<PAGE>
                                                                   EXHIBIT 10.16

                           REGENCY INTRASTATE GAS LLC

                         PIPELINE CONSTRUCTION CONTRACT

This Contract is made and entered into this 2nd day of May, 2005, at Dallas,
Texas, by and between Regency Gas Intrastate LLC, a Delaware limited liability
company (hereinafter called " Company") and H.C. Price Co., a ______________
(hereinafter called " Contractor").

Company has advised Contractor that Company desires to have constructed certain
24" natural gas pipeline with facilities, beginning at [Describe].

In consideration of Ten Dollars ($10.00) cash in hand paid by Company to
Contractor and other good and valuable consideration the receipt and adequacy of
which is hereby acknowledged and in consideration of the mutual covenants
herein, Company and Contractor agree as follows:

     1.   Contractor represents and warrants that it has fully acquainted itself
          with the work to be performed hereunder, including, without
          limitation, all the provisions of the Contract as herein after
          defined, the topography of the right-of-way; the type and character of
          the soil, rock, grading, stream, highway, railroad and all other
          conditions, obstacles and impediments, of whatsoever kind and
          character, that may be encountered in the performance of the work.

     2.   Contractor hereby acknowledges that Company has furnished to
          Contractor the Company's General Conditions, the Pipeline Construction
          Specifications, the Standard Drawings, the Special R.O.W. Provisions,
          and the Project Drawings (all the immediately foregoing documents
          shall be collectively hereinafter referred to as the "Documents").
          Attached to this Pipeline Construction Contract are the Pipeline
          Construction Bid Specifications and a list of the Project Drawings.
          This Pipeline Construction Contract, the Documents, the Pipeline
          Construction Bid Specification and the Project Drawings, together with
          any written documents which are referred to and made a part of any of
          the foregoing, shall constitute the "Contract" between Company and
          Contractor and the Documents, the Pipeline Construction Bid
          Specification and the Project Drawings are all incorporated herein by
          this reference.

     3.   Contractor shall perform, and do all things necessary, for the proper
          construction and completion of the work as described and provided in
          the Contract.

     4.   Time is of the essence. The Work shall be commenced on or

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          before May 2, 2005 and all Work under this Contract shall be completed
          on or before July 1, 2005, Mechanical Completion being June 24, 2005
          (Haughton to Sibley), Mechanical Completion being October 21, 2005
          (Sibley to Mainline) Final Clean-up, December 31, 2005; provided,
          however, that Company may postpone the above starting date pending the
          issuance of any necessary approvals of governmental authorities,
          availability of rights-of-way, or receipt of adequate amounts of
          material at the delivery points provided for in this Contract, so long
          as Company provides Contractor with an appropriate equitable
          adjustment of the time and payment provisions of this Contract. It is
          agreed that Company will give notice to Contractor of any such
          postponement at least ten (10) days prior to the specified starting
          date and providing a subsequent starting date. The subsequent
          completion dates shall be delayed equally.

     5.   Company shall pay Contractor for the performance of this Contract in
          accordance with the unit prices set forth in the Pipeline Construction
          Bid Specification and the other applicable provisions of the Contract.

     6.   This Contract is and shall be deemed made and delivered in State of
          Louisiana, and shall be governed and construed in accordance with the
          laws of the State of Louisiana.

     7.   This Contract shall be binding upon the parties hereto, their
          representatives, heirs, executors, administrators, successors and
          assigns. Contractor shall not assign this Contract, or any portion
          hereof, or any of its rights and obligations hereunder without first
          securing the prior written consent of Company.

     8.   Contractor represents and warrants that it has read and understands
          this Contract and now states that this Contract constitutes the entire
          agreement between the parties concerning the subject matter hereof,
          and any prior statements, negotiations, inducements, representatives,
          contracts or agreements, exclusive of the Contract, relating thereto
          are hereby canceled, and declared invalid and shall not be binding
          upon the parties.

     9.   Special Requirements

          a.   Regency retains the right to select or reject any or all bidders
               at its sole discretion.

          b.   Operator Qualification Requirements.

          c.   Drug Test Requirements Provisions.

     10.  Capitalized terms used but not defined herein are defined in Article

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          1.0 of the General Conditions and are used herein with the meanings
          ascribed to them therein.

EXECUTED, effective as of the day and year first above written.

ATTEST                            "CONTRACTOR"

                                  H.C. Price Co.
                                  ---------------------------------------------
                                  (Name of Contractor)

                                  /s/ C.S. Hardwick, Jr.
                                  ---------------------------------------------
                                  BY

/s/ Nan Drinker                   Sr. Vice President
--------------------------------  ---------------------------------------------
SECRETARY                         TITLE

                                  "COMPANY"

ATTEST                            REGENCY INTRASTATE GAS LLC


                                  /s/ Durrell J. Johnson
                                  ---------------------------------------------
                                  BY

/s/ Angela (Illegible)            Vice President - Operations and  Engineering
--------------------------------  ---------------------------------------------
SECRETARY                         TITLE


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                           REGENCY INTRASTATE GAS LLC

                                INVOICE PROCEDURE

                                       SUPPLEMENT TO INVOICE NO. _______________
                                                    INVOICE DATE _______________

FOR WORK COMPLETED FOR PERIOD _____________________, 20__ THROUGH
____________________, 20__, ON SPREAD __________________ UNDER CONTRACT OF
____________________, AND AS PER CONSTRUCTION CERTIFICATE DATED _______________,
ATTACHED.

<TABLE>
<CAPTION>
                                         UNITS TO    UNIT      AMOUNT
                                 %         DATE      PRICE     EARNED
           ITEM              Complete     (FT.)      (FT.)       ($)
           ----              --------   ---------   ------   ----------
<S>                          <C>        <C>         <C>      <C>
a. Mobilization (10%)          ____%    _________   ______   __________
b. Clearing (15%)              ____%    _________   ______   __________
c. Grading (5%)                ____%    _________   ______   __________
d. Ditching (10%)              ____%    _________   ______   __________
e. Stringing (5%)              ____%    _________   ______   __________
f. Laying & Welding (20%)      ____%    _________   ______   __________
g. Field Joints (3%)           ____%    _________   ______   __________
h. Lowering-in (7%)            ____%    _________   ______   __________
i. Tie-Ins (10%)               ____%    _________   ______   __________
j. Testing (5%)                ____%    _________   ______   __________
k. Clean-up (10%)              ____%    _________   ______   __________
                               ----
                               ____%
</TABLE>

<TABLE>
<CAPTION>
                                   EARNINGS         RETENTION
                                --------------   --------------
<S>                             <C>              <C>
(1) Cumulative Total to Date    $_____________   $_____________
(2) Total Previously Invoiced   $_____________   $_____________
(3) Total Earned This Period    $_____________   $_____________
</TABLE>

AMOUNT DUE THIS INVOICING $ _____________________________ (Item 3, Earnings Less
Ten Percent (10%) Retention

BILL TO ADDRESS:
Jay Strickler
Regency Intrastate Gas LLC
201 Oak Street

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                                                    Company Initials: DJJ


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Dubach, LA 71235
318-243-6718


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                           REGENCY INTRASTATE GAS LLC

                                      INDEX

                               GENERAL CONDITIONS

<TABLE>
<S>    <C>
1.0    Definitions and Correlation of Documents
2.0    Materials, Equipment and Employees Furnished by Contractor
3.0    Materials and Equipment Furnished by Company
4.0    Representatives and Superintendents
5.0    Safety
6.0    Insurance
7.0    Personal Injury and Property Damage
8.0    Taxes, Liens, and Legal Requirements
9.0    Workmen's Compensation Insurance
10.0   Subcontractors
11.0   Commencing Work at Contractor's Risk
12.0   Skipping Work
13.0   Suspension, Discontinuance of Work or Shut Down
14.0   Changes in Work
15.0   Disputed Claims for Extra Compensation
16.0   Extra Work
17.0   Force Count Work
18.0   Omitted Work
19.0   Contractor's Obligation to Furnish Statements
20.0   Prosecution of Work
21.0   Inspection: Authority of Company's Representative and Inspectors
22.0   Radiographic Inspection
23.0   No Waiver Authorization
24.0   Site Examination
</TABLE>


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<TABLE>
<S>    <C>
25.0   Measurement of Work Quantities
26.0   Consideration
27.0   Inspection of Contractor's Records
28.0   Company's Right to Supplement Work of Partially Terminate Contract
29.0   Termination of Work for Default of Contractor
30.0   Payment
31.0   Oral Agreements
32.0   Bonds
33.0   Liability of Company
34.0   Guarantee
35.0   Equal Opportunity
36.0   Certification of Non-Standard Facilities
37.0   Handicapped Workers
38.0   Disabled Veterans and Veterans of the Vietnam Era
39.0   Contractor Assurances
</TABLE>

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1.0 DEFINITIONS, CONSTRUCTION AND CORRELATION OF DOCUMENTS

     1.1  The obligations of Contractor and the rights of Company under the
          Contract shall be cumulative. The fact that two or more of the
          provisions of the Contract may deal with the same or a similar subject
          matter but impose different, although not mutually exclusive,
          obligations upon Contractor shall not relieve Contractor from
          satisfying all of said obligations. The exercise by Company of any
          right granted under this Contract shall not limit or affect Company's
          ability to exercise any other rights under this Contract; provided,
          however, the rights and remedies set forth in this Contract shall be
          the exclusive rights and remedies of Company. If any provision of the
          Contract is or should subsequently become void, or unenforceable under
          applicable law, such fact shall not affect Company's rights under or
          ability to enforce any other provision.

     1.2  Subject to the provisions of paragraph 1.1 above, if two or more of
          the provisions of this booklet entitled "Documents" are in direct
          conflict, unless otherwise expressly provided in the Contract, the
          order of precedence among the sections shall be as follows:

               Special Provisions
               Construction Specifications
               Project Drawings (eg: Alignment Sheets, Mainline Valve
               Drawings, Launcher/Receiver Drawings, etc.)
               Special Drawings (eg: Permit Drawings, Typical Construction
               Drawings, etc)
               General Conditions

     1.3  The term "Company" as used in the Contract shall mean Regency
          Intrastate Gas LLC which has contracted with the Contractor for the
          performance of the Work, acting through its officers.

     1.4  The term "Contract" as used herein shall have the meaning ascribed to
          such term in paragraph 2 of the Pipeline Construction Contract.

     1.5  The term "Contractor" as used in the Contract shall mean H. C. Price
          Co. and any successor thereto.

     1.6  The term "crew" as used in the Contract shall mean a group of workmen,
          including supervisory personnel, operators and related equipment,
          engaged in a single specific task in the construction of the
          facilities.


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     1.7  The term "Extra Work" as used in the Contract shall have the meaning
          ascribed to such term in paragraph 14.2 of these General Conditions.

     1.8  The term "Construction Bid Sheet" and the term "Unit Price Summary" as
          used herein shall mean that portion of the Contract entitled
          Construction Bid Sheet" and "Unit Price Summary," respectively, or any
          other provision of the Contract however entitled that sets forth the
          prices that Company has agreed to pay Contractor for the performance
          of the Work.

     1.9  The term "right-of-way", "rights-of-way" or "ROW" as used in the
          Contract shall mean the easements, license, lease, permit or other
          real or personal right under which Company has the right to construct
          the facilities upon, over, under, across, and through the lands
          whereupon the Contractor is to construct the work hereunder.

     1.10 The term "spread" as used in the Contract shall mean all crews
          necessary to install a pipeline or other facilities to be constructed
          by Contractor as described in this Contract.

     1.11 Unless the context clearly indicates otherwise, the term "Work" as
          used in the Contract shall mean all of the materials, labor and
          activities necessary for the completion of the facilities to be
          constructed under the Contract to the satisfaction of Company.

     1.12 "Applicable Law" shall mean any applicable law or statute or any
          order, decree, injunction, license, permit, consent, approval,
          agreement, or regulation of any governmental entity having
          jurisdiction, including any specified standards or criteria contained
          in any applicable permit or approval, which standards or criteria must
          be met in order for the Work to be constructed and operated lawfully,
          or other legislative or administrative action of a governmental entity
          or a final decree, judgment, or order of a court.

     1.13 "Change in Law" shall mean the adoption, enactment or application to
          Company or Contractor of any Applicable Law subsequent to the
          Effective Date that adversely affects (in cost or time or both) the
          ability of Company or Contractor to perform its obligations hereunder;
          provided, however, that a change in any income tax law shall not
          constitute a Change in Law. If and to the extent that any Change in
          Law gives rise to a change in the Work or to the schedule, manner or
          sequence of execution of the Work, such Change in Law shall be treated
          as a Change.

     1.14 "Change" shall have the meaning ascribed to such term in paragraph


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                                                    Company Initials: DJJ


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          14.4 of these General Conditions.

     1.15 "Superintendant" shall have the meaning ascribed to such term in
          paragraph 4.2 of these General Conditions.

     1.16 "Extra Work" shall have the meaning ascribed to such term in paragraph
          14.2 of these General Conditions.

     1.17 "Force Account Work" and "Force Account Basis" shall have the meanings
          ascribed to such terms in paragraph 14.2 of these General Conditions.

     1.18 "Omitted Work" shall have the meaning ascribed to such term in
          paragraph 14.3 of these General Conditions.

2.0 MATERIALS, EQUIPMENT and EMPLOYEES FURNISHED BY CONTRACTOR

     2.1  Except to the extent otherwise expressly provided in paragraph 3.1 of
          these General Conditions and unless and except as otherwise provided
          herein, Contractor shall provide and pay for all construction related
          materials and consumable supplies, labor, tools, equipment, water,
          light, power, transportation and other facilities necessary for the
          execution, testing and completion of the Work.

     2.2  WARRANTY

          All material and equipment incorporated into Work covered by the
          Contract shall be new and without defects in workmanship and
          materials. All workmanship shall be in accordance with accepted
          construction practices and of a quality accepted within the industry.
          Contractor warrants all equipment, materials and labor, including
          required pipeline depth of cover, furnished or performed under the
          Contract against defects in materials and workmanship for a period of
          one (1) year from and after substantial completion of the Work. This
          warranty regarding depth of cover will apply to the entire pipeline,
          save and except such pipeline sections as to which Company agrees in
          writing that it does not apply. Upon receipt of written notice from
          Company of any defect in any such equipment, material, labor or
          pipeline cover discovered during the applicable warranty period,
          Contractor shall repair or replace the affected item or parts thereof
          at Contractor's expense at a time acceptable to Company. If within a
          reasonable time after Company gives the Contractor notice of a defect,
          Contractor neglects to make or undertake with due diligence to make
          the necessary repair or replacement, Company is hereby authorized to
          make the correction itself or order the Work to be done


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          by a third party, and the cost of the correction shall be promptly
          paid by Contractor upon receipt of an invoice from Company for the
          same.

     2.3  All tools and equipment furnished and used by Contractor shall be
          safe, efficient, serviceable and in good condition, and Contractor
          further agrees to replace any equipment and machinery that, in the
          judgment of the Company's Representative, is unsafe or incapable of
          satisfactorily performing the work for which it was designed.

     2.4  Should Contractor require unskilled labor, it agrees to employ persons
          residing in the locality in which the Work is being performed, insofar
          as possible, to fulfill such unskilled labor requirements.

     2.5  Contractor shall pay all persons employed by it for the performance of
          the Work in compliance with all legal requirements, as the same may
          now or hereafter exist and shall comply any Applicable Law regarding
          Contractor's employment practices.

     2.6  Contractor will remove from the job any of its employees who refuse to
          comply with any of the terms of this Contract.

     2.7  Company shall have the right, at any time, to require that the
          Contractor replace Contractor's Superintendent if, in Company's
          opinion, the Superintendent is negligent, incompetent or fails to
          observe and to perform the provisions of the Contract. Contractor
          shall not remove any equipment or key men from the location of the
          Work unless such removal is authorized by Company's Representative,
          and the Company shall have the right to require Contractor to employ
          an additional crew or crews and provide additional equipment, tools
          and supplies if, in the judgment of Company's Representative, such
          procedure is necessary to complete the Work within the time specified
          in the Contract.

     2.8  Contractor will furnish and install field joint coating FBE for
          mainline and SP 2888 or company-approved equivalent for tie-ins.

3.0 MATERIALS and EQUIPMENT FURNISHED BY COMPANY

     3.1  Company shall pay for and furnish to Contractor at appropriate common
          carrier sidings, terminals or stations, the nearest suitable Company
          warehouses or storage yards or other mutually acceptable points of
          delivery, all pipe, valves, fittings, and other materials that are
          intended to become a permanent part of the facilities to be
          constructed hereunder.

     3.2  Contractor shall be responsible for receiving any and all materials


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          and equipment furnished to Contractor by Company after delivery to the
          agreed points of delivery and shall repair or replace with materials
          of equal quality at its own expense, or reimburse Company for the cost
          of any loss or damage that said materials may sustain from any cause
          after said delivery to it.

     3.3  Contractor shall bear the cost of any demurrage or other claims
          resulting from delays in unloading said materials furnished to it by
          Company after reasonable notification that such materials have been
          shipped.

     3.4  Contractor shall notify and secure permission from the Company, in
          advance, if it wishes to withdraw materials stored in Company material
          yards or warehouses.

     3.5  Contractor shall return to Company at the Dubach Facility Yard,
          without undue delay after completion of the Work, all extra and
          surplus materials delivered by Company ;that were not used to complete
          the Work.

     3.6  All materials, furnished by Company to Contractor hereunder shall be
          inspected and tallied at the point of delivery to Contractor by
          representatives of Company and Contractor, each keeping a record of
          quantities, quality and conditions, and any loss of or damage to such
          materials during shipment shall be reported immediately to the
          shipping agency.

4.0 REPRESENTATIVES AND SUPERINTENDENTS

     4.1  Company may have a representative or representatives ("Company's
          Representative") at the location of the Work to observe and inspect
          the same.

     4.2  Contractor shall at all times have a superintendent ("Superintendent")
          on the Work, vested with full authority to represent Contractor in
          prosecuting the Work hereunder.

     4.3  In the performance of the Work, Contractor is an independent
          contractor, and nothing in this Contract creates or shall be construed
          creating either a partnership (of any kind) or the relationship of
          principal and agent, or employer and employee, between Company and
          Contractor or between Company and Contractor's agents, subcontractors
          or employees. Contractor shall have no authority to hire any persons
          on behalf of Company, and any and all persons whom it may employ are
          and shall be deemed to be solely the


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          employees of Contractor.

     4.4  Contractor shall have control and management of the details of the
          Work, the selection of employees and the fixing of their hours of
          labor. Upon completion of the Contract, the pipeline or the other
          facilities to be constructed hereunder shall be delivered to Company
          completed in accordance with the Contract. The Company shall be
          entitled to inspect and determine whether the Work is being performed
          in compliance with the terms of this Contract. Nothing herein
          contained authorizes, or shall be construed to authorize, Contractor
          to incur any debt, liability or obligation of any nature for, or on
          behalf of, the Company.

5.0 SAFETY

     5.1  Contractor shall continuously maintain adequate protection of all its
          Work from damage and shall protect the Company's property from injury
          or loss arising in connection with this Contract. Contractor shall at
          all times exercise due care with regard to all excavations, equipment,
          machinery and materials to prevent loss or injury to persons and
          property, including livestock, and shall use such adequate protective
          devices, warning signs and barriers as may be reasonably required
          under the circumstances. Contractor will comply with all federal and
          state safety and environmental laws at all times.

     5.2  Relative to performance of the Work hereunder, Contractor, in
          recognition of the scope of Work, the specifics of the Work location,
          and its experience in the kinds of work to be undertaken hereunder,
          agrees to provide all necessary safety equipment, safety instructions
          and a written safety plan for the safety of its employees,
          representatives, subcontractors, if any, and others who may be at the
          Work location pursuant to the requirements of Contractor. In addition
          to the foregoing, Contractor agrees to comply with any safety
          requirements of the Company.

6.0 INSURANCE

     6.1  Contractor, at its own expense, shall provide and maintain in force
          the kinds of insurance, with companies acceptable to the Company, and
          in the minimum amounts of coverage's set forth in the insurance
          schedule below to cover all loss and liability for damages on account
          of bodily injury, including death, and injury to, or destruction of,
          property caused by, or arising from, any and all operations carried
          on, or any and all work performed under this Contract. Contractor has
          furnished Company with copies of the policies with all endorsements
          prior to commencement of any Work hereunder, including a copy of


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          the contractual insurance endorsement insuring performance of the hold
          harmless clause included in Article 7.0 hereof:

          6.1.1 Workers' Compensation (Including Occupational Disease) and
               Employer's Liability Insurance with a minimum policy limit of
               $1,000,000 per accident. Coverages shall apply to all employees
               in accordance with the benefits afforded by the statutory
               workers' compensation acts applicable to the State, Territory or
               District of hire, supervision or place of accident.

          6.1.2 Comprehensive Commercial General Liability Insurance covering
               premises operations, products and completed operations,
               independent contractors, blanket contractual liability, explosion
               (x), collapse (c), and underground (u) hazards. Policy shall be
               endorsed to provide broad form property damage, including
               completed operations.

               Policy limits shall not be less than:

               (A) Bodily Injury $1,000,000/$1,000,000

               (B) Property Damage $1,000,000/$1,000,000

          6.1.3 Comprehensive Automobile Liability Insurance covering all owned,
               hired and non-owned automotive equipment. Policy limits shall not
               be less than:

               (A) Bodily Injury $1,000,000 Per Person
                                 $1,000,000 Per Occurrence

               (B) Property Damage $1,000,000 Per Occurrence

          6.1.4 Umbrella Liability or Excess Liability Insurance having
               following form excess of all primary coverage's enumerated in
               6.1.1, 6.1.2 and 6.1.3 above with limits of at least
               $10,000,000.00 Combined Single Limit for Bodily Injury and
               Property Damage.

     6.2  All policies shall provide that the insurance company will notify the
          Company thirty (30) days prior to (i) the termination of any policy
          (ii) the implementation of any changes therein that restrict or reduce
          the coverage provided and (iii) any change of the insured or the
          beneficiary thereunder. In the event of the Contractor's failure to
          carry out any of the provisions of this Article, the Company shall, in
          addition to any right to recover damages or to obtain other relief,
          have the right to cancel and terminate this Contract.

     6.3  Waiver of Subrogation


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          All insurance policies of Contractor with respect to the operations
          conducted hereunder shall be endorsed in accordance with the following
          policy wording to waive all express or implied rights of subrogation:

          "The Insurers hereby waive their rights of subrogation against any
          individual, firm, corporation, partnership or other entity for whom,
          or with whom, the Insured may be working and against any affiliated
          subsidiary or associated companies, partners, joint ventures, factors,
          or assigns of such entities."

     6.4  Before commencing performance of this Contract, Contractor shall
          furnish Company with Certificates of Insurance indicating:

          6.4.1 The kinds and amounts of insurance required above are in force.

          6.4.2 The insurance company or companies carrying the aforesaid
               coverage's.

          6.4.3 The expiration dates of policies.

          6.4.4 That Company will be given thirty (30) written advance notice of
               any material change in or termination of any policy.

          6.4.5 That waiver of subrogation has been endorsed on all policies.

          6.4.6 That the indemnification and hold harmless provisions hereof are
               insured.

     6.5  Subcontractors

          Contractor shall require all of its subcontractors to provide for the
          foregoing insurance coverages, as well as any other insurance
          coverages that Contractor may consider necessary, all to be endorsed
          with the waiver of subrogation wording above, and any deficiency in
          the coverages, policy limits or endorsements of said subcontractors
          will be the sole responsibility of Contractor.

7.0 PERSONAL INJURY AND PROPERTY DAMAGE

     7.1  INDEMNITY

          Contractor agrees to assume liability for, and does hereby agree to
          indemnify, protect, save and hold harmless Company from and

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          against any and all third party liabilities, obligations, losses,
          damages, penalties, claims, suits, judgments, attorney fees and other
          expenses or disbursements of any kind for personal injury (including
          death) or property damage, environmental contamination or violation of
          any applicable federal, state, or local statute, regulation or
          ordinance arising out of the performance of this Agreement by
          Contractor or its Subcontractors ("Claims"); provided, however, that
          Contractor's contractual obligation of indemnity shall not extend to
          the percentage, if any, of the claimant's Claims attributable to
          Company's negligence, fault, breach of contract or warranty or to
          matters of strict liability imposed on Company as a matter of law. Any
          Claim submitted to Company by a third party that relates in any way to
          the performance of Work under this Contract shall be forwarded to the
          Contractor. Contractor shall have sixty (60) days from the date on
          which Company forwards the Claim to the Contractor (the "Claim Date")
          to investigate the Claim and to provide a written response to Company.
          Should Contractor fail to respond to Company within sixty (60) days of
          the Claim Date, Contractor shall be deemed to have accepted any and
          all responsibility for said Claim. Should the Contractor notify
          Company within sixty (60) days of the Claim Date that the Claim should
          be contested, the parties hereto shall work together to resolve the
          Claim, notwithstanding any obligation of the Contractor for
          indemnification of Company.

     7.2  Contractor shall be solely responsible for the proper location of
          all-foreign pipeline crossings as well as the location and depth of
          the pipelines that parallel most of this project. Company and its
          agents have provided materials giving the approximate location of many
          of these crossings. Contractor shall not rely on any of these
          approximations when actual excavation begins. It shall be Contractor's
          responsibility to avoid damage to these foreign crossings and their
          associated ROW and to repair damage to these foreign crossings and
          their associated ROW to the specifications required by the owner. It
          shall be Contractor's responsibility to follow all applicable one-call
          location laws regarding this project prior to any Work being done.

     7.3  CONSEQUENTIAL DAMAGES

          Notwithstanding any other provision of this Agreement to the contrary,
          in no event shall Company be liable to Contractor for any indirect,
          special, incidental or consequential loss or damage including without
          limitation loss of profits or revenue, loss of opportunity or use,
          cost of capital, or like items of loss or damage; and Contractor
          hereby releases Company therefrom.

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8.0 TAXES, LIENS AND LEGAL REQUIREMENTS

     8.1  Contractor shall promptly and satisfactorily settle and pay all Claims
          for labor, equipment, materials, supplies and any and all other Claims
          of every nature that it is obligated to pay hereunder and shall
          furnish evidence satisfactory to Company that all such Claims have
          been settled and paid.

     8.2  Contractor shall not at any time suffer or permit any lien, attachment
          or other encumbrances, or the filing of any instrument claiming any
          such lien, attachment or other encumbrance, under any Applicable Laws
          or otherwise, by any person or persons whomsoever, to be put or remain
          on the Work or any premises on which Work or materials relating to the
          Work are located for any Claim whatsoever against the Contractor,
          provided that Contractor is being paid on a current basis pursuant to
          this Contract. Any such lien, attachment or other encumbrance, until
          it is removed by Contractor at Contractor's sole expense, shall
          preclude any and all Claims by Contractor for any payment by Company
          whatsoever under or by virtue of this Contract. If the lien,
          attachment or other encumbrance, or any instrument claiming any such
          lien, attachment or other encumbrance, is not removed and released,
          the Company may pay such claim or demand and remove such encumbrance
          and may deduct the amount so paid, together with all expenses incurred
          in connection with said payment or removal including, without
          limitation, legal fees from any payment then or thereafter due
          Contractor, or, if demanded by Company, Contractor shall reimburse
          Company for said amount and expenses. Any such payment made in good
          faith by Company shall be binding upon Contractor.

     8.3  Contractor shall comply with and pay all federal, state, or municipal
          laws and regulations regarding taxes of all kinds now in effect and
          those becoming effective during the term of this Contract, including,
          without limitation, Social Security Taxes, State Unemployment
          Insurance Taxes, Gross Receipts Taxes, Withholding Taxes, Workman's
          Compensation Taxes, Income Tax Laws, and will furnish, as requested by
          Company, satisfactory evidence of such compliance. Contractor shall
          indemnify and save harmless Company from any and all liability, lien
          or assessment imposed upon Company arising from Contractor's failure
          to comply with said laws, rules and regulations.

     8.4  In any jurisdiction in which the Work or any part of the Work is to be
          performed and in which a stipulation against mechanic's liens is
          recognized, Contractor will enter into such a stipulation to the
          maximum extent permitted by law, and Contractor agrees that such


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          stipulation may be recorded in the office or offices provided for the
          recording of such instruments. In addition, Contractor hereby waives
          any and all rights to a lien or other encumbrance of any character
          whatsoever on against any real or personal property of Company arising
          out of the labor performed or material furnished under the Contract
          and also waives the right to enforce any such lien or encumbrance.

9.0 WORKMEN'S COMPENSATION INSURANCE

     9.1  The Contractor shall comply with and qualify under the workmen's
          compensation laws of the state or states in which the Work is to be
          performed and furnish a sworn statement of its compliance with said
          laws. It shall also cause each of its subcontractors to comply with
          and qualify under said laws and to furnish a sworn statement of its
          (the subcontractor's) compliance with said laws.

10.0 SUBCONTRACTORS

     10.1 Contractor shall not have the right to assign any of its duties under
          this Contract or to subcontract any of the Work to be performed by it
          hereunder without the prior written consent of Company and upon such
          conditions as Company shall deem necessary.

     10.2 As soon as practicable after the execution of this Contract, the
          Contractor will notify the Company in writing of the names of any
          subcontractors it intends to employ in the performance of any of the
          Work hereunder and further agrees that it will employ only competent,
          experienced and skilled subcontractors to do any part of the Work
          contemplated hereunder.

     10.3 Contractor further agrees that before employing any subcontractor to
          perform any of the Work hereunder, it will cause such subcontractors
          to agree in writing to be bound by the terms and provisions of this
          Contract, so far as it is applicable to the Work to be performed by
          such subcontractor, and will furnish Company with a copy of such
          agreement.

11.0 COMMENCING WORK AT CONTRACTOR'S RISK

     11.1 Contractor may with Company's written approval commence construction
          of the work before all necessary materials have been secured by
          Company, in which event, Company agrees that any subsequent delay
          suffered by Contractor by reason or failure of Company to secure
          adequate material shall entitle Contractor to an equitable adjustment
          of the time and payment provisions of this

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          Contract.

12.0 SKIPPING WORK

     12.1 If it becomes necessary in the judgment of Company, any or all of the
          crews of Contractor shall (i) skip any portion of the Work and move to
          a location on another portion of the Work designated by Company's
          Representative and perform such other portion of Work, (ii) move back
          when designated by Company's Representative and perform such skipped
          Work and (iii) upon the completion of said skipped Work, move to a
          location on the then remaining work designated by Company's
          Representative and resume performance of the remaining Work. The
          performance of all three of the operations enumerated and described in
          the immediately foregoing sentence shall be considered to constitute,
          and shall be referred to throughout the Contract, including the Unit
          Price Summary, as a "move around." Company shall pay Contractor the
          price, if any, set forth in the Unit Price Summary for each complete
          "move around" that has been authorized in writing by Company's
          Representative. Additional compensation shall not be paid for any move
          around, or part thereof, permitted by Company for the sole purpose of
          expediting Contractor's operations.

13.0 SUSPENSION, DISCONTINUANCE OF WORK OR SHUT DOWN

     13.1 If either party is rendered unable wholly or in part by force majeure
          to carry out its obligations, other than the obligation to pay money,
          under this Contract and such party shall give notice and full
          particulars regarding such force majeure in writing to the other party
          within two (2) working days after the occurrence of the cause thereof,
          the obligation of the party giving such notice, so far and only
          insofar as affected by such force majeure, shall be suspended during
          the continuance of any inability so caused, such inability shall not
          be a breach of this Contract, and such party shall not be liable for
          damages or otherwise on account thereof.

     13.2 The term. "force majeure," as employed herein, shall mean the
          occurrence of conditions beyond the control of the affected party such
          as acts of God (except as excluded herein), acts of the public
          enemies, wars, blockades, insurrections, riots, epidemics,
          earthquakes, major materials shipment failures, fires, priority
          allocations of pipe or other materials, orders, restraints or
          prohibitions by any court, board, department, commission or agency of
          the United States or of any state, including without limitation any
          arrests and restraints by rules and people, civil disturbances,
          explosions, and inability with reasonable diligence to obtain pipe or
          other essential

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          materials. Labor disputes such as employee strikes or work slowdowns
          shall not be considered force majeure. Any event of RAIN, FLOOD, SNOW,
          ICE OR OTHER ADVERSE WEATHER CONDITIONS shall not be considered as
          Force Majeure, unless the event is greater than the maximum event
          during the preceding 10 years...

14.0 CHANGES IN WORK

     14.1 By written order of Company's Representative, Company may, at any time
          and without notice to any surety on any bond, omit, change, alter or
          add to Work to be performed hereunder by Contractor and in connection
          therewith issue additional or revised specifications, drawings, and
          written instructions. Contractor shall perform such Work in accordance
          with such revised specifications, drawings, and written instruction
          and pursuant to written authorization executed by Company or Company's
          Representative and otherwise in accordance with the provisions of this
          Contract.

     14.2 If the Company and Contractor agree that any specific additions,
          changes or alteration to the Work ordered by Company's Representative
          justifies extra performance time or compensation, such additions,
          changes or alterations shall be considered "Extra Work" and Contractor
          shall be entitled to a time extension and compensated for such Extra
          Work in accordance with Article 16. If a price for the Extra Work is
          not agreed upon or is not provided for in Article 16 then such Extra
          Work shall be performed on a "Force Account Basis" and considered
          "Force Account Work" and Contractor shall be compensated as provided
          in Article 17.0 Force Account Work.

     14.3 If an order to change Work, deletes Work that is to be performed
          hereunder and such deletion results in a substantial reduction, in the
          opinion of Company, in the labor or materials to be furnished by
          Contractor hereunder then such reduction in Work shall be considered
          "Omitted Work" and Company shall be entitled to a reduction in the
          compensation to be paid Contractor as provided in Article 18.

     14.4 Company shall have the right by written notice to Contractor to make
          changes to the Contract ("Changes"), and Contractor shall have the
          right to an equitable adjustment of its compensation under this
          Contract, the schedule and other affected terms of this Contract to
          reflect such Changes. If Contractor believes that it has encountered a
          Change and that such Change affects the price, schedule or other


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          terms for the Work, Contractor shall so notify Company in writing
          within seven (7) calendar days from the date that Contractor becomes
          aware of same. After receipt of such written notice, Company and
          Contractor shall attempt in good faith to agree in writing upon an
          equitable adjustment of the Unit Prices, the Unit Rates, the other
          compensation to be paid to Contractor hereunder, the schedule and
          other terms to reflect the effect of such Change. Contractor's Change
          request shall be in the detail normally used by Contractor for
          estimating work. If Contractor fails to give notice within seven (7)
          calendars days and Company is prejudiced by the delay, Contractor
          shall be deemed to have waived its claim for adjustment to the extent
          of the prejudice incurred. The agreed adjustments will be incorporated
          into the Contract via formal change order. Contractor agrees that it
          shall not suspend performance of Work during the period Company and
          Contractor are in the process of negotiating such adjustment. If the
          parties cannot agree on appropriate adjustments, the matter shall be
          resolved in dispute resolution proceedings. In the absence of
          agreement, Company can direct Contractor to proceed.

     14.5 If Company does not consider the circumstances described in
          Contractor's written notice to constitute a Change, Contractor shall
          be required to proceed without delay. Should the Contractor continue
          to believe that the circumstances described in its written notice
          constitutes a Change, the matter shall be resolved in accordance with
          the dispute resolution provisions of this Contract.

15.0 DISPUTED CLAIMS FOR EXTRA COMPENSATION

     15.1 Should Contractor, in any situation, deem or contend in any manner
          that extra compensation is or will be due for Work to be performed or
          material to be furnished pursuant to the instructions or orders of
          Company's Representative and Company has not agreed that such Work
          constitutes Extra Work, Contractor shall notify Company. In such event
          Company may, at its sole option, (i) have the Company's Representative
          execute a Disputed Extra Work Order which shall set forth the Work for
          which Contractor contends additional compensation is due or (ii)
          without waiving any of Company's rights arising under the Contract or
          otherwise, require that Contractor not perform such Work and perform
          such Work itself or have it done by other contractors. If Company
          requires that Contractor not perform such Work, Contractor shall
          cooperate with Company and Company's other contractors to facilitate
          completion of the entire project.

     15.2 In no event shall Contractor commence or undertake any work for

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          which it contends extra compensation is or will be owed without (i)
          prior written authorization from the Company as an "Agreed Extra Work
          Order" or (ii) a "Disputed Extra Work Order" executed by Company's
          Representative. Each Agreed Extra Work Order or Disputed Extra Work
          Order must be supported by Contractor with written documentation
          substantiating the nature and quantity of work performed for which
          extra compensation is claimed and enabling pricing pursuant to the
          Contract. If an Agreed or Disputed Extra Work Order is not obtained or
          Company's Representative is not offered proper facilities or
          opportunities by Contractor for keeping a strict account of actual
          costs incurred and Work quantities involved, Contractor shall be
          conclusively deemed to have waived, and Company shall not be obligated
          to pay, any extra compensation for such Work. The fact that notice has
          been given by Contractor as required by Section 14.1, that Company's
          Representative shall have executed a Disputed Extra Work Order or that
          Company's Representative has kept account of the cost and quantity of
          such Work shall not in any way be construed as approving or proving
          the validity of any such claim.

     15.3 Company's Representative is not authorized orally to waive, amend, or
          release any obligation of the Contractor under the Contract or orally
          to approve an Agreed Extra Work Order, and Contractor shall not rely
          upon any such alleged oral authorization in performing such Work.
          Subject to the above, Agreed Extra Work Orders shall be paid by the
          Company, pursuant to Section 14.2 of these General Conditions. In case
          a Disputed Extra Work Order claim is allowed after consideration by
          the Company, it shall be paid in the manner provided in Article 16.2
          of these General Conditions. All claims for Disputed Extra Work shall
          be resolved before final payment shall be due to Contractor.

16.0 EXTRA WORK

     16.1 When Extra Work is authorized by an Agreed Extra Work Order,
          Contractor shall make every effort to provide such additional
          personnel and equipment to complete said Extra Work within the time
          specified for the completion of all work under the Contract including
          such Extra Work with appropriate compensation for accleration costs if
          any, and the time for the completion of all such Work shall extended
          only when required by the nature of the Extra Work or Company's desire
          to avoid paying acceleration costs.

     16.2 Extra Work shall be paid for in accordance with one or more of the
          following methods in the manner specified in an Agreed Extra Work


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          Order or as otherwise expressly agreed upon by Company and Contractor.

          16.2.1 Mutually satisfactory lump sum price agreed upon by Company and
               Contractor in writing.

          16.2.2 Mutually satisfactory unit prices agreed upon by Company and
               Contractor in writing. Subject to the terms and conditions
               hereof, for any Extra Work performed or materials furnished in
               addition to that or those specified in this Contract for which
               unit prices in the Unit Price Summary are applicable, Contractor
               shall be paid the applicable unit prices for completion of such
               Extra Work. Such compensation shall be in addition to the
               contract price. The unit prices set forth in the Unit Price
               Summary applied to the measured quantity of Extra Work added
               shall be the total consideration paid for such Extra Work
               inclusive of fringe benefits, burden, insurance, taxes, overhead
               and profit.

17.0 FORCE ACCOUNT WORK

     17.1 Contractor shall notify Company in writing twenty-four (24) hours in
          advance of commencing any Force Account Work. Force Account Work shall
          be paid for in the following manner.

          17.1.1 For all labor and foremen employed on the specific operation
               and for superintendence, use of small tools and equipment for
               which no rental is allowed, office expense, overhead, insurance
               and profit, Contractor shall receive the composite rate of wages
               as set out in the Labor Rates for Force Account Work shown in the
               Contract for each hour that said labor and foremen are actually
               engaged in Work. The wages of any foreman who is employed on
               Force Account Work and partly on other Work shall be prorated
               between the two classes of Work according to the number of men
               employed under the supervision of such foreman on each class of
               Work as shown by the payrolls.

          17.1.2 For all materials furnished by Contractor and used in the Force
               Account Work, except those materials, if any, for which unit
               prices are included in the Unit Price Summary specifically and
               solely for such materials, Contractor shall receive the actual
               costs of such


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               materials delivered to the Work including freight and hauling
               charges, as shown by original receipted bills.

          17.1.3 For any machine, power tools, or equipment, including fuel and
               lubricant but not including small hand tools, that actually are
               used by Contractor in such Force Account Work, Contractor shall
               receive the rental price shown in the Unit Price Summary, or if
               not shown in the Unit Price Summary, that agreed upon in writing
               in advance by Company and Contractor. No payment shall be due or
               made for any machine, power tool or equipment for which no such
               written agreement exists. The hourly rate will be in effect
               unless equipment is used for one full day in which case the daily
               rate will be in effect unless equipment is used for seven
               consecutive days, in which case the weekly rate will prevail. For
               part of a daily period beyond one or more full days but less than
               seven consecutive days, the maximum rental price for such part of
               the daily period shall be one-eighth of the applicable rate "per
               day" for each hour worked. For a part of a weekly period beyond
               one or more full weekly periods, the maximum rental price for
               such part of the weekly period shall be one-seventh of the
               applicable rate "per week" for each day worked. The compensation
               herein provided shall be accepted by Contractor as payment in
               full for Force Account Work and shall include superintendence,
               use of tools and equipment for which no rental price has been
               agreed upon, overhead expense and profit.

          17.1.4 Contractor and the Company's Representative shall compare
               records of payrolls for labor, equipment and materials furnished
               on Force Account basis at the end of each day and resolve
               discrepancies, if any, in writing. Otherwise, Company's records,
               as approved by Company, shall control, in the absence of actual
               fraud. Copies of these records including employee's name, social
               security number, and classification, shall be made in triplicate
               by the Contractor and the Company's Representative, and one copy
               submitted by Contractor with invoice.

     17.2 Company shall have the right to designate the quantity of labor
          employed and the equipment and materials to be used by Contractor in
          the performance of Force Account Work.

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18.0 OMITTED WORK

     18.1 For Omitted Work for which a unit price is shown in the Construction
          Bid Sheet, Company shall be credited for such Omitted Work at the
          applicable unit prices. Units of such Omitted Work will be reflected
          in the semi-monthly estimates provided for in Section 30.1 of Article
          30.0, Payment, herein. For Omitted Work for which a unit price is not
          shown in the Construction Bid Sheet, Company shall present a claim for
          reduction in the compensation to be paid Contractor hereunder within
          fifteen (15) days after the date it delivers the order to Contractor
          to omit such Work pursuant to Section 14.1. If such a claim for a
          reduction in the compensation to be paid to Contractor is not made
          within such fifteen (15) day period then it shall be conclusively
          presumed that there is no substantial reduction in labor, materials to
          be furnished hereunder and no reduction shall be made in the
          Contractor's compensation.

19.0 CONTRACTOR'S OBLIGATION TO FURNISH STATEMENTS

     19.1 All claims for payment for Extra Work done shall be submitted to
          Company by Contractor upon certified triplicate statements to which
          shall be attached original receipted bills covering the cost and the
          freight and haulage charges on all materials furnished by Contractor
          and used in such Extra Work, said statements shall be submitted to
          Company within fifteen (15) days of the completion of any item of
          Extra Work. Contractor acknowledges that prompt submission of the
          claim and supporting cost data is essential to the efficient
          administration of the project and agrees that the Contractor's failure
          to submit invoices for Extra Work performed within such period of time
          shall constitute the final and absolute waiver by Contractor of any
          claim for extra compensation for such Work performed.

20.0 PROSECUTION OF WORK

     20.1 Except as otherwise provided in this Contract, construction once
          commenced shall be continuous. CONTRACTOR SHALL PROSECUTE THE WORK
          WITH DUE DILIGENCE AND AT SUCH A RATE AND IN SUCH A MANNER AS IN THE
          SOLE OPINION OF THE COMPANY IS NECESSARY FOR COMPLETION WITHIN THE
          TIME LIMIT AS SET OUT IN THE CONTRACT AS IT MAY HAVE BEEN ADJUSTED. In
          no event shall construction operations be interrupted or slowed
          because of the existence of any controversy or dispute between Company
          and Contractor. If Contractor or its subcontractors cause a delay not
          otherwise excused hereunder in the progress of the Work, Contractor
          shall without additional cost to Company, work such overtime, acquire
          necessary additional equipment or perform such other acts as may be
          necessary to

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          complete the Work within the time specified in the Contract. IN SUCH
          EVENT, CONTRACTOR SHALL, WITHOUT ADDITIONAL COST TO COMPANY, ADD SUCH
          MEN AND EQUIPMENT, INCLUDING ENTIRE ADDITIONAL CREWS, AS MAY UNDER THE
          CIRCUMSTANCES BE REQUIRED, IN THE JUDGMENT OF COMPANY OR COMPANY ' S
          REPRESENTATIVE, FOR THE COMPLETION OF THE WORK WITHIN THE TIME
          SPECIFIED IN THE CONTRACT.

21.0 INSPECTION: AUTHORITY OF COMPANY'S REPRESENTATIVES AND INSPECTORS

     21.1 Company contemplates and Contractor agrees to a thorough inspection by
          Company of all of the work, including any Extra Work or Force Account
          Work, and all materials furnished under this Contract. All such Work
          performed by Contractor and all materials furnished by it hereunder
          shall be subject to the inspection of Inspectors designated by the
          Company's Representative to determine whether the Work and all parts
          thereof are being performed in strict compliance with the terms,
          provisions, specifications, drawings and other requirements of this
          Contract. Company's Representative shall be that person or persons
          designated from time to time by Company to represent Company in
          connection with all or any part of the Work. Company may change,
          remove or add Company's Representatives or Inspectors at any time and
          from time to time, upon written notice to Contractor, without
          Contractor's approval. Contractor shall not rely upon any advice,
          direction or representation of Inspectors or Company's Representative
          in the manner of performing the Work, it being Contractor's obligation
          and responsibility to make such decisions and to take such action as
          is required to complete the Work strictly in accordance with the
          specifications, drawings and other requirements of this Contract.
          Contractor shall furnish Company's Representatives and Inspectors
          access at all times to the Work wherever it is in progress and shall
          provide them every reasonable facility for purpose of inspection.
          Contractor shall at all times keep Company advised of its plan of
          operation sufficiently in advance to permit proper inspection of the
          Work. If any Work performed by Contractor or materials furnished by it
          hereunder are defective or fail to comply with the specifications,
          drawings or other requirements of this Contract, as determined by the
          Company's Representative or Inspector, then Contractor shall, at its
          own expense, immediately repair or replace the Work so found to be
          defective in a manner complying with such specifications, drawings and
          other requirements.

     21.2 If the Company's Representative or Inspector requests it, Contractor
          at anytime before acceptance of the Work by the Company shall

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          remove or uncover such portions of the finished Work as may be
          directed. After examination, Contractor shall restore said portions of
          the Work to the standards required by the specifications, drawings or
          other requirements of the Contract. Should the Work thus exposed or
          examined prove to be in accordance with all such specifications,
          drawings or other requirements, the actual cost of uncovering or
          removing, and the replacing of the covering or making good of the
          parts removed shall be paid to Contractor by Company, provided
          Contractor shall have kept an accurate record of such costs. Should
          the Work so exposed or examined prove to be not in accordance with
          such specifications, drawings or other requirements, the uncovering or
          removing, and replacing of the covering or the making good of the
          parts removed shall be at Contractor's expense. If Contractor fails to
          replace any defective Work or materials furnished by Contractor after
          reasonable notice, the Company may cause such defective Work or
          materials to be replaced and all cost associated therewith shall be
          paid by Contractor or deducted by Company from payments to Contractor

     21.3 Should any Work be performed without giving notice and opportunity for
          inspection, Contractor may be required to uncover such Work for
          inspection. Cost of uncovering such Work shall be borne by the
          Contractor, whether or not the Work is found acceptable.

     21.4 If Contractor or any employee, agency or subcontractor of Contractor
          believes or suspects that any action taken by an Inspector, Company's
          Representative or any other person acting, or purporting to act, in
          behalf of Company is, arbitrary or unreasonable, or is motivated by
          malice, intent to defraud or any other motive not connected with
          completion of Work in accordance with the requirements of the Contract
          in the shortest possible time, Contractor shall, within 72 hours of
          said action notify Company in writing, stating the name of the person,
          the action taken and other pertinent details. Contractor agrees that,
          if Contractor does not so notify Company within the specified time,
          such lack of notification shall be a defense to any Contractor claim
          based on such circumstances to the extent that failure of notice
          caused prejudice to Company. CONTRACTOR FURTHER AGREES TO READ THIS
          PARAGRAPH TO EVERY EMPLOYEE, AGENT AND SUBCONTRACTOR PRIOR TO SUCH
          EMPLOYEE, AGENT OR SUBCONTRACTOR ENGAGING IN ANY ACTIVITY RELATED TO
          THE WORK.

     21.5 If Company is a partnership or if Company is causing the construction
          of the work for a third party, Contractor shall permit the presence of
          representatives of each partner or third party or each partner of a
          third party if such third party is a partnership (in addition to the
          presence of any other persons elsewhere provided for in this

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          Contract) at the Work site which representatives may act as observers
          at the observing person's risk, cost and expense. Such observers shall
          have no authority to waive any obligation under this Contract or to
          otherwise act on behalf of, or represent, Company.

22.0 RADIOGRAPHIC INSPECTION

     22.1 Radiographic examinations as well as physical tests on cut out welds,
          shall be performed, as directed by Company, to insure acceptability of
          the welding quality. The Standard of Acceptability shall be in
          accordance with the latest edition of API Standard 1104. The extent
          and frequency of said examinations shall equal or exceed the
          Department of Transportation (D.O.T.) Part 192-Transportation of
          Natural and Other Gas by Pipeline, Subpart E or any regulation
          superceding or replacing Said Part 192. All tie-in welds and repaired
          welds shall be examined by radiography. Welds declared to be
          unsatisfactory by the radiography technician and Company's
          Representative shall be removed and replaced at the Contractor's
          expense.

     22.2 Company may require 100% X-Ray inspection of welds according to
          Company's Specifications for Radiographic Inspection Services. Company
          will endeavor to provide such X-Ray inspection so as not to delay the
          progress of the Contractor, but Company will not be responsible for
          delays occasioned by X-Ray inspection. Contractor shall cooperate in
          keeping Company advised sufficiently in advance to permit proper
          scheduling of X-Ray crews, and shall, at no additional compensation,
          aid the X-Ray inspection crews, including towing and other assistance,
          as required to facilitate maximum utilization of X-Ray crews.

23.0 NO WAIVER AUTHORIZATION

     23.1 Neither Company's Representative nor Company's Inspectors, agents or
          employees shall have any power or authority to waive any of the
          provisions of this Contract or any of the obligations of the
          Contractor hereunder. No waiver of any provision of this Contract or
          other obligation of the Contractor shall be effective unless signed in
          writing by an officer of the Company. Neither Company's failure to
          discover or reject work or material, furnished by the Contractor not
          in strict accordance with the requirements of the Contract, nor any
          payment to Contractor, nor partial or entire occupancy of the premises
          by Company, nor acceptance of the Work by Company's Inspectors or
          Representatives or by Company shall relieve Contractor of its
          obligation to complete the Work strictly in accordance with the
          specifications, drawings and other requirements of the Contract.
          Should it be determined that Work that has been accepted,


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          or for which payment has been made, does not comply with the
          requirements of the Contract, Contractor shall, at its cost and
          expense, do such work and take such action as is necessary to cause
          such nonconforming Work to comply strictly with the Contract
          requirements.

24.0 SITE EXAMINATION

     24.1 Contractor represents that it has had an opportunity to examine the
          entire Contract, including all Drawings, Specifications, and all other
          written instruments incorporated by reference in the Contract, and has
          fully acquainted itself with the general topography, soil structure,
          subsurface conditions, obstructions, the site of the Work, and its
          surroundings, that it has made all investigations essential to a full
          understanding of the difficulties that may be encountered in
          performing the Work, and that anything in the Contract or any
          statements or information made or furnished by Company or its
          representatives notwithstanding, Contractor will, regardless of any
          such conditions pertaining to the Work, weather conditions, and the
          effect thereof, the site of the Work or its surroundings, complete the
          Work within the time specified and for the compensation stated in the
          Contract and assume full and complete responsibility for any such
          conditions pertaining to the Work, the site of the Work or its
          surroundings, and all risks, including the risk of weather, in
          connection therewith. Contractor represents that it has authority to
          do business in the State or location in which the Work is to be
          performed and that it is fully qualified and financially able to do
          the Work in accordance with the Contract within the time specified.

25.0 MEASUREMENT OF WORK QUANTITIES

     25.1 It is recognized that Work quantities as set out in the Contract are
          approximate. The Company's Representative may make the accurate
          measurements to determine the quantities of various items of Work
          performed as the basis for the periodic and final payments or may
          accept Contractor's estimate subject to adjustment by Company. The
          Contractor, in all cases, will be paid the amounts set forth in the
          Unit Price Summary only for the actual amount of Work performed under
          the Contract and no payment shall be due or made for Work that is not
          actually performed. All such payments and measurement of Work
          quantities shall be subject to final audit and verification, and
          overpayments may be deducted by Company from any future payment to
          Contractor under the Contract or any other agreement with Contractor
          or Contractor shall, if directed by Company, refund to Company the
          amount of any such overpayment.

26.0 CONSIDERATION

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     26.1 It is understood that the price or prices specified in the Contract
          cover and include all compensation, payments and remuneration that
          Contractor is to receive from the Company for the performance of the
          Work covered by the Contract. The duties and obligations assumed by
          Contractor in return for such consideration include, but are not
          limited to, the following; furnishing necessary materials, labor,
          tools and equipment; performing all Work described in the Contract;
          all overhead, profits, superintendence, labor, use of equipment, loss,
          damage, increased cost and expense arising from the nature of the
          Work, or from weather or from any difficulties, foreseen or
          unforeseen, that may be encountered during the prosecution of the Work
          until the acceptance for payment by Company; all risks of every
          description connected with the prosecution of the Work, as well as all
          expenses incurred in consequence of the suspension or discontinuance
          of the Work according to the Contract and indemnifying Company (and
          its partners if Company is a partnership) and Company's officers,
          agents and employees and holding them harmless as provided herein.

27.0 INSPECTION OF CONTRACTOR'S RECORDS

     27.1 Contractor shall maintain adequate costs records of all cost plus
          Extra Work performed hereunder, and, upon request by the Company,
          shall permit the Company or representatives of Company to inspect said
          books and records for the purpose of determining the propriety and
          accuracy of charges, claims and demands of the Contractor, its agents,
          employees and subcontractors.

28.0 COMPANY'S RIGHT TO SUPPLEMENT WORK OR PARTIALLY TERMINATE CONTRACT

     28.1 If, in the opinion of the Company, the Contractor shall, at any time,
          refuse or neglect to supply sufficient personnel, supervision or
          equipment of the proper quality, or fail in any respect to prosecute
          the Work with promptness and diligence, or fail to make sufficient
          progress so as to assure completion of the Work by the date fixed for
          such completion (it being recognized and acknowledged by Contractor
          that with respect to such completion date, time is of the essence to
          Company), the Company may, upon giving five (5) days written notice to
          Contractor and without prejudice to the other remedies available to
          Company, supplement the Work by providing such additional labor or
          equipment (itself or through a contractor or contractors) as it deems
          necessary to rectify such default or to complete the Work by the date
          fixed for such completion or withdraw from the Contract that portion
          of the Work, that, in Company's sole

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          opinion, Contractor will be unable to complete by the date fixed for
          such completion, and terminate the Contract with respect thereto and
          complete the Work on such portion itself or through a contractor or
          contractors.

     28.2 Contractor shall not be entitled to receive the Contract consideration
          for any labor or materials provided to supplement the Work or for any
          portions withdrawn from the Contract and terminated as herein
          provided. If Company should supplement the Work or withdraw a portion
          of the Work from this Contract and terminate the Contract with respect
          thereto, and should the cost to the Company of such supplement or
          completion of the Work on such portion withdrawn, including all
          Company overhead expenses, supervision expenses, and reasonable
          attorney's fees, exceed the cost that Company would have incurred had
          Contractor completed the work as required under the Contract, Company
          may deduct such excess cost from any further payment to Contractor or
          require Contractor, upon demand, to reimburse Company for such excess
          cost. If Company exercises its right as provided herein to supplement
          the Work or withdraws a portion thereof from the Contract and
          terminates the Contract with respect thereto, Contractor shall
          continue to perform the remaining portion of the Work under the
          Contract. In such event, or should Company, for any other reason
          permitted hereunder perform any portion of the Work to be performed by
          Contractor under this Contract or changes hereunder, Contractor shall
          fully cooperate with Company and with other contractors of Company and
          shall carefully coordinate its performance of such remaining Work with
          the Work of Company and such other contractors, and Contractor shall
          not, under any circumstances, do anything, or commit any acts, that
          will interfere with the performance of the Work by Company or by any
          other contractor of Company.

29.0 TERMINATION OF WORK FOR DEFAULT OF CONTRACTOR

     29.1 If a petition in bankruptcy should be filed by the Contractor; or if
          the Contractor should make a general assignment for the benefit of
          creditors, or if the Contractor becomes insolvent, or if a receiver
          should be appointed on account of the insolvency of the Contractor, or
          if the Contractor should refuse or fail to supply enough properly
          skilled workmen or proper equipment, or if the Contractor should fail
          to make prompt payment to subcontractors, or if the Contractor should
          fail to pay for materials, labor or services or to pay any claims of
          third parties that are the responsibility of Contractor, or if the
          Contractor should disregard laws, ordinances, or the instructions of
          Company's Representative, or if the Contractor should permit liens,
          attachments or other encumbrances to remain on the project or on

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          the property of Company after written instructions to have same
          removed, or if the Contractor should otherwise be guilty of a
          substantial breach of any provision of the Contract, then the Company
          may, without prejudice to any other right or remedy and without notice
          to any surety, terminate this Contract and take possession of the
          premises by giving Contractor written notice of such termination.

     29.2 In the event of such termination, the Contractor shall not be entitled
          to receive any further payment hereunder until the Work is finished.
          If the cost to Company of completing said Work, including all Company
          overhead expenses, supervision expenses, and reasonable attorney's
          fees, is more than the aggregate sum obtained by applying the Unit
          Price herein specified for the Work so performed, Contractor shall pay
          to Company, upon demand, the amount of such excess together with all
          other damages suffered by Company as a result of Contractor's default,
          or Company may withhold said amount from any payment due Contractor.

30.0 PAYMENT

     30.1 On or as soon as practicable after the fifth (5th) and twentieth
          (20th) days of each calendar month following commencement of Work
          hereunder, the Company's Representative, in collaboration with
          Contractor's Superintendent, shall make a written estimate of that
          portion of the Work that has been completed and omitted, if any. All
          written estimates shall be signed by Company's Representative and
          Contractor's representative in the field, after which Company's
          Representative shall forward same to Company's office. Contractor
          shall prepare and deliver to Company an invoice for that portion of
          the Work that has been completed, as determined by such written
          estimate, and that has not been included in a prior invoice. The
          invoice form shall include Contractor's name and address, invoice
          number, invoice date, description of work, a breakdown of major
          categories showing unit price by categories, percent of progress
          complete, total amount of such invoice and ten percent (10%) of such
          total amount which is to be retained by Company.

          Upon approval of Company, Company shall pay Contractor ninety percent
          (90%) of the total invoice amount less all payments made upon previous
          estimates.

     30.2 The remaining ten percent (10%) of the total invoice amount shall be
          retained by Company until Contractor has completed all of the Work to
          be performed and all of the following conditions have been fulfilled:

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          30.2.1 Final acceptance by Company of all Work performed hereunder.

          30.2.2 Receipt by Company of affidavits or other evidence satisfactory
               to the Company, that Contractor has paid all claims and bills for
               labor, materials, equipment, services and supplies provided for
               or in connection with the Work hereunder.

          30.2.3 Payment by Contractor of all claims of any character
               whatsoever, for which Contractor is responsible under the
               Contract.

          30.2.4 Receipt by Company of satisfactory evidence that Contractor has
               paid any sales, use or other taxes pertaining to said Work which
               are imposed by any governmental body having jurisdiction where
               said Work is done.

          30.2.5 Receipt by Company of a certificate from the Parish Clerk's
               office in the parish where the Work is performed in the name of
               both Contractor and Company showing that no liens of any kind,
               arising from said Work have been recorded. Said Certificate must
               be dated at least thirty (30) days after the date of final
               acceptance of Work by Company.

     30.3 Notwithstanding, and in addition to, any other provision of this
          Contract, any or all payments otherwise due Contractor from Company
          may be withheld at any time and from time to time by Company, without
          payment of interest, on account of defective Work done and not
          remedied by Contractor, unpaid bills or claims for labor, materials,
          services and supplies or unpaid Claims of any kind whatsoever that
          Contractor has agreed to pay, or upon reasonable evidence indicating
          that such unpaid bills or Claims are outstanding. If and when the
          cause or causes for withholding any such payment shall be remedied or
          removed without cost to Company and evidence satisfactory to Company
          of such remedy or removal has been presented to Company, the payments
          withheld shall be made to Contractor.

     30.4 If Contractor fails or refuses to remedy or remove any cause for
          withholding such payment, within ten (10) days after delivery of
          written notice to Contractor by Company to remedy or remove such
          cause, Company may remedy or remove the same or cause the same to be
          remedied and removed and may deduct the cost thereof

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          together with attorney's fees or any other expense, of whatsoever kind
          incurred by Company in connection therewith, from the amount then or
          thereafter due Contractor under the Contract or pursue any remedy
          otherwise provided by this Contract. If such cost should exceed the
          balance due Contractor, Contractor shall be liable for, and shall pay,
          the difference to the Company. If, however, Contractor notifies
          Company in writing within said period of time that it reasonably and
          in good faith contests the validity of any such Claims, Contractor may
          defer remedial action pending a settlement with claimant satisfactory
          to Company or until judgment is rendered against Contractor or Company
          therefore, but Company shall nevertheless be entitled to withhold
          payment of a sum sufficient in its judgment to satisfy amply the
          amount of any and all such Claims, including, in addition, an ample
          amount to cover all costs that may be incurred by Company in
          connection therewith, including all attorney's fees incurred.

     30.5 Company shall have the right to make payment of any sums withheld
          under Section 30.3 or other provisions of the Contract without giving
          notice thereof to any surety or sureties on any bond of the Contractor
          or any subcontractor, and such sureties, liability under said bond or
          bonds shall not in any way be released or diminished on account of
          Company's making any payments of any such sums without notice to the
          surety or sureties. Neither final acceptance of the Work, final
          payment hereunder, nor partial or entire use by Company of the Work
          shall relieve Contractor of any unperformed or continuing obligation
          under the Contract, including, without limitation, Contractor's
          obligations to protect, indemnify and hold harmless Company, its
          officers, agents and employees as herein provided.

     30.6 DISPUTES

          All disputes between Company and Contractor arising under or relating
          to the Contract shall be resolved under this Article. The term
          "dispute" means a demand by either party resulting from a disagreement
          between Company and Contractor that seeks an adjustment or
          interpretation of Contract terms or other relief. A demand shall be
          made in writing and shall contain complete information necessary for
          proper evaluation by the other party. Otherwise it may be returned
          without action. At a minimum the demand submitted shall state the
          facts upon which the demand is based, how or in what way the
          circumstances differ from that which was undertaken contractually and
          the Contract provisions that provide for the relief being sought. If
          the demand seeks monetary payment, it shall be supported by a detailed
          breakdown similar to that accompanying a Change request. A party's
          written decision on a

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          demand shall be final and conclusive, unless within seven (7) calendar
          days after receipt of the written decision the aggrieved party
          furnishes a written appeal to the other party. A written appeal shall
          be precedent to any arbitration or mediation. Contractor shall proceed
          diligently with performance under the Contract and shall comply with
          any written decision of Company pending final resolution of its
          demands so long as Company acts in good faith and promptly provides
          any undisputed entitlement to Contractor. Any dispute between the
          Parties preserved by appeal shall be submitted to mediation under the
          construction industry rules of the American Arbitration Association
          (AAA), and then, failing resolution by mediation, to arbitration under
          the same rules except as modified herein. Unless the AAA fast track
          rules apply, three arbitrators shall be appointed by means of each
          party nominating an arbitrator within 20 days of filing of the
          arbitration demand with AAA, and then the appointees of the parties
          choosing the third arbitrator within an additional 20 days. If either
          a party or the two appointees are unable to make an appointment within
          the required time, the appointment shall be made by AAA. All members
          of the panel shall be neutral upon appointment. The location of the
          arbitration shall be New Orleans, Louisiana. Each party shall pay any
          and all costs associated with the arbitrator selected by that party.
          Each party shall be responsible for fifty percent (50%) of the costs
          associated with the third arbitrator. The parties shall urge the
          arbitrators to provide a written decision to the parties within thirty
          (30) days of the arbitration hearing.

31.0 ORAL AGREEMENTS

     31.1 This Contract sets forth the entire agreement between Company and
          Contractor with respect to the Work and no oral agreements heretofore
          made shall be binding, and no modification of, or supplement to this
          Contract shall be made except by written agreement signed by
          Contractor and an officer of Company. The headings to each of the
          various Sections and Articles of this Contract are for convenience
          only and shall have no effect on, or be deemed a part of, the text of
          the Contract.

32.0 BONDS

     32.1 No performance or other bond is required to be provided by Contractor
          in connection with its performance of the Work under this Contract.

33.0 LIABILITY OF COMPANY

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     33.1 Contractor agrees that its right to recover for any claim against the
          Company shall be limited solely to the assets of Company and, as part
          of the consideration for this Contract, Contractor hereby waives any
          and all rights to institute a legal proceeding or to assert a claim,
          in any manner, for any demand, cause of action, cost, expense, action,
          judgment or damage in any manner arising out of, or in connection
          with, this Contract, against any partner or partners of Company
          individually, or against any entity affiliated or associated with any
          such partner.

34.0 EQUAL OPPORTUNITY

     34.1 Contractor agrees to comply with all of the requirements of 41 CFR
          Part 60-1 and the provisions of the standard clause prescribed there
          under dealing with equal employment opportunity (the "Equal
          Opportunity Clause"), which provisions of said standard clause are
          specifically incorporated herein by reference to have the same force
          and effect as if set out in their entirety.

35.0 CERTIFICATION OF NON-STANDARD FACILITIES

     35.1 Contractor certifies that it does not maintain nor provide its
          employees any segregated facilities at any of its establishments, and
          that it does not permit its employees to perform their services at any
          location, under Contractor's control, where segregated facilities are
          maintained. Contractor certifies further that it will not maintain or
          provide for its employees any segregated facilities at any of its
          establishments and that it will not permit its employees to perform
          their services at any location under Contractor's control, where
          segregated facilities are maintained. Contractor agrees that a breach
          of this certification is a violation of the Equal Opportunity Clause.
          As used in this certification, the term "segregated facilities" means
          any waiting rooms, work areas, rest rooms and wash rooms, restaurants,
          and other eating areas, time clocks, locker rooms and other storage or
          dressing areas, parking lots, drinking fountains, recreation or
          entertainment areas, transportation and housing facilities provided
          for employees that are segregated by explicit directive or are in fact
          segregated on the basis or race, creed, color, age, gender or national
          origin, because of habit or custom or otherwise. Contractor further
          agrees that (except where it has obtained identical certifications
          from proposed subcontractors for specific time periods) Contractor
          will obtain identical certifications from proposed subcontractors
          prior to the award of a subcontract exceeding Ten Thousand and No/100
          Dollars ($10,000.00) unless such subcontractors are exempt from the
          provisions of the Equal Opportunity Clause; and that Contractor will
          retain such certifications in his files.

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36.0 HANDICAPPED WORKERS

     36.1 Contractor agrees to comply with all of the requirements of 41 CFR
          Part 60-741 and the provisions of the standard contract clause
          prescribed thereunder, dealing with the employment of qualified
          handicapped individuals, which provisions of said standard contract
          clause are specifically incorporated herein by reference to have the
          same force and effect as if set out herein in their entirety.

37.0 DISABLED VETERANS AND VETERANS OF THE VIETNAM ERA

     37.1 Contractor agrees to comply with all of the requirements of 41 CFR
          Part 60-250 and the provisions of the standard contract clause
          prescribed there under, dealing with the employment of qualified
          disabled veterans and veterans of the Vietnam Era, which provisions of
          said standard contract clause are specifically incorporated herein by
          reference to have the same force and effect as is set out herein in
          their entirety.

38.0 CONTRACTOR ASSURANCES

     Unless exempted, Contractor hereby certifies that:

          (a)  It has adopted and implemented a written anti-drug plan that
               complies with the procedures and regulations as outlined in 49
               CFR 199. Any and all employees, agents, subcontractors or
               consultants working for Contractor shall comply with Contractor's
               plan.

          (b)  It understands, under penalty of law, the terms and conditions of
               the general National Pollutant Discharge Elimination System
               (NPDES) permit that authorizes the storm water runoff, and the
               requirements to reduce the environmental impact therefrom
               associated with the scope of Work as herein described,
               _____?______ shall be typed on Company letterhead and returned
               with the executed Pipeline Construction Contract (see Special
               Conditions).

          (c)  It has adopted and implemented a written Operator Qualification
               Plan as outline in 49 CFR 192. Such plan is limited only to work
               covered and required under 49 CFR 192. Any and all employee's
               agents, subcontractors or consultants who work for Contractor
               shall comply with Contractor's plan.

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