
> \(4\) Reflecting the trade prior to or on the next monthly Shipper
> imbalance or cashout.

### Imbalance trades can only be withdrawn by the initiating Shipper and only prior to the confirming Shipper's confirmation of the trade. Imbalance trades are considered final when confirmed by the confirming Shipper and effectuated by Transporter. Imbalance trades shall be deemed to be effectuated when Transporter sends the imbalance trade notification.

### After receipt of an imbalance trade confirmation, Transporter shall send the imbalance trade notification to the initiating Shipper and the confirming Shipper no later than noon (Central Clock Time) the next Business Day. 

## Cashout Resolution of Monthly Imbalances

### Any remaining Shipper NMI after minimization in accordance with Section 19.2 herein, shall be cashed out on a monthly basis pursuant to the provisions herein. No imbalance penalty shall be imposed when a prior period adjustment applied to the current period would otherwise cause or increase a current Month cashout tier penalty. On or before the ninth (9th) Business Day after the end of the Month, Transporter will render to Shipper, for each Service Agreement, data specifying the difference (imbalance) which exists between (i) the actual Monthly quantities of Gas received from Shipper or for Shipper's account at the Point(s) of Receipt less Transporter's Use Gas and, (ii) the actual Monthly quantities of Gas delivered to Shipper or for Shipper's account at the Point(s) of Delivery.

### Imbalance Percentage

> The Imbalance Percentage for each Shipper shall be the absolute value
> of the Shipper's NMI divided by the summation of the actual quantities
> of Gas delivered to Shipper or for Shipper's account, as determined
> pursuant to Section 19.2(a).

### Imbalance Due Transporter

> When Shipper's NMI is the result of actual deliveries to Shipper
> exceeding actual receipts from Shipper, Shipper shall pay Transporter
> for Shipper's NMI (in Dth) an amount equal to the NMI multiplied by
> the average of the Gas Price Index for each Day in the Month, and that
> product multiplied by the Factor in accordance with the following
> schedule:
>
> Imbalance
>
> Percentage Factor
>
> \> 0% ≤ 2% 1.0
>
> \> 2% ≤ 5% 1.1
>
> \> 5% ≤ 10% 1.2
>
> \>10% ≤15% 1.3
>
> \>15% ≤ 20% 1.4
>
> \>20% 1.5

### Imbalance Due Shipper

> When Shipper's NMI is the result of actual receipts from Shipper
> exceeding actual deliveries to Shipper, Transporter shall pay Shipper
> for the NMI (in Dth) an amount equal to the NMI multiplied by the Gas
> Price Index for each Day in the Month, and that product multiplied by
> the Factor in accordance with the following schedule:
>
> Imbalance
>
> Percentage Factor
>
> \> 0% ≤2% 1.0
>
> \> 2% ≤5% 0.9
>
> \> 5% ≤ 10% 0.8
>
> \>10% ≤ 15% 0.7
>
> \>15% ≤ 20% 0.6
>
> \>20% 0.5
>
> In the event Shipper owes Transporter any payments under subsection
> (c), above, from a previous Month and which are past due, Transporter
> shall have the right hereunder to offset payments it owes to Shipper
> under this subsection (d) by such past due amounts.

### The provisions of Section 8 of these GT&C shall apply to payments due pursuant to Section 19.3(c). 

## Third-Party Imbalance Management Services

> Nothing in this tariff is intended to inhibit development of, or
> discriminate against the use of, imbalance management services
> provided by third parties or Transporter's Shippers. Any party
> interested in providing imbalance management services must coordinate
> with Transporter.

#  WEBSITE

## General

> Transporter maintains a FERC-compliant interactive Website on its
> electronic computer system.

## Submission of Information and Communications

> Unless specifically provided otherwise in this Tariff, the generic
> provisions of this Tariff requiring that notices, requests, and other
> communications be in writing may be satisfied by Shipper through
> submission of such communications over Transporter's Website, or
> through electronic data interchange where applicable. Transportation
> Service Agreement notices requiring communications to be in writing
> remain unchanged unless agreed to otherwise by the parties. Submission
> of information and communications through Transporter's Website shall
> be legally binding on Shipper and Transporter.

## Archived Information

> Any party with access to the Website will be able to download
> information provided thereon. Transporter shall maintain and retain
> daily back-up records of the information displayed on bulletin board
> for a period of three (3) years for purposes of restoring such
> information to on-line availability if there is a computer malfunction
> or loss. Completed transactions and posted information will remain on
> the Website for at least thirty (30) days and then will be archived.
> Archived information will be available from Transporter upon fifteen
> (15) Days' prior written notice. Copies of archived information will
> be made available at \$0.10 per page if a paper copy is requested or
> \$10.00 per diskette.

## Access to Transporter's Website

> To receive access to Transporter's Website, a Person must execute and
> comply with the terms of the Form of Service Agreement for electronic
> communication service as set forth in these GT&C. Such person shall be
> responsible for providing all computer equipment necessary to use and
> interface with the Website.

#  CAPACITY RELEASE

## Capacity Eligible for Release

### Shippers under Rate Schedule FTS shall be permitted to release their capacity on a temporary or permanent basis, in accordance with this Section 21. Capacity which may be assigned to the Replacement Shipper hereunder shall be limited to the firm capacity reserved by the Releasing Shipper, as defined by the Primary Points of Receipt and the Primary Points of Delivery contained in the released capacity. Releases may be made on an interruptible (i.e., subject to recall) or firm basis and may be billed by Transporter based on usage.

### Transporter shall continue to sell its unsubscribed firm capacity by providing notice of the availability of such capacity on the Website or by using any other marketing services at its disposal.

## Shipper Release Notice

### A Shipper that desires to release any or all of its firm capacity under this Section 21 must notify Transporter electronically on the Website of its intent to release capacity and the terms of the release (hereinafter referred to as "Shipper Notice"). A Shipper Notice shall be posted on the Website upon receipt by Transporter or such other time which must comply with the timeline set forth in Section 21.4(b) herein, as requested by Releasing Shipper. This Shipper Notice shall include:

> \(1\) Releasing Shipper's contract number;
>
> \(2\) The specific quantity of capacity to be released;
>
> \(3\) If the request for release is on a permanent basis;
>
> \(4\) The Points of Receipt and Points of Delivery at which Releasing
> Shipper will release capacity and the quantity of capacity to be
> released at each point;
>
> \(5\) The period of time or term of the release;
>
> \(6\) Whether the transportation rights are to be released on a firm
> or recallable basis and, if on a recallable basis, the specific
> conditions for recall of the capacity. Reput method and rights should
> be specified at the time of the capacity release. Reput method and
> rights shall be individually negotiated between the Releasing Shipper
> and Replacement Shipper;
>
> \(7\) Whether contingent bids will be accepted and when the
> contingency must be removed;
>
> \(8\) The identity of a PRS, if applicable;
>
> \(9\) The minimum rate, including the tariff reservation rate and all
> demand surcharges as a total number or as stated separately, expressed
> in dollars and cents or percentage of Maximum Tariff Rate, term, and
> quantity of capacity Releasing Shipper shall accept, if any, and
> whether bids using a volumetric rate for the collection of Reservation
> Charges will be accepted and whether Releasing Shipper requires a
> volumetric commitment. The maximum volumetric rate that may be bid
> shall not exceed the one hundred percent (100%) load factor equivalent
> of the maximum rate, which reservation rate equals the Authorized
> Overrun rate for the applicable service being released as set forth on
> the effective rate tariff sheets. Transporter shall support volumetric
> releases with volumetric commitments by fully accounting for
> volumetric and reservation components, consistent with the rules and
> regulations enunciated by the Commission. The maximum reservation rate
> that may be bid shall not exceed the Maximum Rate for the applicable
> service being released as set forth on the applicable currently
> effective tariff sheets;
>
> \(10\) The duration of the posting which may not be less than the
> minimum bid period specified in Section 21.4(b) herein;
>
> \(11\) The best bid criterion, the method by which volumetric or
> contingent bids will be evaluated, and any alternate, objective and
> nondiscriminatory method for breaking ties. The best bid evaluation
> method established by Releasing Shipper must be objectively stated,
> applicable to all PRS or Replacement Shippers and not unduly
> discriminatory and shall enable Transporter to rank the bids received
> by utilizing the weight assigned by Releasing Shipper to each element
> of the Shipper Notice;
>
> \(12\) If the release is for a period less than one Month, the
> Releasing Shipper may designate in the Shipper Notice the winning bid
> criterion to be the first acceptable bid received;
>
> \(13\) Restrictions, if any, on the PRS or Replacement Shipper's
> ability to request changes in primary Points of Receipt or primary
> Points of Delivery; and
>
> \(14\) Whether the Shipper Notice may be rejected in part in the event
> Transporter rejects such Shipper Notice pursuant to Section 21.7.

### Releasing Shipper shall post the Shipper Notice on the Website. Offers should be binding until written or electronic notice of withdrawal is received by Transporter. The releasing party has the right to withdraw its offer during the bid period, where unanticipated circumstances justify and no minimum bid has been made.

### The terms Releasing Shipper imposes may not conflict with any provision of the Service Agreement, Rate Schedule or General Terms and Conditions. In the event of such conflict, Transporter may withdraw the Shipper Notice from posting.

## Exceptions to Bidding

### At Shipper's option, a Shipper Notice for a release of thirty-one (31) Days or less with a designated PRS shall not be subject to the bidding process in accordance with Section 21.4 herein (exempt capacity release). An exempt capacity release shall not contain an evergreen provision and cannot be reassigned to the same PRS within twenty-eight (28) Gas Days from the termination of each release, except in the event the PRS is bidding the Maximum Rate or is bidding on a second release under a different Service Agreement.

### In the event Releasing Shipper presents a PRS that is on the approved bidders list, and such PRS agrees to pay the applicable Maximum Rate and agrees to all other conditions of the release prior to the submission of the Shipper Notice to Transporter, the released capacity will be assigned to the PRS and such Shipper Notice shall be exempt from the bidding process in accordance with Section 21.4 herein. The PRS will be posted as the winning bidder in accordance with Section 21.4(j) herein.

### When a Releasing Shipper presents a PRS that is on the approved bidders list, such Replacement Shipper initiates confirmations of prearranged deals electronically as a prerequisite to the awarding of the Shipper Notice.

## Bidding Process

### In order to submit a valid bid under this capacity release program, any party, including a PRS, must be on the approved bidders list. To be on the approved bidders list, a party must meet the provisions of Section 10 herein and have executed a capacity release service agreement with Transporter in the form as set forth in this Tariff (Capacity Release Form of Service Agreement). A party shall remain on the approved bidders list until such party notifies Transporter to the contrary, no longer meets the credit qualifications in Section 10.4 herein, or is suspended from the approved bidders list in the event and for such time as such party fails to pay part or all of the amount of any bill for service in accordance with Section 8 herein.

### The capacity release timeline is applicable to all parties involved in the Capacity Release process; however, it is only applicable if 1) all information provided by the parties to the transaction is valid and the acquiring Shipper has been determined to be creditworthy before the capacity release bid is tendered and 2) there are no special terms or conditions of the release. All times are stated as Central Clock Time:

> \(1\) For biddable releases (less than 1 year):
>
> -offers should be tendered by 12:00 P.M. on a Business Day;
>
> -open season ends no later than 1:00 P.M. on a Business Day
> (evaluation period begins at 1:00 P.M. during which contingency is
> eliminated, determination of best bid is made, and ties are broken);
>
> -evaluation period ends and award posting if no match required at 2:00
> P.M.;
>
> -match or award is communicated by 2:00 P.M.;
>
> -match response by 2:30 P.M.;
>
> -where match required, award posting by 3:00 P.M.;
>
> -contract issued within one hour of award posting (with a new contract
> number, when applicable); nomination possible beginning at the next
> available nomination cycle for effective date of contract. (Central
> Clock Time)
>
> \(2\) For biddable releases (1 year or more)
>
> -offers should be tendered by 12:00 P.M. four Business Days before
> award;
>
> -open season ends no later than 1:00 P.M. on the Business Day before
> timely nominations are due (open season is three Business Days);
>
> -evaluation period begins at 1:00 P.M. during which contingency is
> eliminated, determination of best bid is made, and ties are broken;
>
> -evaluation period ends and award posting if no match required at 2:00
> P.M.;
>
> -match or award is communicated by 2:00 P.M.;
>
> -match response by 2:30 P.M.;
>
> -where match required, award posting by 3:00 P.M.;
>
> -contract issued within one hour of award posting (with a new contract
> number, when applicable); nomination possible beginning at the next
> available nomination cycle for the effective date of the contract.
> (Central Clock Time)
>
> \(3\) For non-biddable releases:
>
> Timely Cycle
>
> -posting of prearranged deals not subject to bid are due by 10:30
> A.M.;
>
> -contract issued within one hour of award posting (with a new contract
> number, when applicable); nomination possible beginning at the next
> available nomination cycle for the effective date of the contract.
> (Central Clock Time)
>
> Evening Cycle
>
> -posting of prearranged deals not subject to bid are due by 5:00 P.M.;
>
> -contract issued within one hour of award posting (with a new contract
> number, when applicable); nomination possible beginning at the next
> available nomination cycle for the effective date of the contract.
> (Central Clock Time)
>
> Intraday 1 Cycle
>
> -posting of prearranged deals not subject to bid are due by 9:00 A.M.;
>
> -contract issued within one hour of award posting (with a new contract
> number, when applicable); nomination possible beginning at the next
> available nomination cycle for the effective date of the contract.
> (Central Clock Time)
>
> Intraday 2 Cycle
>
> -posting of prearranged deals not subject to bid are due by 4:00 P.M.;
>
> -contract issued within one hour of award posting (with a new contract
> number, when applicable); nomination possible at the next available
> nomination cycle for the effective date of the contract. (Central
> Clock Time)

### If the Releasing Shipper specifies a bid evaluation methodology other than highest rate, net revenue or present value, or a permanent release or any other special conditions, the above timelines shall apply; provided, however, one additional Business Day will be added to the evaluation period. Such extended evaluation period shall cause Gas flow to be at least one day later than Gas could flow under the timeline set forth in Section 21.4(b)(1) or Section 21.4(b)(2).

### Where there is a PRS and an offer which is better than the bid submitted by the PRS, Transporter will notify the PRS by 2:00 p.m. Central Clock Time on the day capacity is awarded and the PRS will have until 2:30 p.m. to match the better offer and obtain the right to the released capacity. Transporter shall issue an Addendum to the PRS unless a better bid, as defined in Section 21.2(a)(11) herein, is received within the time period specified in the posting. In the event the PRS does not match the better bid, Transporter shall issue an Addendum to the party who made the best bid.

### All bids must be expressed in dollars and cents or percents of Maximum Rate, whichever is stated in the Shipper Notice, include the required bid information and must be received and posted electronically through the Website. Bids shall be posted on the Website with any contingencies identified and with the bidder's identity deleted upon receipt, unless the Releasing Shipper requests otherwise. 

### A bidder may submit only one bid at a time in response to a Shipper Notice. A bidder may withdraw its bid through the Website at any time prior to the close of the posting period specified in the Shipper Notice without prejudice to its submitting another bid with an economic value equal to or greater than the economic value of the withdrawn bid. 

### Bids shall be binding until written or electronic notice of withdrawal is received by Transporter. Bids cannot be withdrawn after the bid period ends. 

### In the event that a winning bid has an unacceptable contingency, and Transporter is not notified through the Website that such contingency has been removed within the time period specified in the Shipper Notice, such contingent bid will be rejected by Transporter.

### The Releasing Shipper may define in the Shipper Notice the criteria for determining the best bid. If the Releasing Shipper does not specify the criteria, Transporter shall use the highest economic value basis calculation as set forth in Section 10.1 herein to determine the best bid. If there have been multiple bids meeting the minimum conditions, Transporter shall award the bids, best bid first, until all offered capacity is awarded. Transporter will notify, through the Website by 3:15 p.m. Central Clock Time following the end of the posting period, or by 5:00 p.m. Central Clock Time if a matching period is applicable, the PRS or Replacement Shipper that capacity has been awarded. 

### Transporter will post the winning bids and Replacement Shippers' identity on the Website for at least five Business Days.

## Rights and Obligations of Releasing Shipper

### Regardless of the amount of capacity Releasing Shipper releases under this Section 21, Releasing Shipper shall remain liable for the Reservation Charges attributable to the released capacity unless otherwise agreed to in writing and in advance by Transporter. In the event of a permanent release, Transporter may, and will not unreasonably refuse to, waive liability of Releasing Shipper for the Reservation Charges.

### When capacity is awarded to Replacement Shipper, Releasing Shipper must adjust or reconfirm its nominations to reflect the capacity released. Transporter may automatically change Releasing Shipper's nominations to zero for the Service Agreement under which capacity was released unless such nominations are adjusted or reconfirmed by the Releasing Shipper.

### If Releasing Shipper releases its MDQ for a geographic portion of the capacity reserved under its Service Agreement, Releasing Shipper may use its full MDQ for its unreleased geographic portion of capacity.

### When Releasing Shipper partially releases its capacity under a Service Agreement by releasing capacity between specific Points of Receipt and Points of Delivery or by releasing only a portion of its MDQ, Releasing Shipper's Service Agreement shall be deemed to be modified in accordance with the release and Releasing Shipper may not utilize the capacity released during the term of the release.

### Releasing Shipper shall retain all Rights of First Refusal with respect to the released capacity, unless such release is a permanent release.

### In the event of termination of a Replacement Shipper's Addendum pursuant to Section 21.6(c) herein, the released capacity related to such Addendum will revert to the Releasing Shipper.

\(g\) Releasing Shipper may, to the extent permitted as a condition of
the capacity release, recall released capacity (scheduled or
unscheduled).

## Rights and Obligations of Replacement Shipper

### Any bid submitted will bind Replacement Shipper or PRS to the terms of the bid if Transporter selects such bid as the best bid. If all the information provided by the Releasing Shipper, the bidder/PRS is valid, the Replacement Shipper is creditworthy, and there are no special terms and conditions, Transporter will issue and execute the Addendum to the Capacity Release Service Agreement within one hour of awarding the winning bid. 

### The capacity release addendum number will be issued within one hour of the award posting. Nomination is possible beginning at the next available nomination cycle for the effective date of the capacity release addendum; however, in no event will Gas flow on Replacement Shipper's Service Agreement prior to the effective date of the release as posted in the Shipper Notice.

### Replacement Shipper is responsible for payment of the applicable Reservation Charge, and any surcharges thereon, in the amount of its winning bid. Replacement Shipper is also responsible for all other billings, e.g., usage rate and applicable usage surcharges. In the event of payment default, subject to Section 8 herein, Transporter may elect to terminate that Replacement Shipper's Capacity Release Service Agreement which shall terminate all service thereunder utilized by the Replacement Shipper.

### Once Replacement Shipper or PRS is notified of a winning bid, such Replacement Shipper or PRS shall have all the rights and obligations specified under the Releasing Shipper's Rate Schedule, the Releasing Shipper's Service Agreement and the General Terms and Conditions of this Tariff including the right to release firm capacity pursuant to this Section unless the conditions prescribed by the Shipper Notice require otherwise. Transporter shall allow re-releases on the same terms and basis as the primary release (except as prohibited by regulations).

### Replacement Shipper shall have no Right of First Refusal with respect to the released capacity, unless such release is permanent.

## Rights and Obligations of Transporter

### Transporter shall determine the best bid based upon the best bid criteria established pursuant to Section 21.2(a)(11) or Section 21.4(i) herein. Transporter shall have the right, but not the obligation, to reject, in whole or in part, the terms of any Shipper Notice or bid which is discriminatory or conflicts with any order or regulation issued by the FERC, or provision of the Service Agreement, Rate Schedule or General Terms and Conditions. Such Shipper Notice shall be rejected in its entirety unless Shipper, pursuant to Section 21.2(a)(14), permits a partial rejection. Transporter shall provide notification to Shipper, through the Website, of the reason(s) for rejecting a release notice with the notice of rejection. 

### Transporter shall not have any liability to any Shipper, Releasing Shipper, Replacement Shipper, PRS, bidder or any other party as a result of Transporter's performance of its obligations under its capacity release program, and any such Shipper, Releasing Shipper, Replacement Shipper, PRS, and bidder shall indemnify Transporter from and against any and all losses, damages, expenses, claims, suits, actions and proceedings whatsoever threatened, incurred or initiated as a result of Transporter's performance hereunder, except to the extent such loss, damage, expense, claim, suit, action or proceeding is the result of Transporter's gross negligence, undue discrimination or willful misconduct, provided that Transporter shall be responsible for direct damages, if any, resulting from Transporter's own negligence. 

## Recall Notification

### If the Releasing Shipper retains recall rights, Releasing Shipper's offer to release capacity shall clearly specify the conditions precedent to such recall. The Releasing Shipper shall provide capacity recall notification to Transporter via the Website. The recall notification shall specify the recall notification period for the specified effective Gas Day, as well as any other information needed to uniquely identify the capacity being recalled. 

### Transporter shall support the following recall notification periods for all released capacity subject to recall rights:

> \(1\) Timely Recall Notification:
>
> \(A\) A Releasing Shipper recalling capacity should provide notice of
> such recall to Transporter and the first Replacement Shipper no later
> than 8:00 a.m. on the day that Timely Notifications are due;
>
> \(B\) Transporter should provide notification of such recall to all
> affected Replacement Shippers no later than 9:00 a.m. on the day that
> Timely Nominations are due (Central Clock Time);
>
> \(2\) Early Evening Recall Notification:
>
> \(A\) A Releasing Shipper recalling capacity should provide notice of
> such recall to Transporter and the first Replacement Shipper no later
> than 3:00 p.m. on the day that Evening Nominations are due;
>
> \(B\) Transporter should provide notification of such recall to all
> affected Replacement Shippers no later than 4:00 p.m. on the day that
> Evening Nominations are due (Central Clock Time);
>
> \(3\) Evening Recall Notification:
>
> \(A\) A Releasing Shipper recalling capacity should provide notice of
> such recall to Transporter and the first Replacement Shipper no later
> than 5:00 p.m. on the day that Evening Nominations are due;
>
> \(B\) Transporter should provide notification of such recall to all
> affected Replacement Shippers no later than 6:00 p.m. on the day that
> Evening Nominations are due (Central Clock Time);
>
> \(4\) Intraday 1 Recall Notification:
>
> \(A\) A Releasing Shipper recalling capacity should provide notice of
> such recall to Transporter and the first Replacement Shipper no later
> than 7:00 a.m. on the day that Intraday 1 Nominations are due;
>
> \(B\) Transporter should provide notification of such recall to all
> affected Replacement Shippers no later than 8:00 a.m. on the day that
> Intraday 1 Nominations are due (Central Clock Time); and
>
> \(5\) Intraday 2 Recall Notification:
>
> \(A\) A Releasing Shipper recalling capacity should provide notice of
> such recall to Transporter and the first Replacement Shipper no later
> than 2:30 p.m. on the day that Intraday 2 Nominations are due;
>
> \(B\) Transporter should provide notification of such recall to all
> affected Replacement Shippers no later than 3:30 p.m. on the day that
> Intraday 2 Nominations are due (Central Clock Time).

### For recall notification provided to Transporter prior to the recall notification deadline specified in NAESB WGQ Standard No. 5.3.44 and received between 7:00 a.m. and 5:00 p.m., Transporter should provide notification to all affected Replacement Shippers no later than one hour after receipt of such recall notification. For recall notification provided to Transporter after 5:00 p.m. and prior to 7:00 a.m., Transporter should provide notification to all affected Replacement Shippers no later than 8:00 a.m. after receipt of such recall notification. (Central Clock Time)

### When capacity is recalled, it may not be reput for the same Gas Day. The deadline for notifying Transporter of a reput is 8:00 a.m. to allow for timely nominations to follow on the next Gas Day.

## Term

### Any release under this Section 21 shall be for a minimum term of at least one Gas Day.

### Any release under this Section 21 shall be for a maximum term expiring on the earlier of:

> \(1\) The last date this Tariff provision shall be effective;
>
> \(2\) The expiration date of Releasing Shipper's Service Agreement
> when the release is for the full term of such agreement; or
>
> \(3\) The expiration date specified by the Releasing Shipper in the
> Shipper Notice.

## Billing Adjustments to Releasing Shipper

### Transporter shall credit Releasing Shipper's monthly bill to reflect the Reservation Charge (including surcharges, if any) invoiced to Replacement Shipper. In the event of a release with a volumetric rate, the volumetric rate shall be no greater than the 100% load factor equivalent of the Maximum Rate currently applicable to the service released and shall be credited to the Releasing Shipper's monthly bill. Replacement Shipper's payment of the Usage Charge and applicable usage surcharges, if any, will be retained by Transporter.

### If Replacement Shipper fails to pay all or any part of the Reservation Charge so credited within thirty (30) Days of its due date, then such unpaid amount plus interest will be charged to Releasing Shipper's next monthly bill and will be due and payable by Releasing Shipper in accordance with Section 8 herein.

## Offers to Purchase Firm Capacity

> Transporter agrees to post on its Website, at a party's request,
> offers to purchase firm capacity on a permanent or temporary basis.
> Each offer will remain on the Website for five (5) Business Days
> before it is removed, unless the requesting party notifies Transporter
> prior to the expiration of any five (5) Day period that it wishes to
> extend the posting for an additional five (5) Business Days.

#  MARKETING FEES

> When a Releasing Shipper requests that Transporter actively market its
> released firm capacity, then Transporter will be entitled to a
> marketing fee for successfully marketing such released firm capacity.
> The fee will be negotiated between Transporter and Releasing Shipper;
> provided, however, if Transporter only posts the Releasing Shipper's
> firm capacity on its Website and does not actively market the released
> firm capacity, no marketing fee will be charged for the routine
> arrangement of transportation services.

# RIGHT OF FIRST REFUSAL AND PREGRANTED ABANDONMENT OF FIRM SERVICE AGREEMENTS

## General

> Any Shipper may, at the expiration of a Firm Service Agreement (a) for
> which Shipper is paying the maximum rate applicable for the service,
> and (b) with a term of at least twelve (12) consecutive months (or, if
> the service is not available for twelve (12) consecutive months, the
> Service Agreement is for more than one year), continue service for all
> or a portion of the firm capacity covered by the Service Agreement,
> subject to the conditions of this Section 23. Subject only to
> Shipper's Right of First Refusal to continue service, Transporter
> shall have all necessary abandonment authorization under the Natural
> Gas Act as of such termination date and shall not be required to seek
> case specific authorization prior to abandoning service. Although
> Shippers under discounted rate agreements do not qualify for the right
> of first refusal under this Section 23, Transporter and any such
> Shipper may agree otherwise.
>
> Shipper may exercise its right to retain a portion of its firm service
> entitlement, subject to the Right of First Refusal; provided, however,
> the Shipper may not exercise the Right of First Refusal for a
> geographic portion of its Service Agreement.

## Right of First Refusal

> To exercise its Right of First Refusal to continue service for all or
> a portion of the firm capacity covered by a Service Agreement, which
> meets the requirements of Section 23.1, the Shipper must provide
> notice to Transporter pursuant to Section 23.3 that it desires to
> continue its Service Agreement and that it will match (a) the longest
> term, and (b) the highest rate offered for such service, up to the
> applicable maximum rate, that is offered by another person desiring
> such capacity as set forth in Section 23.5, provided that Transporter
> shall not be obligated to provide service at less than the applicable
> maximum rate.

## Notice to Transporter

> Shipper shall notify Transporter in writing of its intention to
> exercise a Right of First Refusal for all or a portion of the MDQ
> stated in its Service Agreement by certified mail at least twelve (12)
> months prior to the end of the primary term of the Service Agreement.

## Posting Periods

> At least forty-five (45) Days prior to expiration of the applicable
> Service Agreement, Transporter shall post on its Website that capacity
> which may, subject to the exercise by Shipper of its right of first
> refusal, be available upon the termination of Shipper's firm
> transportation Service Agreement, such posting to be for the following
> minimum period of time:

### For Service Agreements with terms of five (5) years or longer: Fourteen (14) Days.

### For Service Agreements with terms of not less than thirty (30) Months but less than five (5) years: Ten (10) Days.

### For Service Agreements with terms of not less than one (1) year but less than thirty (30) Months: Seven (7) Days. 

## Bidding Procedures

> Each bidder for Shipper's firm capacity, or any part thereof, must
> submit its bid to Transporter through Transporter's Website (with its
> Rate Schedule FTS Service Request Form and any required prepayment)
> within the time specified by Transporter. Each bid shall contain the
> term for which the capacity is sought and shall be at the maximum rate
> in effect during said term. If Transporter receives more than one bid
> for Shipper's capacity, and it does not reject all bids as provided
> below, it will choose the bid, or combination of bids, having the
> highest Net Present Value to Transporter. Transporter reserves the
> right to reject any bid which is for less than one-hundred percent
> (100%) of the maximum rate applicable to Shipper's firm service.

## Pregranted Abandonment

### Transporter will notify Shipper of the best bid received in an arm's length transaction that Transporter is willing to accept, and Shipper shall have a specified time, but not less than fifteen (15) Days, within which it must match the price and contract term offered in the best bid in order to retain its firm capacity. If Shipper matches the best bid, Transporter and Shipper will enter into a new Rate Schedule FTS Service Agreement reflecting the terms of Shipper's matching bid. If Shipper fails to match the best bid within the time allowed by Transporter, Shipper's existing Service Agreement will be subject to pregranted abandonment upon the effective termination date of Shipper's existing Rate Schedule FTS Service Agreement, and Transporter may enter into a new Rate Schedule FTS Service Agreement with the party or parties offering the best bid.

### In the event Transporter does not receive any bids for Shipper's capacity or any bids that are acceptable to Transporter, Shipper shall have the right to retain its firm capacity at the applicable maximum rate applicable thereto, or any discounted rate agreed to by Transporter, for an additional term as requested by Shipper, provided that Transporter shall not be obligated to provide service at less than the applicable maximum rate. If Shipper refuses to renew its Service Agreement at the maximum rate, absent an agreement by Transporter to discount, said Service Agreement shall be subject to pregranted abandonment on the effective date of termination.

### If Shipper does not elect to extend its Service Agreement pursuant to the provisions contained therein and in this Section 23, said Agreement shall terminate and be subject to pregranted abandonment at the end of the Primary Term set forth in Shipper's Service Agreement. 

#  FORCE MAJEURE

## Liability Excused

> In the event either Transporter or Shipper is unable, in whole or in
> part, by reason of the existence of a Force Majeure event to carry out
> its obligations under the Service Agreement, it is agreed that, on
> such party giving notice and full particulars of such Force Majeure to
> the other party in a form consistent with Section 9 of these GT&C as
> soon as possible after the occurrence of the cause relied on, the
> obligations of both parties, so far as they are affected by such event
> of Force Majeure, shall be excused during the continuance of any
> inability so caused but for no longer period. Provided, however, the
> party claiming the existence of Force Majeure shall use all reasonable
> efforts to remedy any situation that may interfere with the
> performance of its obligations hereunder, and the existence of Force
> Majeure shall not relieve a party from its obligations to make
> payments as then due or becoming due under a Service Agreement,
> including the obligation of Shipper to pay reservation or other fixed
> charges during the period of Force Majeure. However, as a reasonable
> way to divide the risk of Force Majeure, when claimed by Transporter,
> Transporter shall provide to affected Shipper(s) a partial reservation
> charge credit equal to Transporter's return on equity and income
> taxes, beginning on the first Day that Force Majeure is claimed.

## Force Majeure

> The term "Force Majeure" shall mean an event or condition, whether
> affecting Transporter or Shipper, beyond the reasonable control of the
> party claiming Force Majeure. Such events or conditions shall include,
> but shall not be limited to: acts of God; strikes, lockouts, or other
> industrial disturbances; sabotage, acts of the public enemy, wars,
> blockades, insurrections, riots, or epidemics; landslides, lightning,
> earthquakes, fires, hurricanes, storms, floods, washouts or other
> natural events or the threat thereof or warnings related thereto;
> arrests and restraints of government and people or civil disturbances;
> explosions, breakage, or accident to plants, platforms, equipment,
> machinery, or lines of pipe by whatever cause, or the threat thereof
> or warnings related thereto; freezing of wells or lines of pipe; acts
> of government or the necessity of complying with any governmental or
> judicial rule or order; events of Force Majeure affecting any
> facilities located at the Sparrows Point LNG Terminal, or on upstream
> or downstream pipelines, gatherers, or processors; and any other
> causes, whether of the kind hereunder enumerated or otherwise, whether
> affecting Transporter or Shipper, or any other person including but
> not limited to upstream or downstream transporter(s), gatherer(s), or
> processor(s), not within the control of the party claiming suspension
> and which the exercise of due diligence by such party is unable to
> prevent or overcome. The term of such condition shall likewise include
> the inability of either party to acquire, or delays on the part of
> such party in acquiring, at reasonable costs and by the exercise of
> reasonable diligence, servitudes, rights-of-way grants, permits,
> permissions, certificates, authorizations, licenses, materials, or
> supplies which are required to enable such party to fulfill its
> obligations hereunder. The settlement of strikes and lockouts shall be
> entirely within the discretion of the person affected, and the above
> requirements that any Force Majeure shall be remedied with all
> reasonable dispatch shall not require the settlement of strikes or
> lockouts when such course is inadvisable in the discretion of the
> person affected thereby.

## Liabilities Not Relieved

> Any causes or contingencies affecting performance by a party shall not
> relieve it of liability that might otherwise exist in the event of its
> concurring negligence or in the event of its failure to use due
> diligence to remedy the situation and remove the cause in an adequate
> manner and with all reasonable dispatch, although this provision shall
> not be construed to impose liability beyond that to which a party may
> otherwise be subject and this provision is subject to other sections
> of these GT&C with respect to limitations on liability; provided
> further, such causes or contingencies affecting performance shall not
> relieve a party from its obligation to make payments of any and all
> amounts owed or coming due under Shipper's applicable Service
> Agreement during the period of the Force Majeure, subject to Section
> 24.1 above.

## Compliance with Directives of Governmental Agencies

> Whenever, in order to comply with orders, directives, or regulations
> of duly constituted state, local, or federal authorities, including
> but not limited to the U.S. Department of Transportation, FERC, and
> the U.S. Environmental Protection Agency, Transporter must curtail
> deliveries to or for the account of Shipper and is unable to deliver
> to or for the account of Shipper the quantities of Natural Gas which
> Shipper may then require, up to the quantities of Natural Gas
> Transporter is then obligated to deliver to Shipper, Transporter shall
> not be liable in damages or otherwise to Shipper or any other Person
> or entity for any such failure to deliver such quantities of Natural
> Gas to or for the account of Shipper, except to the extent the orders
> or directives were issued as a result of Transporter's gross
> negligence, undue discrimination or willful misconduct, provided that
> Transporter shall be responsible for direct damages, if any, resulting
> from Transporter's own negligence.

#  MARKETING AFFILIATES

## Shared Operating Personnel and Facilities

### Information on facilities and operating personnel that Transporter shares with its marketing affiliates will be available on the Website.

### "Operating personnel" include all personnel (employees, officers, directors and agents) who are authorized to make or implement decisions that have a material effect on the pipeline's operations, such as contract negotiations, scheduling, dispatching or other similar transactions, but excluding personnel who are not authorized to make material decisions affecting the pipeline's operations, such as employees performing accounting, legal or computer support functions.

## Complaint Resolution 

## Transporter will attempt to resolve any complaints by Shippers or potential Shippers without the necessity of a written complaint. To this end, Shippers are encouraged to attempt to resolve disputes informally with their designated service representatives. A formal complaint concerning any services offered by Transporter should be directed, in writing or via facsimile, to: {#transporter-will-attempt-to-resolve-any-complaints-by-shippers-or-potential-shippers-without-the-necessity-of-a-written-complaint.-to-this-end-shippers-are-encouraged-to-attempt-to-resolve-disputes-informally-with-their-designated-service-representatives.-a-formal-complaint-concerning-any-services-offered-by-transporter-should-be-directed-in-writing-or-via-facsimile-to .unnumbered}

> Mid-Atlantic Express, L.L.C.
>
> Attn: General Manager
>
> 140 Professional Parkway
>
> Suite A
>
> Lockport, NY 14094
>
> Ph. 716-439-1273
>
> Fax 716-434-7514
>
> The complaint should state that it constitutes a complaint pursuant to
> these tariff provisions, and the complaint should state with
> specificity the nature of the complaint, the actions or procedures of
> Transporter that gave rise to the complaint, and the remedy sought by
> the Shipper. Transporter will respond initially to the complaint
> within two (2) Business Days and in writing within thirty (30) Days.

# DISCOUNTS, NEGOTIATED RATES, RATE CHANGES, AND ADJUSTMENTS

## Discounting

### Subject to the applicable regulations and orders of the FERC, Transporter shall have the right to discount, on a not unduly discriminatory basis, as agreed to in writing between Transporter and Shipper, any of the rates for service under any Service Agreement under any of Transporter's Rate Schedules. For example, Shipper and Transporter may agree that a specified discounted rate shall apply: (a) only to certain quantities under this Agreement; (b) only if specified quantity levels are actually achieved or only with respect to quantities below a specified level; (c) only during specified periods; (d) only to specified Points of Receipt, Points of Delivery, mainline segments, transportation paths or defined geographical areas; or (e) in a specified relationship to the quantities of Gas actually transported (i.e., that the rates shall be adjusted in a specified relationship to quantities actually transported); provided, however, that any such discounted rate set forth above shall be between the maximum rate and minimum rate applicable to the service provided under this Agreement. Any such discount shall be effective on a prospective basis only and only as specified in the written Service Agreement between Transporter and Shipper.

### To the extent that Transporter agrees to discount its rates in accordance with Section 26.1(a) above, given that Transporter's rates do not include any discountable surcharges, any such discounts shall be attributable to Transporter's base tariff reservation rates.

## Negotiated Rates

### Notwithstanding anything to the contrary contained in this Tariff, Transporter and Shipper may mutually agree to Negotiated Rates under any Service Agreement, provided that Shipper has not acquired its capacity on a temporary basis under the capacity release provisions of Section 21 of these GT&C. Transporter and Shipper may agree to a Negotiated Rate for the entire term of the Service Agreement, or may agree to a Negotiated Rate for some portion of the term of the Service Agreement. If a portion of the capacity under any existing Service Agreement is agreed to be priced at Negotiated Rates, the existing maximum or discounted tariff rates will continue to apply to the capacity not subject to the Negotiated Rates. As recourse to the Negotiated Rates, any Shipper may receive service at the Recourse Rate, including applicable surcharges. 

### Recourse Rates shall be available to any Shipper that does not wish to mutually agree to a Negotiated Rate.

### No later than the Business Day on which Transporter commences service at a Negotiated Rate, Transporter shall file with the Commission either: (1) a numbered tariff sheet that includes the name of the Shipper, the negotiated rate, the type of service being offered pursuant to the negotiated rate, the Point(s) of Receipt and the Point(s) of Delivery applicable to the service, the volume of Gas to be transported, a statement affirming that the negotiated rate agreement conforms in all material respects to the [pro]{.underline} [forma]{.underline} service agreement in Transporter's Tariff and, where the price term of the negotiated rate agreement is a formula, the formula, or (2) the negotiated rate agreement; provided, however, if the negotiated rate agreement deviates materially from the [pro]{.underline} [forma]{.underline} service agreement in Transporter's Tariff, Transporter shall file the negotiated rate agreement.

### Transporter shall have the right to seek in future general rate proceedings discount-type adjustments in the design of its rates related to Negotiated Rate Service Agreements that were converted from pre-existing discount Service Agreements to Negotiated Rate Service Agreements. In those situations, Transporter may seek a discount-type adjustment based upon the greater of: (1) the Negotiated Rate revenue received; or (2) the discounted tariff rate revenues which otherwise would have been received.

### This Section 26.2 does not authorize Transporter to negotiate terms and conditions of service.

### The maximum price cap for the release of capacity by a Shipper paying a Negotiated Rate which exceeds the Recourse Rate shall be the applicable Recourse Rate. Replacement Shippers may not bid or pay a rate for such capacity greater than the applicable Recourse Rate. 

### Transporter shall maintain separate records for all revenues associated with Negotiated Rate transactions sufficient for Natural Gas Act Section 4 rate change filing purposes. Transporter shall record each volume transported, billing determinants, rate component, surcharge, and the revenue associated with its Negotiated Rates so that this information can be filed and separately identified in the form of Statements G, I and J in future rate proceedings.

## Rate Changes and Adjustments

> Subject to agreement(s) that Transporter may negotiate with Shippers,
> Transporter shall have the unilateral right to file with the
> appropriate regulatory authority and make changes effective in (a) the
> maximum reservation rates and charges applicable to Transporter's Rate
> Schedules; (b) the terms and conditions of service for Transporter's
> Rate Schedules; or (c) any provision of these GT&C applicable to
> service under Transporter's Rate Schedules. Upon placing such rates
> into effect, Transporter will charge and Shipper will pay
> Transporter's rates in effect from time to time as adjusted pursuant
> to the terms of this Section 26 except to the extent such rates are
> otherwise discounted pursuant to the terms of Section 26.1. Provided,
> however, subject to agreement(s) that Transporter may negotiate with
> Shipper(s), Shipper may protest or contest any of the aforementioned
> filings.

# POLICY WITH RESPECT TO FEES AND CONSTRUCTION OF LATERAL, DELIVERY AND RECEIPT FACILITIES

## Meters and Taps At Point(s) Of Receipt And Point(s) Of Delivery

> If requested by a Shipper, Transporter agrees to own, construct and
> install and/or operate new meters and taps and associated facilities
> at Point(s) of Receipt and Point(s) of Delivery only if the cost of
> such meters, taps and associated facilities are paid for by Shipper
> and/or a third party on a payment basis mutually agreed to by such
> Shipper and Transporter in advance and in writing. Such request, if
> granted, shall not cause Shipper's reservation charges paid to
> Transporter to decrease.
>
> In addition to the above requirements, Transporter will agree to
> construct a new interconnect or modify an existing interconnect on the
> following terms:

### The construction of the new interconnect will not create any significant operational problems for Transporter;

### The proposed interconnect will not adversely affect the rendition of existing service or adversely alter the operation of the pipeline system;

### The new interconnect must be at a mutually agreeable location on Transporter's system; provided, however, that Transporter may not deny a customer's request for specific placement of the interconnect without adequate operational, environmental, or legal justification;

### In order to properly and prudently design and size the new interconnect, Transporter must be provided with reasonable and reliable data concerning the interconnecting facilities, including delivery pressures, and anticipated hourly, daily, monthly and annual volume levels of the service that supports the new interconnect and such other data as is reasonably required to construct the interconnect facility;

### The new interconnect must not result in any minimum pressure receipt or delivery requirement by Transporter, unless Transporter agrees otherwise, such agreement not to be unreasonably withheld, and Transporter shall not be responsible for any downstream parties' facilities, the operation or maintenance of such facilities, or the delivery of any unauthorized volumes to the facilities;

### The service supporting the interconnect as well as the construction of the new facilities must conform with the provisions of Transporter's FERC Gas Tariff, Original Volume No. 1, as well as applicable regulatory requirements;

### The proposed interconnect must not cause Transporter to be in violation of any applicable environmental or safety laws or regulations with respect to the facilities required to establish an interconnect with Transporter's existing facilities; and 

### The proposed interconnect must not cause Transporter to be in violation of its right-of-way agreements or any other contractual obligations with respect to the interconnect facilities.

## Laterals And Other Facilities

> Except as required pursuant to Section 27.1, unless otherwise agreed
> to by the parties, Transporter shall not be required to own, construct
> or install and/or operate any facilities to perform any service
> requested by a Shipper under this Volume No. 1 FERC Gas Tariff. In the
> event Transporter agrees to own, construct or install and/or operate
> facilities to perform services requested including, but not limited to
> laterals, looping, and/or compression facilities, Transporter shall do
> so on a not unduly discriminatory basis, provided that if requested by
> Transporter to do so, Shipper agrees in writing to reimburse or
> compensate Transporter for one hundred percent (100%) of Transporter's
> construction, acquisition and/or installation costs (including any
> associated tax effects) through one or a combination of the following
> payment methods:

### Payment of an up-front contribution in aid of construction, acquisition and/or installation; and/or

### Payment of a separately stated reservation charge for the new facilities under a firm transportation Service Agreement for the use of those facilities; and/or 

### Payment of reservation charges for a new and/or incremental quantity of mainline firm transportation service.

> Shippers choosing payment methods under Section 27.2(b) or Section
> 27.2(c) shall be required to enter into new or incremental firm
> transportation service agreements for sufficient entitlement and
> duration to produce an incremental net revenue stream providing a
> present value greater than or equal to Transporter's construction,
> acquisition, and/or installation costs (including and associated tax
> effects). Shipper shall be required to demonstrate creditworthiness as
> specified in Section 10 of these General Terms and Conditions to
> support such firm transportation Service Agreements.
>
> In addition, Transporter's construction, acquisition and/or
> installation cost for any project or portion of a project under the
> payment method specified in Section 27.2(b) or Section 27.2(c) shall
> not exceed ten million dollars (\$10,000,000); any Shipper requiring
> new facilities costing more than ten million dollars (\$10,000,000)
> must elect the payment method specified in Section 27.2(a) for
> Transporter's costs in excess of such amount. Transporter may waive
> this limit on a non-discriminatory basis if funds are available to
> Transporter to support the requested new facilities.
>
> For purposes of this Section 27, Transporter's construction,
> acquisition and/or installation costs shall include, but shall not be
> limited to: Transporter's design, equipment, labor, material,
> supervision, construction and construction financing costs, taxes
> (whether income or otherwise), filing fees and associated costs, right
> of way costs, and permitting costs.
>
> Nothing in this lateral construction policy statement shall require
> Transporter to file an application for a certificate of public
> convenience and necessity under Section 7(c) of the Natural Gas Act.
> Nothing in this policy statement, further, shall prevent Transporter
> from contesting an application for service filed pursuant to Section
> 7(a) of the Natural Gas Act.

#  WAIVERS

## Penalty Waivers

### In recognition of the fact that each penalty provision in this Tariff is intended to promote efficient operations by Transporter so that service to other Shippers is not impaired in any way, Transporter may waive any penalty charges incurred by Shipper if Transporter determines that Shipper was conducting its operations in a responsible manner at the time the penalty charges were incurred, and that Shipper's conduct did not impair service to another Shipper. Transporter must grant waivers under this section on a not unduly discriminatory basis, but the waiver of any penalty charges shall not constitute a waiver of any future penalty charges.

### Transporter shall maintain a record of all waivers granted under this Section 28.1 and shall make such record available upon request to the Commission and to any Shipper.

## Waiver Under Tariff

> Transporter may also waive on a not unduly discriminatory basis, any
> of its rights hereunder or any obligations of Shipper; provided,
> however, that no waiver by Transporter of any provision, condition, or
> requirement therein shall be deemed to be a waiver of, or in any
> manner release the Shipper from performance of any other provision,
> condition, or requirement of these General Terms and Conditions, the
> applicable Rate Schedules, or the Service Agreements, nor shall such
> waiver be deemed to be a waiver of, or in any manner release the
> Shipper from future performance of the same provision, condition, or
> requirement; nor shall any delay or omission of Transporter to
> exercise any right in these General Terms and Conditions, the
> applicable Rate Schedules, or the Service Agreements, in any manner
> impair the exercise of any such right or any like right accruing to
> Transporter thereafter.

#  AGENCY

> A Shipper may delegate to any third party the responsibility for
> submitting nominations and receiving confirmations or performing other
> administrative duties under any agreement, subject to the following
> conditions:

## Any designation of a third party as agent, or any change in such designation, must be provided in writing to Transporter at least two (2) Business Days prior to the requested effective date of the designation.

## The written designation must specify any limits on the authority of the Agent, including any time limit for the designation. Transporter may reject any Shipper's request to delegate responsibilities if the limitations on the designation would impose undue administrative burdens on Transporter.

## Transporter will rely on communications from a Shipper's agent for all nomination purposes except to the extent the designation is expressly limited. Communications by Transporter to such Agent will be deemed notice to shipper.

## Any third party may administer multiple agreements as the agent for one or more Shippers, but the agent must make nominations and otherwise administer and account separately for each agreement.

#  ANNUAL CHARGE ADJUSTMENT ("ACA")

## In order to recover the annual charges assessed by the Commission under Section 382.202 of the Commission's Regulations pursuant to the provisions of the Commission's Order No. 472, this Section 30 is established to be applicable to the Rate Schedules contained in Volume No. 1 of Transporter's FERC Gas Tariff. Because Transporter is electing to recover the annual charges assessed by the Commission through the operation of this Annual Charge Adjustment Clause, Transporter does not intend to recover any annual charges recorded in Account No. 928 in any Natural Gas Act Section 4 rate case.

## The Rate Schedules specified in Section 30.1 shall include an Annual Charge Adjustment unit charge ("ACA unit charge") applicable to each Dth of gas transported thereunder in the amount set forth on Original Sheet No. 8. The ACA unit charge shall be added to the volumetric rate of any Rate Schedule with a reservation charge.

## Changes to the ACA unit charge must be filed annually, if necessary, to reflect the annual charge unit rate authorized by the Commission each fiscal year and are subject to the notice requirements of Section 154.207 of the Commission's Regulations. Transporter shall not commence to collect the ACA unit charge until Transporter has received authorization from the Commission.

#  TRANSPORTER'S USE GAS ADJUSTMENT 

## General

> This section sets forth the procedures to reflect changes in
> Transporter's Use Gas Percentage.

## Conditions

### Subject to paragraph (b) below, Transporter's Use Gas Percentage may be increased to reflect a net positive change in the percentage and shall be decreased to reflect a net negative change in the percentage.

### Transporter may file with the Commission to reflect net changes in Transporter's Use Gas Percentages at least thirty (30) days prior to each November 1 which is the beginning date for the Annual Period, provided that such filing shall be required to the extent that the currently effective percentage has decreased by at least ten (10) percent.

## Definitions

### Annual Period - The twelve-month period beginning each November 1.

### Actual Gas Required for Operations (GRO) - Actual gas used in Transporter's operations including all Gas used for compression or heaters, or unaccounted for.

### Estimated GRO - Actual GRO quantities for the latest twelve month period adjusted, where necessary, for known variations from actual experiences.

### Estimated Volumes - Actual annual volume determinants attributable to services to which Transporter allocates or assigns GRO quantities for the latest twelve month period adjusted, where necessary, for known variations from actual experience.

### Deferral Period - The Period of 12 months ending 2 months prior to the effective date of a change in Transporter's Gas Use Percentage filed pursuant to this Section 31.

## Determination of the Current Transporter's Gas Use Percentage

> Transporter shall determine the current Transporter's Gas Use
> percentage for the next Annual Period by the following procedures:

### The Estimated GRO quantities shall be summed with the balance accumulated at the end of the Deferral Period in the Deferred GRO Account as determined in accordance with Section 31.5.

### The quantities determined in Section 31.4(a) will be divided by the Estimated Volume determinants, as appropriate.

## Deferred GRO Account

> Transporter shall maintain the Deferred GRO Account for each Deferral
> Period in accordance with the following procedures:

### Transporter shall determine each month the Actual GRO quantities plus the pro rata monthly amount of the Deferred GRO Account volumes included in the then-effective Transporter's Use Gas Percentage.

### Transporter shall determine each month the actual recovery of Transporter's Use Gas quantities by multiplying, as applicable, Transporter's Use Gas Percentages by the appropriate volume determinants.

### Each month, Transporter shall determine the difference, positive or negative, between the quantities computed in Section 31.5(a) and 31.5(b) and such difference shall be recorded each month in a subaccount of Account No. 186 of the Uniform System of Accounts which Transporter shall designate as the Deferred GRO Account.

#  NORTH AMERICAN ENERGY STANDARDS BOARD ("NAESB") STANDARDS

> Transporter hereby incorporates into this FERC Gas Tariff by reference
> the following NAESB business standards of Version 1.7 that are
> required by the Commission in 18 CFR Part 284.12, in accordance with
> Order Nos. 587, et seq.:
>
> Additional Standards:
>
> 0.1.1, 0.1.2, 0.3.1, 0.3.3, 0.3.4, 0.3.5, 0.3.6, 0.3.7, 0.3.8, 0.3.9,
> 0.3.10
>
> Nomination Related Standards:
>
> 1.1.1, 1.1.2, 1.1.3, 1.1.4, 1.1.6, 1.1.7, 1.1.8, 1.1.9, 1.1.10,
> 1.1.11, 1.1.13, 1.1.14, 1.1.15, 1.1.16, 1.1.17, 1.1.18, 1.1.20,
> 1.1.21, 1.2.1, 1.2.2, 1.2.3, 1.2.5, 1.2.8, 1.2.9, 1.2.10, 1.2.11,
> 1.2.12, 1.2.13, 1.2.14, 1.2.15, 1.2.16, 1.2.17, 1.2.18, 1.2.19,
> 1.3.2(vi), 1.3.3, 1.3.4, 1.3.8, 1.3.15, 13.16, 1.3.17, 1.3.18, 1.3.19,
> 1.3.20, 1.3.22, 1.3.23, 1.3.24, 1.3.25, 1.3.26, 1.3.27, 1.3.28,
> 1.3.29, 1.3.30, 1.3.31, 1.3.32, 1.3.33, 1.3.34, 1.3.35, 1.3.36,
> 1.3.37, 1.3.38, 1.3.39, 1.3.40, 1.3.41, 1.3.42, 1.3.43, 1.3.44,
> 1.3.45, 1.3.46, 1.3.47, 1.3.48, 1.3.49, 1.3.50, 1.3.51, 1.3.52,
> 1.3.53, 1.3.54, 1.3.55, 1.3.56, 1.3.57, 1.3.58, 1.3.59, 1.3.60,
> 1.3.61, 1.3.62, 1.3.63, 1.3.64, 1.3.65, 1.3.66, 1.3.67, 1.3.68,
> 1.3.69, 1.3.70, 1.3.71, 1.3.72, 1.3.73, 1.3.74, 1.3.75, 1.3.76,
> 1.3.77, 1.3.79, 1.4.1, 1.4.2, 1.4.3, 1.4.4, 1.4.5, 1.4.6, 1.4.7.
>
> Flowing Gas Related Standards:
>
> 2.1.1, 2.1.2, 2.1.3, 2.1.4, 2.1.5, 2.2.2, 2.2.3, 2.3.1, 2.3.2, 2.3.3,
> 2.3.4, 2.3.5, 2.3.6, 2.3.8, 2.3.9, 2.3.10, 2.3.11, 2.3.12, 2.3.13,
> 2.3.15, 2.3.17, 2.3.18, 2.3.19, 2.3.20, 2.3.21, 2.3.22, 2.3.23,
> 2.3.25, 2.3.27, 2.3.28, 2.3.29, 2.3.30, 2.3.31, 2.3.32, 2.3.33,
> 2.3.34, 2.3.35, 2.3.41, 2.3.42, 2.3.43, 2.3.44, 2.3.45, 2.3.48,
> 2.3.50, 2.3.51, 2.3.52, 2.3.53, 2.3.54, 2.3.55, 2.3.56, 2.3.57,
> 2.3.58, 2.3.59, 2.3.60, 2.3.61, 2.3.62, 2.3.63, 2.3.64, 2.4.1, 2.4.2,
> 2.4.3, 2.4.4, 2.4.5, 2.4.6, 2.4.7, 2.4.8, 2.4.9, 2.4.10, 2.4.11,
> 2.4.12, 2.4.13, 2.4.14, 2.4.15, 2.4.16.
>
> Invoicing Related Standards:
>
> 3.1.1, 3.1.2, 3.3.1, 3.3.2, 3.3.3, 3.3.5, 3.3.6, 3.3.7, 3.3.8, 3.3.9,
> 3.3.10, 3.3.11, 3.3.12, 3.3.13, 3.3.16, 3.3.20, 3.3.21, 3.3.22,
> 3.3.23, 3.3.24, 3.3.25, 3.3.26, 3.4.1, 3.4.2, 3.4.3, 3.4.4.
>
> Electronic Delivery Mechanism Related Standards:
>
> 4.1.2, 4.1.3, 4.1.4, 4.1.6, 4.1.7, 4.1.9, 4.1.10, 4.1.12, 4.1.13,
> 4.1.15, 4.1.16, 4.1.17, 4.1.18, 4.1.19, 4.1.20, 4.1.21, 4.1.22,
> 4.1.23, 4.1.24, 4.1.25, 4.1.26, 4.1.27, 4.1.28, 4.1.29, 4.1.30,
> 4.1.31, 4.1.32, 4.1.33, 4.1.34, 4.1.35, 4.1.36, 4.1.37, 4.1.38,
> 4.1.39, 4.2.1, 4.2.2, 4.2.3, 4.2.4, 4.2.5, 4.2.6, 4.2.7, 4.2.8, 4.2.9,
> 4.2.10, 4.2.11, 4.2.12, 4.2.13, 4.2.14, 4.2.15, 4.2.16, 4.2.17,
> 4.2.18, 4.2.19, 4.2.20, 4.3.1, 4.3.2, 4.3.3, 4.3.5, 4.3.6, 4.3.7,
> 4.3.8, 4.3.9, 4.3.10, 4.3.11, 4.3.12, 4.3.13, 4.3.14, 4.3.15, 4.3.16,
> 4.3.17, 4.3.18, 4.3.19, 4.3.20, 4.3.21, 4.3.22, 4.3.23, 4.3.24,
> 4.3.25, 4.3.26, 4.3.27, 4.3.28, 4.3.29, 4.3.30, 4.3.31, 4.3.32,
> 4.3.33, 4.3.34, 4.3.35, 4.3.36, 4.3.37, 4.3.38, 4.3.39, 4.3.40,
> 4.3.41, 4.3.42, 4.3.43, 4.3.44, 4.3.45, 4.3.46, 4.3.47, 4.3.48,
> 4.3.49, 4.3.50, 4.3.51, 4.3.52, 4.3.53, 4.3.54, 4.3.55, 4.3.56,
> 4.3.57, 4.3.58, 4.3.59, 4.3.60, 4.3.61, 4.3.62, 4.3.63, 4.3.64,
> 4.3.65, 4.3.66, 4.3.67, 4.3.68, 4.3.69, 4.3.70, 4.3.71, 4.3.72,
> 4.3.73, 4.3.74, 4.3.75, 4.3.76, 4.3.78, 4.3.79, 4.3.80, 4.3.81,
> 4.3.82, 4.3.83, 4.3.84, 4.3.85, 4.3.86, 4.3.87, 4.3.88.
>
> Capacity Release Related Standards:
>
> 5.1.1, 5.1.2, 5.1.3, 5.1.4, 5.2.1, 5.2.2, 5.2.3, 5.3.3, 5.3.5, 5.3.9,
> 5.3.10, 5.3.12, 5.3.17, 5.3.18, 5.3.20, 5.3.21, 5.3.22, 5.3.23,
> 5.3.24, 5.3.25, 5.3.26, 5.3.27, 5.3.28, 5.3.29, 5.3.30, 5.3.31,
> 5.3.32, 5.3.33, 5.3.34, 5.3.35, 5.3.36, 5.3.37, 5.3.38, 5.3.39,
> 5.3.40, 5.3.41, 5.3.42, 5.3.43, 5.3.46, 5.3.47, 5.3.48, 5.3.49,
> 5.3.50, 5.3.51, 5.3.52, 5.3.55, 5.3.56, 5.3.57, 5.3.58, 5.3.59,
> 5.3.60, 5.4.1, 5.4.2, 5.4.3, 5.4.4, 5.4.5, 5.4.6, 5.4.7, 5.4.8, 5.4.9,
> 5.4.10, 5.4.11, 5.4.12, 5.4.13, 5.4.14, 5.4.15, 5.4.16, 5.4.17,
> 5.4.18, 5.4.19, 5.4.20, 5.4.21, 5.4.22.

# FLOW THROUGH OF CASH-OUT REVENUES AND PENALTIES IN EXCESS OF COSTS

## Flow Through of Cash-Out Revenues/Costs

### This Sectopm 32 sets forth the procedures under which Transporter will flow through to Shippers, or bill to Shippers, for each annual billing period, any excess of cashout revenues received over costs incurred, or excess of cashout costs incurred over revenues received (combined, Transporter's net cashout experience), as applicable, under the cash-out provisions in Sections 19.3(c) and 19.3(d).

### The annual rate adjustment period applicable to this Section 33.1 shall be the twelve month period commencing each May 1, and ending the following April 30.

### The net revenues received pursuant to the provisions of Section 33.1(a) shall be the amount collected for the twelve (12) month period ending three months prior to each May 1. Transporter will calculate a reservation surcharge (positive or negative) applicable to Rate Schedule FTS and a usage surcharge applicable to Rate Schedules ITS and PALS (positive or negative) for the next twelve (12) month period which shall commence May 1.

### Transporter will calculate the reservation surcharge by dividing the net revenues calculated above by the sum of (1) MDQ under Rate Schedule FTS in effect at the end of each annual billing period and (2) the derivative equivalent of MDQ applicable to the actual ITS volume for the annual billing period calculated at a 100% load factor rate. The usage surcharge applicable to service under Rate Schedule ITS shall be the reservation surcharge converted to a volumetric credit at a 100% load factor rate. The reservation surcharge shall be computed to the nearest cent. No reservation surcharge change shall be filed unless the change in rates is at least one (1) cent per Dth per Month. The usage surcharge shall be computed to the nearest one hundredth of a cent. No usage surcharge shall be made unless the change in rates is at least .01 cents per Dth.

### If the computations in Section 33.1(d) above do not produce a surcharge large enough to effect a change in rates, or if Transporter elects not to implement a surcharge that increases the maximum rate, the net cashout experience for the annual billing period will be carried over to the next annual billing period. 

## Flow Through of Penalties in Excess of Costs

### This Section 32 sets forth the procedures under which Transporter will flow through to Shippers any penalties in excess of costs collected pursuant to Sections 12.3(f), 14.1, 14.2 and 18.5 of these GT&C and Section 7 of Rate Schedule FTS. Transporter will reduce such penalties for any out-of-pocket costs incurred as a direct result of the Shipper's conduct which was penalized pursuant to these Sections.

### The crediting period applicable to this Section 33.2 shall be monthly.

### Credit to Non-Offending Shippers

> \(1\) Transporter will net all revenues received pursuant to Sections
> 12.3(f), 14.1, 14.2 and 18.5 of these GT&C and Section 7 of Rate
> Schedule FTS, against the costs incurred in connection with such
> revenues. Transporter will credit the net amount to those Shippers
> under Rate Schedules FTS, ITS and PALS that were not billed pursuant
> to Sections 12.3(f), 14.1, 14.2 and 18.5 of these GT&C or Section 7 of
> Rate Schedule FTS, during the applicable month ("Non-Offending
> Shippers"). Each Non-Offending Shipper's credit shall be based on the
> ratio of the actual revenues collected for services to the
> Non-Offending Shipper during the Month to the actual revenues
> collected for services to all Non-Offending Shippers. Each
> Non-Offending Shipper's credit shall be paid with a billing adjustment
> to the billing of charges for service during the following Month.

# CREDITING OF REVENUES FROM INTERRUPTIBLE TRANSPORTATION SERVICE AND AUTHORIZED OVERRUN SERVICE 

## For each annual period ending October 31 of each year, one hundred percent (100%) of all net revenues received by Transporter for service under Rate Schedule ITS and for Authorized Overrun under Rate Schedule FTS shall be subject to being credited to all Shippers. Credit amounts shall be allocated to each Shipper based on each Shipper's contribution to fixed costs during the year under its Service Agreement.

## Transporter and a Negotiated Rate Shipper may agree upon a sharing of such Rate Schedule ITS and Authorized Overrun revenues. 

# MISCELLANEOUS

## Assignment

> Any company which shall succeed by purchase, merger, or consolidation
> to the properties, substantially or as an entirety, of Transporter or
> of Shipper, as the case may be, shall be entitled to the rights and
> shall be subject to all of the obligations of its predecessors in
> interest under a Service Agreement. Subject to the provisions of the
> applicable Rate Schedule, either Transporter or Shipper may, without
> relieving itself of its obligations under the Service Agreement,
> assign any of its rights thereunder to a company with which it is
> affiliated, but otherwise no assignment of such Service Agreement, or
> of any of the rights or obligations thereunder, shall be made unless
> the assigning party first shall have been obtained the consent thereto
> of the other. These restrictions on assignment shall not in any way
> prevent any party from pledging or mortgaging its rights under a
> Service Agreement as security of its indebtedness.

## Market Centers

> Nothing in Transporter's Tariff shall operate to inhibit the
> development of market centers at the interconnections between
> Transporter's Pipeline Facilities and other pipelines or local
> distribution company systems.

## Descriptive Headings

> The descriptive headings of the provisions of this Tariff are
> formulated and used for convenience only and shall not be deemed to
> affect the meaning or construction of any of such provisions.

## Governmental Regulations

> This Tariff, including these GT&C, and the respective rights and
> obligations of the parties under any Service Agreement, are subject to
> valid laws, orders, rules, and regulations of duly constituted
> authorities having jurisdiction and are subject to change from time to
> time by addition, amendment, or substitution, as provided by law.

## Limitation of Liability

> Except as otherwise provided herein, neither Transporter nor Shipper
> shall be liable in damages, whether direct, indirect, consequential or
> otherwise, other than for acts of gross negligence, undue
> discrimination or willful misconduct and then only to the extent that
> Force Majeure does not apply, provided that nothing herein shall limit
> Transporter's or Shipper's liability, if any, for direct damages
> resulting from its own negligence.

## System Inventory Management

> In the event that conditions exist that affect the operational
> integrity of Transporter's system, Transporter shall be permitted to
> buy and sell gas at appropriate locations on Transporter's system.

## Limitation of Service

> If a Shipper fails to comply with any material terms of its Service
> Agreement, including the applicable Rate Schedules and these GT&C,
> Transporter may unilaterally and without liability, after ten (10)
> Days' notice to such Shipper, suspend any service provided hereunder
> to Shipper until such time as Shipper has cured such failure to
> comply.

## Interpretation of Laws

> Any Agreement shall be interpreted, performed and enforced in
> accordance with the laws of the State of New York.

## No Third-Party Beneficiary

> It is expressly agreed that there is no third-party beneficiary of any
> agreement, and that the provisions of any Service Agreement and these
> General Terms and Conditions do not impart enforceable rights in
> anyone who is not a party or successor or assignee of any party to a
> Service Agreement herein.

SHEETS RESERVED FOR FUTURE USE

Sheet Nos. 133-150 are reserved for future use.

FORM OF SERVICE AGREEMENT FOR RATE SCHEDULE FTS

> This Service Agreement is made and entered into this \_\_\_\_ day of
> \_\_\_\_\_\_\_\_\_\_, \_\_\_\_, by and between Mid-Atlantic Express
> LLC (herein called "Transporter") and \_\_\_\_\_\_\_\_\_\_\_ (herein
> called "Shipper").

W I T N E S S E T H:

> WHEREAS, Transporter owns and operates a pipeline system; and
>
> WHEREAS, Shipper desires to purchase firm transportation service from
> Transporter;
>
> NOW, THEREFORE, in consideration of the premises and mutual covenants
> and agreements herein contained, Transporter and Shipper agree as
> follows:

ARTICLE I

SCOPE OF AGREEMENT

## Subject to the terms, conditions, and limitations hereof, of Transporter's Rate Schedule FTS and of the General Terms and Conditions ("GT&C") of Transporter's FERC Gas Tariff, Volume No.1, transportation service hereunder shall be firm. Transporter agrees to receive from Shipper during the term of this Service Agreement for Shipper or Shipper's account quantities of Natural Gas and to deliver to Shipper Thermally Equivalent Quantities of Natural Gas received by Transporter from Shipper or for Shipper's account, up to the MDQ specified on Exhibit "A" hereto, which Exhibit "A" shall be deemed to be a part of this Service Agreement.

## Transporter will receive from Shipper or for Shipper's account for transportation hereunder, daily quantities of Natural Gas up to Shipper's MDRO at Point(s) of Receipt specified on Exhibit "A" hereto. Transporter will transport and deliver to Shipper or for Shipper's account such daily quantities tendered up to Shipper's MDDO at Point(s) of Delivery specified on Exhibit "A" hereto. 

## On any Day, Transporter may receive at Point(s) of Receipt and deliver at Point(s) of Delivery quantities of Natural Gas in excess of Shipper's MDQ, or the MDRO and MDDO, respectively, at such Point(s) of Receipt and/or Point(s) of Delivery, provided that such quantities shall be Authorized Overrun Service subject to the terms of Transporter's Rate Schedule FTS and the GT&C under its Volume No. 1 FERC Gas Tariff.

ARTICLE II

TERM OF AGREEMENT

## This Service Agreement shall become effective on \_\_\_\_\_\_\_\_\_\_\_\_\_ and service hereunder will commence on \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_; thereafter, the term of this Service Agreement will continue in force and effect for a Primary Term of \_\_\_\_\_\_. This Service Agreement shall terminate at the end of the Primary Term, unless extended under Section 23 of the GT&C. This Service Agreement may also be terminated in accordance with Section 15 of Rate Schedule FTS.

1.  The termination of this Service Agreement triggers pregranted
    abandonment under Section 7 of the Natural Gas Act as of the
    effective date of the termination. To the extent that Shipper
    desires to terminate this Service Agreement prior to its expiration
    date, and Transporter agrees to such termination, Transporter shall
    be entitled to collect as part of the exit fee that Shipper shall
    pay for such early termination all, or such lesser portion as
    Transporter agrees to, of the Reservation Charge otherwise
    recoverable by Transporter from Shipper for the balance of the
    contractual term absent such early termination.

2.  Any provisions of this Service Agreement necessary to correct or
    cash out imbalances or to pay all applicable rates, charges, and
    penalties will survive the other parts of this Service Agreement
    until such time as such balancing or payment has been accomplished.

ARTICLE III

RATES AND CHARGES, RATE SCHEDULE AND

GENERAL TERMS AND CONDITIONS

1.  Shipper agrees to and will pay Transporter all applicable maximum
    rates and charges provided for in Rate Schedule FTS and the GT&C, as
    effective from time to time, for service under this Service
    Agreement, unless service is rendered hereunder at discounted rates
    under Section 26.1 of the GT&C, in which event the rates and charges
    that Shipper shall pay Transporter are those agreed to and set forth
    in Article IX of this Service Agreement.

2.  All of the GT&C and Rate Schedule FTS of which this Service
    Agreement is a part shall be applicable to service hereunder and
    shall be made a part hereof to the extent that such terms and
    conditions are not contradicted by any provision herein.

3.  Shipper agrees that Transporter shall have the unilateral right to
    file with the appropriate regulatory authority and make changes
    effective in: (i) the rates and charges applicable to Transporter's
    Rate Schedule FTS; (ii) the terms and conditions of service for Rate
    Schedule FTS pursuant to which service hereunder is rendered;
    and/or (iii) any provision of the GT&C applicable to service under
    Rate Schedule FTS. Transporter agrees that Shipper may protest or
    contest any such filings or may seek authorization from duly
    constituted regulatory authorities for such adjustments of
    Transporter's Tariff as may be necessary to ensure that the
    provisions in (i), (ii), or (iii) above are consistent with
    regulatory law and policy.

ARTICLE IV

RESERVATIONS

> Transporter shall have the right to take actions as may be required to
> preserve the integrity of Transporter's Pipeline Facilities, including
> maintenance of service to other firm Shippers.

ARTICLE V

GOVERNMENTAL AUTHORIZATIONS

> It is hereby agreed that transportation service under this Service
> Agreement shall be implemented pursuant to applicable authorizations
> or programs of the FERC for which Transporter has filed or in which
> Transporter has agreed to participate.

ARTICLE VI

NOTICES

> Notices shall be provided in accordance with the GT&C, to Transporter
> and Shipper, respectively, at the addresses set forth below:

Transporter:

> Mid-Atlantic Express, L.L.C.
>
> \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_
>
> \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_
>
> \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_
>
> \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_
>
> Fax: 
> \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_
>
> E-mail:\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_
>
> Shipper:
>
> \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_
>
> \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_
>
> \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_
>
> \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_
>
> Fax: 
> \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_
>
> E-mail:\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_
>
> or such other address as either party designates by formal written
> notice for any communication.

ARTICLE VII

NONRECOURSE OBLIGATION OF LIMITED LIABILITY COMPANY

MEMBERS AND OPERATOR

> Shipper acknowledges and agrees that (a) Transporter is a Delaware
> limited liability company; (b) Shipper shall have no recourse against
> any member of Transporter with respect to Transporter's obligations
> under this Service Agreement and its sole recourse shall be against
> the assets of Transporter, irrespective of any failure to comply with
> applicable law or any provision of this Service Agreement; (c) no
> claim shall be made against any member of Transporter, or the member's
> or Transporter's officers, employees, or agents, under or in
> connection with this Service Agreement; (d) no claims shall be made
> against the operator, its officers, employees, and agents, under or in
> connection with this Service Agreement and the performance of its
> duties as operator (provided that this provision shall not bar claims
> resulting from the gross negligence or willful misconduct of the
> Operator), and Shipper shall provide the operator with a waiver of
> subrogation of Shipper's insurance company for all such claims; and
> (e) this representation is made expressly for the benefit of the
> members of Transporter and the operator.

ARTICLE VIII

INTERPRETATION

> THE PARTIES HERETO AGREE THAT THE INTERPRETATION AND PERFORMANCE OF
> THIS SERVICE AGREEMENT MUST BE IN ACCORDANCE WITH THE LAWS OF THE
> STATE OF NEW YORK WITHOUT RECOURSE TO THE LAW GOVERNING CONFLICT OF
> LAWS WHICH WOULD REQUIRE THE APPLICATION OF THE LAWS OF ANOTHER STATE.

ARTICLE IX

FURTHER AGREEMENT

> \[If none, so state\] \[Particulars of any discount agreement pursuant
> to Section 26.1 of the GT&C to be included here\]

ARTICLE X

CANCELLATION OF PRIOR CONTRACT(S)

> This Service Agreement supersedes and cancels, as of the effective
> date of this Service Agreement, the contract(s) between the parties
> hereto as described below:

ARTICLE XI

> No modification of the terms and provisions of this Service Agreement
> shall be or become effective except by the execution of a written
> instrument by Transporter and Shipper.

IN WITNESS WHEREOF, the parties hereto have caused this Service
Agreement to be executed by their respective duly authorized officers
and attested by their respective Secretaries or Assistant Secretaries,
the day and year first above written.

MID-ATLANTIC EXPRESS, L.L.C. (SHIPPER)

By:\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_
By: \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_

Printed Name: \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_ Printed
Name: \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_

Title:\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_
Title: \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_

Executed: \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_, \_\_\_\_ Executed:
\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_, \_\_\_\_

EXHIBIT "A"

to

SERVICE AGREEMENT UNDER

FIRM RATE SCHEDULE FTS

BETWEEN

MID-ATLANTIC EXPRESS, L.L.C.

("TRANSPORTER")

AND

\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_
("SHIPPER")

DATED \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_

TOTAL MDQ: \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_

**FIRM PRIMARY POINT(S) OF RECEIPT**

POINT(S)

[OF RECEIPT]{.underline} [MDRO]{.underline}

TOTAL PRIMARY POINT(S) OF RECEIPT MDQ:

**FIRM PRIMARY POINT(S) OF DELIVERY**

POINT(S)

[OF DELIVERY]{.underline} [MDDO]{.underline}

TOTAL PRIMARY POINT(S) OF DELIVERY MDQ:

Supersedes Exhibit "A" Dated\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_

FORM OF SERVICE AGREEMENT FOR RATE SCHEDULE ITS

> This Service Agreement, is made and entered into this \_\_\_ day of
> \_\_\_\_\_\_\_\_\_, \_\_\_\_, by and between MID-ATLANTIC EXPRESS,
> L.L.C. (herein called "Transporter") and
> \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_ (herein called
> "Shipper").

W I T N E S S E T H:

> WHEREAS, Transporter owns and operates a pipeline system; and
>
> WHEREAS, Shipper desires to purchase interruptible transportation
> service from Transporter;
>
> NOW, THEREFORE, in consideration of the premises and mutual covenants
> and agreements herein contained, the Transporter and Shipper agree as
> follows:

ARTICLE I

SCOPE OF AGREEMENT

1.  Subject to the terms, conditions, and limitations hereof, and of
    Transporter's Rate Schedule ITS and of the General Terms and
    Conditions ("GT&C") of Transporter's FERC Gas Tariff, Volume No. 1,
    Transporter agrees to receive from Shipper on an interruptible basis
    quantities of Natural Gas and to deliver on an interruptible basis
    to Shipper Thermally Equivalent Quantities of Natural Gas received
    by Transporter from Shipper or for Shipper's account.

2.  Service rendered hereunder shall be subject to interruption or
    curtailment when interruption or curtailment is necessary due to
    operating conditions or insufficient available capacity on
    Transporter's Pipeline Facilities or is otherwise necessary to
    protect authorized firm services.

ARTICLE II

TERM OF AGREEMENT

1.  The term of this Service Agreement shall commence on
    \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_ and shall continue in force
    and effect until \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_, and month
    to month thereafter unless this Service Agreement is terminated as
    hereinafter provided. This Service Agreement may be terminated by
    Transporter, in accordance with Section 12 of Rate Schedule ITS, or
    by either Transporter or Shipper upon 30 Days' prior written notice
    to the other specifying a termination date.

2.  The termination of this Service Agreement triggers pregranted
    abandonment under Section 7 of the Natural Gas Act as of the
    effective date of the termination.

3.  Any provisions of this Service Agreement necessary to correct or
    cash out imbalances or to pay all applicable rates, charges, and
    penalties under this Service Agreement shall survive the other parts
    of this Service Agreement until such time as such balancing or
    payment has been accomplished.

ARTICLE III

RATES AND CHARGES, RATE SCHEDULE AND

GENERAL TERMS AND CONDITIONS

1.  For the entire period when this Service Agreement is in effect, this
    Service Agreement in all respects will be subject to the applicable
    provisions of Rate Schedule ITS and of the GT&C on file with the
    FERC, all of which are by this reference made a part hereof to the
    extent that such terms and conditions are not contradicted by any
    provision herein.

2.  Shipper agrees to and shall pay Transporter all applicable maximum
    rates, and charges provided for in Transporter's Rate Schedule ITS
    and the GT&C, as effective from time to time, for service under this
    Service Agreement, unless service is rendered hereunder at
    discounted rates under Section 26.1 of the GT&C, in which event the
    rates and charges that Shipper shall pay Transporter are those
    agreed to and set forth in Article IX of this Service Agreement.

3.  Shipper agrees that Transporter shall have the unilateral right to
    file with the appropriate regulatory authority and make changes
    effective in: (i) the rates and charges applicable to service
    pursuant to Transporter's Rate Schedule ITS; (ii) the terms and
    conditions of service for Transporter's Rate Schedule ITS pursuant
    to which service hereunder is rendered; and/or (iii) any provision
    of the GT&C applicable to service under Rate Schedule ITS.
    Transporter agrees that Shipper may protest or contest the
    aforementioned filings or may seek authorization from duly
    constituted regulatory authorities for such adjustments to
    Transporter's Tariff as may be necessary to ensure that the
    provisions in (i), (ii), and (iii) above are consistent with the
    regulatory law and policy.

ARTICLE IV

RESERVATIONS

> Transporter shall have the right to take actions as may be required to
> preserve the integrity of Transporter's Pipeline Facilities, including
> maintenance of service to firm Shippers.

ARTICLE V

GOVERNMENTAL AUTHORIZATIONS

> It is hereby agreed that transportation service under this Service
> Agreement shall be implemented pursuant to applicable authorizations
> or programs of the FERC for which Transporter has filed or in which
> Transporter has agreed to participate.

ARTICLE VI

NOTICES

> Notices shall be provided in accordance with the GT&C, to Transporter
> and Shipper, respectively, at the addresses set forth below:

Transporter:

> Mid-Atlantic Express, L.L.C.
>
> \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_
>
> \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_
>
> \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_
>
> \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_
>
> Fax: 
> \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_
>
> E-mail:\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_
>
> Shipper:
>
> \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_
>
> \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_
>
> \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_
>
> \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_
>
> Fax: 
> \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_
>
> E-mail:\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_
>
> or such other address as either party designates by formal written
> notice for any communication.

ARTICLE VII

NONRECOURSE OBLIGATION OF

LIMITED LIABILITY COMPANY

MEMBERS AND OPERATOR

> Shipper acknowledges and agrees that (a) Transporter is a Delaware
> limited liability company, (b) Shipper shall have no recourse against
> any member of Transporter with respect to Transporter's obligations
> under this Service Agreement and its sole recourse shall be against
> the assets of Transporter, irrespective of any failure to comply with
> applicable law or any provision of this Service Agreement; (c) no
> claim shall be made against any member of Transporter or the member's
> or Transporter's officers, employees, or agents, under or in
> connection with this Service Agreement; (d) no claims shall be made
> against the operator, its officers, employees, and agents, under or in
> connection with this Service Agreement and the performance of its
> duties as operator (provided that this shall not bar claims resulting
> from the gross negligence or willful misconduct of the operator), and
> Shipper shall provide the operator with a waiver of subrogation of
> Shipper's insurance company for all such claims; and (e) this
> representation is made expressly for the benefit of the members of
> Transporter and the operator.

ARTICLE VIII

INTERPRETATION

> THE PARTIES HERETO AGREE THAT THE INTERPRETATION AND PERFORMANCE OF
> THIS SERVICE AGREEMENT MUST BE IN ACCORDANCE WITH THE LAWS OF THE
> STATE OF NEW YORK WITHOUT RECOURSE TO THE LAW REGARDING THE CONFLICT
> OF LAWS WHICH WOULD REQUIRE THE APPLICATION OF THE LAWS OF ANOTHER
> STATE.

ARTICLE IX

FURTHER AGREEMENT

> \[If none, so state\] \[Particular of any discount agreement pursuant
> to Section 26.1 of the GT&C to be included here.\]

ARTICLE X

CANCELLATION OF PRIOR CONTRACT(S)

> This Service Agreement supersedes and cancels, as of the effective
> date of this Service Agreement, the contract(s) between the parties
> hereto as described below:

ARTICLE XI

> No modification of the terms and provisions of this Service Agreement
> shall be or become effective except by the execution of a written
> instrument by Transporter and Shipper.
>
> IN WITNESS WHEREOF, the parties hereto have caused this Service
> Agreement to be signed by their respective duly authorized officers
> and attested by their respective Secretaries or Assistant Secretaries,
> the day and year first above written.

MID-ATLANTIC EXPRESS, L.L.C. (SHIPPER)

By:\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_
By: \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_

Printed Name: \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_ Printed
Name: \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_

Title:\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_
Title: \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_

Executed: \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_, \_\_\_\_ Executed:
\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_, \_\_\_\_

FORM OF SERVICE AGREEMENT

FOR RATE SCHEDULE PALS

> This Service Agreement, is made and entered into this \_\_\_ day of
> \_\_\_\_\_\_\_\_\_, \_\_\_\_, by and between MID-ATLANTIC EXPRESS,
> L.L.C. (herein called "Transporter") and
> \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_ (herein called
> "Shipper").
>
> W I T N E S S E T H:
>
> WHEREAS, Transporter owns and operates a pipeline system; and
>
> WHEREAS, Shipper desires to purchase interruptible parking and lending
> service from Transporter;
>
> NOW, THEREFORE, in consideration of the premises and mutual covenants
> and agreements herein contained, the Transporter and Shipper agree as
> follows:

ARTICLE I

SCOPE OF AGREEMENT

> Transporter agrees to receive for the Parking and Lending Account of
> Shipper and park, or lend to the Shipper, on an interruptible and
> capacity available basis, quantities of Natural Gas at the specified
> parking or lending point as follows:

Description of Parking Point:
\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_

\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_

Description of Lending Point:
\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_

\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_

ARTICLE II

TERM OF AGREEMENT

1.  The term of this Service Agreement shall commence on
    \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_ and shall continue in force
    and effect until \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_, and month
    to month thereafter. This Service Agreement may be terminated by
    either Transporter or Shipper upon 30 Days' prior written notice to
    the other specifying a termination date.

2.  The termination of this Service Agreement triggers pregranted
    abandonment under Section 7 of the Natural Gas Act as of the
    effective date of the termination.

3.  Any provisions of this Service Agreement necessary to correct or
    cash out imbalances or to pay all applicable rates, charges, and
    penalties under this Service Agreement shall survive the other parts
    of this Service Agreement until such time as such balancing or
    payment has been accomplished.

ARTICLE III

RATES AND CHARGES, RATE SCHEDULE AND

GENERAL TERMS AND CONDITIONS

1.  Shipper agrees to and shall pay Transporter all applicable maximum
    rates, and charges provided for in Transporter's Rate Schedule PALS
    and the General Terms and Conditions ("GT&C") of Transporter's FERC
    Gas Tariff, Volume No. 1, as effective from time to time, for
    service under this Service Agreement, unless service is rendered
    hereunder at discounted rates under Section 26.1 of the GT&C, in
    which event the rates and charges that Shipper shall pay Transporter
    are those agreed to and set forth in Article IX of this Service
    Agreement.

2.  Shipper agrees that Transporter shall have the unilateral right to
    file with the appropriate regulatory authority and make changes
    effective in: (i) the rates and charges applicable to service
    pursuant to Transporter's Rate Schedule PALS; (ii) the terms and
    conditions of service for Transporter's Rate Schedule PALS pursuant
    to which service hereunder is rendered; and/or (iii) any provision
    of the GT&C applicable to service under Rate Schedule PALS.
    Transporter agrees that Shipper may protest or contest the
    aforementioned filings or may seek authorization from duly
    constituted regulatory authorities for such adjustments to
    Transporter's Tariff as may be necessary to ensure that the
    provisions in (i), (ii), and (iii) above are consistent with the
    regulatory law and policy.

ARTICLE IV

RESERVATIONS

> Transporter shall have the right to take actions as may be required to
> preserve the integrity of Transporter's Pipeline Facilities, including
> maintenance of service to firm Shippers.

ARTICLE V

NOTICES

> Notices shall be provided in accordance with the GT&C, to Transporter
> and Shipper, respectively, at the addresses set forth below:

Transporter:

> Mid-Atlantic Express, L.L.C.
>
> \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_
>
> \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_
>
> \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_
>
> \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_
>
> Fax: 
> \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_
>
> E-mail:\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_
>
> Shipper:
>
> \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_
>
> \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_
>
> \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_
>
> \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_
>
> Fax: 
> \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_

E-mail:\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_

> or such other address as either party designates by formal written
> notice for any communication.

ARTICLE VI

NONRECOURSE OBLIGATION OF

LIMITED LIABILITY COMPANY

MEMBERS AND OPERATOR

> Shipper acknowledges and agrees that (a) Transporter is a Delaware
> limited liability company, (b) Shipper shall have no recourse against
> any member of Transporter with respect to Transporter's obligations
> under this Service Agreement and its sole recourse shall be against
> the assets of Transporter, irrespective of any failure to comply with
> applicable law or any provision of this Service Agreement; (c) no
> claim shall be made against any member of Transporter or the member's
> or Transporter's officers, employees, or agents, under or in
> connection with this Service Agreement; (d) no claims shall be made
> against the operator, its officers, employees, and agents, under or in
> connection with this Service Agreement and the performance of its
> duties as operator (provided that this shall not bar claims resulting
> from the gross negligence or willful misconduct of the operator), and
> Shipper shall provide the operator with a waiver of subrogation of
> Shipper's insurance company for all such claims; and (e) this
> representation is made expressly for the benefit of the members of
> Transporter and the operator.

ARTICLE VII

INTERPRETATION

> THE PARTIES HERETO AGREE THAT THE INTERPRETATION AND PERFORMANCE OF
> THIS SERVICE AGREEMENT MUST BE IN ACCORDANCE WITH THE LAWS OF THE
> STATE OF NEW YORK WITHOUT RECOURSE TO THE LAW REGARDING THE CONFLICT
> OF LAWS WHICH WOULD REQUIRE THE APPLICATION OF THE LAWS OF ANOTHER
> STATE.

ARTICLE VIII

FURTHER AGREEMENT

> \[If none, so state\] \[Particular of any discount agreement pursuant
> to Section 26.1 of the GT&C to be included here.\]
>
> IN WITNESS WHEREOF, the parties hereto have caused this Service
> Agreement to be signed by their respective officers or other persons
> duly authorized to do, the day and year first above written.

MID-ATLANTIC EXPRESS, L.L.C. (SHIPPER)

By:\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_
By: \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_

Printed Name: \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_ Printed
Name: \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_

Title:\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_
Title: \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_

Executed: \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_, \_\_\_\_ Executed:
\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_, \_\_\_\_

SHEET RESERVED FOR FUTURE USE

Sheet Nos. 166-172 are reserved for future use.

FORM OF SERVICE AGREEMENT

FOR ELECTRONIC COMMUNICATION SERVICE

> This Service Agreement, executed this \_\_\_\_\_ day of
> \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_, \_\_\_\_, by and between
> \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_
> (\"Mid-Atlantic Express Website Subscriber\"), and Mid-Atlantic
> Express, L.L.C. ("Transporter") witnesseth that for and in
> consideration of the mutual covenants and provisions herein contained
> and subject to all of the terms, provisions and conditions herein set
> forth, Mid-Atlantic Express Website Subscriber and Transporter do
> hereby agree as follows:

ARTICLE I

SCOPE OF AGREEMENT

> Transporter shall make available for use by Mid-Atlantic Express
> Website Subscriber Transporter's computerized electronic communication
> service, the Mid-Atlantic Express Website system. Mid-Atlantic Express
> Website Subscriber may at its option use the Mid-Atlantic Express
> Website system to: (1) request new services under applicable Rate
> Schedules; (2) request and execute amendment of existing service
> agreements; and (3) nominate quantities for receipt and delivery by
> Transporter pursuant to an existing service agreement under any of
> Transporter's rate schedules. Mid-Atlantic Express Website Subscriber
> may also use the Mid-Atlantic Express Website system to request and
> receive from Transporter such other information as Transporter may
> from time to time make available to Mid-Atlantic Express Website
> Subscriber through the Mid-Atlantic Express Website system.

ARTICLE II

TERMS AND CONDITIONS

> Mid-Atlantic Express Website Subscriber's use of the Mid-Atlantic
> Express Website System shall be in accordance with and subject to
> Transporter's currently effective FERC Gas Tariff, including any and
> all applicable provisions of the General Terms and Conditions (the
> \"General Terms and Conditions\") and the terms and conditions of any
> relevant rate schedules which appear in Transporter's currently
> effective FERC Gas Tariff, all of which terms and conditions are
> expressly incorporated by reference herein.

[Authorized Use of Mid-Atlantic Express Website;
Confidentiality]{.underline}

> Use of the Mid-Atlantic Express Website system by Mid-Atlantic Express
> Website Subscriber shall be limited only to those persons who have
> been duly authorized by Mid-Atlantic Express Website Subscriber to use
> the Mid-Atlantic Express Website system (the \"Authorized
> Personnel\"), as indicated in the completed Computer Access Request
> Form to be submitted by Mid-Atlantic Express Website Subscriber to
> Transporter, a copy of which is attached to the Mid-Atlantic Express
> Website Agreement. Transporter will provide each of Mid-Atlantic
> Express Website Subscriber's Authorized Personnel with an
> individualized user identification code (\"USERID\") and password. The
> number and type of USERIDs and passwords to be issued by Transporter
> shall be subject to the sole discretion of Transporter.
>
> Mid-Atlantic Express Website Subscriber shall also designate one or
> more Authorized Personnel who are additionally authorized: (1) to
> transmit information to Transporter through the Mid-Atlantic Express
> Website system, and/or (2) to perform the contracting function and
> thereby legally bind Mid-Atlantic Express Website Subscriber to any
> service agreement or amended service agreement entered into with
> Transporter (collectively, the \"Designated Personnel\"). Transporter
> shall be entitled to rely upon Mid-Atlantic Express Website
> Subscriber's representation that any and all Designated Personnel
> authorized to perform the Mid-Atlantic Express Website system
> contracting function have been duly authorized by Mid-Atlantic Express
> Website Subscriber to enter into one or more service agreements or
> amended service agreements for all purposes of this Mid-Atlantic
> Express Website Agreement.
>
> Mid-Atlantic Express Website Subscriber shall not disclose to persons
> other than Authorized Personnel, and shall otherwise keep completely
> confidential, all USERIDs and passwords issued to Mid-Atlantic Express
> Website Subscriber by Transporter. In addition, each Authorized
> Personnel shall likewise not disclose to any other person, and shall
> otherwise keep completely confidential, the individualized USERID and
> password issued to such Authorized Personnel.
>
> Mid-Atlantic Express Website Subscriber shall immediately inform
> Transporter in writing whenever Mid-Atlantic Express Website
> Subscriber desires to terminate access to the Mid-Atlantic Express
> Website system previously granted to any Authorized Personnel, or
> desires to terminate the status of any Designated Personnel.
> Mid-Atlantic Express Website Subscriber shall be solely responsible
> for any and all unauthorized or otherwise improper use of USERIDs and
> passwords issued to Mid-Atlantic Express Website Subscriber by
> Transporter, including but not limited to the use of such USERIDs and
> passwords by Authorized Personnel who at some point are no longer
> within Mid-Atlantic Express Website Subscriber's employment or
> control. Transporter reserves the right, at any time and in
> Transporter's sole discretion, to invalidate without prior notice any
> password or USERID issued to Mid-Atlantic Express Website Subscriber.
>
> Mid-Atlantic Express Website Subscriber shall defend and indemnify
> Transporter from and against any and all claims, demands, and actions,
> and any resulting loss, costs, damages, and expenses (including court
> costs and reasonable attorney's fees) of any nature whatsoever, which
> may be asserted against or imposed upon Transporter by any party as a
> result of the unauthorized or otherwise improper use of any USERID or
> password issued by Transporter to Mid-Atlantic Express Website
> Subscriber.
>
> [Release and Disclaimer of Liability; Indemnification]{.underline}
>
> Transporter expressly disclaims any and all liability for damages to
> Mid-Atlantic Express Website Subscriber, except for damages directly
> attributable to the bad faith, fraud or willful misconduct of
> Transporter, or to any third parties associated with Mid-Atlantic
> Express Website Subscriber's use of the Mid-Atlantic Express Website
> system arising out of or in any manner related to use by Mid-Atlantic
> Express Website Subscriber or Transporter of the Mid-Atlantic Express
> Website system, including but not limited to any damages resulting
> from any one or more of the following: (1) any acts of God or force
> majeure, including but not limited to sabotage, war, riot, lightning,
> vermin, fire, floods, electrical storms and/or power outages, or any
> other natural or public calamity; (2) any defects in computer software
> or hardware or defective programming; (3) any interruption in or
> malfunction of electronic communication or transmission; or (4) any
> improper or erroneous service which may occur as a result of use of
> the Mid-Atlantic Express Website system. Transporter's liability, if
> any, shall be limited to direct damages only incurred by the
> Mid-Atlantic Express Website Subscriber and shall not extend to
> consequential, indirect or punitive damages incurred by the
> Mid-Atlantic Express Website Subscriber or any damages of any nature
> whatsoever incurred by third parties.
>
> TRANSPORTER HEREBY DISCLAIMS ANY AND ALL EXPRESS AND IMPLIED
> WARRANTIES OF ANY NATURE WHATSOEVER IN CONNECTION WITH Mid-Atlantic
> Express Website SUBSCRIBER'S USE OF THE Mid-Atlantic Express Website
> SYSTEM, INCLUDING BUT NOT LIMITED TO ANY AND ALL IMPLIED WARRANTIES OF
> MERCHANTABILITY AND FITNESS FOR ANY PARTICULAR PURPOSE.
>
> Mid-Atlantic Express Website Subscriber agrees to protect, defend,
> indemnify, and hold harmless Transporter against any and all loss,
> costs, damages, and expenses of any nature whatsoever (including court
> costs and reasonable attorney's fees), resulting from or otherwise
> related to any claim, demand, or action asserted against Transporter,
> arising from or in any manner directly or indirectly connected with
> Mid-Atlantic Express Website Subscriber's use of the Mid-Atlantic
> Express Website system, except for the negligence, bad faith, fraud or
> willful misconduct of Transporter.

[Other Terms and Conditions]{.underline}

> Use of the Mid-Atlantic Express Website system is expressly subject to
> all of the General Terms and Conditions, as well as all of the terms
> and conditions of any Rate Schedule and Service Agreement which may be
> applicable to any transaction performed by Mid-Atlantic Express
> Website Subscriber and Transporter by means of the Mid-Atlantic
> Express Website system, all of which are set forth in Transporter's
> currently effective FERC Gas Tariff as amended from time to time and
> are hereby incorporated by reference. In the event of a conflict
> between the terms and conditions of this service agreement and any
> other applicable terms and conditions set forth in Transporter's
> currently effective FERC Gas Tariff which are incorporated by
> reference herein, such other terms and conditions shall govern
> Mid-Atlantic Express Website Subscriber's use of the Mid-Atlantic
> Express Website system unless otherwise specifically provided herein.

ARTICLE III

TERM

> This Agreement shall be and continue in full force and effect from the
> date of execution hereof until terminated only for due cause or at
> Mid-Atlantic Express Website Subscriber's request. Mid-Atlantic
> Express Website Subscriber agrees that Transporter shall have the
> unilateral right to file with the appropriate regulatory authority and
> make changes effective in (a) the rates and charges applicable to
> service pursuant to this Service Agreement or (b) any provision of the
> General Terms and Conditions applicable to this Service Agreement.
> Transporter agrees that Mid-Atlantic Express Website Subscriber may
> protest or contest the aforementioned filings, and Mid-Atlantic
> Express Website Subscriber does not waive any rights it may have with
> respect to such filings.

ARTICLE IV

ADDRESSES

> Except as herein otherwise provided or as provided in the General
> Terms and Conditions of Transporter's FERC Gas Tariff, any notice,
> request, demand, statement, bill or payment provided for in this
> Service Agreement, or any notice which any party may desire to give to
> the other, shall be in writing and shall be considered as duly
> delivered when mailed by registered, certified, or regular mail to the
> post office address of the parties hereto, as the case may be, as
> follows:

\(a\) Transporter: \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_

\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_

\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_

\(b\) Customer: \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_

\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_

\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_

or such other address as either party shall designate by formal written
notice.

ARTICLE V

INTERPRETATION

> The interpretation and performance of this Service Agreement shall be
> in accordance with the laws of the State of New York without recourse
> to the law regarding the conflict of laws.
>
> This Service Agreement and the obligations of the parties are subject
> to all present and future valid laws with respect to the subject
> matter, either State or Federal, and to all valid present and future
> orders, rules, and regulations of duly constituted authorities having
> jurisdiction.
>
> IN WITNESS WHEREOF, the parties hereto have caused this Service
> Agreement to be signed by their respective Presidents, Vice Presidents
> or other duly authorized agents the day and year first above written.

MID-ATLANTIC EXPRESS, L.L.C. (MID-ATLANTIC EXPRESS WEBSITE

SUBSCRIBER)

By:\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_
By: \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_

Printed Name: \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_ Printed
Name: \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_

Title:\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_
Title: \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_

Executed: \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_, \_\_\_\_ Executed:
\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_, \_\_\_\_

CAPACITY RELEASE

FORM OF SERVICE AGREEMENT

CONTRACT NO. \_\_\_\_\_\_\_\_\_\_

> THIS AGREEMENT is made effective as of the \_\_\_\_\_\_ day of
> \_\_\_\_\_\_\_, \_\_\_\_, by and between:
>
> MID-ATLANTIC EXPRESS, L.L.C., (hereinafter called "Transporter"), a
> Delaware limited liability company,

and

> \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_,
> (hereinafter called "Replacement Shipper").
>
> In consideration of the mutual covenants and agreements as herein set
> forth, both Transporter and Replacement Shipper covenant and agree as
> follows:

ARTICLE 1 - SERVICE

> For each occasion that Replacement Shipper obtains capacity from a
> Releasing Shipper through Transporter's capacity release program, an
> Addendum in the form of Exhibit A, attached hereto will be made a part
> hereof. The specific terms and conditions of each release shall be
> reflected in each Addendum, which shall be incorporated and made a
> part of this Agreement, and which together shall constitute the terms
> and conditions of Transporter's service for each release.
>
> Transporter agrees to receive at the Points of Receipt and deliver at
> the Points of Delivery, on a firm basis, quantities of Natural Gas up
> to the Maximum Daily Quantity obtained from the Releasing Shipper. The
> Maximum Daily Quantity is stated in delivered Quantities, for which
> received Quantities must be adjusted for fuel usage and lost or
> unaccounted for Gas as set out in the then-effective, applicable rates
> and charges under Transporter's Rate Schedules applicable to the
> Releasing Shipper.

ARTICLE 2 - TERM

> This Agreement shall be effective from the date first stated above
> until \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_, when this Agreement shall
> expire. Service shall commence and remain effective for a term
> coincidental for each capacity release term identified in each
> Addendum.

ARTICLE 3 - RATES AND CHARGES

> For the services provided or contracted for hereunder (including any
> Addendum hereunder), Shipper agrees to pay Transporter the applicable
> Reservation Charge, and any surcharges thereon, in the amount of its
> winning bid for each contracted for service. Replacement Shipper is
> also responsible for all other billings, e.g., usage rate and
> applicable usage surcharges associated with its usage of capacity
> contracted for hereunder.

ARTICLE 4 - TRANSPORTER'S USE GAS REIMBURSEMENT

> In addition to collection of the rates and charges provided for in
> each Addendum, Transporter shall retain, as Transporter's Use Gas, the
> percentage of the quantities received from Shipper hereunder, as
> provided pursuant to the applicable Rate Schedule.

ARTICLE 5 - GENERAL TERMS AND CONDITIONS

> This Agreement and all terms for service hereunder are subject to the
> further provisions of the applicable Rate Schedule and the General
> Terms and Conditions of Transporter's Tariff, as such may be modified,
> supplemented, superseded or replaced generally or as to the service
> hereunder. Transporter reserves the right from time to time to
> unilaterally file and to make effective any such changes in the
> provisions of the applicable Rate Schedules and the General Terms and
> Conditions, subject to the applicable provisions of the Natural Gas
> Act and the Commission's Regulations thereunder. Such Rate Schedule
> and General Terms and Conditions, as may be changed from time to time,
> are by this reference incorporated in their entirety into this
> Agreement and made an integral part hereof.

ARTICLE 6 - NOTICES

> Notices shall be provided in accordance with the GT&C, to Transporter
> and Shipper, respectively, at the addresses set forth below:

Transporter:

> Mid-Atlantic Express, L.L.C.
>
> \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_
>
> \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_
>
> \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_
>
> \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_
>
> Fax: 
> \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_
>
> E-mail:\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_
>
> Shipper:
>
> \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_
>
> \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_
>
> \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_
>
> \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_
>
> Fax: 
> \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_

E-mail:\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_

> or such other address as either party designates by formal written
> notice for any communication.
>
> IN WITNESS WHEREOF, both Transporter and Replacement Shipper have
> caused this Agreement to be executed in several counterparts by their
> respective officers or other persons duly authorized to do so.

MID-ATLANTIC EXPRESS, L.L.C. (REPLACEMENT SHIPPER)

By: \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_ By:
\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_

Printed Name: \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_ Printed
Name: \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_

Title:\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_
Title: \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_

Executed: \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_, \_\_\_\_ Executed:
\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_, \_\_\_\_

EXHIBIT A

Capacity Release Agreement No. \_\_\_\_\_

Addendum No. \_\_

Capacity Release Service Agreement

Between

Mid-Atlantic Express, L.L.C.

and
\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_

Releasing Shipper Releasing Shipper

Contract No. \_\_\_\_\_\_\_\_\_\_ Rate Schedule \_\_\_\_\_\_

Original Releasing

Shipper Contract No. \_\_\_\_\_ Regulation \_\_\_\_\_\_\_\_\_\_\_\_\_

Replacement Shipper's

Maximum Daily Quantity (Dth)
\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_

Permanent or Temporary Release \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_

Conditions of Recall \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_

Term of Release

Begin \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_ End
\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_

Reservation Rate (including applicable surcharges) \_\_\_\_\_\_\_

Other Conditions

EXHIBIT A

Capacity Release Agreement No. \_\_\_\_\_

Addendum No. \_\_

CAPACITY RIGHTS

Points of Receipt

**Primary Points of Receipt:**

Meter

[Zone]{.underline} [Received From]{.underline} [Location]{.underline}
[County]{.underline} [State]{.underline} [No]{.underline}.
[Quantity]{.underline}

**Secondary Points of Receipt:**

> Shipper shall have secondary Points of Receipt as set forth in Section
> 17.2 of the General Terms and Conditions of Transporter's FERC Gas
> Tariff.

EXHIBIT A

Capacity Release Agreement No. \_\_\_\_\_

Addendum No. \_\_

CAPACITY RIGHTS

Points of Delivery

**Primary Points of Delivery:**

Meter

[Zone]{.underline} [Received From]{.underline} [Location]{.underline}
[County]{.underline} [State]{.underline} [No]{.underline}.
[Quantity]{.underline}

**Secondary Points of Delivery:**

> Shipper shall have secondary Points of Delivery as set forth in
> Section 17.2 of the General Terms and Conditions of Transporter's FERC
> Gas Tariff.