Document:

<PAGE>

                                                                     EXHIBIT 4.L

                        GULFTERRA ENERGY PARTNERS, L.P.,
                GULFTERRA ENERGY FINANCE CORPORATION, as Issuers,

             THE SUBSIDIARIES NAMED HEREIN, as Subsidiary Guarantors

                                       And

               WELLS FARGO BANK, NATIONAL ASSOCIATION, as Trustee

                      6 1/4% Series A Senior Notes due 2010
                      6 1/4% Series B Senior Notes due 2010

                                    INDENTURE

                            Dated as of July 3, 2003

<PAGE>

                             CROSS-REFERENCE TABLE*

                                 TRUST INDENTURE

<TABLE>
<CAPTION>
ACT SECTION                                                                                       INDENTURE SECTION
-----------                                                                                       -----------------
<S>                                                                                               <C>
310  (a)(1).............................................................................          7.10
     (a)(2).............................................................................          7.10
     (a)(3).............................................................................          N.A.
     (a)(4).............................................................................          N.A.
     (a)(5).............................................................................          7.10
     (b)................................................................................          7.10
     (c)................................................................................          N.A.
311  (a)................................................................................          7.11
     (b)................................................................................          7.11
     (c)................................................................................          N.A.
312  (a)................................................................................          2.05
     (b)................................................................................          12.03
     (c)................................................................................          12.03
313  (a)................................................................................          7.06
     (b)(1).............................................................................          N.A.
     (b)(2).............................................................................          7.06
     (c)................................................................................          7.06; 12.02
     (d)................................................................................          7.6
314  (a)................................................................................          4.03; 4.18; 12.02
     (b)................................................................................          N.A.
     (c)(1).............................................................................          12.04
     (c)(2).............................................................................          12.04
     (c)(3).............................................................................          N.A.
     (d)................................................................................          N.A.
     (e)................................................................................          12.05
     (f)................................................................................          N.A.
315  (a)................................................................................          7.01
     (b)................................................................................          7.05, 12.02
     (c)................................................................................          7.01
     (d)................................................................................          7.01; 6.05
     (e)................................................................................          6.11
316  (a)(last sentence).................................................................          2.09
     (a)(1)(A)..........................................................................          6.05
     (a)(1)(B)..........................................................................          6.04
     (a)(2).............................................................................          N.A.
     (b)................................................................................          6.07
     (c)................................................................................          2.12
317  (a)(1).............................................................................          6.08
     (a)(2).............................................................................          6.09
     (b)................................................................................          2.04
</TABLE>

                                       i

<PAGE>

<TABLE>
<S>                                                                                               <C>
318  (a)................................................................................          12.01
     (b)................................................................................          N.A.
     (c)................................................................................          12.01
</TABLE>

----------
N.A. means not applicable.

*This Cross-Reference Table is not part of the Indenture.

                                       ii
<PAGE>

                                TABLE OF CONTENTS

<TABLE>
<CAPTION>
                                                                                                                    PAGE
<S>                                                                                                                 <C>
ARTICLE 1 DEFINITIONS AND INCORPORATION BY REFERENCE.............................................................     1

         SECTION 1.01.   DEFINITIONS.............................................................................     1
         SECTION 1.02.   OTHER DEFINITIONS.......................................................................    29
         SECTION 1.03.   INCORPORATION BY REFERENCE OF TRUST INDENTURE ACT.......................................    30
         SECTION 1.04.   RULES OF CONSTRUCTION...................................................................    30

ARTICLE 2 THE NOTES..............................................................................................    30

         SECTION 2.01.   FORM AND DATING.........................................................................    30
         SECTION 2.02.   EXECUTION AND AUTHENTICATION............................................................    31
         SECTION 2.03.   REGISTRAR AND PAYING AGENT..............................................................    32
         SECTION 2.04.   PAYING AGENT TO HOLD MONEY IN TRUST.....................................................    32
         SECTION 2.05.   HOLDER LISTS............................................................................    33
         SECTION 2.06.   TRANSFER AND EXCHANGE...................................................................    33
         SECTION 2.07.   REPLACEMENT NOTES.......................................................................    47
         SECTION 2.08.   OUTSTANDING NOTES.......................................................................    48
         SECTION 2.09.   TREASURY NOTES..........................................................................    48
         SECTION 2.10.   TEMPORARY NOTES.........................................................................    48
         SECTION 2.11.   CANCELLATION............................................................................    49
         SECTION 2.12.   DEFAULTED INTEREST......................................................................    49
         SECTION 2.13.   CUSIP NUMBERS...........................................................................    49

ARTICLE 3 REDEMPTION AND PREPAYMENT..............................................................................    49

         SECTION 3.01.   NOTICES TO TRUSTEE......................................................................    49
         SECTION 3.02.   SELECTION OF NOTES TO BE REDEEMED.......................................................    50
         SECTION 3.03.   NOTICE OF REDEMPTION....................................................................    50
         SECTION 3.04.   EFFECT OF NOTICE OF REDEMPTION..........................................................    51
         SECTION 3.05.   DEPOSIT OF REDEMPTION PRICE.............................................................    51
         SECTION 3.06.   NOTES REDEEMED IN PART..................................................................    52
         SECTION 3.07.   OPTIONAL REDEMPTION.....................................................................    52
         SECTION 3.08.   MANDATORY REDEMPTION....................................................................    52
         SECTION 3.09.   OFFER TO PURCHASE BY APPLICATION OF NET PROCEEDS........................................    52
</TABLE>

                                      iii

<PAGE>

<TABLE>
<CAPTION>
                                                                                                                    PAGE
<S>                                                                                                                 <C>
ARTICLE 4 COVENANTS..............................................................................................    54

         SECTION 4.01.   PAYMENT OF NOTES........................................................................    54
         SECTION 4.02.   MAINTENANCE OF OFFICE OR AGENCY.........................................................    55
         SECTION 4.03.   COMPLIANCE CERTIFICATE..................................................................    55
         SECTION 4.04.   TAXES...................................................................................    56
         SECTION 4.05.   STAY, EXTENSION AND USURY LAWS..........................................................    56
         SECTION 4.06.   CHANGE OF CONTROL.......................................................................    56
         SECTION 4.07.   ASSET SALES.............................................................................    59
         SECTION 4.08.   RESTRICTED PAYMENTS.....................................................................    61
         SECTION 4.09.   INCURRENCE OF INDEBTEDNESS AND ISSUANCE OF DISQUALIFIED EQUITY..........................    65
         SECTION 4.10.   LIENS...................................................................................    68
         SECTION 4.11.   DIVIDEND AND OTHER PAYMENT RESTRICTIONS AFFECTING SUBSIDIARIES..........................    68
         SECTION 4.12.   TRANSACTIONS WITH AFFILIATES............................................................    70
         SECTION 4.13.   ADDITIONAL SUBSIDIARY GUARANTEES........................................................    72
         SECTION 4.14.   DESIGNATION OF RESTRICTED AND UNRESTRICTED SUBSIDIARIES.................................    72
         SECTION 4.15.   BUSINESS ACTIVITIES.....................................................................    73
         SECTION 4.16.   SALE AND LEASEBACK TRANSACTIONS.........................................................    73
         SECTION 4.17.   PAYMENTS FOR CONSENT....................................................................    74
         SECTION 4.18.   REPORTS.................................................................................    74
         SECTION 4.19.   ELIMINATION OF COVENANTS................................................................    75

ARTICLE 5 SUCCESSORS.............................................................................................    75

         SECTION 5.01.   MERGER, CONSOLIDATION, OR SALE OF ASSETS................................................    75
         SECTION 5.02.   SUCCESSOR ENTITY SUBSTITUTED............................................................    77

ARTICLE 6 DEFAULTS AND REMEDIES..................................................................................    78

         SECTION 6.01.   EVENTS OF DEFAULT.......................................................................    78
         SECTION 6.02.   ACCELERATION............................................................................    80
         SECTION 6.03.   OTHER REMEDIES..........................................................................    80
         SECTION 6.04.   WAIVER OF PAST DEFAULTS.................................................................    81
         SECTION 6.05.   CONTROL BY MAJORITY.....................................................................    81
         SECTION 6.06.   LIMITATION ON SUITS.....................................................................    81
         SECTION 6.07.   RIGHTS OF HOLDERS OF NOTES TO RECEIVE PAYMENT...........................................    82
         SECTION 6.08.   COLLECTION SUIT BY TRUSTEE..............................................................    82
</TABLE>

                                       iv

<PAGE>

<TABLE>
<CAPTION>
                                                                                                                    PAGE
<S>                                                                                                                 <C>
         SECTION 6.09.   TRUSTEE MAY FILE PROOFS OF CLAIM........................................................    82
         SECTION 6.10.   PRIORITIES..............................................................................    83
         SECTION 6.11.   UNDERTAKING FOR COSTS...................................................................    83

ARTICLE 7 TRUSTEE................................................................................................    83

         SECTION 7.01.   DUTIES OF TRUSTEE.......................................................................    83
         SECTION 7.02.   RIGHTS OF TRUSTEE.......................................................................    85
         SECTION 7.03.   INDIVIDUAL RIGHTS OF TRUSTEE............................................................    87
         SECTION 7.04.   TRUSTEE'S DISCLAIMER....................................................................    87
         SECTION 7.05.   NOTICE OF DEFAULTS......................................................................    87
         SECTION 7.06.   REPORTS BY TRUSTEE TO HOLDERS OF THE NOTES..............................................    87
         SECTION 7.07.   COMPENSATION AND INDEMNITY..............................................................    88
         SECTION 7.08.   REPLACEMENT OF TRUSTEE..................................................................    89
         SECTION 7.09.   SUCCESSOR TRUSTEE BY MERGER, ETC........................................................    90
         SECTION 7.10.   ELIGIBILITY; DISQUALIFICATION...........................................................    90
         SECTION 7.11.   PREFERENTIAL COLLECTION OF CLAIMS AGAINST ISSUERS.......................................    90

ARTICLE 8 LEGAL DEFEASANCE AND COVENANT DEFEASANCE...............................................................    90

         SECTION 8.01.   OPTION TO EFFECT LEGAL DEFEASANCE OR COVENANT DEFEASANCE................................    90
         SECTION 8.02.   LEGAL DEFEASANCE AND DISCHARGE..........................................................    90
         SECTION 8.03.   COVENANT DEFEASANCE.....................................................................    91
         SECTION 8.04.   CONDITIONS TO LEGAL OR COVENANT DEFEASANCE..............................................    91
         SECTION 8.05.   DEPOSITED MONEY AND GOVERNMENT SECURITIES TO BE HELD IN TRUST; OTHER
                                 MISCELLANEOUS PROVISIONS........................................................    93
         SECTION 8.06.   REPAYMENT TO ISSUERS....................................................................    93
         SECTION 8.07.   REINSTATEMENT...........................................................................    94

ARTICLE 9 AMENDMENT, SUPPLEMENT AND WAIVER.......................................................................    94

         SECTION 9.01.   WITHOUT CONSENT OF HOLDERS OF NOTES.....................................................    94
         SECTION 9.02.   WITH CONSENT OF HOLDERS OF NOTES........................................................    95
         SECTION 9.03.   COMPLIANCE WITH TRUST INDENTURE ACT.....................................................    97
         SECTION 9.04.   REVOCATION AND EFFECT OF CONSENTS.......................................................    97
         SECTION 9.05.   NOTATION ON OR EXCHANGE OF NOTES........................................................    97
         SECTION 9.06.   TRUSTEE TO SIGN AMENDMENTS, ETC.........................................................    97
</TABLE>

                                       v

<PAGE>

<TABLE>
<CAPTION>
                                                                                                                    PAGE
<S>                                                                                                                 <C>
         SECTION 9.07.   EFFECT OF SUPPLEMENTAL INDENTURES.......................................................    97

ARTICLE 10 GUARANTEES............................................................................................    98

         SECTION 10.01.   GUARANTEES.............................................................................    98
         SECTION 10.02.   LIMITATION OF GUARANTOR'S LIABILITY....................................................    99
         SECTION 10.03.   EXECUTION AND DELIVERY OF GUARANTEES...................................................    99
         SECTION 10.04.   SUBSIDIARY GUARANTORS MAY CONSOLIDATE, ETC., ON CERTAIN TERMS.........................    100
         SECTION 10.05.   RELEASES..............................................................................    100
         SECTION 10.06.   "TRUSTEE" TO INCLUDE PAYING AGENT.....................................................    101

ARTICLE 11 SATISFACTION AND DISCHARGE...........................................................................    101

         SECTION 11.01.   SATISFACTION AND DISCHARGE............................................................    101
         SECTION 11.02.   APPLICATION OF TRUST..................................................................    102
         SECTION 11.03.   REPAYMENT OF THE ISSUERS..............................................................    103
         SECTION 11.04.   REINSTATEMENT.........................................................................    103

ARTICLE 12 MISCELLANEOUS........................................................................................    103

         SECTION 12.01.   TRUST INDENTURE ACT CONTROLS..........................................................    103
         SECTION 12.02.   NOTICES...............................................................................    104
         SECTION 12.03.   COMMUNICATION BY HOLDERS OF NOTES WITH OTHER HOLDERS OF NOTES.........................    105
         SECTION 12.04.   CERTIFICATE AND OPINION AS TO CONDITIONS PRECEDENT....................................    105
         SECTION 12.05.   STATEMENTS REQUIRED IN CERTIFICATE OR OPINION.........................................    106
         SECTION 12.06.   RULES BY TRUSTEE AND AGENTS...........................................................    106
         SECTION 12.07.   NO PERSONAL LIABILITY OF DIRECTORS, OFFICERS, PARTNERS, EMPLOYEES,
                                 INCORPORATORS, STOCKHOLDERS AND MEMBERS........................................    106
         SECTION 12.08.   GOVERNING LAW.........................................................................    106
         SECTION 12.09.   NO ADVERSE INTERPRETATION OF OTHER AGREEMENTS.........................................    107
         SECTION 12.10.   SUCCESSORS............................................................................    107
         SECTION 12.11.   SEVERABILITY..........................................................................    107
         SECTION 12.12.   COUNTERPART ORIGINALS.................................................................    107
         SECTION 12.13.   TABLE OF CONTENTS, HEADINGS, ETC......................................................    107
</TABLE>

                                       vi

<PAGE>

Schedule A - Schedule of Subsidiary Guarantors

                                    EXHIBITS

Exhibit A                  FORM OF NOTE

Exhibit B                  FORM OF CERTIFICATE OF TRANSFER

Exhibit C                  FORM OF CERTIFICATE OF EXCHANGE

Exhibit D                  FORM OF GUARANTEE NOTATION

Exhibit E        .         FORM OF CERTIFICATE FROM ACQUIRING INSTITUTIONAL
                           ACCREDITED INVESTOR

                                      vii

<PAGE>

                  INDENTURE dated as of July 3, 2003 among GulfTerra Energy
Partners, L.P., a Delaware limited partnership (the "Partnership"), GulfTerra
Energy Finance Corporation, a Delaware corporation ("GulfTerra Finance," and
collectively with the Partnership, the "Issuers"), the Subsidiary Guarantors (as
defined herein) listed on Schedule A hereto, and Wells Fargo Bank, National
Association, a national banking association, as trustee (the "Trustee").

                  The Issuers, the Subsidiary Guarantors, and the Trustee agree
as follows for the benefit of each other and for the equal and ratable benefit
of the Holders of the 6 1/4% Series A Senior Notes due 2010 (the "Series A
Notes") and the 6 1/4% Series B Senior Notes due 2010 (the "Exchange Notes" and,
together with the Series A Notes, the "Notes"):

                                   ARTICLE 1
                   DEFINITIONS AND INCORPORATION BY REFERENCE

SECTION 1.01. DEFINITIONS.

                  "144A Global Note" means the Global Note in the form of
Exhibit A hereto bearing the Global Note Legend and the Private Placement Legend
and that has the "Schedule of Exchange of Interests in the Global Note" attached
thereto and deposited with and registered in the name of the Depositary or its
nominee that will be issued in a denomination equal to the outstanding principal
amount of the Notes sold in reliance on Rule 144A, subject to adjustment as
provided in Section 2.06 hereof.

                  "Acquired Debt" means, with respect to any specified Person:
(i) Indebtedness of any other Person existing at the time such other Person is
merged with or into or became a Subsidiary of such specified Person, whether or
not such Indebtedness is incurred in connection with, or in contemplation of,
such other Person merging with or into, or becoming a Subsidiary of, such
specified Person, but excluding Indebtedness that is extinguished, retired or
repaid in connection with such Person merging with or becoming a Subsidiary of
such specified Person; and (ii) Indebtedness secured by a Lien encumbering any
asset acquired by such specified Person.

                  "Additional Interest" means all additional interest then owing
pursuant to Section 5 of the Registration Rights Agreement.

                  "Affiliate" of any specified Person means any other Person
directly or indirectly controlling or controlled by or under direct or indirect
common control with such specified Person. For purposes of this definition,
"control," as used with respect to any Person, shall mean the possession,
directly or indirectly, of the power to direct or cause the direction of the
management or policies of such Person, whether through the ownership of voting
securities, by agreement or otherwise; provided that beneficial ownership of 10%
or more of the Voting Stock of a specified Person shall be deemed to be control
by the other Person; provided, further, that any third Person which also
beneficially owns 10% or more of the Voting Stock of a specified Person shall
not be deemed to be an Affiliate of either the specified Person or the other
Person merely because of such common ownership in such specified Person. For
purposes of this definition, the terms "controlling," "controlled by" and "under
common control with" shall have correlative meanings. Notwithstanding the

                                       1

<PAGE>

foregoing, the term "Affiliate" shall not include a Restricted Subsidiary of any
specified Person.

                  "Agent" means any Registrar, Paying Agent or co-registrar.

                  "Applicable Procedures" means, with respect to any transfer or
exchange of or for beneficial interests in any Global Note, the rules and
procedures of the Depositary, Euroclear and Clearstream that apply to such
transfer or exchange.

                  "Asset Sale" means, (i) the sale, lease, conveyance or other
disposition of any assets or rights, other than sales of inventory in the
ordinary course of business consistent with past practices; provided that the
sale, lease, conveyance or other disposition of all or substantially all of the
assets of the Partnership or the Partnership and its Restricted Subsidiaries
taken as a whole will be governed by the provisions of Section 4.06 and/or the
provisions of Article 5 hereof and not by the provisions of Section 4.07; and
(ii) the issuance of Equity Interests by any of the Partnership's Restricted
Subsidiaries or the sale by the Partnership or any of its Restricted
Subsidiaries of Equity Interests in any of its Restricted Subsidiaries.
Notwithstanding the preceding, the following items shall not be deemed to be
Asset Sales: (i) any single transaction or series of related transactions that:
(a) involves assets having a fair market value of less than $5.0 million; or (b)
results in net proceeds to the Partnership and its Restricted Subsidiaries of
less than $5.0 million; (ii) a transfer of assets between or among the
Partnership and its Restricted Subsidiaries; (iii) an issuance of Equity
Interests by a Restricted Subsidiary to the Partnership or to another Restricted
Subsidiary of the Partnership; (iv) a Restricted Payment that is permitted under
Section 4.08 hereof; and (v) a transaction of the type described in Section
4.07(d).

                  "Attributable Debt" in respect of a sale and lease-back
transaction means, at the time of determination, the present value of the
obligation of the lessee for net rental payments during the remaining term of
the lease included in such sale and lease-back transaction, including any period
for which such lease has been extended or may, at the option of the lessor, be
extended. Such present value shall be calculated using a discount rate equal to
the rate of interest implicit in such transaction, determined in accordance with
GAAP.

                  "Available Cash" has the meaning assigned to such term in the
Partnership Agreement, as in effect on the Issue Date.

                  "Bankruptcy Law" means Title 11, U.S. Code or any similar
federal or state law for the relief of debtors.

                  "Board of Directors" means, with respect to the Partnership,
the Board of Directors of the General Partner, or any authorized committee of
such Board of Directors, and with respect to GulfTerra Finance or any other
Subsidiary of the Partnership, the Board of Directors or managing members of
such Person.

                  "Board Resolution" means a copy of a resolution certified by
the Secretary or an Assistant Secretary of the General Partner or GulfTerra
Finance, as applicable, to have been duly adopted by the Board of Directors of
the General Partner or GulfTerra Finance, as applicable, and to be in full force
and effect on the date of such certification.

                                       2

<PAGE>

                  "Business Day" means any day other than a Legal Holiday.

                  "Capital Lease Obligation" means, at the time any
determination thereof is to be made, the amount of the liability in respect of a
capital lease that would at such time be required to be capitalized on a balance
sheet in accordance with GAAP.

                  "Cash Equivalent" means:

                           (i)      United States dollars or, in an amount up to
                  the amount necessary or appropriate to fund local operating
                  expenses, other currencies;

                           (ii)     securities issued or directly and fully
                  guaranteed or insured by the United States government or any
                  agency or instrumentality thereof (provided that the full
                  faith and credit of the United States is pledged in support
                  thereof) having maturities of not more than one year from the
                  date of acquisition;

                           (iii)    certificates of deposit, time deposits and
                  eurodollar time deposits with maturities of one year or less
                  from the date of acquisition, bankers' acceptances with
                  maturities not exceeding 365 days, demand and overnight bank
                  deposits and other similar types of investments routinely
                  offered by commercial banks, in each case with any domestic
                  commercial bank having a combined capital and surplus of not
                  less than $500.0 million and a Thompson Bank Watch Rating of
                  "B" or better or any commercial bank of any other country that
                  is a member of the Organization for Economic Cooperation and
                  Development ("OECD") and has total assets in excess of $500.0
                  million;

                           (iv)     repurchase obligations with a term of not
                  more than seven days for underlying securities of the types
                  described in clauses (ii) and (iii) above entered into with
                  any financial institution meeting the qualifications specified
                  in clause (iii) above;

                           (v)      commercial paper having one of the two
                  highest ratings obtainable from Moody's Investors Service,
                  Inc. or Standard & Poor's Ratings Group and in each case
                  maturing within six months after the date of acquisition; and

                           (vi)     investments in money market funds at least
                  95% of whose assets consist of investments of the types
                  described in clauses (i) through (v) above.

                  "Cash from Operations" shall have the meaning assigned to such
term in the Partnership Agreement, as in effect on the Issue Date.

                  "Certificated Note" means a certificated Note registered in
the name of the Holder thereof and issued in accordance with Section 2.06
hereof, in the form of Exhibit A, hereto except that such Note shall not bear
the Global Note Legend, shall not have the phrase identified by footnote 1
thereto and shall not have the "Schedule of Exchanges of Interests in the Global
Note" attached thereto.

                                       3

<PAGE>

                  "Change of Control" means the occurrence of any of the
following:

                           (i)      the sale, transfer, lease, conveyance or
                  other disposition (other than by way of merger or
                  consolidation), in one or a series of related transactions, of
                  all or substantially all of the assets of the Partnership and
                  its Restricted Subsidiaries taken as a whole to any "person"
                  (as such term is used in Section 13(d)(3) of the Exchange Act)
                  other than the El Paso Group;

                           (ii)     the adoption of a plan relating to the
                  liquidation or dissolution of the Partnership or the General
                  Partner; and

                           (iii)    such time as the El Paso Group ceases to
                  own, directly or indirectly, the general partner interests of
                  the Partnership, or members of the El Paso Group cease to
                  serve as the only general partners of the Partnership.

Notwithstanding the foregoing, a conversion of the Partnership from a limited
partnership to a corporation, limited liability company or other form of entity
or an exchange of all of the outstanding limited partnership interests for
capital stock in a corporation, for member interests in a limited liability
company or for Equity Interests in such other form of entity shall not
constitute a Change of Control, so long as following such conversion or exchange
the El Paso Group beneficially owns, directly or indirectly, in the aggregate
more than 50% of the Voting Stock of such entity, or continues to own a
sufficient number of the outstanding shares of Voting Stock of such entity to
elect a majority of its directors, managers, trustees or other persons serving
in a similar capacity for such entity.

                  "Clearstream" means Clearstream Banking, societe anonyme.

                  "Code" means the Internal Revenue Code of 1986, as amended
from time to time, and the rules and regulations thereunder.

                  "Comparable Treasury Dealer Quotations" means, with respect to
each Reference Treasury Dealer and any redemption date, the average, as
determined by the Trustee, of the bid and asked prices for the Comparable
Treasury Issue (expressed in each case as a percentage of its principal amount)
quoted in writing to the Trustee by such Reference Treasury Dealer at 5:00 p.m.,
New York City on the third Business Day preceding such redemption date.

                  "Comparable Treasury Issue" means the fixed rate United States
Treasury security selected by an Independent Investment Banker as having a
maturity most comparable to the remaining term of the Notes to be redeemed (and
which is not callable prior to maturity) that would be utilized, at the time of
selection and in accordance with customary financial practices, in pricing new
issues of corporate debt securities of comparable maturity to the remaining term
of the Notes to be redeemed.

                  "Comparable Treasury Price" means with respect to any
redemption date for the Notes: (1) the average of the Comparable Treasury Dealer
Quotations for such redemption date, after excluding the highest and the lowest
of such Comparable Treasury Dealer Quotations, or (2) if the Trustee obtains
fewer than three such Comparable Treasury Dealer Quotations, the average of all
such quotations.

                                       4

<PAGE>

                  "Consolidated Cash Flow" means, with respect to any Person for
any period, the Consolidated Net Income of such Person for such period plus

                           (i)      an amount equal to the dividends or
                  distributions paid during such period in cash or Cash
                  Equivalents to such Person or any of its Restricted
                  Subsidiaries by a Person that is not a Restricted Subsidiary
                  of such Person; plus

                           (ii)     an amount equal to any extraordinary loss of
                  such Person and its Restricted Subsidiaries plus any net loss
                  realized by such Person and its Restricted Subsidiaries in
                  connection with an Asset Sale, to the extent such losses were
                  deducted in computing such Consolidated Net Income; plus

                           (iii)    the provision for taxes based on income or
                  profits of such Person and its Restricted Subsidiaries for
                  such period, to the extent that such provision for taxes was
                  deducted in computing such Consolidated Net Income; plus

                           (iv)     the consolidated interest expense of such
                  Person and its Restricted Subsidiaries for such period,
                  whether paid or accrued (including, without limitation,
                  amortization of debt issuance costs and original issue
                  discount, non-cash interest payments, the interest component
                  of any deferred payment obligations, the interest component of
                  all payments associated with Capital Lease Obligations,
                  imputed interest with aspect to Attributable Debt,
                  commissions, discounts and other fees and charges incurred in
                  respect of letter of credit or bankers' acceptance financings,
                  and net payments, if any, pursuant to Hedging Obligations), to
                  the extent that any such expense was deducted in computing
                  such Consolidated Net Income, excluding any such expenses to
                  the extent incurred by a Person that is not a Restricted
                  Subsidiary of the Person for which the calculation is being
                  made; plus

                           (v)      depreciation, depletion and amortization
                  (including amortization of goodwill and other intangibles but
                  excluding amortization of prepaid cash expenses that were paid
                  in a prior period) and other non-cash expenses (excluding any
                  such non-cash expense to the extent that it represents an
                  accrual of or reserve for cash expenses in any future period
                  or amortization of a prepaid cash expense that was paid in a
                  prior period) of such Person and its Restricted Subsidiaries
                  for such period to the extent that such depreciation,
                  amortization and other non-cash expenses were deducted in
                  computing such Consolidated Net Income (excluding any such
                  expenses to the extent incurred by a Person that is neither an
                  Issuer nor a Restricted Subsidiary); minus

                           (vi)     non-cash items increasing such Consolidated
                  Net Income for such period, other than items that were accrued
                  in the ordinary course of business, in each case, on a
                  consolidated basis and determined in accordance with GAAP.

Notwithstanding the preceding, the provision for taxes based on the income or
profits of, and the depreciation and amortization and other non-cash charges of,
a Restricted Subsidiary of the Partnership shall be added to Consolidated Net
Income to compute

                                       5

<PAGE>

Consolidated Cash Flow of the Partnership only to the extent that a
corresponding amount would be permitted at the date of determination to be
dividended or distributed to the Partnership by such Restricted Subsidiary
without prior approval (that has not been obtained), pursuant to the terms of
its charter and all agreements, instruments, judgments, decrees, orders,
statutes, rules and governmental regulations applicable to that Restricted
Subsidiary or its stockholders.

                  "Consolidated Net Income" means, with respect to any specified
Person for any period, the aggregate of the Net Income of such Person and its
Restricted Subsidiaries for such period, on a consolidated basis, determined in
accordance with GAAP; provided that: (i) the aggregate Net Income (but not net
loss in excess of such aggregate Net Income) of all Persons that are
Unrestricted Subsidiaries shall be excluded (without duplication); (ii) the
earnings included therein attributable to all Persons that are accounted for by
the equity method of accounting and the aggregate Net Income (but not net loss
in excess of such aggregate Net Income) included therein attributable to all
entities constituting Joint Ventures that are accounted for on a consolidated
basis (rather than by the equity method of accounting) shall be excluded; (iii)
the Net Income of any Restricted Subsidiary shall be excluded to the extent that
the declaration or payment of dividends or similar distributions by that
Restricted Subsidiary of that Net Income is not at the date of determination
permitted without any prior governmental approval (that has not been obtained)
or, directly or indirectly, by operation of the terms of its charter or any
agreement (other than this Indenture, the Notes or any Guarantee), instrument,
judgment, decree, order, statute, rule or governmental regulation applicable to
that Restricted Subsidiary or its stockholders; (iv) the Net Income of any
Person acquired in a pooling of interests transaction for any period prior to
the date of such acquisition shall be excluded; and (v) the cumulative effect of
a change in accounting principles shall be excluded.

                  "Consolidated Net Tangible Assets" means, at any date of
determination, the total amount of assets of the Partnership and its Restricted
Subsidiaries after deducting therefrom:

                           (1)      all current liabilities (excluding (A) any
                  current liabilities that by their terms are extendable or
                  renewable at the option of the obligor thereon to a time more
                  than 12 months after such date of determination, and (B)
                  current maturities of long-term debt); and

                           (2)      the value (net of any applicable reserves)
                  of all goodwill, trade names, trademarks, patents and other
                  like intangible assets, all as set forth, or on a pro forma
                  basis would be set forth, on the consolidated balance sheet of
                  the Partnership and its consolidated subsidiaries for the
                  Partnership's most recently completed fiscal quarter, prepared
                  in accordance with GAAP.

                  "Consolidated Net Worth" means, with respect to any Person as
of any date, the sum of: (i) the consolidated equity of the common stockholders
or members (or consolidated partners' capital in the case of a partnership) of
such Person and its consolidated Subsidiaries as of such date as determined in
accordance with GAAP; plus (ii) the respective amounts reported on such Person's
balance sheet as of such date with respect to any series of preferred stock
(other than Disqualified Equity) that by its terms is not entitled to the
payment of dividends unless such dividends may be declared and paid

                                       6
<PAGE>

only out of net earnings in respect of the year of such declaration and payment,
but only to the extent of any cash received by such Person upon issuance of such
preferred stock.

                  "Corporate Trust Office of the Trustee" shall be at the
address of the Trustee specified in Section 12.02 hereof or such other address
as to which the Trustee may give notice to the Issuers.

                  "Credit Facilities" means, with respect to the Partnership,
GulfTerra Finance or any Restricted Subsidiary, one or more debt facilities or
commercial paper facilities, including the Partnership Credit Facility, in each
case providing for revolving credit loans, term loans, receivables financing
(including through the sale of receivables to such lenders or to special purpose
entities formed to borrow from such lenders against such receivables) or letters
of credit, in each case, as amended, restated, modified, renewed, refunded,
replaced or refinanced in whole or in part from time to time.

                  "Default" means any event that is or with the passage of time
or the giving of notice or both would be, an Event of Default.

                  "Depositary" means, with respect to the Notes issuable or
issued in whole or in part in global form, the Person specified in Section 2.03
hereof as the Depositary with respect to the Notes, and any and all successors
thereto appointed as depositary hereunder and having become such pursuant to the
applicable provision of this Indenture.

                  "Disqualified Equity" means any Equity Interests that, by its
terms (or by the terms of any security into which it is convertible, or for
which it is exchangeable, in each case at the option of the holder thereof), or
upon the occurrence of any event, matures or is mandatorily redeemable, pursuant
to a sinking fund obligation or otherwise, or redeemable at the option of the
holder thereof, in whole or in part, on or prior to the date on which the Notes
mature. Notwithstanding the preceding sentence, any Equity Interests that would
constitute Disqualified Equity solely because the holders thereof have the right
to require the Partnership or any of its Restricted Subsidiaries or GulfTerra
Finance to repurchase such Equity Interests upon the occurrence of a change of
control or an asset sale shall not constitute Disqualified Equity if the terms
of such Equity Interests provide that such Equity Interests shall not be
repurchased or redeemed pursuant to such provisions unless such repurchase or
redemption is conditioned upon, and subject to, compliance with Section 4.08
hereof.

                  "Distribution Compliance Period" means the 40-day distribution
compliance period as defined in Regulation S.

                  "El Paso" means El Paso Corporation, a Delaware corporation,
and its successors.

                  "El Paso Group" means, collectively, (1) El Paso, (2) each
Person of which, as of the time of the determination, El Paso is a direct or
indirect Subsidiary and (3) each Person which is a direct or indirect Subsidiary
of any Person described in (1) or (2) above.

                  "Equity Interests" means:

                           (i)      in the case of a corporation, corporate
                  stock;

                                       7

<PAGE>

                           (ii)     in the case of an association or business
                  entity, any and all shares, interests, participations, rights
                  or other equivalents (however designated) of corporate stock;

                           (iii)    in the case of a partnership or limited
                  liability company, partnership or membership interests
                  (whether general or limited);

                           (iv)     any other interest or participation that
                  confers on a Person the right to receive a share of the
                  profits and losses of, or distributions of assets of, the
                  issuing Person, and any rights (other than debt securities
                  convertible into capital stock) warrants or options
                  exchangeable for or convertible into such capital stock; and

                           (v)      all warrants, options or other rights to
                  acquire any of the interests described in clauses (i) through
                  (iv) above (but excluding any debt security that is
                  convertible into, or exchangeable for, any of the interests
                  described in clauses (i) through (iv) above).

                  "Euroclear" means Euroclear Bank S.A./N.V., as operator of the
Euroclear system.

                  "Exchange Act" means the Securities Exchange Act of 1934, as
amended.

                  "Exchange Notes" means the 6 1/4 % Series B Senior Notes due
2010, having terms substantially identical to the Series A Notes, offered to the
Holders of the Series A Notes under the Exchange Offer Registration Statement.

                  "Exchange Offer" means the offer that may be made by the
Issuers pursuant to the Registration Rights Agreement to the Holders of the
Series A Notes to exchange their Series A Notes for the Exchange Notes.

                  "Exchange Offer Registration Statement" means that certain
registration statement filed by the Issuers and the Subsidiary Guarantors with
the SEC to register the Exchange Notes for issuance in the Exchange Offer.

                  "Existing Indebtedness" means the aggregate principal amount
of Indebtedness of the Partnership and its Restricted Subsidiaries in existence
on the Issue Date.

                  "Existing Senior Subordinated Notes" means, the 8 1/2% Senior
Subordinated Notes of the Issuers originally issued in March 2003 with maturity
in June 2010, the 10 5/8% Senior Subordinated Notes of the Issuers originally
issued in November 2002 with maturity in December 2012, the 8 1/2% Senior
Subordinated Notes of the Issuers originally issued in May 2002 with maturity in
June 2011, the 8 1/2% Senior Subordinated Notes of the Issuers originally issued
in May 2001 with maturity in June 2011 and the 10 3/8% Senior Subordinated Notes
of the Issuers originally issued in May 1999 with maturity in May 2009.

                  "Fixed Charge Coverage Ratio" means, with respect to any
specified Person for any period, the ratio of the Consolidated Cash Flow of such
Person and its Restricted

                                       8

<PAGE>

Subsidiaries for such period to the Fixed Charges of such Person for such
period. In the event that the specified Person or any of its Restricted
Subsidiaries incurs, assumes, guarantees, repays or redeems any Indebtedness
(other than revolving credit borrowings not constituting a permanent commitment
reduction) or issues or redeems Disqualified Equity subsequent to the
commencement of the period for which the Fixed Charge Coverage Ratio is being
calculated but prior to the date on which the event for which the calculation of
the Fixed Charge Coverage Ratio is made (the "Calculation Date"), then the Fixed
Charge Coverage Ratio shall be calculated giving pro forma effect to such
incurrence (and the application of the net proceeds thereof), assumption,
guarantee, repayment or redemption of Indebtedness, or such issuance or
redemption of Disqualified Equity, as if the same had occurred at the beginning
of the applicable four-quarter reference period (and if such Indebtedness is
incurred to finance the acquisition of assets (including, without limitation, a
single asset, a division or segment or an entire company) that were conducting
commercial operations prior to such acquisition, there shall be included pro
forma net income for such assets, as if such assets had been acquired on the
first day of such period).

                  In addition, for purposes of calculating the Fixed Charge
Coverage Ratio:

                           (i)      acquisitions that have been made by the
                  specified Person or any of its Restricted Subsidiaries,
                  including through mergers or consolidations and including any
                  related financing transactions, during the four-quarter
                  reference period or subsequent to such reference period and on
                  or prior to the Calculation Date shall be deemed to have
                  occurred on the first day of the four-quarter reference period
                  and Consolidated Cash Flow for such reference period shall be
                  calculated without giving effect to clause (iv) of the proviso
                  set forth in the definition of Consolidated Net Income;

                           (ii)     the Consolidated Cash Flow attributable to
                  discontinued operations, as determined in accordance with
                  GAAP, and operations or businesses disposed of prior to the
                  Calculation Date, shall be excluded;

                           (iii)    the Fixed Charges attributable to
                  discontinued operations, as determined in accordance with
                  GAAP, and operations or businesses disposed of prior to the
                  Calculation Date, shall be excluded, but only to the extent
                  that the obligations giving rise to such Fixed Charges will
                  not be obligations of the specified Person or any of its
                  Restricted Subsidiaries following the Calculation Date;

                           (iv)     interest on outstanding Indebtedness of the
                  specified Person or any of its Restricted Subsidiaries as of
                  the last day of the four-quarter reference period shall be
                  deemed to have accrued at a fixed rate per annum equal to the
                  rate of interest on such Indebtedness in effect on such last
                  day after giving effect to any Hedging Obligation then in
                  effect; and

                           (v)      if interest on any Indebtedness incurred by
                  the specified Person or any of its Restricted Subsidiaries on
                  such date may optionally be determined at an interest rate
                  based upon a factor of a prime or similar rate,

                                       9

<PAGE>

                  a eurocurrency interbank offered rate or other rates, then the
                  interest rate in effect on the last day of the four-quarter
                  reference period will be deemed to have been in effect during
                  such period.

                  "Fixed Charges" means, with respect to any Person for any
period, without duplication,

                  (A)      the sum of:

                                 (i)      the consolidated interest expense of
                           such Person and its Restricted Subsidiaries
                           (excluding for purposes of this clause (i)
                           consolidated interest expense included therein that
                           is attributable to Indebtedness of a Person that is
                           not a Restricted Subsidiary of the Person for which
                           the calculation is being made) for such period,
                           whether paid or accrued, including, without
                           limitation, amortization of debt issuance costs and
                           original issue discount, non-cash interest payments,
                           the interest component of any deferred payment
                           obligations, the interest component of all payments
                           associated with Capital Lease Obligations, imputed
                           interest with respect to Attributable Debt,
                           commissions, discounts, and other fees and charges
                           incurred in respect of letter of credit or bankers'
                           acceptance financings, and net payments, if any,
                           pursuant to Hedging Obligations; plus

                                 (ii)     the consolidated interest expense of
                           such Person and its Restricted Subsidiaries that was
                           capitalized during such period (excluding for
                           purposes of this clause (ii) any such consolidated
                           interest included therein that is attributable to
                           Indebtedness of a Person that is not a Restricted
                           Subsidiary); plus

                                 (iii)    any interest expense on Indebtedness
                           of another Person that is guaranteed by such Person
                           or one of its Restricted Subsidiaries or secured by a
                           Lien on assets of such Person or one of its
                           Restricted Subsidiaries, whether or not such
                           guarantee or Lien is called upon, provided that this
                           clause (iii) excludes interest on "claw-back,"
                           "make-well" or "keep- well" payments made by the
                           Partnership or any Restricted Subsidiary; plus

                                 (iv)     the product of (a) all dividend
                           payments, whether or not in cash, on any series of
                           Disqualified Equity of such Person or any of its
                           Restricted Subsidiaries, other than dividend payments
                           on Equity Interests payable solely in Equity
                           Interests of the Partnership (other than Disqualified
                           Equity) or to the Partnership or a Restricted
                           Subsidiary of the Partnership, times (b) a fraction,
                           the numerator of which is one and the denominator of
                           which is one minus the then current combined federal,
                           state and local statutory tax rate of such Person,
                           expressed as a decimal, in each case, on a
                           consolidated basis and in accordance with GAAP, less

                                       10

<PAGE>

                           (B)      to the extent included in clause (A) above,
                  amortization or write-off of deferred financing costs of such
                  Person and its Restricted Subsidiaries during such period and
                  any charge related to, or any premium or penalty paid in
                  connection with, incurring any such Indebtedness of such
                  Person and its Restricted Subsidiaries prior to its Stated
                  Maturity.

In the case of both clauses (A) and (B) of this definition, such amounts will be
determined after elimination of intercompany accounts among such Person and its
Restricted Subsidiaries and in accordance with GAAP.

                  "GAAP" means United States generally accepted accounting
principles set forth in the opinions and pronouncements of the Accounting
Principles Board of the American Institute of Certified Public Accountants and
statements and pronouncements of the Financial Accounting Standards Board or in
such other statements by such other entity as have been approved by a
significant segment of the accounting profession, which are in effect from time
to time.

                  "General Partner" means GulfTerra Energy Company, L.L.C., a
Delaware limited liability company, in its capacity as the general partner of
the Partnership.

                  "Global Note Legend" means the legend set forth in Section
2.06(g)(ii), which is required to be placed on all Global Notes issued under
this Indenture.

                  "Global Notes" means, individually and collectively, each of
the Restricted Global Notes and the Unrestricted Global Notes, in the form of
Exhibit A hereto issued in accordance with Section 2.01, 2.06(b), 2.06(d) or
2.06(f) hereof.

                  "guarantee" means a guarantee, other than by endorsement of
negotiable instruments for collection in the ordinary course of business, direct
or indirect, in any manner, including, without limitation, by way of pledge of
assets, or through letters of credit or reimbursement, "claw-back," "make-well"
or "keep-well" agreement in respect thereof, of all or any part of any
Indebtedness. The term "guarantee" used as a verb has a corresponding meaning.
The term "guarantor" shall mean any Person providing a guarantee of any
obligation.

                  "Guarantee" means, individually and collectively, the
guarantees given by the Subsidiary Guarantors pursuant to Article 10 hereof,
including a notation in the Notes substantially in the form attached hereto as
Exhibit D.

                  "Guarantee Obligations" means, with respect to each Subsidiary
Guarantor, the obligations of such Guarantor under Article 10.

                  "Guarantor Subordinated Obligation" means, with respect to a
Subsidiary Guarantor, any Indebtedness or other Obligations of such Subsidiary
Guarantor (whether outstanding on the Issue Date or thereafter incurred) which
are expressly subordinated in right of payment to the Obligations of such
Subsidiary Guarantor under its Guarantee pursuant to a written agreement,
including the guarantees by such Subsidiary Guarantor of the Existing Senior
Subordinated Notes.

                                       11

<PAGE>

                  "GulfTerra Finance" means the Person named as such in the
preamble of this Indenture under and until a successor replaces it pursuant to
the applicable provision of this Indenture and thereafter means such successor.

                  "Hedging Obligations" means, with respect to any Person, the
net obligations (not the notional amount) of such Person under interest rate and
commodity price swap agreements, interest rate and commodity price cap
agreements, interest rate and commodity price collar agreements and foreign
currency and commodity price exchange agreements, options or futures contracts
or other similar agreements or arrangements or hydrocarbon hedging contracts or
hydrocarbon forward sales contracts, in each case designed to protect such
Person against fluctuations in interest rates, foreign exchange rates, or the
commodities prices.

                  "Holder" means the Person in whose name a Note is registered
on the Registrar's books.

                  "IAI Global Note" means the Global Note in the form of Exhibit
A hereto bearing the Global Note Legend and the Private Placement Legend and
that has the "Schedule of Exchange of Interests in the Global Note" attached
thereto and deposited with and registered in the name of the Depositary or its
nominee that will be issued in a denomination equal to the outstanding principal
amount of the Notes transferred to Institutional Accredited Investors in
accordance with 2.06(b)(iii)(C) or 2.06(d)(i)(D), subject to adjustment as
provided in Section 2.06 hereof.

                  "Indebtedness" means, with respect to any specified Person,
any indebtedness of such Person, whether or not contingent, in respect of:

                           (i)      borrowed money;

                           (ii)     evidenced by bonds, notes, debentures or
                  similar instruments or letters of credit (or reimbursement
                  agreements in respect thereof), other than standby letters of
                  credit and performance bonds issued by such Person in the
                  ordinary course of business, to the extent not drawn;

                           (iii)    banker's acceptances;

                           (iv)     representing Capital Lease Obligations;

                           (v)      all Attributable Debt of such Person in
                  respect of any sale and lease-back transactions not involving
                  a Capital Lease Obligation;

                           (vi)     the balance deferred and unpaid of the
                  purchase price of any property, except any such balance that
                  constitutes an accrued expense or trade payable incurred in
                  the ordinary course of business;

                           (vii)    representing Disqualified Equity; or

                           (viii)   representing any Hedging Obligations other
                  than to (in the ordinary course of business and consistent
                  with prior practice) hedge risk

                                       12

<PAGE>

                  exposure in the operations, ownership of assets or the
                  management of liabilities of such Person and its Restricted
                  Subsidiaries;

if and to the extent any of the preceding items (other than letters of credit
and Hedging Obligations) would appear as a liability upon a balance sheet of the
specified Person prepared in accordance with GAAP. In addition, the term
"Indebtedness" includes all Indebtedness of others secured by a Lien on any
asset of the specified Person (whether or not such Indebtedness is assumed by
the specified Person) and, to the extent not otherwise included, the guarantee
by such Person of any indebtedness of any other Person, provided that a
guarantee otherwise permitted by this Indenture to be incurred by the
Partnership or any of its Restricted Subsidiaries of Indebtedness incurred by
the Partnership or a Restricted Subsidiary in compliance with the terms of this
Indenture shall not constitute a separate incurrence of Indebtedness.

                  The amount of any Indebtedness outstanding as of any date
shall be: (i) the accreted value thereof, in the case of any Indebtedness issued
with original issue discount; and (ii) the principal amount thereof, together
with any interest thereon that is more than 30 days past due, in the case of any
other Indebtedness. For purposes of clause (vii) of this definition of
Indebtedness, Disqualified Equity shall be valued at the maximum fixed
redemption, repayment or repurchase price, which shall be calculated in
accordance with the terms of such Disqualified Equity as if such Disqualified
Equity were repurchased on any date on which Indebtedness shall be required to
be determined pursuant to this Indenture; provided, however, that if such this
Disqualified Equity is not then permitted by its terms to be redeemed, repaid or
repurchased, the redemption, repayment or repurchase price shall be the book
value of such Disqualified Equity. The amount of Indebtedness of any Person at
any date shall be the outstanding balance at such date of all unconditional
Obligations as described above and the maximum liability of any guarantees at
such date; provided that for purposes of calculating the amount of any
non-interest bearing or other discount security, such Indebtedness shall be
deemed to be the principal amount thereof that would be shown on the balance
sheet of the issuer thereof dated such date prepared in accordance with GAAP,
but that such security shall be deemed to have been incurred only on the date of
the original issuance thereof. The amount of Indebtedness of any Person at any
date shall be the outstanding balance at such date of all unconditional
Obligations as described above and the maximum liability, upon the occurrence of
the contingency giving rise to the Obligation, of any contingent Obligations at
such date.

                  "Indenture" means this Indenture, as amended or supplemented
from time to time.

                  "Independent Investment Banker" means J.P. Morgan Securities
Inc. (and its successors), or, if such firm is unwilling or unable to select the
applicable Comparable Treasury Issue, an independent investment banking
institution selected by the Partnership.

                  "Indirect Participant" means a Person who holds a beneficial
interest in a Global Note through a Participant.

                  "Initial Purchasers" means J.P. Morgan Securities Inc.,
Goldman, Sachs & Co., UBS Warburg LLC and Wachovia Securities, Inc.

                                       13

<PAGE>

                  "Institutional Accredited Investor" means an institution that
is an "accredited investor" as defined in Rule 501(a)(1), (2), (3) or (7) of the
rules and regulations promulgated under the Securities Act.

                  "Interest Payment Date" means Stated Maturity of an
installment of interest on the Notes.

                  "Investment Grade Rating" means a rating equal to or higher
than Baa3 (or the equivalent) by Moody's or BBB- (or the equivalent) by S&P; or
the equivalent by any other nationally recognized statistical rating
organization.

                  "Investments" means, with respect to any Person, all
investments by such Person in other Persons (including Affiliates) in the forms
of direct or indirect loans (including guarantees of Indebtedness or other
Obligations), advances (other than advances to customers in the ordinary course
of business that are recorded as accounts receivable on the balance sheet of the
lender and commission, moving, travel and similar advances to officers and
employees made in the ordinary course of business) or capital contributions,
purchases or other acquisitions for consideration of Indebtedness, Equity
Interests or other securities, together with all items that are or would be
classified as investments on a balance sheet prepared in accordance with GAAP.
For purposes of the definition of "Unrestricted Subsidiary," the definition of
"Restricted Payment" and the covenant in Section 4.08, (i) the term "Investment"
shall include the portion (proportionate to the Partnership's Equity Interest in
such Subsidiary) of the fair market value of the net assets of any Subsidiary of
the Partnership or any of its Restricted Subsidiaries at the time that such
Subsidiary is designated an Unrestricted Subsidiary; provided, however, that
upon a redesignation of such Subsidiary as a Restricted Subsidiary, the
Partnership or such Restricted Subsidiary shall be deemed to continue to have a
permanent "Investment" in such Subsidiary at the time of such redesignation
equal to the amount thereof as determined immediately prior to redesignation
less the portion (proportionate to the Partnership's or such Restricted
Subsidiary's Equity Interest in such Subsidiary) of the fair market value of the
net assets of such Subsidiary at the time of such redesignation, and (ii) any
property transferred to or from an Unrestricted Subsidiary shall be valued at
its fair market value at the time of such transfer, in each case as determined
in good faith by the Board of Directors of the General Partner. If the
Partnership or any Restricted Subsidiary of the Partnership sells or otherwise
disposes of any Equity Interests of any direct or indirect Restricted Subsidiary
of the Partnership such that, after giving effect to any such sale or
disposition, such Person is no longer a Restricted Subsidiary of the
Partnership, the Partnership shall be deemed to have made an Investment on the
date of any such sale or disposition equal to the fair market value of the
Equity Interests of such Restricted Subsidiary not sold or disposed of in an
amount determined as provided in Section 4.08(b).

                  "Issue Date" means July 3, 2003.

                  "Issuers" means the Partnership and GulfTerra Finance,
collectively; "Issuer" means the Partnership or GulfTerra Finance.

                  "Joint Venture" shall have the meaning assigned to such term
in the definition of "Permitted Business Investments" set forth in this Section
1.01. The term "Joint Venture" shall initially include Atlantis Offshore,
L.L.C., Copper Eagle Gas Storage,

                                       14

<PAGE>

L.L.C., Poseidon Oil Pipeline Company, L.L.C., Cameron Highway Oil Pipeline
Company and Deepwater Gateway, L.L.C. and its Subsidiaries.

                  "Legal Holiday" means a Saturday, a Sunday or a day on which
banking institutions in the City of Houston, Texas or New York, New York or at a
place of payment are authorized by law, regulation or executive order to remain
closed. If a payment date is a Legal Holiday at a place of payment, payment may
be made at that place on the next succeeding day that is not a Legal Holiday,
and no interest shall accrue for the intervening period.

                  "Letter of Transmittal" means the letter of transmittal to be
prepared by the Issuers and sent to all Holders of the Series A Notes for use by
such Holders in connection with the Exchange Offer.

                  "Lien" means, with respect to any asset, any mortgage, lien
(statutory or otherwise), pledge, charge, security interest, hypothecation,
assignment for security, claim, preference, priority or encumbrance of any kind
in respect of such asset, whether or not filed, recorded or otherwise perfected
under applicable law, including any conditional sale or other title retention
agreement or any lease in the nature thereof, any option or other agreement to
grant a security interest in and any filing of or agreement to give any
financing statement under the Uniform Commercial Code (or equivalent statute) of
any jurisdiction.

                  "Management Agreement" means the General and Administrative
Services Agreement, dated as of April 8, 2002, by and among DeepTech
International, Inc., a Delaware corporation, El Paso Field Services, L.P., a
Delaware limited partnership, and the General Partner, as amended and in effect
on the Issue Date.

                  "Moody's" means Moody's Investors Service, Inc. or any
successor to the rating agency business thereof.

                  "Net Income" means, with respect to any Person, the
consolidated net income (loss) of such Person and its Restricted Subsidiaries,
determined in accordance with GAAP and before any reduction in respect of
preferred stock dividends, excluding, however: (i) the aggregate gain (but not
loss in excess of such aggregate gain), together with any related provision for
taxes on such gain, realized in connection with (a) any Asset Sale or (b) the
disposition of any securities by such Person or any of its Restricted
Subsidiaries or the extinguishment of any Indebtedness of such Person or any of
its Restricted Subsidiaries; and (ii) the aggregate extraordinary gain (but not
loss in excess of such extraordinary gain), together with any related provision
for taxes on such extraordinary gain (but not loss in excess of such aggregate
extraordinary gain).

                  "Net Proceeds" means, with respect to any Asset Sale or sale
of Equity Interests, the aggregate proceeds received by the Partnership or any
of its Restricted Subsidiaries in cash or Cash Equivalents in respect of any
Asset Sale or sale of Equity Interests (including, without limitation, any cash
received upon the sale or other disposition of any non-cash consideration
received in any such sale), net of (without duplication): (i) the direct costs
relating to such Asset Sale or sale of Equity Interests, including, without
limitation, brokerage commissions and legal, accounting and investment banking
fees, sales

                                       15

<PAGE>

commissions, recording fees, title transfer fees and any relocation expenses
incurred as a result thereof, (ii) taxes paid or payable as a result thereof, in
each case after taking into account any available tax credits or deductions and
any tax sharing arrangements and amounts required to be applied to the repayment
of Indebtedness secured by a Lien on the asset or assets that were the subject
of such Asset Sale or sale of Equity Interests, (iii) all distributions and
payments required to be made to minority interest holders in Restricted
Subsidiaries as a result of such Asset Sale and (iv) any amounts to be set aside
in any reserve established in accordance with GAAP or any amount placed in
escrow, in either case for adjustment in respect of the sale price of such asset
or Equity Interests or for liabilities associated with such Asset Sale or sale
of Equity Interests and retained by the Partnership or any of its Restricted
Subsidiaries until such time as such reserve is reversed or such escrow
arrangement is terminated, in which case Net Proceeds shall include only the
amount of the reserve so reserved or the amount returned from such escrow
arrangement to the Partnership or its Restricted Subsidiaries, as the case may
be.

                  "Non-Putable Debt Securities" means debt securities of either
of the Issuers or any of the Restricted Subsidiaries (excluding any guarantees
thereof), including the Notes, other than Putable Debt Securities.

                  "Non-Recourse Debt" means Indebtedness as to which:

                           (i)      neither the Partnership nor any of its
                  Restricted Subsidiaries (a) provides credit support of any
                  kind (including any undertaking, agreement or instrument that
                  would constitute Indebtedness), (b) is directly or indirectly
                  liable as a guarantor or otherwise, or (c) constitutes the
                  lender of such Indebtedness;

                           (ii)     no default with respect to which (including
                  any rights that the holders thereof may have to take
                  enforcement action against an Unrestricted Subsidiary) would
                  permit upon notice, lapse of time or both any holder of any
                  other Indebtedness (other than the Notes) of the Partnership
                  or any of its Restricted Subsidiaries to declare a default on
                  such other Indebtedness or cause the payment thereof to be
                  accelerated or payable prior to its stated maturity; and

                           (iii)    the lenders have been notified in writing
                  that they will not have any recourse to the stock or assets of
                  the Partnership or any of its Restricted Subsidiaries,
                  provided that in no event shall Indebtedness of any Person
                  which is not a Restricted Subsidiary fail to be Non-Recourse
                  Debt solely as a result of any default provisions contained in
                  a guarantee thereof by the Partnership or any of its
                  Restricted Subsidiaries provided that the Partnership or such
                  Restricted Subsidiary was otherwise permitted to incur such
                  guarantee pursuant to this Indenture.

                  "Non-U.S. Person" means a person who is not a U.S. Person.

                  "Note Custodian" means the Trustee, as custodian with respect
to the Notes in global form, or any successor entity thereto.

                  "Notes" has the meaning assigned to it in the preamble to this
Indenture.

                                       16

<PAGE>

                  "Obligations" means any principal, interest, penalties, fees,
indemnifications, reimbursement obligations, damages and other liabilities
payable under the documentation governing any Indebtedness.

                  "Offering" means the offering of the Series A Notes by the
Issuers.

                  "Officer" means, with respect to any Person, the Chairman of
the Board, the Chief Executive Officer, the President, the Chief Operating
Officer, the Chief Financial Officer, the Chief Accounting Officer, the
Treasurer, any Assistant Treasurer, the Controller, the Secretary or any
Vice-President of such Person (or, with respect to the Partnership, so long as
it remains a partnership, the General Partner).

                  "Officers' Certificate" means a certificate signed on behalf
of the Partnership by an Officer of the Partnership or an Officer of the General
Partner, GulfTerra Finance or any Subsidiary Guarantor, as the case may be, one
of whom must be the principal executive officer, the principal financial officer
or the principal accounting officer of such Person, that meets the requirements
of Section 12.05 hereof.

                  "Opinion of Counsel" means an opinion from legal counsel who
is reasonably acceptable to the Trustee, that meets the requirements of Section
12.05 hereof. The counsel may be an employee of or counsel to the Partnership,
GulfTerra Finance or the General Partner (or any Subsidiary Guarantor, if
applicable), any Subsidiary of the Partnership or the Trustee.

                  "Participant" means, with respect to DTC, Euroclear or
Clearstream, a Person who has an account with DTC, Euroclear or Clearstream,
respectively (and, with respect to DTC, shall include Euroclear and
Clearstream).

                  "Partnership" means the Person named as such in the preamble
of this Indenture unless and until a successor replaces it pursuant to the
applicable provisions of this Indenture and thereafter means such successor.

                  "Partnership Agreement" means the Second Amended and Restated
Agreement of Limited Partnership of the Partnership, amended and restated
effective as of August 31, 2000, as amended by the First Amendment thereto dated
November 27, 2002, the Second Amendment thereto dated May 5, 2003 and the Third
Amendment thereto dated May 16, 2003, as such may be amended, modified or
supplemented from time to time.

                  "Partnership Credit Facility" means the Sixth Amended and
Restated Credit Agreement dated as of March 23, 1995, as amended and restated
through June 13, 2003, among the Partnership, GulfTerra Finance and the lenders
from time to time party thereto, Credit Lyonnais, New York Branch and Wachovia
Bank, National Association, as co-syndication agents, Fleet National Bank and
Fortis Capital Corp., as co-documentation agents, and JPMorgan Chase Bank, as
administrative agent, including any deferrals, renewals, extensions,
replacements, refinancings or refundings thereof, and any amendments,
modifications or supplements thereto and any agreement providing therefor
(including any restatement thereof and any increases in the amount of
commitments thereunder), whether by or with the same or any other lenders,
creditors, group of lenders

                                       17

<PAGE>

or group of creditors and including related notes, guarantees, collateral
security documents and other instruments and agreements executed in connection
therewith.

                  "Permitted Business" means:

                           (i)      gathering, transporting (by barge, pipeline,
                  ship, truck or other modes of hydrocarbon transportation),
                  terminalling, storing, producing, acquiring, developing,
                  exploring for, processing, dehydrating and otherwise handling
                  hydrocarbons, including, without limitation, constructing
                  pipeline, platform, dehydration, processing and other
                  energy-related facilities, and activities or services
                  reasonably related or ancillary thereto,

                           (ii)     any business that generates gross income
                  that constitutes "qualifying income" under Section 7704(d) of
                  the Internal Revenue Code of 1986, as amended, other than any
                  business that generates any gross income arising from the
                  refining of a natural resource, and

                           (iii)    any other business that does not constitute
                  a reportable segment (as determined in accordance with GAAP)
                  for the Partnership's annual audited consolidated financial
                  statements.

                  "Permitted Business Investments" means Investments by the
Partnership or any of its Restricted Subsidiaries in any Unrestricted Subsidiary
of the Partnership or in any Person that does not constitute a direct or
indirect Subsidiary of the Partnership (a "Joint Venture"), provided that (i)
either (a) at the time of such Investment and immediately thereafter, the
Partnership could incur $1.00 of additional Indebtedness under Section 4.09(a)
or (b) such investment is made with the proceeds of Incremental Funds; (ii) if
such Unrestricted Subsidiary or Joint Venture has outstanding Indebtedness at
the time of such Investment, either (a) all such Indebtedness is Non-Recourse
Debt with respect to the Partnership and its Restricted Subsidiaries or (b) any
such Indebtedness of such Unrestricted Subsidiary or Joint Venture that is
recourse to the Partnership or any of its Restricted Subsidiaries (which shall
include all Indebtedness of such Unrestricted Subsidiary or Joint Venture for
which the Partnership or any of its Restricted Subsidiaries may be directly or
indirectly, contingently or otherwise, obligated to pay, whether pursuant to the
terms of such Indebtedness, by law or pursuant to any guaranty or "claw-back,"
"make-well" or "keep-well" arrangement) could, at the time such Investment is
made and, if later, at the time any such Indebtedness is incurred, be incurred
by the Partnership and its Restricted Subsidiaries in accordance with the
limitation on indebtedness set forth in Section 4.09(a); and (iii) such
Unrestricted Subsidiary's or Joint Venture's activities are not outside the
scope of the Permitted Business.

                  "Permitted Investments" means:

                           (i)      any Investment in, or that results in the
                  creation of, a Restricted Subsidiary of the Partnership;

                           (ii)     any Investment in the Partnership or in a
                  Restricted Subsidiary of the Partnership (excluding
                  redemptions, purchases, acquisitions or other retirements of
                  Equity Interests in the Partnership);

                                       18

<PAGE>

                           (iii)    any Investment in cash or Cash Equivalents;

                           (iv)     any Investment by the Partnership or any
                  Restricted Subsidiary of the Partnership in a Person if as a
                  result of such Investment: (a) such Person becomes a
                  Restricted Subsidiary of the Partnership; or (b) such Person
                  is merged, consolidated or amalgamated with or into, or
                  transfers or conveys substantially all of its assets to, or is
                  liquidated into, the Partnership or a Restricted Subsidiary of
                  the Partnership;

                           (v)      any Investment made as a result of the
                  receipt of consideration consisting of other than cash or Cash
                  Equivalents from an Asset Sale that was made pursuant to and
                  in compliance with Section 4.07;

                           (vi)     any acquisition of assets solely in exchange
                  for the issuance of Equity Interests (other than Disqualified
                  Equity) of the Partnership;

                           (vii)    payroll advances arising in the ordinary
                  course of business and other advances and loans to officers
                  and employees of the Partnership or any of its Restricted
                  Subsidiaries, so long as the aggregate principal amount of
                  such advances and loans does not exceed $1.0 million at any
                  one time outstanding;

                           (viii)   Investments in stock, obligations or
                  securities received in settlement of debts owing to the
                  Partnership or any of its Restricted Subsidiaries as a result
                  of bankruptcy or insolvency proceedings or upon the
                  foreclosure, perfection or enforcement or any Lien in favor of
                  the Partnership or any such Restricted Subsidiary, in each
                  case as to debt owing to the Partnership or any such
                  Restricted Subsidiary that arose in the ordinary course of
                  business of the Partnership or any such Restricted Subsidiary;

                           (ix)     any Investment in Hedging Obligations;

                           (x)      any Investments in prepaid expenses,
                  negotiable instruments held for collection and lease, utility,
                  workers' compensation and performance and other similar
                  deposits and prepaid expenses made in the ordinary course of
                  business;

                           (xi)     any Investments required to be made pursuant
                  to any agreement or obligation of the Partnership or any
                  Restricted Subsidiary in effect on the Issue Date; and

                           (xii)    other Investments in any Person engaged in a
                  Permitted Business (other than an Investment in an
                  Unrestricted Subsidiary) having an aggregate fair market value
                  (measured on the date each such Investment was made and
                  without giving effect to subsequent changes in value), when
                  taken together with all other Investments made pursuant to
                  this clause (xii) since the Issue Date and existing at the
                  time the Investment, which is the subject of the
                  determination, was made, not to exceed $5.0 million.

                                       19

<PAGE>

                  "Permitted Liens" means,

                           (i)      Liens securing Indebtedness and other
                  Obligations of the Issuers and the Restricted Subsidiaries
                  under Credit Facilities permitted to be incurred under the
                  Indenture that do not exceed $1.2 billion in the aggregate;

                           (ii)     Liens in favor of the Partnership or any of
                  its Restricted Subsidiaries;

                           (iii)    Liens on property of a Person existing at
                  the time such Person is merged with or into or consolidated
                  with the Partnership or any Restricted Subsidiary of the
                  Partnership, provided that such Liens were in existence prior
                  to, and were not obtained in contemplation of, such merger or
                  consolidation and do not extend to any assets other than those
                  of the Person merged into or consolidated with the Partnership
                  or such Restricted Subsidiary (including proceeds thereof,
                  accessions thereto and upgrades thereof);

                           (iv)     Liens on property existing at the time of
                  acquisition thereof by the Partnership or any Restricted
                  Subsidiary of the Partnership, provided that such Liens were
                  in existence prior to, and were not obtained in contemplation
                  of, such acquisition and relate solely to such property,
                  accessions thereto and the proceeds thereof (including
                  proceeds thereof, accessions thereto and upgrades thereof);

                           (v)      Liens to secure the performance of tenders,
                  bids, leases, statutory obligations, surety or appeal bonds,
                  government contracts, performance bonds or other obligations
                  of a like nature incurred in the ordinary course of business;

                           (vi)     Liens on any property or asset acquired,
                  constructed, repaired or improved by the Partnership or any
                  Restricted Subsidiary (a "Purchase Money Lien"), which (A) are
                  in favor of the seller of such property or assets, in favor of
                  the Person constructing, repairing or improving such asset or
                  property, or in favor of the Person that provided the funding
                  for the acquisition, construction, repair or improvement of
                  such asset or property, (B) are created, prior to, at the time
                  of or within 360 days after the date of acquisition,
                  completion, construction, repair or improvement or the
                  commencement of full operations thereof (whichever is later),
                  (C) secure all or a portion of the purchase price or
                  construction, repair or improvement cost, as the case may be,
                  of such asset or property, (or debt incurred prior to, at the
                  time of, or within 360 days after such date referred to in
                  clause (B) to provide funds therefor plus fees and expenses in
                  connection with incurrence of such debt) and (D) are limited
                  to the asset or property so acquired, constructed, repaired or
                  improved (including proceeds thereof and accretions and
                  upgrades thereof);

                           (vii)    Liens for taxes, assessments or governmental
                  charges or claims that are not yet delinquent or that are
                  being contested in good faith by appropriate proceedings
                  promptly instituted and diligently concluded,

                                       20

<PAGE>

                  provided that any reserve or other appropriate provision as
                  shall be required in conformity with GAAP shall have been made
                  therefor;

                           (viii)   Liens incurred or deposits made in the
                  ordinary course of business in connection with workers'
                  compensation, unemployment insurance and other types of social
                  security, old age pension or public liability obligations;

                           (ix)     easements, rights-of-way, restrictions,
                  minor defects and irregularities in title and other similar
                  charges or encumbrances not interfering in any material
                  respect with the business of the Partnership or its Restricted
                  Subsidiaries;

                           (x)      Liens securing reimbursement Obligations of
                  the Partnership or a Restricted Subsidiary with respect to
                  letters of credit encumbering only documents and other
                  property relating to such letters of credit and the products
                  and proceeds thereof;

                           (xi)     judgment and attachment Liens not giving
                  rise to a Default or Event of Default;

                           (xii)    Liens encumbering deposits made to secure
                  obligations arising from statutory, regulatory, contractual or
                  warranty requirements of the Partnership and its Restricted
                  Subsidiaries;

                           (xiii)   liens arising out of consignment or similar
                  arrangements for the sale of goods;

                           (xiv)    any interest or title of a lessor in
                  property subject to any Capital Lease Obligation;

                           (xv)     statutory Liens of landlords and Liens of
                  carriers, warehousemen, mechanics, suppliers, materialmen and
                  repairmen and other like Liens (including contractual
                  landlord's Liens) arising in the ordinary course of business
                  and with respect to amounts not yet delinquent or being
                  contested in good faith by appropriate proceedings, if a
                  reserve or other appropriate provision, if any, as shall be
                  required by GAAP shall have been made therefor;

                           (xvi)    Liens upon specific items of inventory or
                  other goods and proceeds of any Person securing such Person's
                  Obligations in respect of bankers' acceptances issued or
                  created for the account of such Person to facilitate the
                  purchase, shipment, or storage of such inventory or other
                  goods;

                           (xvii)   Liens to secure the performance of Hedging
                  Obligations of the Partnership or any Restricted Subsidiary;

                           (xviii)  Liens on pipelines or pipeline facilities
                  that arise by operation of law;

                                       21

<PAGE>

                           (xix)    Liens arising under operating agreements,
                  joint venture agreements, partnership agreements, oil and gas
                  leases, farmout agreements, division orders, contracts for
                  sale, transportation or exchange of oil and natural gas,
                  unitization and pooling declarations and agreements, area of
                  mutual interest agreements and other agreements arising in the
                  ordinary course of the Partnership's or any Restricted
                  Subsidiary's business that are customary in the Permitted
                  Businesses;

                           (xx)     Liens securing the Obligations of the
                  Issuers under the Notes and this Indenture and of the
                  Subsidiary Guarantors under the Guarantees;

                           (xxi)    Liens in favor of collecting or payor banks
                  having a right of setoff, revocation, refund or chargeback
                  with respect to money or instruments of the Partnership or any
                  of its Restricted Subsidiaries on deposit with or in
                  possession of such bank;

                           (xxii)   Liens on and pledges of the Equity Interests
                  of an Unrestricted Subsidiary or any Joint Venture owned by
                  the Partnership or any Restricted Subsidiary to the extent
                  securing either Non- Recourse Debt or Indebtedness (other than
                  Permitted Debt) otherwise permitted under this Indenture;

                           (xxiii)  Liens existing on the Issue Date and Liens
                  on any extensions, refinancing, renewal, replacement or
                  defeasance of any Indebtedness or other obligation secured
                  thereby;

                           (xxiv)   Liens arising from protective filings made
                  in the appropriate office(s) for the filing of a financing
                  statement in the applicable jurisdiction(s) in connection with
                  any lease, consignment or similar transaction otherwise
                  permitted hereby, which filings are made for the purpose of
                  perfecting the interest of the secured party in the relevant
                  items, if the transaction were subsequently classified as a
                  sale and secured lending arrangement;

                           (xxv)    Liens securing any Indebtedness, which
                  Indebtedness includes a covenant that limits Liens in a manner
                  substantially similar to Section 4.10;

                           (xxvi)   Liens imposed by law or order as a result of
                  any proceeding before any court or regulatory body that is
                  being contested in good faith, and liens which secure a
                  judgment or other court-ordered award or settlement as to
                  which the Partnership or the applicable Subsidiary have not
                  exhausted its appellate rights;

                           (xxvii)  any extension, renewal, refinancing,
                  refunding or replacement, or successive extensions, renewals,
                  refinancing, refunding or replacements, of Liens, in whole or
                  in part, referred to in clauses (iii), (iv) or (vi) above;
                  provided, however, that any extension, renewal, refinancing,
                  refunding or replacement Lien shall be limited to the property
                  or assets covered by the Lien extended, renewed, refinanced,
                  refunded or replaced and that the Obligations secured by any
                  extension, renewal, refinancing, refunding or replacement Lien
                  shall be in an amount not greater than the

                                       22

<PAGE>

                  amount of the Obligations secured by the Lien extended,
                  renewed, refinanced, refunded or replaced and any expenses of
                  the Partnership and its Subsidiaries, including any premium,
                  incurred in connection with any extension, renewal,
                  refinancing, refunding or replacement;

                           (xxviii) any Lien resulting from the deposit of
                  moneys or evidence of Indebtedness in trust for the purpose of
                  defeasing debt of the Partnership or any Restricted
                  Subsidiary; and

                           (xxix)   an addition to Liens permitted by clauses
                  (i) through (xxviii) above, Liens with respect to Obligations
                  that do not exceed in the aggregate 10% of Consolidated Net
                  Tangible Assets at any one time outstanding.

                  "Permitted Refinancing Indebtedness" means any Indebtedness of
the Partnership or any of its Restricted Subsidiaries issued in exchange for, or
the net proceeds of which are used to extend, refinance, renew, replace, defease
or refund other Indebtedness of the Partnership or any of its Restricted
Subsidiaries (other than intercompany Indebtedness); provided that: (i) the
principal amount (or accreted value, if applicable) of such Permitted
Refinancing Indebtedness does not exceed the principal amount of (or accreted
value, if applicable), plus accrued interest on the Indebtedness so extended,
refinanced, renewed, replaced, defeased or refunded (plus the amount of
necessary fees and expenses incurred in connection therewith and any premiums
paid on the Indebtedness so extended, refinanced, renewed, replaced, defeased or
refunded); (ii) such Permitted Refinancing Indebtedness has a final maturity
date no earlier than the final maturity date of, and has a Weighted Average Life
to Maturity equal to or greater than the Weighted Average Life to Maturity of,
the Indebtedness being extended, refinanced, renewed, replaced, defeased or
refunded; (iii) if the Indebtedness being extended, refinanced, renewed,
replaced, defeased or refunded is subordinated in right of payment to the Notes
or the Guarantees, such Permitted Refinancing Indebtedness has a final maturity
date later than the final maturity date of, and is subordinated in right of
payment to, the Notes or the Guarantees, as the case may be, on terms at least
as favorable to the Holders of Notes as those contained in the documentation
governing the Indebtedness being extended, refinanced, renewed, replaced,
defeased or refunded; and (iv) such Indebtedness is incurred either by the
Partnership or by the Restricted Subsidiary who is the obligor on the
Indebtedness being extended, refinanced, renewed, replaced, defeased or
refunded.

                  "Person" means any individual, corporation, partnership
(general or limited), limited liability company, joint venture, association,
joint-stock company, trust, unincorporated organization or government or agency
or political subdivision thereof or other entity.

                  "Private Placement Legend" means the legend set forth in
Section 2.06(g)(i) to be placed on all Notes issued under this Indenture except
where otherwise permitted by the provisions of this Indenture.

                  "Putable Debt Securities" means debt securities of either of
the Issuers or any of the Restricted Subsidiaries (excluding any guarantees
thereof) that provide rights of repurchase or redemption to the holders thereof
upon a Change of Control similar to those provided to holders of the Existing
Senior Subordinated Notes upon a Change of Control.

                                       23

<PAGE>

Putable Debt Securities include the Existing Senior Subordinated Notes but do
not include Indebtedness under Credit Facilities, the Notes or any debt
securities of either of the Issuers or any of the Restricted Subsidiaries which,
while providing rights of repurchase or redemption to the holders thereof upon a
Change of Control similar to those provided to holders of the Existing Senior
Subordinated Notes upon a Change of Control, contain provisions that are equally
or more likely to result in the suspension or elimination of such rights as or
than the Investment Grade Suspension Provision is likely to result in the
suspension or elimination of the repurchase rights provided in Section 4.06
hereof.

                  "QIB" means a "qualified institutional buyer" as defined in
Rule 144A of the rules and regulations promulgated by the SEC under the
Securities Act.

                  "Rating Agency" means each of S&P and Moody's, or if S&P or
Moody's or both shall not make a rating on the notes publicly available, a
nationally recognized statistical rating agency or agencies, as the case may be,
selected by the Issuers (as certified by a resolution of the Boards of Directors
of the Issuers) which shall be substituted for S&P or Moody's, or both, as the
case may be.

                  "Ratings Downgrade" means, with respect to a Change of
Control, a reduction in the rating assigned to the Notes by any Rating Agency
that occurs (i) prior to and as a result of, (ii) upon or (iii) within 30 days
following, such Change of Control.

                  "Reference Treasury Dealer" means (i) J.P. Morgan Securities
Inc. (or an Affiliate of thereof which is a Primary Treasury Dealer) and Credit
Suisse First Boston LLC (or an Affiliate thereof which is a Primary Treasury
Dealer), and their respective successors; provided, however, that if either of
the foregoing shall cease to be a primary U.S. Government securities dealer in
New York City (a "Primary Treasury Dealer"), the Partnership will substitute
therefor another Primary Treasury Dealer.

                  "Remaining Scheduled Payments" means the remaining scheduled
payments of the principal of the Notes to be redeemed and interest thereon that
would be due after the related redemption date but for such redemption,
provided, however, that, if such redemption date is not an Interest Payment
Date, the amount of the next succeeding scheduled interest payment thereon will
be reduced by the amount of interest accrued on such Notes to such redemption
date.

                  "Registrable Securities" has the meaning set forth in the
Registration Rights Agreement.

                  "Registration Rights Agreement" means (i) that certain
agreement among the Issuers, the Subsidiary Guarantors and the Initial
Purchasers requiring the Issuers and the Subsidiary Guarantors to file the
Exchange Offer Registration Statement and the Shelf Registration Statement and
(ii) any other registration rights agreement relating to any additional Notes
issued by the Issuers after the Issue Date pursuant to Section 2.02.

                  "Regulation S" means Regulation S promulgated by the SEC under
the Securities Act.

                                       24

<PAGE>

                  "Regulation S Global Note" means a global Note in the form of
Exhibit A hereto bearing the Global Note Legend and the Private Placement Legend
and that has the "Schedule of Exchange of Interests in the Global Note" attached
thereto and deposited with or on behalf of and registered in the name of the
Depositary or its nominee, issued in a denomination equal to the outstanding
principal amount of the Notes initially sold in reliance on Rule 903 of
Regulation S, subject to adjustment as provided in Section 2.06 hereof.

                  "Representative" means this Indenture trustee or other
trustee, agent or representative for any Senior Debt.

                  "Responsible Officer," when used with respect to the Trustee,
means the officer in the Institutional Trust Services department of the Trustee
having direct responsibility for administration of this Indenture.

                  "Restricted Broker-Dealer" has the meaning set forth in the
Registration Rights Agreement.

                  "Restricted Certificated Note" means a Certificated Note
bearing the Private Placement Legend.

                  "Restricted Global Note" means a global Note bearing the
Private Placement Legend and that bears the Global Note Legend and that has the
"Schedule of Exchanges of Interests in the Global Note" attached thereto.

                  "Restricted Investment" means an Investment other than a
Permitted Investment or a Permitted Business Investment.

                  "Restricted Subsidiary" of a Person means any Subsidiary of
the referenced Person that is not an Unrestricted Subsidiary, provided that none
of Cameron Highway Pipeline GP I, L.L.C., Cameron Highway Pipeline II, L.P.,
Cameron Highway Pipeline III, L.P., GulfTerra Arizona Gas, LLC and Arizona Gas
Storage, LLC, as the case may be, shall constitute a Restricted Subsidiary for
purposes of this Indenture (even if such Person is then a Subsidiary of the
Partnership), until such time as the Board of Directors of the General Partner
designates Cameron Highway Pipeline GP I, L.L.C., Cameron Highway Pipeline II,
L.P., Cameron Highway Pipeline III, L.P., GulfTerra Arizona Gas, LLC and Arizona
Gas Storage, LLC, as the case may be, as a Restricted Subsidiary in a manner
consistent with the designation of an Unrestricted Subsidiary as a Restricted
Subsidiary, as described in Section 4.14. Notwithstanding anything in this
Indenture to the contrary, GulfTerra Finance shall constitute a Restricted
Subsidiary of the Partnership.

                  "Rule 144" means Rule 144 promulgated by the SEC under the
Securities Act.

                  "Rule 144A" means Rule 144A promulgated by the SEC under the
Securities Act.

                  "Rule 903" means Rule 903 of Regulation S promulgated by the
SEC under the Securities Act.

                                       25

<PAGE>

                  "Rule 904" means Rule 904 of Regulation S promulgated by the
SEC under the Securities Act.

                  "S&P" means Standard & Poor's Ratings Group or any successor
to the rating agency business thereof.

                  "SEC" means the Securities and Exchange Commission.

                  "Securities Act" means the Securities Act of 1933, as amended.

                  "Series A Notes" has the meaning set forth in the preamble of
this Indenture.

                  "Shelf Registration Statement" means that certain shelf
registration statement filed by the Issuers and the Subsidiary Guarantors in
accordance with the Registration Rights Agreement with the SEC to register
resales of the Notes or the Exchange Notes.

                  "Significant Subsidiary" means any Subsidiary that would be a
"significant subsidiary" as defined in Article 1, Rule 1-02 of Regulation S-X,
promulgated pursuant to the Securities Act and the Exchange Act, as such
Regulation is in effect on the date hereof.

                  "Stated Maturity" means, with respect to any installment of
interest or principal on any series of Indebtedness, the date on which such
payment of interest or principal was scheduled to be paid in the original
documentation governing such Indebtedness, and shall not include any contingent
obligations to repay, redeem or repurchase any such interest or principal prior
to the date originally scheduled for the payment thereof.

                  "Subordinated Obligation" means any Indebtedness of the
Partnership or GulfTerra Finance (whether outstanding on the Issue Date or
thereafter incurred) which is subordinated or junior in right of payment to the
Notes pursuant to a written agreement, including the Existing Senior
Subordinated Notes.

                  "Subordinated Putable Debt Securities" means Putable Debt
Securities that are subordinated or junior in right of payment to the Notes
pursuant to a written agreement, including the Existing Senior Subordinated
Notes.

                  "Subsidiary" means, with respect to any Person: (i) any
corporation, association or other business entity of which more than 50% of the
total Voting Stock is at the time owned or controlled, directly or indirectly,
by such Person or one or more of the other Subsidiaries of that Person (or a
combination thereof); and (ii) any partnership (whether general or limited),
limited liability company or joint venture (a) the sole general partner or the
managing general partner or managing member of which is such Person or a
Subsidiary of such Person or (b) if there are more than a single general partner
or member either (i) the only general partners or managing members of such
Person are such Person or of one or more Subsidiaries of such Person (or any
combination thereof) or (ii) such Person owns or controls, directly or
indirectly, a majority of the outstanding general partner interests, member
interests or other Voting Stock of such partnership, limited liability company
or joint venture, respectively.

                                       26

<PAGE>

                  "Subsidiary Guarantors" means each of: (i) the entities listed
on Schedule A hereto; and (ii) any other Restricted Subsidiary of the
Partnership that executes a Guarantee in accordance with the provisions of
Section 4.13 and Article 10 of this Indenture; and (iii) their respective
successors and assigns. Notwithstanding anything in this Indenture to the
contrary, GulfTerra Finance shall not be a Subsidiary Guarantor.

                  "Tax Payment" means any payment of foreign, federal, state or
local tax liabilities.

                  "Tender Condition" means, as of the time of expiration of the
period during which Notes may be validly tendered for repurchase or redemption
pursuant to a Change of Control Offer, Subordinated Putable Debt Securities in
an aggregate principal amount of the greater of (a) $250 million and (b) 30% of
the aggregate principal amount of all Non-Putable Debt Securities outstanding at
such time, have been properly tendered and not withdrawn pursuant to a change of
control offer in respect of the Change of Control made in accordance with the
applicable indenture or other instrument or agreement governing such
Subordinated Putable Debt Securities.

                  "Treasury Rate" means, with respect to any redemption date of
the Notes, the rate per annum equal to the semi-annual equivalent yield to
maturity of the Comparable Treasury Issue, calculated using a price for the
Comparable Treasury Issue, expressed as a percentage of the principal amount,
equal to the Comparable Treasury Price for such redemption date.

                  "TIA" means the Trust Indenture Act of 1939 (15 U.S.C.
Sections 77aaa-77bbbb) as in effect on the date on which this Indenture is
qualified under the TIA, except as provided in Section 9.03 hereof.

                  "Trustee" means the party named as such above until a
successor replaces it in accordance with the applicable provisions of this
Indenture and thereafter means the successor serving hereunder.

                  "Unrestricted Certificated Note" means one or more
Certificated Notes that do not bear and are not required to bear the Private
Placement Legend.

                  "Unrestricted Global Note" means a permanent global Note in
the form of Exhibit A attached hereto that bears the Global Note Legend and that
has the "Schedule of Exchanges of Interests in the Global Note" attached
thereto, and that is deposited with or on behalf of and registered in the name
of the Depositary, representing a series of Notes that do not bear the Private
Placement Legend.

                  "Unrestricted Subsidiary" means any Subsidiary of the
Partnership (other than GulfTerra Finance) that is designated by the Board of
Directors of the General Partner as an Unrestricted Subsidiary pursuant to a
Board Resolution, provided that, at the time of such designation, (i) no portion
of the Indebtedness or other obligation of such Subsidiary (whether contingent
or otherwise and whether pursuant to the terms of such Indebtedness or the terms
governing the organization of such Subsidiary or by law (A) is guaranteed by the
Partnership or any Restricted Subsidiary of the Partnership, (B) is recourse to
or obligates the Partnership or any Restricted Subsidiary of the Partnership in

                                       27

<PAGE>

any way (including any "claw-back," "keep-well," "make- well" or other
agreements, arrangements or understandings to maintain the financial performance
or results of operations of such Subsidiary or to otherwise infuse or contribute
cash to such Subsidiary), or (C) subjects any property or assets of the
Partnership or any Restricted Subsidiary, directly or indirectly, contingently
or otherwise, to the satisfaction of such Indebtedness, unless such Investment
or Indebtedness is permitted by Section 4.08 or Section 4.09, (ii) no Equity
Interests of a Restricted Subsidiary are held by such Subsidiary, directly or
indirectly, and (iii) the amount of the Partnership's Investment, as determined
at the time of such designation, in such Subsidiary since the Issue Date to the
date of designation is treated as of the date of such designation as a
Restricted Investment, Permitted Investment or Permitted Business Investment, as
applicable. Cameron Highway Pipeline GP I, L.L.C., Cameron Highway Pipeline II,
L.P., Cameron Highway Pipeline III, L.P., EPN Arizona Gas, L.L.C. and Arizona
Gas Storage, L.L.C. are designated as Unrestricted Subsidiaries. Notwithstanding
anything in the Indenture to the contrary, GulfTerra Finance shall not be, and
shall not be designated as, an Unrestricted Subsidiary.

                  Any designation of a Subsidiary of the Partnership as an
Unrestricted Subsidiary shall be evidenced to the Trustee by filing with the
Trustee a Board Resolution giving effect to such designation and an Officers'
Certificate certifying that such designation complied with the preceding
conditions and was permitted by Section 4.08. If, at any time, any Unrestricted
Subsidiary would fail to meet the preceding requirements as an Unrestricted
Subsidiary, it shall thereafter cease to be an Unrestricted Subsidiary for
purposes of this Indenture and any Indebtedness of such Subsidiary shall be
deemed to be incurred by a Restricted Subsidiary of the Partnership as of such
date and, if such Indebtedness is not permitted to be incurred as of such date
under Section 4.09, the Partnership shall be in Default of such covenant. The
Board of Directors of the General Partner may at any time designate any
Unrestricted Subsidiary to be a Restricted Subsidiary; provided that such
designation shall be deemed to be an incurrence of Indebtedness by a Restricted
Subsidiary of the Partnership of any outstanding Indebtedness of such
Unrestricted Subsidiary and such designation shall only be permitted if (1) such
Indebtedness is permitted under the covenant described under Section 4.09,
calculated on a pro forma basis as if such designation had occurred at the
beginning of the four- quarter reference period; and (2) no Default or Event of
Default would be in existence following such designation.

                  "U.S. Government Obligations" means securities that are (i)
direct Obligations of the United States of America for the payment of which its
full faith and credit is pledged; (ii) Obligations of a Person controlled or
supervised by and acting as an agency or instrumentality of the United States of
America the payment of which is unconditionally guaranteed as a full faith and
credit obligation by the United States of America, which, in either case under
clauses (i) or (ii) above, are not callable or redeemable at the option of the
issuers thereof; or (iii) depository receipts issued by a bank or trust company
as custodian with respect to any such U.S. Government Obligations or a specific
payment of interest on or principal of any such U.S. Government Obligation held
by such custodian for the account of the holder of a Depository receipt,
provided that (except as required by law) such custodian is not authorized to
make any deduction from the amount payable to the holder of such Depository
receipt from any amount received by the custodian in respect of the U.S.
Government Obligation evidenced by such Depository receipt.

                                       28

<PAGE>

                  "U.S. Person" means a U.S. person as defined in Rule 902(k) of
Regulation S promulgated by the SEC under the Securities Act.

                  "Voting Stock" of any Person as of any date means the Equity
Interests of such Person pursuant to which the holders thereof have the general
voting power under ordinary circumstances to elect at least a majority of the
board of directors, managers, general partners or trustees of any Person
(regardless of whether, at the time, Equity Interests of any other class or
classes shall have, or might have, voting power by reason of the occurrence of
any contingency) or, with respect to a partnership (whether general or limited),
any general partner interest in such partnership.

                  "Weighted Average Life to Maturity" means, when applied to any
Indebtedness at any date, the number of years obtained by dividing: (i) the sum
of the products obtained by multiplying (a) the amount of each then remaining
installment, sinking fund, serial maturity or other required payments of
principal, including payment at final maturity, in respect thereof, by (b) the
number of years (calculated to the nearest one-twelfth) that will elapse between
such date and the making of such payment; by (ii) the then outstanding principal
amount of such Indebtedness.

SECTION 1.02. OTHER DEFINITIONS.

<TABLE>
<CAPTION>
TERM                                                                    DEFINED IN SECTION
------------------------------------------------------------------      ------------------------------------------------
<S>                                                                     <C>
"Affiliate Transaction"...........................................      4.12
"Asset Sale Offer"................................................      3.09
"Calculation Date"................................................      1.01 (definition of Fixed Charge Coverage Ratio)
"Change of Control Offer".........................................      4.06
"Change of Control Payment".......................................      4.06
"Change of Control Payment Date"..................................      4.06
"Covenant Defeasance".............................................      8.03
"DTC".............................................................      2.03
"Eliminated Covenants"............................................      4.19
"Event of Default"................................................      6.01
"Excess Proceeds".................................................      4.07(c)
"Incremental Funds"...............................................      4.08(a)
"incur"...........................................................      4.09
"Investment Grade Suspension Provision"...........................      4.06(h)
"Legal Defeasance"................................................      8.02
"Offer Amount"....................................................      3.09
"Offer Period"....................................................      3.09
"Paying Agent"....................................................      2.03
"Payment Default".................................................      6.01(e)
"Permitted Debt"..................................................      4.09(b)
"Purchase Date"...................................................      3.09
"Registrar".......................................................      2.03
"Restricted Payment"..............................................      4.08
</TABLE>

                                       29

<PAGE>

SECTION 1.03. INCORPORATION BY REFERENCE OF TRUST INDENTURE ACT

                  Whenever this Indenture refers to a provision of the TIA, the
provision is incorporated by reference in and made a part of this Indenture.

                  The following TIA terms used in this Indenture have the
following meanings:

                  "indenture securities" means the Notes and the Guarantees;

                  "indenture security Holder" means a Holder of a Note;

                  "indenture to be qualified" means this Indenture;

                  "indenture trustee" or "institutional trustee" means the
Trustee;

                  "obligor" on the Notes means the Partnership, GulfTerra
Finance or any Subsidiary Guarantor and any successor obligor upon the Notes.

                  All other terms used in this Indenture that are defined by the
TIA, defined by TIA reference to another statute or defined by SEC rule under
the TIA have the meanings so assigned to them.

SECTION 1.04. RULES OF CONSTRUCTION.

                  Unless the context otherwise requires:

                           (i)      a term has the meaning assigned to it;

                           (ii)     an accounting term not otherwise defined has
                  the meaning assigned to it in accordance with GAAP;

                           (iii)    "or" is not exclusive;

                           (iv)     words in the singular include the plural,
                  and in the plural include the singular;

                           (v)      provisions apply to successive events and
                  transactions; and

                           (vi)     references to sections of or rules under the
                  Securities Act shall be deemed to include substitute,
                  replacement of successor sections or rules adopted by the SEC
                  from time to time.

                                       30

<PAGE>

                                    ARTICLE 2
                                    THE NOTES

SECTION 2.01. FORM AND DATING.

                  The Notes and the Trustee's certificate of authentication
shall be substantially in the form of Exhibit A hereto. The notation on each
Note relating to the Guarantees shall be substantially in the form set forth on
Exhibit D, which is a part of this Indenture. The Notes may have notations,
legends or endorsements required by law, stock exchange rule or usage. Each Note
shall be dated the date of its authentication. The Notes shall be in
denominations of $1,000 and integral multiples thereof.

                  The terms and provisions contained in the Notes (including the
Guarantees) shall constitute, and are hereby expressly made, a part of this
Indenture and the Partnership, GulfTerra Finance, the Subsidiary Guarantors, and
the Trustee, by their execution and delivery of this Indenture, expressly agree
to such terms and provisions and to be bound thereby. However, to the extent any
provision of any Note conflicts with the express provisions of this Indenture,
the provisions of this Indenture shall govern and be controlling.

                  Notes issued in global form shall be substantially in the form
of Exhibit A attached hereto (including the Global Note Legend and the "Schedule
of Exchanges in the Global Note" attached thereto). Notes issued in definitive
form shall be substantially in the form of Exhibit A attached hereto (but
without the Global Note Legend, the phrase identified in footnote 1 thereto and
without the "Schedule of Exchanges of Interests in the Global Note" attached
thereto). Each Global Note shall represent such of the outstanding Notes as
shall be specified therein and each shall provide that it shall represent the
aggregate principal amount of outstanding Notes from time to time endorsed
thereon and that the aggregate principal amount of outstanding Notes represented
thereby may from time to time be reduced or increased, as appropriate, to
reflect exchanges and redemptions. Any endorsement of a Global Note to reflect
the amount of any increase or decrease in the aggregate principal amount of
outstanding Notes represented thereby shall be made by the Trustee or the Note
Custodian, at the direction of the Trustee, in accordance with instructions
given by the Holder thereof as required by Section 2.06 hereof.

SECTION 2.02. EXECUTION AND AUTHENTICATION.

                  One Officer of the Partnership and one Officer of GulfTerra
Finance shall sign the Notes for the Partnership and GulfTerra Finance,
respectively, by manual or facsimile signature. The seal of the Partnership and
GulfTerra Finance shall be reproduced on the Notes and may be in facsimile form.

                  If an Officer whose signature is on a Note no longer holds
that office at the time a Note is authenticated, the Note shall nevertheless be
valid.

                  A Note shall not be valid until authenticated by the manual
signature of the Trustee. The signature shall be conclusive evidence that the
Note has been authenticated under this Indenture.

                                       31

<PAGE>

                  The Trustee shall, upon a written order of the Partnership and
GulfTerra Finance signed by one Officer of the Partnership and one Officer of
GulfTerra Finance, authenticate (i) $250,000,000 aggregate principal amount of
Notes, with the Guarantees endorsed thereon, for original issue on the Issue
Date and (ii) any amount of additional Notes specified by the Issuers, in each
case, upon a written order of the Partnership and GulfTerra Finance signed by
one Officer of the Partnership and one Officer of GulfTerra Finance. Such order
shall specify (a) the amount of the Notes of each series to be authenticated and
the date of original issue thereof, and (b) whether the Notes are Series A Notes
or Exchange Notes. The aggregate principal amount of Notes of any series
outstanding at any time may not exceed the aggregate principal amount of Notes
of such series authorized for issuance by the Issuers pursuant to one or more
written orders of the Issuers, except as provided in Section 2.07 hereof.
Subject to the foregoing, the aggregate principal amount of Notes of any series
that may be issued under this Indenture shall not be limited.

                  The Trustee may appoint an authenticating agent acceptable to
the Issuers to authenticate Notes. An authenticating agent may authenticate
Notes whenever the Trustee may do so. Each reference in this Indenture to
authentication by the Trustee includes authentication by such agent. An
authenticating agent has the same rights as an Agent to deal with Holders or an
Affiliate of either of the Issuers.

SECTION 2.03. REGISTRAR AND PAYING AGENT.

                  The Partnership, GulfTerra Finance and the Subsidiary
Guarantors shall maintain an office or agency where Notes may be presented for
registration of transfer or for exchange ("Registrar") and an office or agency
in the State of New York where Notes may be presented for payment ("Paying
Agent"). The Registrar shall keep a register of the Notes and of their transfer
and exchange. The Issuers may appoint one or more co-registrars and one or more
additional paying agents. The term "Registrar" includes any co-registrar and the
term "Paying Agent" includes any additional paying agent. The Issuers may change
any Paying Agent or Registrar without notice to any Holder. The Issuers shall
notify the Trustee in writing of the name and address of any Agent not a party
to this Indenture. If the Issuers fail to appoint or maintain another entity as
Registrar or Paying Agent, the Trustee shall act as such. The Partnership,
GulfTerra Finance or any of the Subsidiary Guarantors may act as Paying Agent or
Registrar.

                  The Issuers initially appoint The Depository Trust Company
("DTC") to act as Depositary with respect to the Global Notes.

                  The Issuers initially appoint the Trustee to act as the
Registrar and Paying Agent and to act as Note Custodian with respect to the
Global Notes.

SECTION 2.04. PAYING AGENT TO HOLD MONEY IN TRUST.

                  The Issuers shall require each Paying Agent other than the
Trustee to agree in writing that the Paying Agent will hold in trust for the
benefit of Holders or the Trustee all money held by the Paying Agent for the
payment of principal, premium, if any, or interest or Additional Interest, if
any, on the Notes, and will notify the Trustee of any

                                       32

<PAGE>

default by the Partnership, GulfTerra Finance or the Subsidiary Guarantors in
making any such payment. While any such default continues, the Trustee may
require a Paying Agent to pay all money held by it to the Trustee. The Issuers
at any time may require a Paying Agent to pay all money held by it to the
Trustee. Upon payment over to the Trustee, the Paying Agent (if other than an
Issuer or a Subsidiary Guarantor) shall have no further liability for the money.
If an Issuer or a Subsidiary Guarantor acts as Paying Agent, it shall segregate
and hold in a separate trust fund for the benefit of the Holders all money held
by it as Paying Agent. Upon any bankruptcy or reorganization proceedings
relating to the Partnership or GulfTerra Finance, the Trustee shall serve as
Paying Agent for the Notes.

SECTION 2.05. HOLDER LISTS.

                  The Trustee shall preserve in as current a form as is
reasonably practicable the most recent list available to it of the names and
addresses of all Holders and shall otherwise comply with TIA Section 312(a). If
the Trustee is not the Registrar, the Issuers shall furnish to the Trustee at
least seven Business Days before each Interest Payment Date and at such other
times as the Trustee may request in writing, a list in such form and as of such
date as the Trustee may reasonably require of the names and addresses of the
Holders of Notes and the Issuers shall otherwise comply with TIA Section 312(a).

SECTION 2.06. TRANSFER AND EXCHANGE.

                  (a)      Transfer and Exchange of Global Notes. A Global Note
may not be transferred as a whole except by the Depositary to a nominee of the
Depositary, by a nominee of the Depositary to the Depositary or to another
nominee of the Depositary, or by the Depositary or any such nominee to a
successor Depositary or a nominee of such successor Depositary. All Global Notes
may be exchanged by the Issuers for Certificated Notes if (i) the Issuers
deliver to the Trustee notice from the Depositary that it is unwilling or unable
to continue to act as Depositary or that it is no longer a clearing agency
registered under the Exchange Act and, in either case, a successor Depositary is
not appointed by the Issuers within 90 days after the date of such notice from
the Depositary, (ii) the Issuers in their sole discretion determine that the
Global Notes (in whole but not in part) should be exchanged for Certificated
Notes and deliver a written notice to such effect to the Trustee; provided that
in no event shall the Regulation S Global Note be exchanged by the Issuers for
Certificated Notes prior to (x) the expiration of the Distribution Compliance
Period and (y) the receipt by the Registrar of any certificates required
pursuant to Rule 903 under the Securities Act, or (iii) if a Default or an Event
of Default occurs and is continuing. Whenever a Global Note is exchanged as a
whole for one or more Certificated Notes, it shall be surrendered by the Holder
thereof to the Trustee for cancellation. Whenever a Global Note is exchanged in
part for one or more Certificated Notes, it shall be surrendered by the Holder
thereof to the Trustee and the Trustee shall make the appropriate notations to
the Schedule of Exchanges of Interests in the Global Notes attached thereto
pursuant to Section 2.01 hereof. All Certificated Notes issued in exchange for a
Global Note or any portion thereof shall be registered in such names, and
delivered, as the Depositary shall instruct the Trustee. Global Notes also may
be exchanged or replaced, in whole or in part, as provided in Sections 2.07 and
2.10 hereof. Every Note authenticated and delivered in exchange for, or in lieu
of, a Global Note or any portion

                                       33

<PAGE>

thereof, pursuant to Section 2.07 or 2.10 hereof, shall be authenticated and
delivered in the form of, and shall be, a Global Note. A Global Note may not be
exchanged for another Note other than as provided in this Section 2.06(a);
however, beneficial interests in a Global Note may be transferred and exchanged
as provided in Section 2.06(b), (c) or (f) hereof.

                  (b)      Transfer and Exchange of Beneficial Interests in the
Global Notes. The transfer and exchange of beneficial interests in the Global
Notes shall be effected through the Depositary, in accordance with the
provisions of this Indenture and the Applicable Procedures. Beneficial interests
in the Restricted Global Notes shall be subject to restrictions on transfer
comparable to those set forth herein to the extent required by the Securities
Act. Transfers of beneficial interests in the Global Notes also shall require
compliance with either subparagraph (i) or (ii) below, as applicable, as well as
one or more of the other following subparagraphs as applicable:

                           (i)      Transfer of Beneficial Interests in the Same
                  Global Note. Beneficial interests in any Restricted Global
                  Note may be transferred to Persons who take delivery thereof
                  in the form of a beneficial interest in the same Restricted
                  Global Note in accordance with the transfer restrictions set
                  forth in the Private Placement Legend; provided, however, that
                  prior to the expiration of the Distribution Compliance Period
                  transfers of beneficial interests in the Regulation S Global
                  Note may not be made to a U.S. Person or for the account or
                  benefit of a U.S. Person (other than an Initial Purchaser).
                  Beneficial interests in any Unrestricted Global Note may be
                  transferred only to Persons who take delivery thereof in the
                  form of a beneficial interest in an Unrestricted Global Note.
                  No written orders or instructions shall be required to be
                  delivered to the Registrar to effect the transfers described
                  in this Section 2.06(b)(i).

                           (ii)     All Other Transfers and Exchanges of
                  Beneficial Interests in Global Notes. In connection with all
                  transfers and exchanges of beneficial interests (other than a
                  transfer of a beneficial interest in a Global Note to a Person
                  who takes delivery thereof in the form of a beneficial
                  interest in the same Global Note), the transferor of such
                  beneficial interest must deliver to the Registrar either (A)
                  (i) a written order from a Participant or an Indirect
                  Participant given to the Depositary in accordance with the
                  Applicable Procedures directing the Depositary to credit or
                  cause to be credited a beneficial interest in another Global
                  Note in an amount equal to the beneficial interest to be
                  transferred or exchanged and (ii) instructions given in
                  accordance with the Applicable Procedures containing
                  information regarding the Participant account to be credited
                  with such increase or (B) (i) a written order from a
                  Participant or an Indirect Participant given to the Depositary
                  in accordance with the Applicable Procedures directing the
                  Depositary to cause to be issued a Certificated Note in an
                  amount equal to the beneficial interest to be transferred or
                  exchanged and (ii) instructions given by the Depositary to the
                  Registrar containing information regarding the Person in whose
                  name such Certificated Note shall be registered to effect the
                  transfer or exchange referred to in (i) above; provided that
                  in no event shall Certificated Notes be issued upon the
                  transfer or exchange of beneficial

                                       34

<PAGE>

                  interests in the Regulation S Global Note prior to (x) the
                  expiration of the Distribution Compliance Period and (y) the
                  receipt by the Registrar of any certificates required pursuant
                  to Rule 903 under the Securities Act. Upon an Exchange Offer
                  by the Issuers in accordance with Section 2.06(f) hereof, the
                  requirements of this Section 2.06(b)(ii) shall be deemed to
                  have been satisfied upon receipt by the Registrar of the
                  instructions contained in the Letter of Transmittal delivered
                  by the Holder of such beneficial interests in the Restricted
                  Global Notes. Upon satisfaction of all of the requirements for
                  transfer or exchange of beneficial interests in Global Notes
                  contained in this Indenture, the Notes and otherwise
                  applicable under the Securities Act, the Trustee shall adjust
                  the principal amount of the relevant Global Note(s) pursuant
                  to Section 2.06(h) hereof.

                           (iii)    Transfer of Beneficial Interests to Another
                  Restricted Global Note. A beneficial interest in any
                  Restricted Global Note may be transferred to a Person who
                  takes delivery thereof in the form of a beneficial interest in
                  another Restricted Global Note if the transfer complies with
                  the requirements of clause (ii) above and the Registrar
                  receives the following:

                                    (A)      if the transferee will take
                           delivery in the form of a beneficial interest in the
                           144A Global Note, then the transferor must deliver a
                           certificate in the form of Exhibit B hereto,
                           including the certifications in item (1) thereof;

                                    (B)      if the transferee will take
                           delivery in the form of a beneficial interest in the
                           Regulation S Global Note, then the transferor must
                           deliver a certificate in the form of Exhibit B
                           hereto, including the certifications in item (2)
                           thereof; and

                                    (C)      if the transferee will take
                           delivery in the form of a beneficial interest in the
                           IAI Global Note, then the transferor must deliver (x)
                           a certificate in the form of Exhibit B hereto,
                           including the certifications and certificates and
                           Opinion of Counsel required by item (3)(c) thereof,
                           if applicable.

                           (iv)     Transfer and Exchange of Beneficial
                  Interests in a Restricted Global Note for Beneficial Interests
                  in the Unrestricted Global Note. A beneficial interest in any
                  Restricted Global Note may be exchanged by any holder thereof
                  for a beneficial interest in an Unrestricted Global Note or
                  transferred to a Person who takes delivery thereof in the form
                  of a beneficial interest in an Unrestricted Global Note if the
                  exchange or transfer complies with the requirements of clause
                  (ii) above and:

                                    (A)      such exchange or transfer is
                           effected pursuant to the Exchange Offer in accordance
                           with the Registration Rights Agreement and the holder
                           of the beneficial interest to be transferred, in the
                           case of an exchange, or the transferee, in the case
                           of a transfer,

                                       35

<PAGE>

                           is not (i) a broker-dealer, (ii) a Person
                           participating in the distribution of the Exchange
                           Notes or (iii) a Person who is an affiliate (as
                           defined in Rule 144) of the Partnership;

                                    (B)      any such transfer is effected
                           pursuant to the Shelf Registration Statement in
                           accordance with the Registration Rights Agreement;

                                    (C)      any such transfer is effected by a
                           Restricted Broker-Dealer pursuant to the Exchange
                           Offer Registration Statement in accordance with the
                           Registration Rights Agreement; or

                                    (D)      the Registrar receives the
                           following:

                                             (i)      if the holder of such
                                    beneficial interest in a Restricted Global
                                    Note proposes to exchange such beneficial
                                    interest for a beneficial interest in an
                                    Unrestricted Global Note, a certificate from
                                    such holder in the form of Exhibit C hereto,
                                    including the certifications in item (1)(a)
                                    thereof;

                                             (ii)     if the holder of such
                                    beneficial interest in a Restricted Global
                                    Note proposes to transfer such beneficial
                                    interest to a Person who shall take delivery
                                    thereof in the form of a beneficial interest
                                    in an Unrestricted Global Note, a
                                    certificate from such holder in the form of
                                    Exhibit B hereto, including the
                                    certifications in item (4) thereof; and

                                             (iii)    in each such case set
                                    forth in this subparagraph (D), an opinion
                                    of counsel in form reasonably acceptable to
                                    the Issuers to the effect that such exchange
                                    or transfer is in compliance with the
                                    Securities Act and that the restrictions on
                                    transfer contained herein and in the Private
                                    Placement Legend are not required in order
                                    to maintain compliance with the Securities
                                    Act.

                  If any such transfer is effected pursuant to subparagraph (B)
or (D) above at a time when an Unrestricted Global Note has not yet been issued,
the Issuers shall issue and, upon receipt of an authentication order in
accordance with Section 2.02 hereof, the Trustee shall authenticate one or more
Unrestricted Global Notes (accompanied by a notation of the Guarantees duly
endorsed by the Subsidiary Guarantors) in an aggregate principal amount equal to
the principal amount of beneficial interests transferred pursuant to
subparagraph (B) or (D) above.

                  Beneficial interests in an Unrestricted Global Note cannot be
exchanged for, or transferred to Persons who take delivery thereof in the form
of, a beneficial interest in a Restricted Global Note.

                  (c)      Transfer or Exchange of Beneficial Interests for
Certificated Notes.

                                       36
<PAGE>

                           (i)      If any holder of a beneficial interest in a
                  Restricted Global Note proposes to exchange such beneficial
                  interest for a Certificated Note or to transfer such
                  beneficial interest to a Person who takes delivery thereof in
                  the form of a Certificated Note, then, upon receipt by the
                  Registrar of the following documentation:

                                    (A)      if the holder of such beneficial
                           interest in a Restricted Global Note proposes to
                           exchange such beneficial interest for a Restricted
                           Certificated Note, a certificate from such holder in
                           the form of Exhibit C hereto, including the
                           certifications in item (2)(a) thereof;

                                    (B)      if such beneficial interest is
                           being transferred to a QIB in accordance with Rule
                           144A under the Securities Act, a certificate to the
                           effect set forth in Exhibit B hereto, including the
                           certifications in item (1) thereof;

                                    (C)      if such beneficial interest is
                           being transferred to a Non-U.S. Person in an offshore
                           transaction in accordance with Rule 903 or Rule 904
                           under the Securities Act, a certificate to the effect
                           set forth in Exhibit B hereto, including the
                           certifications in item (2) thereof;

                                    (D)      if such beneficial interest is
                           being transferred pursuant to an exemption from the
                           registration requirements of the Securities Act in
                           accordance with Rule 144 under the Securities Act, a
                           certificate to the effect set forth in Exhibit B
                           hereto, including the certifications in item (3)(a)
                           thereof;

                                    (E)      if such beneficial interest is
                           being transferred to an Institutional Accredited
                           Investor in reliance on an exemption from the
                           registration requirements of the Securities Act other
                           than those listed in subparagraphs (B) through (D)
                           above, a certificate to the effect set forth in
                           Exhibit B hereto, including the certifications,
                           certificates and Opinion of Counsel required by item
                           (3)(c) thereof, if applicable; or

                                    (F)      if such beneficial interest is
                           being transferred to the Partnership, GulfTerra
                           Finance or any Restricted Subsidiary of the
                           Partnership, a certificate to the effect set forth in
                           Exhibit B hereto, including the certifications in
                           item (3)(b) thereof,

                  the Trustee shall cause the aggregate principal amount of the
                  applicable Global Note to be reduced accordingly pursuant to
                  Section 2.06(h) hereof, and the Issuers shall execute and the
                  Trustee shall authenticate and deliver to the Person
                  designated in the instructions a Certificated Note
                  (accompanied by a notation of the Guarantees duly endorsed by
                  the Subsidiary Guarantors) in the appropriate principal
                  amount. Any Certificated Note issued in exchange for a
                  beneficial interest in a Restricted Global Note pursuant to
                  this Section 2.06(c) shall be registered in such name or names

                                       37

<PAGE>

                  and in such authorized denomination or denominations as the
                  holder of such beneficial interest shall instruct the
                  Registrar through instructions from the Depositary and the
                  Participant or Indirect Participant. The Trustee shall deliver
                  such Certificated Notes to the Persons in whose names such
                  Notes are so registered. Any Certificated Note issued in
                  exchange for a beneficial interest in a Restricted Global Note
                  pursuant to this Section 2.06(c)(i) shall bear the Private
                  Placement Legend and shall be subject to all restrictions on
                  transfer contained therein.

                           (ii)     Notwithstanding Sections 2.06(c)(i)(A) and
                  (C) hereof, a beneficial interest in the Regulation S Global
                  Note may not be (A) exchanged for a Certificated Note prior to
                  (x) the expiration of the Distribution Compliance Period and
                  (y) the receipt by the Registrar of any certificates required
                  pursuant to Rule 903 under the Securities Act or (B)
                  transferred to a Person who takes delivery thereof in the form
                  of a Certificated Note prior to the conditions set forth in
                  clause (A) above or unless the transfer is pursuant to an
                  exemption from the registration requirements of the Securities
                  Act other than Rule 903 or Rule 904.

                           (iii)    Notwithstanding 2.06(c)(i) hereof, a holder
                  of a beneficial interest in a Restricted Global Note may
                  exchange such beneficial interest for an Unrestricted
                  Certificated Note or may transfer such beneficial interest to
                  a Person who takes delivery thereof in the form of an
                  Unrestricted Certificated Note only if:

                                    (A)      such exchange or transfer is
                           effected pursuant to the Exchange Offer in accordance
                           with the Registration Rights Agreement and the holder
                           of such beneficial interest, in the case of an
                           exchange, or the transferee, in the case of a
                           transfer, is not (i) a broker-dealer, (ii) a Person
                           participating in the distribution of the Exchange
                           Notes or (iii) a Person who is an affiliate (as
                           defined in Rule 144) of the Partnership;

                                    (B)      any such transfer is effected
                           pursuant to the Shelf Registration Statement in
                           accordance with the Registration Rights Agreement;

                                    (C)      any such transfer is effected by a
                           Restricted Broker-Dealer pursuant to the Exchange
                           Offer Registration Statement in accordance with the
                           Registration Rights Agreement; or

                                    (D)      the Registrar receives the
                           following:

                                             (i)      if the holder of such
                                    beneficial interest in a Restricted Global
                                    Note proposes to exchange such beneficial
                                    interest for a Certificated Note that does
                                    not bear the Private Placement Legend, a
                                    certificate from such holder in the form of
                                    Exhibit C hereto, including the
                                    certifications in item (1)(b) thereof;

                                       38

<PAGE>

                                             (ii)     if the holder of such
                                    beneficial interest in a Restricted Global
                                    Note proposes to transfer such beneficial
                                    interest to a Person who shall take delivery
                                    thereof in the form of a Certificated Note
                                    that does not bear the Private Placement
                                    Legend, a certificate from such holder in
                                    the form of Exhibit B hereto, including the
                                    certifications in item (4) thereof; and

                                             (iii)    in each such case set
                                    forth in this subparagraph (D), an opinion
                                    of counsel in form reasonably acceptable to
                                    the Issuers, to the effect that such
                                    exchange or transfer is in compliance with
                                    the Securities Act and that the restrictions
                                    on transfer contained herein and in the
                                    Private Placement Legend are not required in
                                    order to maintain compliance with the
                                    Securities Act.

                           (iv)     If any holder of a beneficial interest in an
                  Unrestricted Global Note proposes to exchange such beneficial
                  interest for a Certificated Note or to transfer such
                  beneficial interest to a Person who takes delivery thereof in
                  the form of a Certificated Note, then, upon satisfaction of
                  the conditions set forth in Section 2.06(b)(ii) hereof, the
                  Trustee shall cause the aggregate principal amount of the
                  applicable Global Note to be reduced accordingly pursuant to
                  Section 2.06(h) hereof, and the Issuers shall execute and the
                  Trustee shall authenticate and deliver to the Person
                  designated in the instructions a Certificated Note
                  (accompanied by a notation of the Guarantees duly endorsed by
                  the Subsidiary Guarantors) in the appropriate principal
                  amount. Any Certificated Note issued in exchange for a
                  beneficial interest pursuant to this Section 2.06(c)(iv) shall
                  be registered in such name or names and in such authorized
                  denomination or denominations as the holder of such beneficial
                  interest shall instruct the Registrar through instructions
                  from the Depositary and the Participant or Indirect
                  Participant. The Trustee shall deliver such Certificated Notes
                  to the Persons in whose names such Notes are so registered.
                  Any Certificated Note issued in exchange for a beneficial
                  interest pursuant to this Section 2.06(c)(iv) shall not bear
                  the Private Placement Legend. A beneficial interest in an
                  Unrestricted Global Note cannot be exchanged for a
                  Certificated Note bearing the Private Placement Legend or
                  transferred to a Person who takes delivery thereof in the form
                  of a Certificated Note bearing the Private Placement Legend.

                  (d)      Transfer and Exchange of Certificated Notes for
         Beneficial Interests.

                           (i)      If any Holder of a Restricted Certificated
                  Note proposes to exchange such Note for a beneficial interest
                  in a Restricted Global Note or to transfer such Certificated
                  Notes to a Person who takes delivery thereof in the form of a
                  beneficial interest in a Restricted Global Note, then, upon
                  receipt by the Registrar of the following documentation:

                                    (A)      if the Holder of such Restricted
                           Certificated Note proposes to exchange such Note for
                           a beneficial interest in a

                                       39

<PAGE>

                           Restricted Global Note, a certificate from such
                           Holder in the form of Exhibit C hereto, including the
                           certifications in item (2)(b) thereof;

                                    (B)      if such Certificated Note is being
                           transferred to a QIB in accordance with Rule 144A
                           under the Securities Act, a certificate to the effect
                           set forth in Exhibit B hereto, including the
                           certifications in item (1) thereof;

                                    (C)      if such Certificated Note is being
                           transferred to a Non-U.S. Person in an offshore
                           transaction in accordance with Rule 903 or Rule 904
                           under the Securities Act, a certificate to the effect
                           set forth in Exhibit B hereto, including the
                           certifications in item (2) thereof;

                                    (D)      if such Certificated Note is being
                           transferred to an Institutional Accredited Investor
                           in reliance on an exemption from the registration
                           requirements of the Securities Act other than those
                           listed in subparagraphs (B) and (C) above, a
                           certificate to the effect set forth in Exhibit B
                           hereto, including the certifications, certificates
                           and Opinion of Counsel required by item (3)(c)
                           thereof, if applicable; or

                                    (E)      if such Certificated Note is being
                           transferred to the Partnership, GulfTerra Finance or
                           any Restricted Subsidiary of the Partnership, a
                           certificate to the effect set forth in Exhibit B
                           hereto, including the certifications in item (3)(b)
                           thereof.

                  the Trustee shall cancel the Certificated Note, increase or
                  cause to be increased the aggregate principal amount of, in
                  the case of clause (A) above, the appropriate Restricted
                  Global Note, in the case of clause (B) above, the 144A Global
                  Note, in the case of clause (C) above, the Regulation S Global
                  Note, in the case of clause (D) above, the IAI Global Note,
                  and in all other cases, the Restricted Global Note.

                           (ii)     A Holder of a Restricted Certificated Note
                  may exchange such Note for a beneficial interest in an
                  Unrestricted Global Note or transfer such Restricted
                  Certificated Note to a Person who takes delivery thereof in
                  the form of a beneficial interest in an Unrestricted Global
                  Note only if:

                                    (A)      such exchange or transfer is
                           effected pursuant to the Exchange Offer in accordance
                           with the Registration Rights Agreement and the
                           Holder, in the case of an exchange, or the
                           transferee, in the case of a transfer, is not (i) a
                           broker-dealer, (ii) a Person participating in the
                           distribution of the Exchange Notes or (iii) a Person
                           who is an affiliate (as defined in Rule 144) of the
                           Partnership;

                                    (B)      any such transfer is effected
                           pursuant to the Shelf Registration Statement in
                           accordance with the Registration Rights Agreement;

                                       40

<PAGE>

                                    (C)      any such transfer is effected by a
                           Restricted Broker-Dealer pursuant to the Exchange
                           Offer Registration Statement in accordance with the
                           Registration Rights Agreement; or

                                    (D)      the Registrar receives the
                           following:

                                             (i)      if the Holder of such
                                    Restricted Certificated Notes proposes to
                                    exchange such Notes for a beneficial
                                    interest in the Unrestricted Global Note, a
                                    certificate from such Holder in the form of
                                    Exhibit C hereto, including the
                                    certifications in item (1)(c) thereof;

                                             (ii)     if the Holder of such
                                    Restricted Certificated Notes proposes to
                                    transfer such Notes to a Person who shall
                                    take delivery thereof in the form of a
                                    beneficial interest in the Unrestricted
                                    Global Note, a certificate from such Holder
                                    in the form of Exhibit B hereto, including
                                    the certifications in item (4) thereof; and

                                             (iii)    in each such case set
                                    forth in this subparagraph (D), an opinion
                                    of counsel in form reasonably acceptable to
                                    the Issuers to the effect that such exchange
                                    or transfer is in compliance with the
                                    Securities Act, that the restrictions on
                                    transfer contained herein and in the Private
                                    Placement Legend are not required in order
                                    to maintain compliance with the Securities
                                    Act, and such Certificated Notes are being
                                    exchanged or transferred in compliance with
                                    any applicable blue sky securities laws of
                                    any State of the United States.

                  Upon satisfaction of the conditions of any of the
                  subparagraphs in this Section 2.06(d)(ii), the Trustee shall
                  cancel the Certificated Notes and increase or cause to be
                  increased the aggregate principal amount of the Unrestricted
                  Global Note.

                           (iii)    A Holder of an Unrestricted Certificated
                  Note may exchange such Note for a beneficial interest in an
                  Unrestricted Global Note or transfer such Certificated Notes
                  to a Person who takes delivery thereof in the form of a
                  beneficial interest in an Unrestricted Global Note at any
                  time. Upon receipt of a request for such an exchange or
                  transfer, the Trustee shall cancel the applicable Unrestricted
                  Certificated Note and increase or cause to be increased the
                  aggregate principal amount of one of the Unrestricted Global
                  Notes.

                  If any such exchange or transfer from a Certificated Note to a
beneficial interest is effected pursuant to subparagraphs (ii) or (iii) above at
a time when an Unrestricted Global Note has not yet been issued, the Issuers
shall issue and, upon receipt of an authentication order in accordance with
Section 2.02 hereof, the Trustee shall authenticate one or more Unrestricted
Global Notes (accompanied by a notation of the Guarantees duly endorsed by the
Guarantors) in an aggregate principal amount equal to the principal amount of
beneficial interests transferred pursuant to subparagraphs (ii) or (iii) above.

                                       41

<PAGE>

                  (e)      Transfer and Exchange of Certificated Notes for
Certificated Notes.

Upon request by a Holder of Certificated Notes and such Holder's compliance with
the provisions of this Section 2.06(e), the Registrar shall register the
transfer or exchange of Certificated Notes. Prior to such registration of
transfer or exchange, the requesting Holder shall present or surrender to the
Registrar the Certificated Notes duly endorsed or accompanied by a written
instruction of transfer in form satisfactory to the Registrar duly executed by
such Holder or by his attorney, duly authorized in writing. In addition, the
requesting Holder shall provide any additional certifications, documents and
information, as applicable, pursuant to the provisions of this Section 2.06(e).

                           (i)      Restricted Certificated Notes may be
                  transferred to and registered in the name of Persons who take
                  delivery thereof if the Registrar receives the following:

                                    (A)      if the transfer will be made
                           pursuant to Rule 144A under the Securities Act, then
                           the transferor must deliver a certificate in the form
                           of Exhibit B hereto, including the certifications in
                           item (1) thereof;

                                    (B)      if the transfer will be made
                           pursuant to Rule 903 or Rule 904, then the transferor
                           must deliver a certificate in the form of Exhibit B
                           hereto, including the certifications in item (2)
                           thereof; and

                                    (C)      if the transfer will be made
                           pursuant to any other exemption from the registration
                           requirements of the Securities Act, then the
                           transferor must deliver a certificate in the form of
                           Exhibit B hereto, including the certifications,
                           certificates and Opinion of Counsel required by item
                           (3) thereof, if applicable.

                           (ii)     Any Restricted Certificated Note may be
                  exchanged by the Holder thereof for an Unrestricted
                  Certificated Note or transferred to a Person or Persons who
                  take delivery thereof in the form of an Unrestricted
                  Certificated Note if:

                                    (A)      such exchange or transfer is
                           effected pursuant to the Exchange Offer in accordance
                           with the Registration Rights Agreement and the
                           Holder, in the case of an exchange, or the
                           transferee, in the case of a transfer, is not (i) a
                           broker-dealer, (ii) a Person participating in the
                           distribution of the Exchange Notes or (iii) a Person
                           who is an affiliate (as defined in Rule 144) of the
                           Partnership;

                                    (B)      any such transfer is effected
                           pursuant to the Shelf Registration Statement in
                           accordance with the Registration Rights Agreement;

                                    (C)      any such transfer is effected by a
                           Participating Broker-Dealer pursuant to the Exchange
                           Offer Registration Statement in accordance with the
                           Registration Rights Agreement; or

                                    (D)      the Registrar receives the
                           following:

                                       42

<PAGE>

                                             (i)      if the Holder of such
                                    Restricted Certificated Notes proposes to
                                    exchange such Notes for an Unrestricted
                                    Certificated Note, a certificate from such
                                    Holder in the form of Exhibit C hereto,
                                    including the certifications in item (1)(d)
                                    thereof;

                                             (ii)     if the Holder of such
                                    Restricted Certificated Notes proposes to
                                    transfer such Notes to a Person who shall
                                    take delivery thereof in the form of an
                                    Unrestricted Certificated Note, a
                                    certificate from such Holder in the form of
                                    Exhibit B hereto, including the
                                    certifications in item (4) thereof; and

                                             (iii)    in each such case set
                                    forth in this subparagraph (D), an opinion
                                    of counsel in form reasonably acceptable to
                                    the Issuers to the effect that such exchange
                                    or transfer is in compliance with the
                                    Securities Act, that the restrictions on
                                    transfer contained herein and in the Private
                                    Placement Legend are not required in order
                                    to maintain compliance with the Securities
                                    Act, and such Restricted Certificated Note
                                    is being exchanged or transferred in
                                    compliance with any applicable blue sky
                                    securities laws of any State of the United
                                    States.

                           (iii)    A Holder of Unrestricted Certificated Notes
                  may transfer such Notes to a Person who takes delivery thereof
                  in the form of an Unrestricted Certificated Note. Upon receipt
                  of a request for such a transfer, the Registrar shall register
                  the Unrestricted Certificated Notes pursuant to the
                  instructions from the Holder thereof. Unrestricted
                  Certificated Notes cannot be exchanged for or transferred to
                  Persons who take delivery thereof in the form of a Restricted
                  Certificated Note.

                  (f)      Exchange Offer. Upon the occurrence of the Exchange
Offer in accordance with the Registration Rights Agreement, the Issuers shall
issue and, upon receipt of an authentication order in accordance with Section
2.02, the Trustee shall authenticate (i) one or more Unrestricted Global Notes
(accompanied by a notation of the Guarantees duly endorsed by the Subsidiary
Guarantors) in an aggregate principal amount equal to the principal amount of
the beneficial interests in the Restricted Global Notes tendered for acceptance
by Persons that are not (x) broker-dealers (excluding broker-dealers that
acquired such beneficial interests in Restricted Global Notes as a result of
market-making activities or other trading activities (other than such beneficial
interests in Restricted Global Notes acquired directly from the Issuers or any
of their affiliates (as defined in Rule 144) thereof)), (y) Persons
participating in the distribution of the Exchange Notes or (z) Persons who are
affiliates of the Partnership and accepted for exchange in the Exchange Offer
and (ii) Certificated Notes (accompanied by a notation of the Guarantees duly
endorsed by the Subsidiary Guarantors) in an aggregate principal amount equal to
the principal amount of the Restricted Certificated Notes accepted for exchange
in the Exchange Offer. Concurrent with the issuance of such Notes, the Trustee
shall cause the aggregate principal amount of the applicable Restricted Global
Notes to be reduced accordingly, and the Issuers shall execute and the Trustee
shall authenticate and deliver to

                                       43

<PAGE>

the Persons designated by the Holders of Certificated Notes so accepted
Certificated Notes in the appropriate principal amount.

                  (g)      Legends. The following legends shall appear on the
face of all Global Notes and Certificated Notes issued under this Indenture
unless specifically stated otherwise in the applicable provisions of this
Indenture.

                           (i)      Private Placement Legend.

                                    (A)      Except as permitted by subparagraph
                           (B) below, each Global Note and each Certificated
                           Note (and all Notes issued in exchange therefor or
                           substitution thereof) shall bear the legend in
                           substantially the following form:

                           "THIS NOTE (OR ITS PREDECESSOR) WAS ORIGINALLY ISSUED
                           IN A TRANSACTION EXEMPT FROM REGISTRATION UNDER THE
                           UNITED STATES SECURITIES ACT OF 1933 (THE "SECURITIES
                           ACT"), AND THIS NOTE MAY NOT BE OFFERED, SOLD OR
                           OTHERWISE TRANSFERRED IN THE ABSENCE OF SUCH
                           REGISTRATION OR AN APPLICABLE EXEMPTION THEREFROM.
                           EACH PURCHASER OF THIS NOTE IS HEREBY NOTIFIED THAT
                           THE SELLER OF THIS NOTE MAY BE RELYING ON THE
                           EXEMPTION FROM THE PROVISIONS OF SECTION 5 OF THE
                           SECURITIES ACT PROVIDED BY RULE 144A THEREUNDER.

                           THE HOLDER OF THIS NOTE AGREES FOR THE BENEFIT OF THE
                           ISSUERS OF THIS NOTE THAT: (A) THIS NOTE MAY BE
                           OFFERED, RESOLD, PLEDGED OR OTHERWISE TRANSFERRED,
                           ONLY (I) TO GULFTERRA ENERGY PARTNERS, L.P.,
                           GULFTERRA ENERGY FINANCE CORPORATION, OR ANY OF THEIR
                           SUBSIDIARIES, (II) IN THE UNITED STATES TO A PERSON
                           WHOM THE SELLER REASONABLY BELIEVES IS A QUALIFIED
                           INSTITUTIONAL BUYER (AS DEFINED IN RULE 144A UNDER
                           THE SECURITIES ACT) IN A TRANSACTION MEETING THE
                           REQUIREMENTS OF RULE 144A, (III) OUTSIDE THE UNITED
                           STATES IN AN OFFSHORE TRANSACTION IN ACCORDANCE WITH
                           RULE 904 UNDER THE SECURITIES ACT, (IV) PURSUANT TO
                           AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES
                           ACT PROVIDED BY RULE 144 THEREUNDER (IF AVAILABLE),
                           (V) TO AN INSTITUTIONAL "ACCREDITED INVESTOR" WITHIN
                           THE MEANING OF RULE 501(A)(1), (2), (3) OR (7) UNDER
                           THE SECURITIES ACT THAT IS AN INSTITUTIONAL
                           ACCREDITED INVESTOR ACQUIRING THE SECURITY FOR ITS
                           OWN ACCOUNT OR FOR THE ACCOUNT OF SUCH INSTITUTIONAL
                           ACCREDITED INVESTOR, IN EACH CASE IN A MINIMUM
                           PRINCIPAL AMOUNT OF THE SECURITIES OF

                                       44

<PAGE>

                           $250,000, FOR INVESTMENT PURPOSES AND NOT WITH A VIEW
                           TO OR FOR OFFER OR SALE IN CONNECTION WITH ANY
                           DISTRIBUTION IN VIOLATION OF THE SECURITIES ACT, OR
                           (VI) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT
                           UNDER THE SECURITIES ACT, IN EACH OF CASES (I)
                           THROUGH (VI) IN ACCORDANCE WITH ANY APPLICABLE
                           SECURITIES LAWS OF ANY STATE OF THE UNITED STATES,
                           AND (B) THE HOLDER WILL, AND EACH SUBSEQUENT HOLDER
                           IS REQUIRED TO, NOTIFY ANY PURCHASER OF THIS NOTE
                           FROM IT OF THE RESALE RESTRICTIONS REFERRED TO IN (A)
                           ABOVE."

                                    (B)      Notwithstanding the foregoing, any
                           Global Note or Certificated Note issued pursuant to
                           subparagraphs (b)(iv), (c)(iii), (c)(iv), (d)(ii),
                           (d)(iii), (e)(ii), (e)(iii) or (f) to this Section
                           2.06 (and all Notes issued in exchange therefor or
                           substitution thereof) shall not bear the Private
                           Placement Legend.

                           (ii)     Global Note Legend. Each Global Note shall
                  bear a legend in substantially the following form:

                           THIS GLOBAL NOTE IS HELD BY THE DEPOSITARY (AS
                           DEFINED IN THE INDENTURE GOVERNING THIS NOTE) OR ITS
                           NOMINEE IN CUSTODY FOR THE BENEFIT OF THE BENEFICIAL
                           OWNERS HEREOF, AND IS NOT TRANSFERABLE TO ANY PERSON
                           UNDER ANY CIRCUMSTANCES EXCEPT THAT (I) THE TRUSTEE
                           MAY MAKE SUCH NOTATIONS HEREON AS MAY BE REQUIRED
                           PURSUANT TO SECTION 2.06 OF THE INDENTURE, (II) THIS
                           GLOBAL NOTE MAY BE EXCHANGED PURSUANT TO SECTION
                           2.06(a) OF THE INDENTURE, (III) THIS GLOBAL NOTE MAY
                           BE DELIVERED TO THE TRUSTEE FOR CANCELLATION PURSUANT
                           TO SECTION 2.11 OF THE INDENTURE AND (IV) THIS GLOBAL
                           NOTE MAY BE TRANSFERRED TO A SUCCESSOR DEPOSITARY
                           WITH THE PRIOR WRITTEN CONSENT OF THE ISSUERS."

                           "UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART
                           FOR NOTES IN DEFINITIVE FORM, THIS NOTE MAY NOT BE
                           TRANSFERRED EXCEPT AS A WHOLE BY THE DEPOSITARY TO A
                           NOMINEE OF THE DEPOSITARY OR BY A NOMINEE OF THE
                           DEPOSITARY TO THE DEPOSITARY OR ANOTHER NOMINEE OF
                           THE DEPOSITARY OR BY THE DEPOSITARY OR ANY SUCH
                           NOMINEE TO A SUCCESSOR DEPOSITARY OR A NOMINEE OF
                           SUCH SUCCESSOR DEPOSITARY. UNLESS THIS CERTIFICATE IS
                           PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
                           DEPOSITORY TRUST COMPANY (55 WATER STREET, NEW YORK,
                           NEW

                                       45

<PAGE>

                           YORK) ("DTC"), TO THE ISSUERS OR THEIR AGENT FOR
                           REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND
                           ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF
                           CEDE & CO. OR SUCH OTHER NAME AS MAY BE REQUESTED BY
                           AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT
                           IS MADE TO CEDE & CO. OR SUCH OTHER ENTITY AS MAY BE
                           REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC),
                           ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
                           OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS
                           THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN
                           INTEREST HEREIN.

                  (h)      Cancellation and/or Adjustment of Global Notes. At
such time as all beneficial interests in a particular Global Note have been
exchanged for Certificated Notes or a particular Global Note has been redeemed,
repurchased or canceled in whole and not in part, each such Global Note shall be
returned to or retained and canceled by the Trustee in accordance with Section
2.11 hereof. At any time prior to such cancellation, if any beneficial interest
in a Global Note is exchanged for or transferred to a Person who will take
delivery thereof in the form of a beneficial interest in another Global Note or
for Certificated Notes, the principal amount of Notes represented by such Global
Note shall be reduced accordingly and an endorsement shall be made on such
Global Note, by the Trustee or by the Depositary at the direction of the
Trustee, to reflect such reduction; and if the beneficial interest is being
exchanged for or transferred to a Person who will take delivery thereof in the
form of a beneficial interest in another Global Note, such other Global Note
shall be increased accordingly and an endorsement shall be made on such Global
Note, by the Trustee or by the Depositary at the direction of the Trustee, to
reflect such increase.

                  (i)      General Provisions Relating to Transfers and
Exchanges.

                           (i)      To permit registrations of transfers and
                  exchanges, the Issuers shall execute and the Trustee shall
                  authenticate Global Notes and Certificated Notes (in each
                  case, accompanied by a notation of the Guarantees duly
                  endorsed by the Subsidiary Guarantors) upon the Issuers' order
                  or at the Registrar's request.

                           (ii)     No service charge shall be made to a holder
                  of a beneficial interest in a Global Note or to a Holder of a
                  Certificated Note for any registration of transfer or
                  exchange, but the Issuers may require payment of a sum
                  sufficient to cover any transfer tax or similar governmental
                  charge payable in connection therewith (other than any such
                  transfer taxes or similar governmental charge payable upon
                  exchange or transfer pursuant to Sections 2.10, 3.06, 3.09,
                  4.06 and 9.05 hereof).

                           (iii)    The Registrar shall not be required to
                  register the transfer of or exchange any Note selected for
                  redemption in whole or in part, except the unredeemed portion
                  of any Note being redeemed in part.

                                       46

<PAGE>

                           (iv)     All Global Notes and Certificated Notes (in
                  each case, accompanied by a notation of the Guarantees duly
                  endorsed by the Subsidiary Guarantors) issued upon any
                  registration of transfer or exchange of Global Notes or
                  Certificated Notes shall be the valid obligations of the
                  Issuers and the Subsidiary Guarantors, evidencing the same
                  debt, and entitled to the same benefits under this Indenture,
                  as the Global Notes or Certificated Notes surrendered upon
                  such registration of transfer or exchange.

                           (v)      The Issuers shall not be required (A) to
                  issue, to register the transfer of or to exchange Notes during
                  a period beginning at the opening of business 15 days before
                  the day of mailing of notice of redemption and ending at the
                  close of business on the day of such mailing, (B) to register
                  the transfer of or to exchange any Note so selected for
                  redemption in whole or in part, except the unredeemed portion
                  of any Note being redeemed in part or (C) to register the
                  transfer of or to exchange a Note between a record date and
                  the next succeeding Interest Payment Date.

                           (vi)     Prior to due presentment for the
                  registration of a transfer of any Note, the Trustee, any Agent
                  and the Issuers may deem and treat the Person in whose name
                  any Note is registered as the absolute owner of such Note for
                  the purpose of receiving payment of principal of and interest
                  on such Notes and for all other purposes, and none of the
                  Trustee, any Agent or the Issuers shall be affected by notice
                  to the contrary.

                           (vii)    The Trustee shall authenticate Global Notes
                  and Certificated Notes (in each case, accompanied by a
                  notation of the Guarantees duly endorsed by the Subsidiary
                  Guarantors) in accordance with the provisions of Section 2.02
                  hereof.

                           (viii)   All certifications, certificates and
                  opinions of counsel required to be submitted to the Registrar
                  pursuant to this Section 2.06 to effect a transfer or exchange
                  may be submitted by facsimile.

                           (ix)     Each Holder of a Note agrees to indemnify
                  the Issuers and the Trustee against any liability that may
                  result from the transfer, exchange or assignment of such
                  Holder's Note in violation of any provision of this Indenture
                  and/or applicable United States federal or state securities
                  law.

                  (j)      Each beneficial owner of an interest in a Note agrees
to indemnify the Issuers and the Trustee against any liability that may result
from the transfer, exchange or assignment by such beneficial owner of such
interest in violation of any provision of this Indenture and/or applicable
United States federal or state securities law.

                  (k)      The Trustee shall have no obligation or duty to
monitor, determine or inquire as to compliance with any restrictions on transfer
imposed under this Indenture or under applicable law with respect to any
transfer of any interest in any Note (including any transfers between or among
beneficial owners of interest in any Global Note) other than to require delivery
of such certificate and other documentation or evidence as are expressly

                                       47

<PAGE>

required by, and to do so if and when expressly required by the terms of, this
Indenture, and to examine the same to determine substantial compliance as to
form with the express requirements hereof.

SECTION 2.07. REPLACEMENT NOTES.

                  If any mutilated Note is surrendered to the Trustee or either
of the Issuers and the Trustee receives evidence to its satisfaction of the
destruction, loss or theft of any Note, the Issuers shall issue and the Trustee,
upon the written order of the Issuers signed by one Officer of the Partnership
and one Officer of GulfTerra Finance, shall authenticate a replacement Note
(accompanied by a notation of the Guarantees duly endorsed by the Subsidiary
Guarantors) if the Trustee's requirements are met. An indemnity bond must be
supplied by the Holder that is sufficient in the judgment of the Trustee and the
Issuers to protect the Issuers, the Subsidiary Guarantors, the Trustee, any
Agent and any authenticating agent from any loss that any of them may suffer if
a Note is replaced. The Issuers may charge for their expenses in replacing a
Note.

                  Every replacement Note is an additional obligation of the
Issuers and the Subsidiary Guarantors and shall be entitled to all of the
benefits of this Indenture equally and proportionately with all other Notes duly
issued hereunder. The provisions of this Section 2.07 are exclusive and shall
preclude (to the extent lawful) all other rights and remedies with respect to
the replacement of mutilated, destroyed, lost or stolen Notes.

SECTION 2.08. OUTSTANDING NOTES.

                  The Notes outstanding at any time are all the Notes
authenticated by the Trustee except for those canceled by it, those delivered to
it for cancellation, those reductions in the interest in a Global Note effected
by the Trustee in accordance with the provisions hereof, and those described in
this Section as not outstanding. Except as set forth in Section 2.09 hereof, a
Note does not cease to be outstanding because an Issuer or an Affiliate of an
Issuer holds the Note.

                  If a Note is replaced pursuant to Section 2.07 hereof, it
ceases to be outstanding unless the Trustee receives proof satisfactory to it
that the replaced Note is held by a bona fide purchaser.

                  If the principal amount of any Note is considered paid under
Section 4.01 hereof, it ceases to be outstanding and interest and Additional
Interest, if applicable, on it cease to accrue.

                  If the Paying Agent (other than an Issuer or a Subsidiary or
an Affiliate of an Issuer) holds, on a redemption date or maturity date, money
sufficient to pay Notes payable on that date, then on and after that date such
Notes shall be deemed to be no longer outstanding and shall cease to accrue
interest (and Additional Interest, if any).

SECTION 2.09. TREASURY NOTES.

                  In determining whether the Holders of the required principal
amount of Notes have concurred in any direction, waiver or consent, Notes owned
by an Issuer, by

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<PAGE>

any Subsidiary Guarantor or by any Person directly or indirectly controlling or
controlled by or under direct or indirect common control with the Partnership or
any Subsidiary Guarantor, shall be considered as though not outstanding, except
that for the purposes of determining whether the Trustee shall be protected in
relying on any such direction, waiver or consent, only Notes that a Responsible
Officer of the Trustee actually knows are so owned shall be so disregarded.

SECTION 2.10. TEMPORARY NOTES.

                  Until Certificated Notes are ready for delivery, the Issuers
may prepare and the Trustee shall authenticate temporary Notes (accompanied by a
notation of the Guarantees duly endorsed by the Subsidiary Guarantors) upon a
written order of the Issuers signed by one Officer of the Partnership and one
Officer of GulfTerra Finance. Temporary Notes shall be substantially in the form
of definitive Notes but may have variations that the Issuers consider
appropriate for temporary Notes and as shall be reasonably acceptable to the
Trustee. Without unreasonable delay, the Issuers shall prepare and the Trustee
shall authenticate definitive Notes (accompanied by a notation of the Guarantees
duly endorsed by the Subsidiary Guarantors) in exchange for temporary Notes.

                  Holders of temporary Notes shall be entitled to all of the
benefits of this Indenture.

SECTION 2.11. CANCELLATION.

                  Either of the Issuers at any time may deliver Notes to the
Trustee for cancellation. The Registrar and Paying Agent shall forward to the
Trustee any Notes surrendered to them for registration of transfer, exchange or
payment. The Trustee and no one else shall cancel all Notes surrendered for
registration of transfer, exchange, payment, replacement or cancellation and
shall treat such canceled Notes in accordance with its documents retention
policies. The Issuers may not issue new Notes to replace Notes that it has paid
or that have been delivered to the Trustee for cancellation.

SECTION 2.12. DEFAULTED INTEREST.

                  If any of the Partnership, GulfTerra Finance or any Subsidiary
Guarantor defaults in a payment of interest on the Notes, it or they (to the
extent of their obligations under the Guarantees) shall pay the defaulted
interest in any lawful manner plus, to the extent lawful, interest payable on
the defaulted interest, to the Persons who are Holders on a subsequent special
record date, in each case at the rate provided in the Notes and in Section 4.01
hereof. The Issuers shall notify the Trustee in writing of the amount of
defaulted interest proposed to be paid on each Note and the date of the proposed
payment. The Issuers shall fix or cause to be fixed each such special record
date and payment date, provided that no such special record date shall be less
than 10 days prior to the related payment date for such defaulted interest. At
least 15 days before the special record date, the Issuers (or, upon the written
request of the Issuers, the Trustee in the name and at the expense of the
Issuers) shall mail or cause to be mailed to Holders a notice that states the
special record date, the related payment date and the amount of such interest to
be paid.

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<PAGE>

SECTION 2.13. CUSIP NUMBERS.

                  The Issuers in issuing the Notes may use "CUSIP" numbers (if
then generally in use), and, if they do so, the Trustee shall use "CUSIP"
numbers in notices of redemption as a convenience to Holders; provided that any
such notice may state that no representation is made as to the correctness of
such numbers either as printed on the Notes or as contained in any notice of a
redemption and that reliance may be placed only on the other identification
numbers printed on the Notes, and any such redemption shall not be affected by
any defect in or omission of such numbers. The Issuers will promptly notify the
Trustee of any change in the "CUSIP" numbers.

                                    ARTICLE 3
                            REDEMPTION AND PREPAYMENT

SECTION 3.01. NOTICES TO TRUSTEE.

                  If an Issuer elects to redeem Notes pursuant to the optional
redemption provisions of Section 3.07 hereof, it shall furnish to the Trustee,
at least 35 days (unless a shorter period is acceptable to the Trustee) but not
more than 60 days before a redemption date, an Officers' Certificate setting
forth (i) the clause of this Indenture pursuant to which the redemption shall
occur, (ii) the redemption date, (iii) the principal amount of Notes to be
redeemed and (iv) the redemption price.

SECTION 3.02. SELECTION OF NOTES TO BE REDEEMED.

                  If less than all of the Notes are to be redeemed at any time,
the Trustee will select Notes for redemption as follows:

                           (a)      if the Notes are listed for trading on a
                  national securities exchange, in compliance with the
                  requirements of the principal national securities exchange on
                  which the Notes are so listed; or

                           (b)      if the Notes are not so listed or there are
                  no such requirements, on a pro rata basis, by lot or by such
                  method as the Trustee shall deem fair and appropriate.

                  No Notes of $1,000 or less shall be redeemed in part. Notices
of redemption shall be mailed by first class mail at least 30 but not more than
60 days before the redemption date to each Holder of Notes to be redeemed at its
registered address. Notices of redemption may not be conditional.

                  If any Note is to be redeemed in part only, the notice of
redemption that relates to that Note shall state the portion of the principal
amount thereof to be redeemed. A new Note in principal amount equal to the
unredeemed portion of the original Note will be issued in the name of the Holder
thereof upon cancellation of the original Note. Notes called for redemption
become due on the date fixed for redemption. On and after the redemption date,
interest and Additional Interest, if applicable, cease to accrue on Notes or
portions of them called for redemption unless the Issuers default in making such
redemption payment.

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<PAGE>

SECTION 3.03. NOTICE OF REDEMPTION.

                  At least 30 days but not more than 60 days before a redemption
date, the Issuers shall mail or cause to be mailed, by first class mail, a
notice of redemption to each Holder whose Notes are to be redeemed at its
registered address.

                  The notice shall identify the Notes to be redeemed (including
CUSIP numbers) and shall state:

                  (a)      the redemption date;

                  (b)      the redemption price;

                  (c)      if any Note is being redeemed in part, the portion of
the principal amount of such Note to be redeemed and that, after the redemption
date upon surrender of such Note, a new Note or Notes in principal amount equal
to the unredeemed portion shall be issued upon cancellation of the original
Note;

                  (d)      the name and address of the Paying Agent;

                  (e)      that Notes called for redemption (other than a Global
Note) must be surrendered to the Paying Agent to collect the redemption price;

                  (f)      that, unless the Issuers default in making such
redemption payment, interest and Additional Interest, if applicable, on Notes
called for redemption cease to accrue on and after the redemption date;

                  (g)      the paragraph of the Notes and/or Section of this
Indenture pursuant to which the Notes called for redemption are being redeemed;
and

                  (h)      that no representation is made as to the correctness
or accuracy of the CUSIP number, if any, listed in such notice or printed on the
Notes.

                  At the Issuers' request, the Trustee shall give the notice of
redemption in the Issuers' names and at their expense; provided, however, that
the Issuers shall have delivered to the Trustee, at least 45 days prior to the
redemption date (unless a shorter period is otherwise acceptable to the
Trustee), an Officers' Certificate requesting that the Trustee give such notice
and setting forth the information to be stated in such notice as provided in the
preceding paragraph.

SECTION 3.04. EFFECT OF NOTICE OF REDEMPTION.

                  Once notice of redemption is mailed in accordance with Section
3.03 hereof, Notes called for redemption become irrevocably due and payable on
the redemption date at the redemption price. A notice of redemption may not be
conditional.

SECTION 3.05. DEPOSIT OF REDEMPTION PRICE.            Not later than 11:00 a.m.,
New York City time, on the redemption date, the Issuers shall deposit with the

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<PAGE>

Trustee or with the Paying Agent money sufficient to pay the redemption price of
and accrued interest and Additional Interest, if applicable, on all Notes to be
redeemed on that date. The Trustee or the Paying Agent shall promptly return to
the Issuers any money deposited with the Trustee or the Paying Agent by the
Issuers in excess of the amounts necessary to pay the redemption price of, and
accrued interest and Additional Interest, if applicable, on, all Notes to be
redeemed.

                  If the Issuers comply with the provisions of the preceding
paragraph, on and after the redemption date, interest and Additional Interest,
if applicable, shall cease to accrue on the Notes or the portions of Notes
called for redemption. If a Note is redeemed on or after an interest record date
but on or prior to the related Interest Payment Date, then any accrued and
unpaid interest (and Additional Interest, if any) shall be paid to the Person in
whose name such Note was registered at the close of business on such record
date. If any Note called for redemption shall not be so paid upon surrender for
redemption because of the failure of the Issuers to comply with the preceding
paragraph, interest (and Additional Interest, if any) shall be paid on the
unpaid principal, from the redemption date until such principal is paid, and to
the extent lawful on any interest not paid on such unpaid principal, in each
case at the rate provided in the Notes and in Section 4.01 hereof.

SECTION 3.06. NOTES REDEEMED IN PART.

                  Upon surrender of a Note that is redeemed in part, the Issuers
shall issue and, upon the Issuers' written request, the Trustee shall
authenticate for the Holder at the expense of the Issuers a new Note
(accompanied by a notation of the Guarantees duly endorsed by the Subsidiary
Guarantors) equal in principal amount to the unredeemed portion of the Note
surrendered.

SECTION 3.07. OPTIONAL REDEMPTION.

                  (a)      The Issuers shall have the option to redeem the
Notes, in whole or in part from time to time, at a redemption price equal to the
greater of (i) 100% of the principal amount of Notes to be redeemed plus accrued
and unpaid interest on the principal amount being redeemed to the date of
redemption or (ii) the sum of (A) the present values of the Remaining Scheduled
Payments on such Notes, discounted to the date of redemption, on a semiannual
basis (assuming a 360-day year consisting of twelve 30-day months), at the
Treasury Rate plus 50 basis points plus (B) accrued and unpaid interest on the
principal amount being redeemed to the date of redemption.

                  (b)      Any redemption pursuant to this Section 3.07 shall be
made pursuant to the provisions of Section 3.01 through 3.06 hereof.

SECTION 3.08. MANDATORY REDEMPTION.

                  Except for any repurchase offers required to be made pursuant
to Sections 4.06 and 4.07 hereof, the Issuers shall not be required to make
mandatory redemption payments with respect to the Notes.

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<PAGE>

SECTION 3.09. OFFER TO PURCHASE BY APPLICATION OF NET PROCEEDS.

                  In the event that, pursuant to Section 4.07 hereof, the
Issuers shall be required to commence a pro rata offer (an "Asset Sale Offer")
to all Holders and all holders of other Indebtedness that is pari passu with the
Notes containing provisions similar to those set forth in this Indenture with
respect to offers to purchase or redeem with the Net Proceeds of sales of assets
to purchase Notes and such other pair passu Indebtedness, it shall follow the
procedures specified below.

                  The Asset Sale Offer shall remain open for a period of at
least 30 days following its commencement but no longer than 60 days, except to
the extent that a longer period is required by applicable law (the "Offer
Period"). Promptly after the termination of the Offer Period (the "Purchase
Date"), the Issuers shall purchase the principal amount of Notes required to be
purchased pursuant to Section 4.07 hereof (the "Offer Amount") or, if less than
the Offer Amount has been tendered, all Notes tendered and not withdrawn in
response to the Asset Sale Offer. Payment for any Notes so purchased shall be
made in the same manner as interest payments are made.

                  If the Purchase Date is on or after an interest record date
and on or before the related Interest Payment Date, accrued and unpaid interest,
if any, and Additional Interest (to the extent involving interest that is due
and payable on such Interest Payment Date), if any, shall be paid to the Person
in whose name a Note is registered at the close of business on such record date,
and no additional interest (or Additional Interest, if any) shall be payable to
Holders who validly tender Notes pursuant to the Asset Sale Offer.

                  Upon the commencement of an Asset Sale Offer, the Issuers
shall send, by first class mail, a notice to the Trustee and each of the
Holders, with a copy to the Trustee. The notice shall contain all instructions
and materials necessary to enable such Holders to tender Notes pursuant to the
Asset Sale Offer. The Asset Sale Offer shall be made to all Holders. The notice,
which shall govern the terms of the Asset Sale Offer, shall state:

                  (a)      that the Asset Sale Offer is being made pursuant to
this Section 3.09 and Section 4.07 hereof and the length of time the Asset Sale
Offer shall remain open;

                  (b)      the Offer Amount, the purchase price and the Purchase
Date;

                  (c)      that any Note not validly tendered or accepted for
payment shall continue to accrue interest and Additional Interest, if
applicable;

                  (d)      that, unless the Issuers default in making such
payment, any Note accepted for payment pursuant to the Asset Sale Offer shall
cease to accrue interest and Additional Interest, if applicable, after the
Purchase Date;

                  (e)      that Holders electing to have a Note purchased
pursuant to any Asset Sale Offer shall be required to surrender the Note, with
the form entitled "Option of Holder to Elect Purchase" on the reverse of the
Note completed, or transfer by book-entry transfer, to the Issuers, a
depositary, if appointed by the Issuers, or a Paying Agent at the address
specified in the notice at least three days before the Purchase Date;

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<PAGE>

                  (f)      that Holders shall be entitled to withdraw their
election if the Issuers, the Depositary or the Paying Agent, as the case may be,
receives, not later than the expiration of the Offer Period, a telegram,
facsimile transmission or letter setting forth the name of the Holder, the
principal amount of the Note the Holder delivered for purchase and a statement
that such Holder is withdrawing his election to have such Note purchased;

                  (g)      that, if the aggregate principal amount of Notes
surrendered by Holders exceeds the Offer Amount, the Issuers shall select the
Notes to be purchased on a pro rata basis (with such adjustments as may be
deemed appropriate by the Issuers so that only Notes in denominations of $1,000,
or integral multiples thereof, shall be purchased); and

                  (h)      that Holders whose Notes were purchased only in part
shall be issued new Notes (accompanied by a notation of the Guarantees duly
endorsed by the Subsidiary Guarantors) equal in principal amount to the
unpurchased portion of the Notes surrendered (or transferred by book-entry
transfer).

                  On or before the Purchase Date, the Issuers shall, to the
extent lawful, accept for payment, on a pro rata basis to the extent necessary,
the Offer Amount of Notes or portions thereof validly tendered and not properly
withdrawn pursuant to the Asset Sale Offer, or if less than the Offer Amount has
been validly tendered and not properly withdrawn, all Notes so tendered and not
withdrawn, and shall deliver to the Trustee an Officers' Certificate stating
that such Notes or portions thereof were accepted for payment by the Issuers in
accordance with the terms of this Section 3.09. Upon surrender and cancellation
of a Certificated Note that is purchased in part, the Issuers shall promptly
issue and the Trustee shall authenticate and deliver to the surrendering Holder
of such Certificated Note a new Certificated Note equal in principal amount to
the unpurchased portion of such surrendered Certificated Note; provided that
each such new Certificated Note shall be in a principal amount of $1,000 or an
integral multiple thereof. Upon surrender of a Global Note that is purchased in
part pursuant to an Asset Sale Offer, the Paying Agent shall forward such Global
Note to the Trustee who shall make an endorsement thereon to reduce the
principal amount of such Global Note to an amount equal to the unpurchased
portion of such Global Note, as provided in Section 2.06(h) hereof. The Issuers,
the Depositary or the Paying Agent, as the case may be, shall promptly mail or
deliver to each tendering Holder an amount equal to the purchase price of the
Notes tendered by such Holder and accepted by the Issuers for purchase, and the
Issuers shall promptly issue a new Note (in each case, accompanied by a notation
of the Guarantees duly endorsed by the Subsidiary Guarantors), and the Trustee,
upon written request from the Issuers shall authenticate and mail or deliver
such new Note to such Holder, in a principal amount equal to any unpurchased
portion of the Note surrendered. Any Note not so accepted shall be promptly
mailed or delivered by the Issuers to the Holder thereof. The Issuers shall
publicly announce the results of the Asset Sale Offer on or as soon as
practicable after the Purchase Date. Other than as specifically provided in this
Section 3.09, any purchase pursuant to this Section 3.09 shall be made pursuant
to the provisions of Sections 3.01 through 3.06 hereof.

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<PAGE>

                                    ARTICLE 4
                                    COVENANTS

SECTION 4.01. PAYMENT OF NOTES.

                  The Issuers shall pay or cause to be paid the principal of and
premium, if any, interest and Additional Interest, if any, on the Notes in New
York, New York on the dates and in the manner provided in the Notes. Principal,
premium, if any, interest and Additional Interest, if any, shall be considered
paid on the date due if the Paying Agent, if other than an Issuer or any
Subsidiary Guarantor thereof, holds as of 11:00 a.m. Eastern Time on the due
date money deposited by the Issuers in immediately available funds and
designated for and sufficient to pay all principal, premium, if any, interest
and Additional Interest, if any, then due. The Issuers shall pay all Additional
Interest, if any, in the same manner on the dates and in the amounts set forth
in the Registration Rights Agreement.

                  The Issuers shall pay interest (including post-petition
interest in any proceeding under any Bankruptcy Law) on overdue principal and
premium at the then applicable interest rate on the Notes to the extent lawful.
The Issuers shall pay interest (including post-petition interest in any
proceeding under any Bankruptcy Law) on overdue installments of interest and
Additional Interest (without regard to any applicable grace period) at the same
rate to the extent lawful.

SECTION 4.02. MAINTENANCE OF OFFICE OR AGENCY.

                  The Issuers shall maintain in the Borough of Manhattan, The
City of New York, an office or agency (which may be an office of the Trustee or
an Affiliate of the Trustee, Registrar or co-registrar) where Notes may be
surrendered for registration of transfer or for exchange and where notices and
demands to or upon the Issuers or the Subsidiary Guarantors in respect of the
Notes and this Indenture may be served. The Issuers shall give prompt written
notice to the Trustee of the location, and any change in the location, of such
office or agency. If at any time the Issuers shall fail to maintain any such
required office or agency or shall fail to furnish the Trustee with the address
thereof, such presentations, surrenders, notices and demands may be made or
served at the Corporate Trust Office of the Trustee.

                  The Issuers may also from time to time designate one or more
other offices or agencies where the Notes may be presented or surrendered for
any or all such purposes and may from time to time rescind such designations;
provided, however, that no such designation or rescission shall in any manner
relieve the Issuers of their obligation to maintain an office or agency in the
Borough of Manhattan, The City of New York for such purposes. The Issuers shall
give prompt written notice to the Trustee of any such designation or rescission
and of any change in location of any such other office or agency.

                  The Issuers hereby designate the Corporate Trust Office of the
Trustee as one such office or agency of the Issuers in accordance with Section
2.03.

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<PAGE>

SECTION 4.03. COMPLIANCE CERTIFICATE.

                  (a)      The Issuers and the Subsidiary Guarantors shall
deliver to the Trustee, within 90 days after the end of each fiscal year, an
Officers' Certificate stating that a review of the activities of the Issuers and
the Restricted Subsidiaries of the Partnership during the preceding fiscal year
has been made under the supervision of the signing Officers with a view to
determining whether the Issuers and the Subsidiary Guarantors have kept,
observed, performed and fulfilled their respective obligations under this
Indenture and the Guarantees, respectively, and further stating, as to each such
Officer signing such certificate, that to the best of his or her knowledge each
of such Issuers and such Subsidiary Guarantors, as the case may be, has kept,
observed, performed and fulfilled each and every covenant contained in this
Indenture and is not in default in the performance or observance of any of the
terms, provisions and conditions of this Indenture (or, if a Default or Event of
Default shall have occurred, describing all such Defaults or Events of Default
of which he or she may have knowledge and what action such Issuer or such
Subsidiary Guarantor, as the case may be, is taking or proposes to take with
respect thereto) and that to the best of his or her knowledge no event has
occurred and remains in existence by reason of which payments on account of the
principal of or interest, if any, on the Notes is prohibited or if such event
has occurred, a description of the event and what action such Issuer or such
Subsidiary Guarantor, as the case may be, is taking or proposes to take with
respect thereto.

                  (b)      So long as not contrary to the then current
recommendations of the American Institute of Certified Public Accountants, the
year-end financial statements delivered pursuant to Section 4.18(a) shall be
accompanied by a written statement of the Issuers' independent public
accountants (who shall be a firm of established national reputation) that in
making the examination necessary for certification of such financial statements,
nothing has come to their attention that would lead them to believe that the
Issuers have violated any provisions of Article 4 or Article 5 hereof (except
that such written statement need not address the Issuers' and Subsidiary
Guarantors' compliance with Sections 4.02, 4.05, 4.06 or 4.12 hereof) or, if any
such violation has occurred, specifying the nature and period of existence
thereof, it being understood that such accountants shall not be liable directly
or indirectly to any Person for any failure to obtain knowledge of any such
violation.

                  (c)      Each of the Issuers shall, so long as any of the
Notes are outstanding, deliver to the Trustee, forthwith upon any Officer of the
Partnership, the General Partner or GulfTerra Finance becoming aware of any
Default or Event of Default, an Officers' Certificate specifying such Default or
Event of Default and what action the Issuers are taking or propose to take with
respect thereto.

SECTION 4.04. TAXES.

                  The Issuers shall pay, and shall cause each of its Restricted
Subsidiaries to pay, prior to delinquency, all material taxes, assessments, and
governmental levies except such as are contested in good faith and by
appropriate proceedings or where the failure to effect such payment is not
adverse in any material respect to the Holders of the Notes.

                                       56

<PAGE>

SECTION 4.05. STAY, EXTENSION AND USURY LAWS.

                  Each of the Issuers and the Subsidiary Guarantors covenants
(to the extent that it may lawfully do so) that it shall not at any time insist
upon, plead, or in any manner whatsoever claim or take the benefit or advantage
of, any stay, extension or usury law wherever enacted, now or at any time
hereafter in force, that may affect the covenants or the performance of this
Indenture; and each of the Issuers and the Subsidiary Guarantors (to the extent
that it may lawfully do so) hereby expressly waives all benefit or advantage of
any such law, and covenants that it shall not, by resort to any such law,
hinder, delay or impede the execution of any power herein granted to the
Trustee, but shall suffer and permit the execution of every such power as though
no such law has been enacted.

SECTION 4.06. CHANGE OF CONTROL.

                  (a)      If a Change of Control occurs, each Holder of Notes
shall have the right to require the Issuers to repurchase all or any part (equal
to $1,000 or an integral multiple thereof) of that Holder's Notes pursuant to
the offer described below (the "Change of Control Offer"), subject to the
satisfaction of the Tender Condition in the event of a Change of Control that
does not result in a Ratings Downgrade. In the Change of Control Offer, the
Issuers shall offer, subject to the satisfaction of the Tender Condition in the
event of a Change of Control that does not result in a Ratings Downgrade, a
"Change of Control Payment" in cash equal to 101% of the aggregate principal
amount of Notes repurchased plus accrued and unpaid interest thereon, if any,
and Additional Interest, if any, to the date of purchase (the "Change of Control
Payment"). Within 30 days following any Change of Control, the Issuers shall
mail a notice to each Holder describing the transaction or transactions that
constitute the Change of Control and offering to repurchase Notes, subject to
the satisfaction of the Tender Condition in the event of a Change of Control
that does not result in a Ratings Downgrade, on the Change of Control Payment
Date specified in such notice, pursuant to the procedures required by this
Indenture and described in such notice. If the Change of Control Payment Date is
on or after a record date and on or before the related Interest Payment Date,
any accrued and unpaid interest and Additional Interest (to the extent involving
interest that is due and payable on such Interest Payment Date), if any, shall
be paid, subject to the satisfaction of the Tender Condition in the event of a
Change of Control that does not result in a Ratings Downgrade, to the Person in
whose name a Note is registered at the close of business on such record date,
and no additional interest (or Additional Interest, if any) (to the extent
involving interest that is due and payable on such Interest Payment Date) shall
be payable to Holders who validly tender Notes pursuant to the Change of Control
Offer. The Issuers shall comply with the requirements of Rule 14e-l under the
Exchange Act and any other securities laws and regulations thereunder to the
extent such laws and regulations are applicable in connection with the
repurchase of the Notes as a result of a Change of Control.

                  (b)      Within 30 days following any Change of Control, the
Issuers shall mail by first class mail, a notice to each Holder, with a copy of
such notice to the Trustee. The notice, which shall govern the terms of the
Change of Control Offer, shall state, among other things:

                           (i)      that a Change of Control has occurred and a
                                    Change of Control Offer is being made as
                                    provided for herein, and that, although
                                    Holders are not required to tender their

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                                    Notes, all Notes that are validly tendered
                                    shall be accepted for payment, subject to
                                    the satisfaction of the Tender Condition in
                                    the event of a Change of Control that does
                                    not result in a Ratings Downgrade;

                           (ii)     the Change of Control Payment and the Change
                                    of Control Payment Date, which will be no
                                    earlier than 30 days and no later than 60
                                    days after the date such notice is mailed;

                           (iii)    that any Note accepted for payment pursuant
                                    to the Change of Control Offer (and duly
                                    paid for on the Change of Control Payment
                                    Date) shall cease to accrue interest and
                                    Additional Interest, if applicable, after
                                    the Change of Control Payment Date;

                           (iv)     that any Notes (or portions thereof) not
                                    validly tendered shall continue to accrue
                                    interest and Additional Interest, if
                                    applicable;

                           (v)      that any Holder electing to have a Note
                                    purchased pursuant to any Change of Control
                                    Offer shall be required to surrender the
                                    Note, with the form entitled "Option of
                                    Holder to Elect Purchase" on the reverse of
                                    the Note completed, or transfer by
                                    book-entry transfer, to the Issuers, a
                                    depositary, if appointed by the Issuers, or
                                    a Paying Agent at the address specified in
                                    the notice at least one (1) Business Day
                                    before the Change of Control Payment Date;

                           (vi)     that Holders shall be entitled to withdraw
                                    their election if the Issuers, the
                                    Depositary or the Paying Agent, as the case
                                    may be, receives, not later than the
                                    expiration of the Change of Control Offer, a
                                    telegram, facsimile transmission or letter
                                    setting forth the name of the Holder, the
                                    principal amount of the Note the Holder
                                    delivered for purchase and a statement that
                                    such Holder is withdrawing his election to
                                    have such Note purchased; and

                           (vii)    the instructions and any other information
                                    necessary to enable Holders to tender their
                                    Notes (or portions thereof) and have such
                                    Notes (or portions thereof) purchased
                                    pursuant to the Change of Control Offer.

                  (c)      On the Change of Control Payment Date, the Issuers
shall, to the extent lawful and, in the case of a Change of Control Offer in
respect of a Change of Control that did not result in a Ratings Downgrade, only
if the Tender Condition is satisfied:

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                           (i)      accept for payment all Notes or portions
                  thereof properly tendered and not withdrawn pursuant to the
                  Change of Control Offer;

                           (ii)     deposit by 11:00 a.m., New York Time with
                  the Paying Agent an amount equal to the Change of Control
                  Payment in respect of all Notes or portions thereof so
                  tendered; and

                           (iii)    deliver or cause to be delivered to the
                  Trustee the Notes so accepted together with an Officers'
                  Certificate stating the aggregate principal amount of Notes or
                  portions thereof being purchased by the Issuers.

                  (d)      Subject to the satisfaction of the Tender Condition
in the event of a Change of Control that does not result in a Ratings Downgrade,
the Paying Agent shall promptly mail to each Holder of Notes so tendered the
Change of Control Payment for such Notes, and the Trustee shall promptly
authenticate and mail (or cause to be transferred by book entry) to each Holder
a new Note equal in principal amount to any unpurchased portion of the Notes
surrendered, if any; provided that each such new Note shall be in a principal
amount of $1,000 or an integral multiple thereof. The Issuers shall publicly
announce the results of the Change of Control Offer on or as soon as practicable
after the Change of Control Payment Date.

                  (e)      Upon surrender and cancellation of a Certificated
Note that is purchased in part pursuant to the Change of Control Offer, the
Issuers shall promptly issue and the Trustee shall authenticate and mail (or
cause to be transferred by book entry) to the surrendering Holder of such
Certificated Note, a new Certificated Note equal in principal amount to the
unpurchased portion of such surrendered Certificated Note; provided that each
such new Certificated Note shall be in principal amount of $1,000 or an integral
multiple thereof.

                  (f)      The change of control offers made pursuant to the
terms of each series of Subordinated Putable Debt Securities in respect of a
Change of Control shall each (a) provide for the same time of expiration of the
period during which valid tenders of Subordinated Putable Debt Securities may be
made as the time of expiration of the period during which valid tenders of Notes
may be made pursuant to the Change of Control Offer and (b) provide that the
date of purchase of Subordinated Putable Debt Securities validly tendered
pursuant to such change of control offer is the Change of Control Payment Date.

                  (g)      The provisions described in this Section 4.06 require
the Issuers to make a Change of Control Offer following a Change of Control
shall be applicable regardless of whether or not any other provisions of this
Indenture are applicable.

                  (h)      Notwithstanding the other provisions of this Section
4.06, the Issuers will not be required to make a Change of Control Offer upon a
Change of Control and a Holder will not have the right to require the Issuers to
repurchase any Notes pursuant to a Change of Control Offer if at the time of the
Change of Control (1) the Notes have and have had for at least the last 90
consecutive days an Investment Grade Rating from both Rating Agencies, (2) the
aggregate principal amount of Putable Debt Securities outstanding at such time
is less than the greater of (i) $250 million and (ii) 30% of the aggregate
principal amount of Non-Putable Debt Securities outstanding at such time, and
(3) no

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Default has occurred and is then continuing under the Indenture (the "Investment
Grade Suspension Provision").

                  (i)      Notwithstanding the other provisions of this Section
4.06, the Issuers shall not be required to make a Change of Control Offer upon a
Change of Control, and a Holder will not have the right to require that the
Issuers repurchase any Notes pursuant to a Change of Control Offer, if a third
party makes the Change of Control Offer in the manner, at the times and
otherwise in compliance with the requirements set forth in this Indenture
applicable to a Change of Control Offer made by the Issuers and purchases all
Notes validly tendered and not withdrawn under such Change of Control Offer.

SECTION 4.07. ASSET SALES.

                  (a)      The Issuers shall not, and shall not permit any
Restricted Subsidiary of the Partnership to, consummate an Asset Sale unless:

                           (i)      such Issuer (or the Restricted Subsidiary,
                  as the case may be) receives consideration at the time of such
                  Asset Sale at least equal to the fair market value of the
                  assets or Equity Interests issued or sold or otherwise
                  disposed of;

                           (ii)     such fair market value is determined by (a)
                  an executive officer of the Partnership if the value is less
                  than $25.0 million, as evidenced by an Officers' Certificate
                  delivered to the Trustee or (b) the Board of Directors of the
                  General Partner if the value is $25.0 million or more, as
                  evidenced by a resolution of such Board of Directors of the
                  General Partner; and

                           (iii)    at least 75% of the Net Proceeds received by
                  such Issuer or such Restricted Subsidiary is in the form of
                  cash or Cash Equivalents.

                  For purposes of this clause (iii), each of the following shall
be deemed to be cash:

                           (A)      any liabilities (as shown on such Issuer's
                  or such Restricted Subsidiary's most recent balance sheet) of
                  the Issuers or any Restricted Subsidiary (other than
                  contingent liabilities and liabilities that are by their terms
                  subordinated to the Notes or any Guarantee) that are assumed
                  by the transferee of any such assets pursuant to a customary
                  novation agreement that releases such Issuer or such
                  Restricted Subsidiary from further liability; and

                           (B)      any securities, notes or other obligations
                  received by such Issuer or any such Restricted Subsidiary from
                  such transferee that are within 90 days after the Asset Sale
                  (subject to ordinary settlement periods) converted by such
                  Issuer or such Restricted Subsidiary into cash (to the extent
                  of the cash received in that conversion).

                  (b)      Within 360 days after the receipt of any Net Proceeds
from an Asset Sale, the Partnership or a Restricted Subsidiary may apply (or
enter into a definitive

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agreement for such application, provided that such capital expenditure or
purchase is closed within 90 days after the end of such 360-day period) such Net
Proceeds at its option:

                           (i)      to repay senior Indebtedness of the
                  Partnership and/or its Restricted Subsidiaries (or to make an
                  offer to repurchase or redeem any such Indebtedness, provided
                  that such repurchase or redemption closes within 45 days after
                  the end of such 360-day period) with a permanent reduction in
                  availability for any revolving credit Indebtedness;

                           (ii)     to make a capital expenditure in a Permitted
                  Business;

                           (iii)    to acquire other long-term tangible assets
                  that are used or useful in a Permitted Business; or

                           (iv)     to invest in any other Permitted Business
                  Investment or any other Permitted Investments other than
                  Investments in Cash Equivalents, Interest Swaps or Currency
                  Agreements.

Pending the final application of any such Net Proceeds, the Partnership or a
Restricted Subsidiary may temporarily reduce revolving credit borrowings or
otherwise invest such Net Proceeds in any manner that is not prohibited by this
Indenture.

                  (c)      Any Net Proceeds from Asset Sales that are not
applied or invested as provided in Section 4.07(b) above will constitute "Excess
Proceeds". When the aggregate amount of Excess Proceeds exceeds $20.0 million,
the Issuers will make a pro rata offer (an "Asset Sale Offer") to all Holders of
Notes and all holders of other Indebtedness that is pari passu with the Notes
containing provisions similar to those set forth in this Indenture with respect
to offers to purchase or redeem with the proceeds of sales of assets to purchase
the maximum principal amount of Notes and such other pari passu Indebtedness
that may be purchased out of the Excess Proceeds. The offer price in any Asset
Sale Offer will be equal to 100% of principal amount plus accrued and unpaid
interest (including any Additional Interest in the case of the Notes), if any,
and premium, if any, to the date of purchase, and will be payable in cash. If
any Excess Proceeds remain after consummation of an Asset Sale Offer, the
Partnership may use such Excess Proceeds for any purpose not otherwise
prohibited by this Indenture, including, without limitation, the repurchase or
redemption of Indebtedness of the Issuers or any Subsidiary Guarantor that is
subordinated to the Notes or, in the case of any Subsidiary Guarantor, the
Guarantee of such Subsidiary Guarantor. If the aggregate principal amount of
Notes tendered into such Asset Sale Offer exceeds the amount of Excess Proceeds
allocated for repurchases of Notes pursuant to the Asset Sale Offer for Notes,
the Trustee shall select the Notes to be purchased on a pro rata basis. Upon
completion of each Asset Sale Offer, the amount of Excess Proceeds shall be
reset at zero.

                  (d)      Notwithstanding the definition of the term "Asset
Sale" in Section 1.01 hereof, the following transactions shall not constitute an
Asset Sale for purposes of this Indenture:

                           (i)      any transaction whereby assets or properties
                  (including ownership interests in any Subsidiary or Joint
                  Venture) owned by the

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                  Partnership or a Restricted Subsidiary of the Partnership are
                  exchanged or contributed for the Equity Interests of a Joint
                  Venture or Unrestricted Subsidiary in a transaction that
                  satisfies the requirements of a Permitted Business Investment
                  or for other assets or properties (including interests in any
                  Subsidiary or Joint Venture) so long as (i) the fair market
                  value of the assets or properties (if other than a Permitted
                  Business Investment) received is substantially equivalent to
                  the fair market value of the assets or properties given up,
                  and (ii) any cash received in such exchange or contribution by
                  the Partnership or any Restricted Subsidiary of the
                  Partnership is applied in accordance with the foregoing
                  provisions of this Section 4.07;

                           (ii)     any sale, transfer or other disposition of
                  cash or Cash Equivalents;

                           (iii)    any sale, transfer or other disposition of
                  Restricted Investments; and

                           (iv)     any sale, transfer or other disposition of
                  interests in oil and gas leaseholds (including, without
                  limitation, by abandonment, farm-ins, farm-outs, leases, swaps
                  and subleases), hydrocarbons and other mineral products in the
                  ordinary course of business of the oil and gas operations
                  conducted by the Partnership or any Restricted Subsidiary of
                  the Partnership, which sale, transfer or other disposition is
                  made by the Partnership or any such Restricted Subsidiary.

SECTION 4.08. RESTRICTED PAYMENTS.

                  (a)      The Issuers shall not, and shall not permit any of
their Restricted Subsidiaries to, directly or indirectly:

                           (i)      declare or pay any dividend or make any
                  other payment or distribution on account of the Equity
                  Interests of the Partnership or any of its Restricted
                  Subsidiaries (including, without limitation, any payment in
                  connection with any merger or consolidation involving the
                  Partnership or any of its Restricted Subsidiaries) or to the
                  direct or indirect holders of the Equity Interests of the
                  Partnership or of any of its Restricted Subsidiaries in their
                  capacity as such (other than dividends or distributions
                  payable in Equity Interests of the Partnership (other than
                  Disqualified Equity) and other than distributions or dividends
                  payable to the Partnership or a Restricted Subsidiary of the
                  Partnership).

                           (ii)     except to the extent permitted in clause
                  (iv) below, purchase, redeem or otherwise acquire or retire
                  for value (including, without limitation, in connection with
                  any merger or consolidation involving an Issuer) any Equity
                  Interests of the Partnership or of any of its Restricted
                  Subsidiaries (other than any such Equity Interests owned by
                  the Partnership or any of its Restricted Subsidiaries);

                           (iii)    except to the extent permitted in clause
                  (iv) below, make any payment on or with respect to, or
                  purchase, redeem, defease or otherwise acquire or retire for
                  value any Subordinated Obligation or Guarantor

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<PAGE>

                  Subordinated Obligation Notes or the Guarantees (other than
                  the Notes or the Guarantees), except (a) a payment of interest
                  or principal at the Stated Maturity thereof, (b) a purchase,
                  redemption, acquisition or retirement required to be made
                  pursuant to the terms of such Indebtedness (including pursuant
                  to an asset sale or change of control provision) and (c) any
                  such Indebtedness of the Partnership or any Restricted
                  Subsidiary owned by the Partnership or a Restricted
                  Subsidiary;

                           (iv)     make any Investment other than a Permitted
                  Investment or a Permitted Business Investment (all such
                  payments and other actions set forth in clauses (i) through
                  (iv) above being collectively referred to as "Restricted
                  Payments"),

unless, at the time of and after giving effect to such Restricted Payment, no
Default or Event of Default shall have occurred and be continuing or would occur
as a consequence thereof and either:

                           (A)      if the Fixed Charge Coverage Ratio for the
                  Partnership's four most recent fiscal quarters for which
                  internal financial statements are available is not less than
                  2.0 to 1.0, such Restricted Payment, together with the
                  aggregate amount of all other Restricted Payments made by the
                  Partnership and its Restricted Subsidiaries during the quarter
                  in which such Restricted Payment is made, is less than the
                  sum, without duplication, of (a) Available Cash constituting
                  Cash from Operations as of the end of the immediately
                  preceding quarter, plus (b) the aggregate net cash proceeds of
                  any (i) substantially concurrent capital contribution to the
                  Partnership from any Person (other than a Restricted
                  Subsidiary of the Partnership) after the Issue Date, (ii)
                  substantially concurrent issuance and sale after the Issue
                  Date of Equity Interests (other than Disqualified Equity) of
                  the Partnership or from the issuance or sale after the Issue
                  Date of convertible or exchangeable Disqualified Equity or
                  convertible or exchangeable debt securities of the Partnership
                  that have been converted into or exchanged for such Equity
                  Interests (other than Disqualified Equity), (iii) to the
                  extent that any Restricted Investment that was made after the
                  Issue Date is sold for cash or Cash Equivalents or otherwise
                  liquidated or repaid for cash or Cash Equivalents, the lesser
                  of the refund of capital or similar payment made in cash or
                  Cash Equivalents with respect to such Restricted Investment
                  (less the cost of such disposition, if any) and the initial
                  amount of such Restricted Investment (other than to a
                  Restricted Subsidiary of the Partnership), plus (c) the net
                  reduction in Investments in Restricted Investments resulting
                  from dividends, repayments of loans or advances, or other
                  transfers of assets in each case to the Partnership or any of
                  its Restricted Subsidiaries from any Person (including,
                  without limitation, Unrestricted Subsidiaries) or from
                  redesignations of Unrestricted Subsidiaries as Restricted
                  Subsidiaries to the extent such amounts have not been included
                  in Available Cash constituting Cash from Operations for any
                  quarter commencing on or after the Issue Date (items (b) and
                  (c) being referred to as "Incremental Funds"), minus (d) the
                  aggregate amount of Incremental Funds previously expended
                  pursuant to this clause (A) or clause (B) below; or

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<PAGE>

                           (B)      if the Fixed Charge Coverage Ratio for the
                  Partnership's four most recent fiscal quarters for which
                  internal financial statements are available is less than 2.0
                  to 1.0, such Restricted Payment, together with the aggregate
                  amount of all other Restricted Payments made by the
                  Partnership and its Restricted Subsidiaries during the quarter
                  in which such Restricted Payment is made, is less than the
                  sum, without duplication, of (a) $60.0 million less the
                  aggregate amount of all Restricted Payments made by the
                  Partnership and its Restricted Subsidiaries pursuant to this
                  clause (B)(a) during the period ending on the last day of the
                  fiscal quarter of the Partnership immediately preceding the
                  date of such Restricted Payment and beginning on the Issue
                  Date, plus (b) Incremental Funds to the extent not previously
                  expended pursuant to this clause (B) or clause (A) above.

For purposes of clauses (A) and (B) above, the term "substantially concurrent"
means that either (x) the offering was consummated within 120 days of the date
of determination or (y) the offering was consummated within 24 months of the
date of determination and the proceeds therefrom were used for the purposes
expressly stated in the documents related thereto and may be traced to such use
by segregating, separating or otherwise specifically identifying the movement of
such proceeds.

                  (b)      So long as no Default has occurred and is continuing
or would be caused thereby, the preceding provisions of this Section 4.08 shall
not prohibit:

                           (i)      the payment by the Partnership or any of its
                  Restricted Subsidiaries of any distribution or dividend within
                  60 days after the date of declaration thereof, if at said date
                  of declaration such payment would have complied with the
                  provisions of this Indenture;

                           (ii)     the redemption, repurchase, retirement,
                  defeasance or other acquisition of any pari passu or
                  subordinated (in right of payment) Indebtedness of the
                  Partnership or any of its Restricted Subsidiaries or of any
                  Equity Interests of the Partnership or any of its Restricted
                  Subsidiaries in exchange for, or out of the net cash proceeds
                  of, a substantially concurrent (a) capital contribution to the
                  Partnership or such Restricted Subsidiary from any Person
                  (other than the Partnership or another Restricted Subsidiary)
                  or (b) sale (a sale will be deemed substantially concurrent if
                  such redemption, repurchase, retirement, defeasance or
                  acquisition occurs not more than 120 days after such sale or
                  within 24 months of the date of determination and the proceeds
                  therefrom were used for the purposes expressly stated in the
                  documents related thereto and may be traced to such use by
                  segregating, separating or otherwise specifically identifying
                  the movement of such proceeds) (other than to a Restricted
                  Subsidiary of the Partnership) of (i) Equity Interests (other
                  than Disqualified Equity) of the Partnership or such
                  Restricted Subsidiary or (ii) Indebtedness that is
                  subordinated to the Notes or the Guarantees, provided that
                  such new subordinated Indebtedness with respect to the
                  redemption, repurchase, retirement, defeasance or other
                  acquisition of pari passu or subordinated Indebtedness (W) is
                  subordinated to the same extent as such refinanced

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<PAGE>

                  Indebtedness (if the refinanced Indebtedness is subordinated),
                  (X) has a Weighted Average Life to Maturity of at least the
                  remaining Weighted Average Life to Maturity of the refinanced
                  pari passu or subordinated Indebtedness, (Y) is for the same
                  principal amount as either such refinanced pari passu or
                  subordinated Indebtedness plus original issue discount to the
                  extent not reflected therein or the redemption or purchase
                  price of such Equity Interests (plus reasonable expenses of
                  refinancing and any premiums paid on such refinanced pari
                  passu or subordinated Indebtedness) and (Z) is incurred by the
                  Partnership or the Restricted Subsidiary that is the obligor
                  on the Indebtedness so refinanced or the issuer of the Equity
                  Interests so redeemed, repurchased or retired; provided,
                  however, that the amount of any net cash proceeds that are
                  utilized for any such redemption, repurchase or other
                  acquisition or retirement shall be excluded or deducted from
                  the calculation of Available Cash and Incremental Funds;

                           (iii)    the defeasance, redemption, repurchase or
                  other acquisition of pari passu or subordinated (in right of
                  payment) Indebtedness of the Partnership or any Restricted
                  Subsidiary with the net cash proceeds from an incurrence of
                  Permitted Refinancing Indebtedness;

                           (iv)     the payment of any distribution or dividend
                  by a Restricted Subsidiary to the Partnership or to the
                  holders of the Equity Interests (other than Disqualified
                  Equity) of such Restricted Subsidiary on a pro rata basis;

                           (v)      the repurchase, redemption or other
                  acquisition or retirement for value of any Equity Interests of
                  the Partnership or any of its Restricted Subsidiaries held by
                  any member of the General Partner's or the Partnership's or
                  any Restricted Subsidiary's management pursuant to any
                  management equity subscription agreement or stock option
                  agreement or to satisfy obligations under any Equity Interests
                  appreciation rights or option plan or similar arrangement;
                  provided that the aggregate price paid for all such
                  repurchased, redeemed, acquired or retired Equity Interests
                  shall not exceed $5.0 million in any 12-month period; and

                           (vi)     any payment by the Partnership pursuant to
                  section 3.1(b) of the Management Agreement to compensate for
                  certain tax liabilities resulting from certain allocated
                  income.

                  In computing the amount of Restricted Payments made for
purposes of Section 4.08(a), Restricted Payments made under clauses (i) (but
only if the declaration of such dividend or other distribution has not been
counted in a prior period) and, to the extent of amounts paid to holders other
than the Partnership or any of its Restricted Subsidiaries, (iv) of this Section
4.08(b) shall be included, and Restricted Payments made under clauses (ii),
(iii), (v) and (vi) and, except to the extent noted above, (iv) of this Section
4.08(b) shall not be included. The amount of all Restricted Payments (other than
cash) shall be the fair market value on the date of the Restricted Payment of
the asset(s) or securities proposed to be transferred or issued by the
Partnership or such Restricted Subsidiary, as

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<PAGE>

the case may be, pursuant to the Restricted Payment. The fair market value of
any assets or securities that are required to be valued by this covenant shall
be determined by the Board of Directors of the General Partner whose resolution
with respect thereto shall be delivered to the Trustee.

SECTION 4.09. INCURRENCE OF INDEBTEDNESS AND ISSUANCE OF DISQUALIFIED EQUITY

                  (a)      The Partnership shall not, and shall not permit any
of its Restricted Subsidiaries to, directly or indirectly, create, incur, issue,
assume, guarantee or otherwise become directly or indirectly liable,
contingently or otherwise, with respect to (collectively, "incur") any
Indebtedness (including Acquired Debt), and the Partnership will not issue any
Disqualified Equity and will not permit any of its Restricted Subsidiaries to
issue any Disqualified Equity; provided, however, that the Partnership and any
Restricted Subsidiary may incur Indebtedness (including Acquired Debt), and the
Partnership and the Restricted Subsidiaries may issue Disqualified Equity, if
the Fixed Charge Coverage Ratio for the Partnership's most recently ended four
full fiscal quarters for which internal financial statements are available
immediately preceding the date on which such additional Indebtedness is incurred
or such Disqualified Equity is issued would have been at least 2.25 to 1.0,
determined on a pro forma basis (including a pro forma application of the net
proceeds therefrom), as if the additional Indebtedness had been incurred, or the
Disqualified Equity had been issued, at the beginning of such four-quarter
period.

                  (b)      Notwithstanding the prohibitions of Section 4.09(a),
so long as no Default or Event of Default shall have occurred and be continuing
or would be caused thereby, the Partnership and its Restricted Subsidiaries may
incur any of the following items of Indebtedness (collectively, "Permitted
Debt"):

                           (i)      the incurrence by the Partnership and any of
                  its Restricted Subsidiaries of the Indebtedness under Credit
                  Facilities and the guarantees thereof; provided that the
                  aggregate principal amount of all Indebtedness of the
                  Partnership and the Restricted Subsidiaries outstanding under
                  all Credit Facilities after giving effect to such incurrence
                  does not exceed $1.2 billion less the aggregate amount of all
                  repayments of principal of Indebtedness under a Credit
                  Facility that have been made by the Partnership or any of its
                  Restricted Subsidiaries with Net Proceeds from Asset Sales to
                  the extent such repayments constitute a permanent reduction of
                  commitments under such Credit Facility;

                           (ii)     the incurrence by the Partnership and its
                  Restricted Subsidiaries of Existing Indebtedness;

                           (iii)    the incurrence by the Partnership and the
                  Subsidiary Guarantors of Indebtedness represented by the Notes
                  and the Guarantees and the related Obligations;

                           (iv)     the incurrence by the Partnership or any of
                  its Restricted Subsidiaries of Indebtedness represented by
                  Capital Lease Obligations,

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<PAGE>

                  mortgage financings or purchase money obligations, in each
                  case, incurred for the purpose of financing all or any part of
                  the purchase price or cost of construction or improvement of
                  property, plant or equipment used in the business of the
                  Partnership or such Restricted Subsidiary, in an aggregate
                  principal amount not to exceed $40.0 million at any time
                  outstanding;

                           (v)      the incurrence by the Partnership or any of
                  its Restricted Subsidiaries of Permitted Refinancing
                  Indebtedness in exchange for, or the net proceeds of which are
                  used to refund, refinance or replace, Indebtedness (other than
                  intercompany Indebtedness) that was not incurred in violation
                  of this Indenture;

                           (vi)     the incurrence by the Partnership or any of
                  its Restricted Subsidiaries of intercompany Indebtedness
                  between or among the Partnership and any of its Restricted
                  Subsidiaries; provided, however, that:

                                    (A)      if the Partnership or any
                           Subsidiary Guarantor is the obligor on such
                           Indebtedness, such Indebtedness must be expressly
                           subordinated to the prior payment in full in cash of
                           all Obligations with respect to the Notes, in the
                           case of the Partnership, or the Guarantee of such
                           Subsidiary Guarantor, in the case of a Subsidiary
                           Guarantor; and

                                    (B)      (i) any subsequent issuance or
                           transfer of Equity Interests that results in any such
                           Indebtedness being held by a Person other than the
                           Partnership or a Restricted Subsidiary thereof and
                           (ii) any sale or other transfer of any such
                           Indebtedness to a Person that is not either the
                           Partnership or a Restricted Subsidiary thereof, shall
                           be deemed, in each case, to constitute an incurrence
                           of such Indebtedness by the Partnership or such
                           Restricted Subsidiary, as the case may be, that was
                           not permitted by this clause (vi);

                           (vii)    the incurrence by the Partnership or any of
                  its Restricted Subsidiaries of Hedging Obligations that are
                  incurred for the purpose of fixing or hedging foreign currency
                  exchange rate risk of the Partnership or any Restricted
                  Subsidiary or interest rate risk with respect to any floating
                  rate Indebtedness of the Partnership or any Restricted
                  Subsidiary that is permitted by the terms of this Indenture to
                  be outstanding or commodities pricing risks of the Partnership
                  or any Restricted Subsidiary in respect of hydrocarbon
                  production from properties in which the Partnership or any of
                  its Restricted Subsidiaries owns an interest;

                           (viii)   the guarantee by the Partnership or any of
                  its Restricted Subsidiaries of Indebtedness of the Partnership
                  or a Restricted Subsidiary of the Partnership that was
                  permitted to be incurred by another provision of this
                  covenant; provided, that in the event such Indebtedness that
                  is being guaranteed is a Subordinated Obligation or a
                  Guarantor Subordinated Obligation, then the guarantee shall be
                  subordinated in right of payment to the Notes or the
                  Guarantee, as the case may be;

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<PAGE>

                           (ix)     bid, performance, surety and appeal bonds
                  incurred in the ordinary course of business, including
                  guarantees and standby letters of credit supporting such
                  Obligations, to the extent not drawn;

                           (x)      the incurrence by the Partnership or any of
                  its Restricted Subsidiaries of additional Indebtedness in an
                  aggregate principal amount (or accreted value, as applicable)
                  at any time outstanding, including all Permitted Refinancing
                  Indebtedness incurred to refund, refinance or replace any
                  Indebtedness incurred pursuant to this clause (x), not to
                  exceed $20.0 million;

                           (xi)     the incurrence by the Partnership's
                  Unrestricted Subsidiaries of Non-Recourse Debt; provided,
                  however, that if any such Indebtedness ceases to be
                  Non-Recourse Debt of an Unrestricted Subsidiary, such event
                  shall be deemed to constitute an incurrence of Indebtedness by
                  a Restricted Subsidiary of the Partnership that was not
                  permitted by this clause (xi);

                           (xii)    the payment of interest on any Indebtedness
                  in the form of additional Indebtedness with the same terms,
                  and the payment of dividends on Disqualified Equity, in the
                  form of additional shares of the same class of Disqualified
                  Equity, provided, in each such case, that the amount thereof
                  is included in Fixed Charges of the Partnership as so accrued,
                  accredited or amortized; and

                           (xiii)   Indebtedness incurred by the Partnership or
                  any of its Restricted Subsidiaries arising from agreements or
                  their respective bylaws providing for indemnification,
                  adjustment of purchase price or similar obligations.

                  (c)      For purposes of determining compliance with this
Section 4.09, in the event that an item of proposed Indebtedness meets the
criteria of more than one of the categories of Permitted Debt described in
paragraphs (b)(i) through (b)(xiii) above, or is entitled to be incurred
pursuant to Section 4.09(a), the Partnership shall be permitted to classify such
item of Indebtedness on the date of its incurrence in any manner that complies
with this Section 4.09. An item of Indebtedness may be divided and classified in
one or more of the types of Permitted Indebtedness.

SECTION 4.10. LIENS.

                  The Partnership shall not, and shall not permit any of its
Restricted Subsidiaries to, directly or indirectly, create, incur, assume or
suffer to exist any Lien of any kind securing Indebtedness or Attributable Debt
on any asset now owned or hereafter acquired, except Permitted Liens, without
making effective a provision whereby all Obligations due under the Notes and
this Indenture or any Guarantee, as applicable, will be secured by a Lien
equally and ratably with (or prior to in the case of Liens with respect to
Subordinated Obligations or Guarantor Subordinated Obligations, as the case may
be) any and all Obligations thereby secured for so long as any such Obligations
shall be so secured.

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SECTION 4.11. DIVIDEND AND OTHER PAYMENT RESTRICTIONS AFFECTING SUBSIDIARIES.

                  The Partnership shall not, and shall not permit any of its
Restricted Subsidiaries to, directly or indirectly, create or permit to exist or
become effective any encumbrance or restriction on the ability of any Restricted
Subsidiary to:

                  (a)      pay dividends or make any other distributions on its
Equity Interests to the Partnership or any of the Partnership's Restricted
Subsidiaries, or with respect to any other interest or participation in, or
measured by, its profits, or pay any indebtedness owed to the Partnership or any
of the other Restricted Subsidiaries;

                  (b)      make loans or advances to or make other Investments
in the Partnership or any of the other Restricted Subsidiaries; or

                  (c)      transfer any of its properties or assets to the
Partnership or any of the other Restricted Subsidiaries.

The restrictions contained in the immediately preceding sentence will not apply
to encumbrances or restrictions existing under or by reason of:

                           (i)      agreements as in effect on the Issue Date
                  and any amendments, modifications, restatements, renewals,
                  increases, supplements, refundings, replacements or
                  refinancings of any such agreements or any Existing
                  Indebtedness to which such agreement relates, provided that
                  such amendments, modifications, restatements, renewals,
                  increases, supplements, refundings, replacements or
                  refinancings are no more restrictive, taken as a whole, with
                  respect to such distribution, dividend and other payment
                  restrictions and loan or investment restrictions than those
                  contained in such agreement, as in effect on the Issue Date;

                           (ii)     the Partnership Credit Facility and any
                  amendments, modifications, restatements, renewals, increases,
                  supplements, refundings, replacements or refinancings thereof,
                  provided that such amendments, modifications, restatements,
                  renewals, increases, supplements, refundings, replacements or
                  refinancings are no more restrictive, taken as a whole, with
                  respect to such distribution, dividend and other payment
                  restrictions and loan or investment restrictions than those
                  contained in such Credit Facility as in effect on the Issue
                  Date;

                           (iii)    this Indenture, the Notes and the
                  Guarantees;

                           (iv)     applicable law;

                           (v)      any instrument governing Indebtedness or
                  Equity Interests of a Person acquired by the Partnership or
                  any of its Restricted Subsidiaries as in effect at the time of
                  such acquisition (except to the extent such Indebtedness was
                  incurred in connection with or in contemplation of such

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                  acquisition), which encumbrance or restriction is not
                  applicable to any Person, other than such Person, or the
                  property or assets of such Person, so acquired, provided that,
                  in the case of Indebtedness, such Indebtedness was permitted
                  by the terms of this Indenture to be incurred;

                           (vi)     customary non-assignment provisions in
                  licenses and leases entered in the ordinary course of business
                  and consistent with past practices;

                           (vii)    purchase money obligations for property
                  acquired in the ordinary course of business that impose
                  restrictions on the property so acquired of the nature
                  described in clause (c) of the preceding sentence;

                           (viii)   any agreement for the sale or other
                  disposition of a Restricted Subsidiary that contains any one
                  or more of the restrictions described in clauses (a) through
                  (c) of the preceding sentence by such Restricted Subsidiary
                  pending its sale or other disposition, provided that such sale
                  or disposition is consummated, or such restrictions are
                  canceled or terminated or lapse, within 90 days;

                           (ix)     Permitted Refinancing Indebtedness, provided
                  that the restrictions contained in the agreements governing
                  such Permitted Refinancing Indebtedness are no more
                  restrictive, taken as a whole, than those contained in the
                  agreements governing the Indebtedness being refinanced;

                           (x)      Liens securing Indebtedness otherwise
                  permitted to be issued pursuant to the provisions of Section
                  4.10 that limit the right of the Partnership or any of its
                  Restricted Subsidiaries to dispose of the assets subject to
                  such Lien;

                           (xi)     any agreement or instrument relating to any
                  property or assets acquired after the Issue Date, so long as
                  such encumbrance or restriction relates only to the property
                  or assets so acquired and is not and are not created in
                  anticipation of such acquisitions;

                           (xii)    any agreement or instrument relating to any
                  Acquired Debt of any Restricted Subsidiary at the date on
                  which such Restricted Subsidiary was acquired by the
                  Partnership or any Restricted Subsidiary (other than the
                  Indebtedness incurred in anticipation of such acquisition and
                  provided such encumbrances or restrictions extend only to
                  property of such acquired Restricted Subsidiary);

                           (xiii)   any agreement or instrument governing
                  Indebtedness permitted to be incurred under this Indenture,
                  provided that the terms and conditions of any such
                  restrictions and encumbrances, taken as a whole, are not
                  materially more restrictive than those contained in this
                  Indenture, taken as a whole;

                           (xiv)    provisions with respect to the disposition
                  or distribution of assets or property in joint venture
                  agreements and other similar agreements, including "clawback,"
                  "make-well" or "keep-well" agreements, to maintain

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                  financial performance or results of operations of a joint
                  venture entered into in the ordinary course of business; and

                           (xv)     restrictions on cash or other deposits or
                  net worth imposed by customers under contracts entered into in
                  the ordinary course of business.

SECTION 4.12. TRANSACTIONS WITH AFFILIATES

                  (a)      The Partnership shall not, and shall not permit any
of its Restricted Subsidiaries to, make any payment to, or sell, lease, transfer
or otherwise dispose of any of its properties or assets to, or purchase any
property or assets from, or enter into or make or amend any transaction,
contract, agreement, understanding, loan, advance or guarantee with, or for the
benefit of, any Affiliate (each, an "Affiliate Transaction"), unless:

                           (i)      such Affiliate Transaction is on terms that
                  are no less favorable to the Partnership or the relevant
                  Restricted Subsidiary than those that would have been obtained
                  in a comparable transaction by the Partnership or such
                  Restricted Subsidiary with an unrelated Person; and

                           (ii)     the Partnership delivers to the Trustee:

                                    (A)      with respect to any Affiliate
                           Transaction or series of related Affiliate
                           Transactions involving aggregate consideration in
                           excess of $10.0 million but less than or equal to
                           $50.0 million, an Officers' Certificate certifying
                           that such Affiliate Transaction complies with this
                           covenant and that such Affiliate Transaction has been
                           approved (either pursuant to specific or general
                           resolutions) by the Board of Directors of the General
                           Partner or has been approved by an officer pursuant
                           to a delegation (specific or general) of authority
                           from the Board of Directors of the General Partner;
                           and

                                    (B)      with respect to any Affiliate
                           Transaction or series of related Affiliate
                           Transactions involving aggregate consideration in
                           excess of $50.0 million, (I) a resolution of the
                           Board of Directors of the General Partner set forth
                           in an Officers' Certificate certifying that such
                           Affiliate Transaction complies with this covenant and
                           that such Affiliate Transaction has been approved by
                           a majority of the disinterested members of the Board
                           of Directors of the General Partner and (II) either
                           (a) an opinion as to the fairness to the Partnership
                           of such Affiliate Transaction from a financial point
                           of view issued by an accounting, appraisal or
                           investment banking firm of national standing
                           recognized as an expert in rendering fairness
                           opinions on transactions such as those proposed, (b)
                           with respect to assets classified, in accordance with
                           GAAP, as property, plant and equipment on the
                           Partnership's or such Restricted Subsidiary's balance
                           sheet, a written appraisal from a nationally
                           recognized appraiser showing the assets have a fair
                           market value not less than the

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                           consideration to be paid (provided that if the fair
                           market value determined by such appraiser is a range
                           of values or otherwise inexact, the Board of
                           Directors of the General Partner shall determine the
                           exact fair market value, provided that it shall be
                           within the range so determined by the appraiser), (c)
                           in the case of gathering, transportation, marketing,
                           hedging, production handling, operating,
                           construction, storage, platform use, or other
                           operational contracts, any such contracts are entered
                           into in the ordinary course of business on terms
                           substantially similar to those contained in similar
                           contracts entered into by the Partnership or any
                           Restricted Subsidiary and third parties or, if none
                           of the Partnership or any Restricted Subsidiary has
                           entered into a similar contract with a third party,
                           that the terms are no less favorable than those
                           available from third parties on an arm's-length
                           basis, as determined by the Board of Directors of the
                           General Partner or (d) in the case of any transaction
                           between the Partnership or any of its Restricted
                           Subsidiaries and any Affiliate thereof in which the
                           Partnership beneficially owns 50% or less of the
                           Voting Stock and one or more Persons not Affiliated
                           with the Partnership beneficially own (together) a
                           percentage of Voting Stock at least equal to the
                           interest in Voting Stock of such Affiliate
                           beneficially owned by the Partnership, a resolution
                           of the Board of Directors of the General Partner set
                           forth in the Officers' Certificate certifying that
                           such Affiliate Transaction complies with this
                           covenant and that such Affiliate Transaction has been
                           approved by a majority of the disinterested members
                           of the Board of Directors of the General Partner.
                           Even though a particular Affiliate Transaction or
                           series of Affiliate Transactions may be covered by
                           two or more of clauses (a) through (d) above, the
                           compliance with any one of such applicable clauses
                           shall be satisfactory.

                  (b)      The following items shall not be deemed to be
Affiliate Transactions and, therefore, shall not be subject to the provisions of
Section 4.11(a):

                           (i)      transactions pursuant to the Management
                  Agreement as in effect on the Issue Date;

                           (ii)     any employment, equity option or equity
                  appreciation agreement or plan entered into by the Partnership
                  or any of its Restricted Subsidiaries in the ordinary course
                  of business and, as applicable, consistent with the past
                  practice of the Partnership or such Restricted Subsidiary;

                           (iii)    transactions between or among the
                  Partnership and/or its Restricted Subsidiaries;

                           (iv)     Restricted Payments that are permitted by
                  Section 4.08;

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                           (v)      transactions effected in accordance with the
                  terms of agreements as in effect on the Issue Date;

                           (vi)     customary compensation, indemnification and
                  other benefits made available to officers, directors or
                  employees of the Partnership or a Restricted Subsidiary,
                  including reimbursement or advancement of out-of-pocket
                  expenses and provisions of officers' and directors' liability
                  insurance; and

                           (vii)    loans to officers and employees made in the
                  ordinary course of business in an aggregate amount not to
                  exceed $1.0 million at any one time outstanding.

SECTION 4.13. ADDITIONAL SUBSIDIARY GUARANTEES.

                  If the Partnership or any of its Restricted Subsidiaries
acquires or creates another Restricted Subsidiary after the Issue Date that
guarantees any Indebtedness of either of the Issuers, then that newly acquired
or created Restricted Subsidiary must become a Subsidiary Guarantor and execute
a supplemental indenture satisfactory to the Trustee and deliver an Opinion of
Counsel to the Trustee within 10 Business Days of the date on which it was
acquired or created. If a Restricted Subsidiary that is not then a Subsidiary
Guarantor guarantees Indebtedness of either of the Issuers or any other
Restricted Subsidiary, such Restricted Subsidiary shall execute and deliver a
Guarantee. The Partnership will not permit any of its Restricted Subsidiaries,
directly or indirectly, to guarantee or pledge any assets to secure the payment
of any other Indebtedness of either Issuer unless such Restricted Subsidiary
simultaneously executes and delivers a supplemental indenture providing for the
guarantee of the payment of the Notes by such Restricted Subsidiary, which
Guarantee shall be senior to or pari passu with such Restricted Subsidiary's
guarantee of or pledge to secure such other Indebtedness (and, if such other
Indebtedness being guaranteed or secured is a Subordinated Obligation or a
Guarantor Subordinated Obligation, then such guarantee of or pledge to secure
such other Indebtedness shall be expressly subordinated in right of payment to
such Restricted Subsidiary's Guarantee of the Notes). Notwithstanding the
foregoing, any Guarantee of a Restricted Subsidiary that was incurred pursuant
to this paragraph shall provide by its terms that it shall be automatically and
unconditionally released upon the release or discharge of the guarantee which
resulted in the creation of such Restricted Subsidiary's Subsidiary Guarantee,
except a discharge or release by, or as a result of payment under, such
guarantee.

SECTION 4.14. DESIGNATION OF RESTRICTED AND UNRESTRICTED SUBSIDIARIES.

                  The General Partner may designate any Restricted Subsidiary of
the Partnership to be an Unrestricted Subsidiary if that designation would not
cause a Default or Event of Default. If a Restricted Subsidiary is designated as
an Unrestricted Subsidiary, all outstanding Investments owned by the Partnership
and its Restricted Subsidiaries in the Subsidiary so designated will be deemed
to be an Investment made as of the time of such designation and will reduce the
amount available for Restricted Payments under Section 4.08(a), for Permitted
Investments or for Permitted Business Investments, as applicable. All such
outstanding Investments will be valued at their fair market value, as determined

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by the Board of Directors of the General Partner, at the time of such
designation. That designation will only be permitted if such Restricted Payment,
Permitted Investments or Permitted Business Investments would be permitted under
this Indenture at that time and such Restricted Subsidiary otherwise complies
with the definition of an Unrestricted Subsidiary. All Subsidiaries of such an
Unrestricted Subsidiary shall be also thereafter constitute Unrestricted
Subsidiaries. A Subsidiary may not be designated as an Unrestricted Subsidiary
unless at the time of such designation, (x) it has no Indebtedness other than
Non-Recourse Debt; (y) no portion of the Indebtedness or any other obligation of
such Subsidiary (whether contingent or otherwise and whether pursuant to the
terms of such Indebtedness or the terms governing the organization and operation
of such Subsidiary or by law) (A) is guaranteed by the Partnership or any of its
other Restricted Subsidiaries, except as such Indebtedness is permitted by
Sections 4.08 and 4.09, (B) is recourse to or obligates the Partnership or any
of its Restricted Subsidiaries in any way (including any "claw-back",
"keep-well' or "make-well" agreements or other agreements, arrangements or
understandings to maintain the financial performance or results of operations of
such Subsidiary, except as such Indebtedness or Investment is permitted by
Sections 4.08 and 4.09), or (C) subjects any property or assets of the
Partnership or any of its other Restricted Subsidiaries, directly or indirectly,
contingently or otherwise, to the satisfaction thereof; and (z) no Equity
Interests of a Restricted Subsidiary are held by such Subsidiary, directly or
indirectly. Upon the designation of a Restricted Subsidiary that is a Subsidiary
Guarantor as an Unrestricted Subsidiary, the Guarantee of such entity shall be
released and the Trustee shall be authorized to take such actions as may be
appropriate to reflect such release.

                  The Board of Directors of the General Partner may redesignate
any Unrestricted Subsidiary to be a Restricted Subsidiary if a Default or Event
of Default is not continuing, the redesignation would not cause a Default or
Event of Default and provided that, after giving effect to such designation, the
Partnership and its remaining Restricted Subsidiaries could incur at least $1.00
of additional Indebtedness under Section 4.09(a).

SECTION 4.15. BUSINESS ACTIVITIES.

                  The Partnership shall not, and shall not permit any of its
Restricted Subsidiaries to, engage in any business other than Permitted
Businesses.

SECTION 4.16. SALE AND LEASEBACK TRANSACTIONS.

                  The Partnership will not, and will not permit any of its
Restricted Subsidiaries to, enter into any sale and leaseback transaction;
provided that the Partnership or any Restricted Subsidiary that is a Subsidiary
Guarantor may enter into a sale and leaseback transaction if:

                  (a)      the Partnership or that Subsidiary Guarantor, as
applicable, could have (i) incurred Indebtedness in an amount equal to the
Attributable Debt relating to such sale and leaseback transaction under Section
4.09(a), and (ii) incurred a Lien to secure such Indebtedness pursuant to
Section 4.10; provided, however, that clause (i) of this clause (a) shall be
deemed deleted and of no effect after the date on which the Partnership and the
Restricted Subsidiaries are no longer subject to the Eliminated Covenants;

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                  (b)      the gross cash proceeds of that sale and leaseback
transaction are at least equal to the fair market value, as determined in good
faith by the Board of Directors of the General Partner, of the property that is
the subject of such sale and leaseback transaction; and

                  (c)      the transfer of assets in that sale and leaseback
transaction is permitted by, and the Partnership applies the proceeds of such
transaction in compliance with, any then applicable other provision of this
Indenture.

SECTION 4.17. PAYMENTS FOR CONSENT.

                  The Partnership shall not, and shall not permit any of its
Subsidiaries to, directly or indirectly, pay or cause to be paid any
consideration to or for the benefit of any Holder of Notes for or as an
inducement to any consent, waiver or amendment of any of the terms or provisions
of this Indenture or the Notes unless such considerations is offered to be paid
and is paid to all Holders of the Notes that consent, waive or agree to amend in
the time frame set forth in the solicitation documents relating to such consent,
waiver or agreement.

SECTION 4.18. REPORTS.

                  (a)      Whether or not required by the SEC, so long as any
Notes are outstanding, the Partnership will file with the SEC (unless the SEC
will not accept such a filing) within the time periods specified in the SEC's
rules and regulations and, upon request, the Partnership will furnish the
Trustee for delivery to Holders upon their request:

                           (i)      all quarterly and annual financial
                  information that would be required to be contained in a filing
                  with the SEC on Forms 10-Q and 10-K if the Partnership were
                  required to file such Forms, including a "Management's
                  Discussion and Analysis of Financial Condition and Results of
                  Operations" and, with respect to the annual information only,
                  a report on the annual financial statements by the
                  Partnership's certified independent accountants; and

                           (ii)     all current reports that would be required
                  to be filed with the SEC on Form 8-K if the Partnership were
                  required to file such reports.

                  (b)      If at the end of any such quarterly or annual period
referred to in Section 4.18(a), the Partnership has designated any of its
Subsidiaries as Unrestricted Subsidiaries, then the Partnership shall deliver
(promptly after such SEC filing referred to in Section 4.18(a)) to the Trustee
for delivery to the Holders of the Notes quarterly and annual financial
information required by Section 4.18(a) as revised to include a reasonably
detailed presentation, either on the face of the financial statements or in the
footnotes thereto, and in Management's Discussion and Analysis of Financial
Condition and Results of Operations, of the financial condition and results of
operations of the Partnership and its Restricted Subsidiaries separate from the
financial condition and results of operations of the Unrestricted Subsidiaries
of the Partnership and the designated Joint Ventures of the Partnership.

                  (c)      In addition, whether or not required by the SEC, the
Partnership will make such information available to securities analysts,
investors and prospective investors upon request. In addition, upon request the
Partnership shall furnish the Trustee such

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other non-confidential information, documents and other reports which the
Partnership is required to file with the SEC pursuant to Section 13 or Section
15(d) of the Exchange Act.

                  (d)      For so long as any Series A Notes remain outstanding
(unless the Partnership is subject to the reporting requirements of the Exchange
Act), the Partnership and the Securities Guarantors shall furnish to the Holders
thereof, upon their request, the information required to be delivered pursuant
to Rule 144A(d)(4) under the Securities Act to the extent such information is
not provided pursuant to Sections 4.18(a) and 4.18(b).

                  (e)      Delivery of reports, information and documents to the
Trustee pursuant to this Section 4.18 is for informational purposes only and the
Trustee's receipt of such shall not constitute constructive notice of any
information contained therein or determinable from information contained
therein, including the Partnership's compliance with any of its covenants
hereunder (as to which the Trustee is entitled to rely exclusively on Officers'
Certificates).

SECTION 4.19. ELIMINATION OF COVENANTS.

                  From and after the first day following a period of 90
consecutive days during which the Notes have an Investment Grade Rating from
both Rating Agencies and no Default has occurred and is continuing, the
Partnership and the Restricted Subsidiaries shall no longer be subject to
Sections 4.07, 4.08, 4.09, 4.11, 4.12, 4.16(a)(i), 4.18 and 5.01(a)(iv)(B)
(collectively, the "Suspended Covenants").

                                    ARTICLE 5
                                   SUCCESSORS

SECTION 5.01. MERGER, CONSOLIDATION, OR SALE OF ASSETS.

                  (a)      Neither of the Issuers may, directly or indirectly:
(x) consolidate or merge with or into another Person (whether or not such Issuer
is the survivor); or (y) sell, assign, transfer, lease, convey or otherwise
dispose of all or substantially all of its properties or assets, in one or more
related transactions, to another Person; unless:

                           (i)      either: (A) such Issuer is the surviving
                  entity; or (B) the Person formed by or surviving any such
                  consolidation or merger (if other than such Issuer) or to
                  which such sale, assignment, transfer, lease, conveyance or
                  other disposition shall have been made is an entity organized
                  or existing under the laws of the United States, any state
                  thereof or the District of Columbia (provided that GulfTerra
                  Finance may not consolidate or merge with or into any entity
                  other than a corporation satisfying such requirement for so
                  long as the Partnership remains a partnership);

                           (ii)     the Person formed by or surviving any such
                  consolidation or merger (if other than such Issuer) or the
                  Person to which such sale, assignment, transfer, lease,
                  conveyance or other disposition shall have been made expressly
                  assumes all the obligations of such Issuer under the Notes and
                  this Indenture pursuant to agreements reasonably satisfactory
                  to the Trustee;

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                           (iii)    immediately after such transaction no
                  Default or Event of Default exists;

                           (iv)     such Issuer or the Person formed by or
                  surviving any such consolidation or merger (if other than such
                  Issuer):

                                    (A)      shall have Consolidated Net Worth
                           immediately after the transaction equal to or greater
                           than the Consolidated Net Worth of such Issuer
                           immediately preceding the transaction; and

                                    (B)      shall, on the date of such
                           transaction after giving pro forma effect thereto and
                           any related financing transactions as if the same had
                           occurred at the beginning of the applicable
                           four-quarter period, be permitted to incur at least
                           $1.00 of additional Indebtedness pursuant to the
                           Fixed Charge Coverage Ratio test set forth in Section
                           4.09(a); provided, however, that this clause (B)
                           shall be deemed deleted and no effect after the date
                           on which the Partnership and the Restricted
                           Subsidiaries are no longer subject to the Eliminated
                           Covenants; and

                                    (C)      has delivered to the Trustee an
                           Officers' Certificate and an Opinion of Counsel, each
                           stating that such consolidation, merger or transfer
                           and, if a supplemental indenture is required, such
                           supplemental indenture comply with this Indenture and
                           all conditions precedent therein relating to such
                           transaction have been satisfied.

                  (b)      Notwithstanding Section 5.01(a), the Partnership is
permitted to reorganize as any other form of entity in accordance with the
procedures established in this Indenture; provided that:

                           (i)      the reorganization involves the conversion
                  (by merger, sale, contribution or exchange of assets or
                  otherwise) of the Partnership into a form of entity other than
                  a limited partnership formed under Delaware law;

                           (ii)     the entity so formed by or resulting from
                  such reorganization is an entity organized or existing under
                  the laws of the United States, any state thereof or the
                  District of Columbia;

                           (iii)    the entity so formed by or resulting from
                  such reorganization assumes all of the obligations of the
                  Partnership under the Notes and this Indenture pursuant to
                  agreements reasonably satisfactory to the Trustee;

                           (iv)     immediately after such reorganization no
                  Default or Event of Default exists; and

                           (v)      such reorganization is not adverse to the
                  Holders of the Notes (for purposes of this clause (v) it is
                  stipulated that such reorganization shall not be considered
                  adverse to the Holders of the Notes solely because the
                  successor or survivor of such reorganization (1) is subject to
                  federal or state

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                  income taxation as an entity or (2) is considered to be an
                  "includible corporation" of an affiliated group of
                  corporations within the meaning of Section 1504(b)(i) of the
                  Code or any similar state or local law).

                  (c)      Section 5.01(a) shall not apply to a merger or
consolidation or any sale, assignment, transfer, lease, conveyance or other
disposition of assets between or among the Partnership and any of its Restricted
Subsidiaries.

                  (d)      No Subsidiary Guarantor may consolidate with or merge
with or into (whether or not such Subsidiary Guarantor is the surviving Person)
another Person, whether or not affiliated with such Subsidiary Guarantor, but
excluding the Partnership or another Subsidiary Guarantor, unless (i) subject to
the provisions of Section 5.01(e), the Person formed by or surviving any such
consolidation or merger (if other than such Subsidiary Guarantor) assumes all
the obligations of such Subsidiary Guarantor pursuant to the Subsidiary
Guarantor's Guarantee of the Notes and the Indenture pursuant to a supplemental
indenture and (ii) immediately after giving effect to such transaction, no
Default or Event of Default exists. Any Subsidiary Guarantor may be merged or
consolidated with or into any one or more Subsidiary Guarantors.

                  (e)      In the event of a sale or other disposition of all or
substantially all of the assets of any Subsidiary Guarantor, by way of merger,
consolidation or otherwise, or a sale or other disposition of all or
substantially all of the Equity Interests of any Subsidiary Guarantor, then such
Subsidiary Guarantor (in the event of a sale or other disposition, by way of
such a merger, consolidation or otherwise, of all of the Equity Interests of
such Subsidiary Guarantor) or the Person acquiring the property (in the event of
a sale or other disposition of all or substantially all of the assets of such
Subsidiary Guarantor) will be released and relieved of any obligations under its
Guarantee; provided that the Partnership applies the Net Proceeds of such sale
or other disposition in accordance with the provisions set forth under Sections
3.09 and 4.07.

SECTION 5.02. SUCCESSOR ENTITY SUBSTITUTED.

                  (a)      Upon any consolidation or merger, or any sale,
assignment, transfer, lease, conveyance or other disposition of all or
substantially all of the assets of an Issuer in accordance with Section 5.01
hereof, the surviving entity formed by such consolidation or into or with which
such Issuer is merged or to which such sale, assignment, transfer, lease,
conveyance or other disposition is made shall succeed to, and be substituted for
(so that from and after the date of such consolidation, merger, sale, lease,
conveyance or other disposition, the provisions of this Indenture referring to
the "Partnership" or "GulfTerra Finance," as the case may be, shall refer
instead to the surviving entity and not to the Partnership or GulfTerra Finance,
as the case may be), and may exercise every right and power of the Partnership
or GulfTerra Finance, as the case may be, under this Indenture with the same
effect as if such successor Person had been named as an Issuer herein; provided,
however, that the predecessor shall not be relieved from the obligation to pay
the principal of and interest on the Notes except in the case of a sale of all
of an Issuer's assets that meets the requirements of Section 5.01 hereof.

                  (b)      If the surviving entity shall have succeeded to and
been substituted for an Issuer, such surviving entity may cause to be signed,
and may issue either in its own

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name or in the name of the applicable Issuer prior to such succession any or all
of the Notes issuable hereunder which theretofore shall not have been signed by
such Issuer and delivered to the Trustee; and, upon the order of such surviving
entity, instead of such Issuer, and subject to all the terms, conditions and
limitations in this Indenture prescribed, the Trustee shall authenticate and
shall deliver any Notes which previously shall have been signed and delivered by
the Officers of such Issuer to the Trustee for authentication, and any Notes
which such surviving entity thereafter shall cause to be signed and delivered to
the Trustee for that purpose (in each instance with notations of Guarantees
thereon by the Subsidiary Guarantors). All of the Notes so issued and so
endorsed shall in all respects have the same legal rank and benefit under this
Indenture as the Notes theretofore or thereafter issued and endorsed in
accordance with the terms of this Indenture and the Guarantees as though all
such Notes had been issued and endorsed at the date of the execution hereof.

                  (c)      In case of any such consolidation, merger,
continuance, sale, transfer, conveyance or other disposal, such changes in
phraseology and form (but not in substance) may be made in the Notes thereafter
to be issued or the Guarantees to be endorsed thereon as may be appropriate.

                  (d)      For all purposes of this Indenture and the Notes,
Subsidiaries of any surviving entity will, upon such transaction or series of
transactions, become Restricted Subsidiaries or Unrestricted Subsidiaries as
provided pursuant to this Indenture and all Indebtedness, and all Liens on
property or assets, of the surviving entity and its Restricted Subsidiaries
immediately prior to such transaction or series of transactions shall be deemed
to have been incurred upon such transaction or series of transactions.

                                    ARTICLE 6
                              DEFAULTS AND REMEDIES

SECTION 6.01. EVENTS OF DEFAULT.

                  Each of the following is an Event of Default:

                  (a)      default for 30 days in the payment when due of
interest on, or Additional Interest with respect to, the Notes;

                  (b)      default in payment when due of the principal of or
premium, if any, on the Notes;

                  (c)      failure by the Partnership or any of its Restricted
Subsidiaries to comply with the provisions described under Sections 3.09, 4.06,
and 4.07 hereof;

                  (d)      failure by the Partnership or any of its Restricted
Subsidiaries to comply with any of the other agreements in this Indenture for 60
days after notice to the Issuers by the Trustee or to the Issuers and Trustee by
Holders of at least 25% in aggregate principal amount of the Notes then
outstanding (provided that no such notice need be given, and an Event of Default
shall occur, 60 days after a failure to comply with the covenants in Section
4.08, 4.09 or 5.01 hereof, unless theretofore cured);

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                  (e)      default under any mortgage, indenture or instrument
under which there may be issued or by which there may be secured or evidenced
any Indebtedness for money borrowed by either Issuer or any of the Restricted
Subsidiaries of the Partnership (or the payment of which is guaranteed by either
Issuer or any of such Restricted Subsidiaries), whether such Indebtedness or
guarantee now exists or is created after the date of this Indenture, if that
default:

                           (i)      is caused by a failure to pay principal of
                  or premium, if any, or interest on such Indebtedness prior to
                  the expiration of the grace period provided in such
                  Indebtedness on the date of such default (a "Payment
                  Default"); or

                           (ii)     results in the acceleration of such
                  Indebtedness prior to its express maturity,

and, in each case, the principal amount of any such Indebtedness, together with
the principal amount of any other such Indebtedness under which there has been a
Payment Default or the maturity of which has been so accelerated, aggregates
$40.0 million or more;

                  (f)      failure by an Issuer or any Restricted Subsidiary of
the Partnership to pay final judgments aggregating in excess of $40.0 million,
which judgments are not paid, discharged or stayed for a period of 60 days;

                  (g)      except as permitted by this Indenture, any Guarantee
shall be held in any judicial proceeding to be unenforceable or invalid or shall
cease for any reason to be in full force and effect or any Subsidiary Guarantor,
or any Person acting on behalf of any Subsidiary Guarantor, shall deny or
disaffirm its obligations under its Guarantee;

                  (h)      either Issuer or any Restricted Subsidiary of the
Partnership that is a Significant Subsidiary or any group of Restricted
Subsidiaries of the Partnership that, taken as a whole, would constitute a
Significant Subsidiary, pursuant to or within the meaning of Bankruptcy Law:

                           (i)      commences a voluntary case,

                           (ii)     consents to the entry of an order for relief
                  against it in an involuntary case,

                           (iii)    consents to the appointment of a custodian
                  of it or for all or substantially all of its property,

                           (iv)     makes a general assignment for the benefit
                  of its creditors, or

                           (v)      generally is not paying its debts as they
                  become due; and

                  (i)      a court of competent jurisdiction enters an order or
decree under any Bankruptcy Law that:

                           (i)      is for relief against an Issuer or any
                  Restricted Subsidiary of the Partnership that is a Significant
                  Subsidiary or any group of Restricted

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                  Subsidiaries of the Partnership that, taken as a whole, would
                  constitute a Significant Subsidiary in an involuntary case;

                           (ii)     appoints a custodian of an Issuer or any
                  Restricted Subsidiary of the Partnership that is a Significant
                  Subsidiary or any group of Restricted Subsidiaries of the
                  Partnership that, taken as a whole, would constitute a
                  Significant Subsidiary or for all or substantially all of the
                  property of an Issuer or any Restricted Subsidiary of the
                  Partnership that is a Significant Subsidiary or any group of
                  Restricted Subsidiaries of the Partnership that, taken as a
                  whole, would constitute a Significant Subsidiary; or

                           (iii)    orders the liquidation of an Issuer or any
                  Restricted Subsidiary of the Partnership that is a Significant
                  Subsidiary or any group of Restricted Subsidiaries of the
                  Partnership that, taken as a whole, would constitute a
                  Significant Subsidiary;

and the order or decree remains unstayed and in effect for 60 consecutive days.

SECTION 6.02. ACCELERATION.

                  If any Event of Default (other than an Event of Default
specified in clauses (h) or (i) of Section 6.01 hereof) occurs and is
continuing, the Trustee may, and upon written request of the Holders of at least
25% in principal amount of the then outstanding Notes shall declare all the
Notes to be due and payable immediately. Upon any such declaration, the Notes
shall become due and payable immediately. Notwithstanding the foregoing, if an
Event of Default specified in clause (h) or (i) of Section 6.01 hereof occurs,
all outstanding Notes shall be due and payable immediately without further
action or notice. Notwithstanding the foregoing, so long as any Credit Facility
shall be in full force and effect, if an Event of Default pursuant to clause (e)
of Section 6.01 with regard to such Credit Facility shall have occurred and be
continuing, the Notes shall not become due and payable until the earlier to
occur of (x) five Business Days following delivery of written notice of such
acceleration of the Notes to the agent under such Credit Facility and (y) the
acceleration of any Indebtedness under such Credit Facility. The Holders of a
majority in aggregate principal amount of the then outstanding Notes by written
notice to the Trustee may on behalf of all of the Holders rescind an
acceleration and its consequences if the rescission would not conflict with any
judgment or decree and if all existing Events of Default (except nonpayment of
principal, interest or premium that has become due solely because of the
acceleration) have been cured or waived.

SECTION 6.03. OTHER REMEDIES.

                  If an Event of Default occurs and is continuing, the Trustee
may pursue any available remedy to collect the payment of principal, premium, if
any, and interest (and Additional Interest, if any) on the Notes or to enforce
the performance of any provision of the Notes or this Indenture.

                  The Trustee may maintain a proceeding even if it does not
possess any of the Notes or does not produce any of them in the proceeding. A
delay or omission by the

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Trustee or any Holder of a Note in exercising any right or remedy accruing upon
an Event of Default shall not impair the right or remedy or constitute a waiver
of or acquiescence in the Event of Default. All remedies are cumulative to the
extent permitted by law.

SECTION 6.04. WAIVER OF PAST DEFAULTS.

                  Holders of not less than a majority in aggregate principal
amount of the then outstanding Notes by notice to the Trustee may on behalf of
the Holders of all of the Notes waive an existing Default or Event of Default
and its consequences hereunder, except a continuing Default or Event of Default
in the payment of the principal of, premium and/or interest, if any, or
Additional Interest, if any, on, the Notes (including in connection with an
offer to purchase) (provided, however, that the Holders of a majority in
aggregate principal amount of the then outstanding Notes may rescind an
acceleration and its consequences, including any related payment default that
resulted from such acceleration). Upon any such waiver, such Default shall cease
to exist, and any Event of Default arising therefrom shall be deemed to have
been cured for every purpose of this Indenture; but no such waiver shall extend
to any subsequent or other Default or impair any right consequent thereon.

SECTION 6.05. CONTROL BY MAJORITY.

                  Holders of a majority in principal amount of the then
outstanding Notes may direct the time, method and place of conducting any
proceeding for exercising any remedy available to the Trustee or exercising any
trust or power conferred on it. However, the Trustee may refuse to follow any
direction that conflicts with law or this Indenture that the Trustee determines
may be unduly prejudicial to the rights of other Holders of Notes or that may
involve the Trustee in personal liability.

SECTION 6.06. LIMITATION ON SUITS.

                  A Holder of a Note may pursue a remedy with respect to this
Indenture or the Notes only if:

                  (a)      the Holder of a Note gives to the Trustee written
notice of a continuing Event of Default;

                  (b)      the Holders of at least 25% in principal amount of
the then outstanding Notes make a written request to the Trustee to pursue the
remedy;

                  (c)      such Holder of a Note or Holders of Notes offer and,
if requested, provide to the Trustee indemnity satisfactory to the Trustee
against any loss, liability or expense;

                  (d)      the Trustee does not comply with the request within
60 days after receipt of the request and the offer and, if requested, the
provision of indemnity; and

                  (e)      during such 60-day period the Holders of a majority
in principal amount of the then outstanding Notes do not give the Trustee a
direction inconsistent with the request.

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                  A Holder of a Note may not use this Indenture to prejudice the
rights of another Holder of a Note or to obtain a preference or priority over
another Holder of a Note.

SECTION 6.07. RIGHTS OF HOLDERS OF NOTES TO RECEIVE PAYMENT.

                  Notwithstanding any other provision of this Indenture, the
right of any Holder of a Note to receive payment of principal, premium and
interest and Additional Interest, if any, on the Note, on or after the
respective due dates expressed in the Note (including in connection with an
offer to purchase), or to bring suit for the enforcement of any such payment on
or after such respective dates, shall not be impaired or affected without the
consent of such Holder.

SECTION 6.08. COLLECTION SUIT BY TRUSTEE.

                  If an Event of Default specified in Section 6.01(a) or (b)
occurs and is continuing, the Trustee is authorized to recover a judgment in its
own name and as trustee of an express trust against the Issuers for the whole
amount of principal of, premium and interest and Additional Interest, if any,
remaining unpaid on the Notes and interest on overdue principal and, to the
extent lawful, interest and such further amount as shall be sufficient to cover
the costs and expenses of collection, including the reasonable compensation,
expenses, disbursements and advances of the Trustee, its agents and counsel.

SECTION 6.09. TRUSTEE MAY FILE PROOFS OF CLAIM.

                  The Trustee is authorized to file such proofs of claim and
other papers or documents as may be necessary or advisable in order to have the
claims of the Trustee (including any claim for the reasonable compensation,
expenses, disbursements and advances of the Trustee, its agents and counsel) and
the Holders of the Notes allowed in any judicial proceedings relative to an
Issuer or any of the Subsidiary Guarantors (or any other obligor upon the
Notes), its creditors or its property and shall be entitled and empowered to
collect, receive and distribute any money or other property payable or
deliverable on any such claims and any custodian in any such judicial proceeding
is hereby authorized by each Holder to make such payments to the Trustee, and in
the event that the Trustee shall consent to the making of such payments directly
to the Holders, to pay to the Trustee any amount due to it for the reasonable
compensation, expenses, disbursements and advances of the Trustee, its agents
and counsel, and any other amounts due the Trustee under Section 7.07 hereof. To
the extent that the payment of any such compensation, expenses, disbursements
and advances of the Trustee, its agents and counsel, and any other amounts due
the Trustee under Section 7.07 hereof out of the estate in any such proceeding,
shall be denied for any reason, payment of the same shall be secured by a Lien
on, and shall be paid out of, any and all distributions, dividends, money,
securities and other properties that the Holders may be entitled to receive in
such proceeding whether in liquidation or under any plan of reorganization or
arrangement or otherwise. Nothing herein contained shall be deemed to authorize
the Trustee to authorize or consent to or accept or adopt on behalf of any
Holder any plan of reorganization, arrangement, adjustment or composition
affecting the Notes or the rights of any Holder, or to authorize the Trustee to
vote in respect of the claim of any Holder in any such proceeding.

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SECTION 6.10. PRIORITIES.

                  If the Trustee collects any money pursuant to this Article, it
shall pay out the money in the following order:

                  First: to the Trustee, its agents and attorneys for amounts
due under Section 7.07 hereof, including payment of all compensation, expense
and liabilities incurred, and all advances made, by the Trustee and the costs
and expenses of collection;

                  Second: subject to the subordination provisions of this
Indenture, to Holders of Notes for amounts due and unpaid on the Notes for
principal, premium and Additional Interest, if any, and interest, ratably,
without preference or priority of any kind, according to the amounts due and
payable on the Notes for principal, premium and Additional Interest, if any and
interest, respectively; and

                  Third: to the Issuers or the Subsidiary Guarantors or to such
other party as a court of competent jurisdiction shall direct.

                  The Trustee may fix a record date and payment date for any
payment to Holders of Notes pursuant to this Section 6.10.

SECTION 6.11. UNDERTAKING FOR COSTS.

                  In any suit for the enforcement of any right or remedy under
this Indenture or in any suit against the Trustee for any action taken or
omitted by it as a Trustee, a court in its discretion may require the filing by
any party litigant in the suit of an undertaking to pay the costs of the suit,
and the court in its discretion may assess reasonable costs, including
reasonable attorneys' fees and expenses against any party litigant in the suit,
having due regard to the merits and good faith of the claims or defenses made by
the party litigant. This Section 6.11 does not apply to a suit by the Trustee, a
suit by a Holder of a Note pursuant to Section 6.07 hereof, or a suit by Holders
of more than 10% in principal amount of the then outstanding Notes.

                                    ARTICLE 7
                                     TRUSTEE

SECTION 7.01. DUTIES OF TRUSTEE.

                  (a)      If an Event of Default has occurred and is
continuing, the Trustee shall exercise such of the rights and powers vested in
it by this Indenture, and use the same degree of care and skill in its exercise,
as a prudent man would exercise or use under the circumstances in the conduct of
his own affairs.

                  (b)      Except during the continuance of an Event of Default:

                           (i)      the duties of the Trustee shall be
                  determined solely by the express provisions of this Indenture
                  and the Trustee need perform only those duties that are
                  specifically set forth in this Indenture and no others, and no
                  implied covenants or obligations shall be read into this
                  Indenture against the Trustee; and

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                           (ii)     in the absence of bad faith on its part, the
                  Trustee may conclusively rely, as to the truth of the
                  statements and the correctness of the opinions expressed
                  therein, upon certificates or opinions furnished to the
                  Trustee and conforming to the requirements of this Indenture.
                  However, in the case of any such certificates or opinions
                  which by any provision hereof are specifically required to be
                  furnished to the Trustee, the Trustee shall be under a duty to
                  examine the same to determine whether or not they conform to
                  the requirements of this Indenture (but need not confirm or
                  investigate the accuracy of mathematical calculations or other
                  facts stated therein).

                  (c)      The Trustee may not be relieved from liabilities for
its own negligent action, its own negligent failure to act, or its own willful
misconduct, except that:

                           (i)      this paragraph does not limit the effect of
                  paragraph (b) of this Section;

                           (ii)     the Trustee shall not be liable for any
                  error of judgment made in good faith by a Responsible Officer,
                  unless it is proved that the Trustee was negligent in
                  ascertaining the pertinent facts; and

                           (iii)    the Trustee shall not be liable with respect
                  to any action it takes or omits to take in good faith in
                  accordance with a direction received by it pursuant to any
                  provision of this Indenture relating to the time, method and
                  place of conducting any proceeding or remedy available to the
                  Trustee, or exercising any trust or power conferred upon the
                  Trustee under this Indenture.

                  (d)      Whether or not therein expressly so provided, every
provision of this Indenture that in any way relates to the Trustee is subject to
paragraphs (a), (b), and (c) of this Section.

                  (e)      No provision of this Indenture shall require the
Trustee to expend or risk its own funds or otherwise incur any financial
liability. The Trustee shall be under no obligation to exercise any of its
rights and powers under this Indenture at the request of any Holders, unless
such Holder shall have offered to the Trustee security and indemnity
satisfactory to it against any claim, loss, liability or expense.

                  (f)      The Trustee shall not be liable for interest on any
money received by it except as the Trustee may agree in writing with the
Partnership or GulfTerra Finance. Money held in trust by the Trustee need not be
segregated from other funds except to the extent required by law.

SECTION 7.02. RIGHTS OF TRUSTEE.

                  (a)      Subject to the provisions of Section 7.01(a) hereof,
the Trustee may conclusively rely upon any document believed by it to be genuine
and to have been signed or presented by the proper Person. The Trustee need not
investigate any fact or matter stated in the document, but may accept the same
as conclusive evidence of the truth and accuracy of such statement or the
correctness of such opinion.

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                  (b)      Before the Trustee acts or refrains from acting in
the administration of this Indenture, it may require an Officers' Certificate or
an Opinion of Counsel or both. The Trustee shall not be liable for any action it
takes or omits to take in good faith in reliance on such Officers' Certificate
or Opinion of Counsel. The Trustee may consult with counsel of its selection and
the advice of such counsel or any Opinion of Counsel shall be full and complete
authorization and protection from liability in respect of any action taken,
suffered or omitted by it hereunder in good faith and in reliance thereon.

                  (c)      The Trustee may execute any of its trusts or powers
or perform any duties under this Indenture either directly by or through agents
or attorneys, and may in all cases pay, subject to reimbursement as provided
herein, such reasonable compensation as it deems proper to all such agents and
attorneys employed or retained by it, and the Trustee shall not be responsible
for any misconduct or negligence of any agent or attorney appointed with due
care.

                  (d)      The Trustee shall not be liable for any action it
takes or omits to take in good faith that it believes to be authorized or within
the rights or powers conferred upon it by this Indenture.

                  (e)      Unless otherwise specifically provided in this
Indenture, any demand, request, direction or notice from an Issuer or any
Subsidiary Guarantor shall be sufficient if signed by an Officer of the
Partnership or the General Partner (in the case of the Partnership), by an
Officer of the General Partner (in the case of the General Partner) or by an
Officer of GulfTerra Finance or any Subsidiary Guarantor (in the case of
GulfTerra Finance or such Subsidiary Guarantor).

                  (f)      The Trustee shall be under no obligation to exercise
any of the rights or powers vested in it by this Indenture at the request or
direction of any of the Holders unless such Holders shall have offered to the
Trustee reasonable security or indemnity against the claims, costs, expenses and
liabilities that might be incurred by it in compliance with such request or
direction.

                  (g)      The Trustee is not required to make any inquiry or
investigation into facts or matters stated in any document but the Trustee, in
its discretion, may make such further inquiry or investigation into such facts
or matters as it may see fit and, if the Trustee determines to make such further
inquiry or investigation, it shall be entitled to examine the books, records and
premises of the Issuers.

                  (h)      The Trustee is not required to take notice or shall
not be deemed to have notice of any Default or Event of Default hereunder except
Defaults or Events of Default under Sections 6.01(a) and 6.01(b) hereof, unless
a Responsible Officer of the Trustee has actual knowledge thereof or has
received notice in writing of such Default or Event of Default from the Issuers
or the Holders of at least 25% in aggregate principal amount of the Notes then
outstanding, and in the absence of any such notice, the Trustee may conclusively
assume that no such Default or Event of Default exists.

                  (i)      The Trustee is not required to give any bond or
surety with respect to the performance of its duties or the exercise of its
powers under this Indenture.

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                  (j)      Under no circumstances shall the Trustee be liable in
its individual capacity for the obligations evidenced by the Notes.

                  (k)      In the event the Trustee receives inconsistent or
conflicting requests and indemnity from two or more groups of Holders of Notes,
each representing less than the aggregate principal amount of Notes outstanding
required to take any action hereunder, the Trustee, in its sole discretion may
determine what action, if any, shall be taken.

                  (l)      The Trustee's immunities and protections from
liability and its right to indemnification in connection with the performance of
its duties under this Indenture shall extend to the Trustee's officers,
directors, agents, attorneys and employees. Such immunities and protections and
right to indemnification, together with the Trustee's right to compensation,
shall survive the Trustee's resignation of removal, the discharge of this
Indenture and final payments of the Notes.

                  (m)      The permissive right of the Trustee to take actions
permitted by this Indenture shall not be construed as an obligation or duty to
do so.

                  (n)      Except for information provided by the Trustee
concerning the Trustee, the Trustee shall have no responsibility for any
information and any offering memorandum, disclosure material or prospectus
distributed with respect to the Notes.

                  (o)      The Trustee shall not be liable for any action taken
or omitted by it in good faith at the direction of the Holders of not less than
a majority in principal amount of the Notes as to the time, method, and place of
conducting any proceedings for any remedy available to the Trustee or the
exercising of any power conferred by the Indenture.

                  (p)      Subject to Section 7.01(d), whether or not therein
expressly so provided, every provision of the Indenture relating to the conduct
of, or affecting the liability of, or affording protection to the Trustee shall
be subject to the provisions of this Section 7.02.

                  (q)      Any action taken, or omitted to be taken, by the
Trustee in good faith, pursuant to this Indenture upon the request or authority
or consent of any Person who, at the time of making such request or giving such
authority or consent, is the Holder of any Note shall be conclusive and binding
upon all future Holders of that Note and upon securities executed and delivered
in exchange therefore or in place thereof.

SECTION 7.03. INDIVIDUAL RIGHTS OF TRUSTEE.

                  The Trustee in its commercial banking or any other capacity
may become the owner or pledgee of Notes and may otherwise deal with the
Issuers, any Subsidiary Guarantors or any Affiliate of the Partnership with the
same rights it would have if it were not Trustee. Any Affiliate of the Trustee
or Agent may do the same with like rights and duties. However, in the event that
the Trustee acquires any conflicting interest (as defined in the TIA) it must
eliminate such conflict within 90 days, apply to the SEC for permission to
continue as trustee or resign. The Trustee is also subject to Sections 7.10 and
7.11 hereof.

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SECTION 7.04. TRUSTEE'S DISCLAIMER.

                  The Trustee shall not be responsible for and makes no
representation as to the validity or adequacy of this Indenture, the Notes or
the Guarantees, it shall not be accountable for the Issuers' use of the proceeds
from the Notes or any money paid to an Issuer or upon an Issuer's direction
under any provision of this Indenture, it shall not be responsible for the use
or application of any money received by any Paying Agent other than the Trustee,
and it shall not be responsible for any statement or recital herein or any
statement in the Notes or any other document in connection with the sale of the
Notes or pursuant to this Indenture other than its certificate of
authentication.

SECTION 7.05. NOTICE OF DEFAULTS.

                  If a Default or Event of Default known to the Trustee occurs,
the Trustee shall mail to Holders of Notes a notice of the Default or Event of
Default within 90 days after it occurs. Except in the case of a Default or Event
of Default in payment of principal of, premium, if any, or interest or
Additional Interest, if any, on any Note, the Trustee may withhold the notice if
and so long as a committee of its Responsible Officers in good faith determines
that withholding the notice is in the interests of the Holders of the Notes.

SECTION 7.06. REPORTS BY TRUSTEE TO HOLDERS OF THE NOTES.

                  Within 60 days after each May 15 beginning with the May 15
following the date of this Indenture, and for so long as Notes remain
outstanding, the Trustee shall mail to the Holders of the Notes a brief report
dated as of such reporting date that complies with TIA Section 313(a) (but if no
event described in TIA Section 313(a) has occurred within the twelve months
preceding the reporting date, no report need be transmitted). The Trustee also
shall comply with TIA Section 313(b)(2). The Trustee shall also transmit by mail
all reports as required by TIA Section 313(c).

                  A copy of each report at the time of its mailing to the
Holders of Notes shall be mailed to the Partnership and filed with the SEC and
each stock exchange on which the Notes are listed in accordance with TIA Section
313(d). The Issuers shall promptly notify the Trustee when the Notes are listed
on any stock exchange.

SECTION 7.07. COMPENSATION AND INDEMNITY.

                  The Issuers and the Subsidiary Guarantors shall pay to the
Trustee from time to time such compensation as shall be agreed upon in writing
between the Issuers and the Trustee for its acceptance of this Indenture and
services hereunder. The Trustee's compensation shall not be limited by any law
on compensation of a trustee of an express trust. The Issuers and the Subsidiary
Guarantors shall reimburse the Trustee promptly upon request for all reasonable
disbursements, advances and expenses incurred or made by it in addition to the
compensation for its services. Such expenses shall include the reasonable
compensation, disbursements and expenses of the Trustee's agents and counsel.

                  The Issuers and the Subsidiary Guarantors shall indemnify each
of the Trustee or any successor Trustee against any and all losses, damages,
claims, liabilities or

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expenses (including reasonable attorneys' fees and expenses) incurred by it
arising out of or in connection with the acceptance or administration of its
duties under this Indenture, including the costs and expenses of enforcing this
Indenture against either of the Issuers or any Subsidiary Guarantor (including
this Section 7.07) and defending itself against any claim (whether asserted by
an Issuer, any Subsidiary Guarantor, or any Holder or any other Person) or
liability in connection with the exercise or performance of any of its powers or
duties hereunder, except to the extent any such loss, liability or expense may
be attributable to its negligence or bad faith. The Trustee shall notify the
Issuers promptly of any claim for which it may seek indemnity. Failure by the
Trustee to so notify the Issuers shall not relieve the Issuers and the
Subsidiary Guarantors of their obligations hereunder. The Issuers and the
Subsidiary Guarantors shall defend the claim and the Trustee shall cooperate in
the defense. The Trustee may have separate counsel and the Issuers and the
Subsidiary Guarantors shall pay the reasonable fees and expenses of such
separate counsel. The Issuers and the Subsidiary Guarantors need not pay for any
settlement made without their consent, which consent shall not be unreasonably
withheld.

                  The obligations of the Issuers and the Subsidiary Guarantors
under this Section 7.07 shall survive the satisfaction and discharge of this
Indenture.

                  To secure the Issuers' and the Subsidiary Guarantors' payment
obligations in this Section, the Trustee shall have a Lien (which it may
exercise through right of set-off) prior to the Notes on all money or property
held or collected by the Trustee, except that held in trust to pay principal,
premium, if any, and Additional Interest, if any, and interest on particular
Notes. Such Lien shall survive the satisfaction and discharge of this Indenture.

                  When the Trustee incurs expenses or renders services after an
Event of Default specified in Section 6.01(h) or (i) hereof occurs, the expenses
and the compensation for the services (including the fees and expenses of its
agents and counsel) are intended to constitute expenses of administration under
any Bankruptcy Law.

                  The Trustee shall comply with the provisions of TIA Section
313(b)(2) to the extent applicable.

SECTION 7.08. REPLACEMENT OF TRUSTEE.

                  A resignation or removal of the Trustee and appointment of a
successor Trustee shall become effective only upon the successor Trustee's
acceptance of appointment as provided in this Section.

                  The Trustee may resign in writing at any time and be
discharged from the trust hereby created by so notifying the Issuers. The
Holders of Notes of a majority in principal amount of the then outstanding Notes
may remove the Trustee by so notifying the Trustee and the Issuers in writing.
The Issuers may remove the Trustee if:

                  (a)      the Trustee fails to comply with Section 7.10 hereof;

                  (b)      the Trustee is adjudged a bankrupt or an insolvent or
an order for relief is entered with respect to the Trustee under any Bankruptcy
Law;

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                  (c)      a custodian or public officer takes charge of the
Trustee or its property; or

                  (d)      the Trustee becomes incapable of acting.

                  If the Trustee resigns or is removed or if a vacancy exists in
the office of Trustee for any reason, the Issuers shall promptly appoint a
successor Trustee. Within one year after the successor Trustee takes office, the
Holders of a majority in principal amount of the then outstanding Notes may
appoint a successor Trustee to replace the successor Trustee appointed by the
Issuers.

                  If a successor Trustee does not take office within 60 days
after the retiring Trustee resigns or is removed, the retiring Trustee, the
Issuers, any Subsidiary Guarantor or the Holders of Notes of at least 10% in
principal amount of the then outstanding Notes may petition any court of
competent jurisdiction for the appointment of a successor Trustee.

                  If the Trustee, after written request by any Holder of a Note
who has been a Holder of a Note for at least six months, fails to comply with
Section 7.10, such Holder of a Note may petition any court of competent
jurisdiction for the removal of the Trustee and the appointment of a successor
Trustee.

                  A successor Trustee shall deliver a written acceptance of its
appointment to the retiring Trustee and to the Issuers. Thereupon, the
resignation or removal of the retiring Trustee shall become effective, and the
successor Trustee shall have all the rights, powers and duties of the Trustee
under this Indenture. The successor Trustee shall mail a notice of its
succession to Holders of the Notes. The retiring Trustee shall promptly transfer
all property held by it as Trustee to the successor Trustee, provided all sums
owing to the Trustee hereunder have been paid and subject to the Lien provided
for in Section 7.07 hereof. Notwithstanding replacement of the Trustee pursuant
to this Section 7.08, the Issuers' and the Subsidiary Guarantors' obligations
under Section 7.07 hereof shall continue for the benefit of the retiring
Trustee.

SECTION 7.09. SUCCESSOR TRUSTEE BY MERGER, ETC.

                  If the Trustee consolidates, merges or converts into, or
transfers all or substantially all of its corporate trust business to, another
corporation, the successor corporation without any further act shall be the
successor Trustee.

SECTION 7.10. ELIGIBILITY; DISQUALIFICATION.

                  There shall at all times be a Trustee hereunder that is a
corporation organized and doing business under the laws of the United States of
America or of any state thereof that is authorized under such laws to exercise
corporate trust powers, that is subject to supervision or examination by federal
or state authorities and that has a combined capital and surplus of at least $50
million as set forth in its most recent published annual report of condition.

                  This Indenture shall always have a Trustee who satisfies the
requirements of TIA Section 310(a)(1), (2) and (5). The Trustee is subject to
TIA Section 310(b), provided, however, that there shall be excluded from the
operation of TIA Section 310(b)(l) any indenture or indentures under which other
securities or certificates of interest or

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participation in other securities of the Issuers are outstanding if the
requirements of such exclusion set forth in TIA Section 310(b)(l) are met. For
purposes of the preceding sentence, the optional provision permitted by the
second sentence of Section 310(b)(9) of the Trust Indenture Act shall be
applicable.

SECTION 7.11. PREFERENTIAL COLLECTION OF CLAIMS AGAINST ISSUERS.

                  The Trustee is subject to TIA Section 311(a), excluding any
creditor relationship listed in TIA Section 311(b). A Trustee who has resigned
or been removed shall be subject to TIA Section 311(a) to the extent indicated
therein.

                                    ARTICLE 8
                    LEGAL DEFEASANCE AND COVENANT DEFEASANCE

SECTION 8.01. OPTION TO EFFECT LEGAL DEFEASANCE OR COVENANT DEFEASANCE.

                  The Issuers may, at the option of the Board of Directors of
the General Partner (in the case of the Partnership) or of the Board of
Directors of GulfTerra Finance (in the case of GulfTerra Finance) evidenced by a
resolution set forth in an Officers' Certificate, at any time, elect to have
either Section 8.02 or 8.03 hereof be applied to all outstanding Notes upon
compliance with the conditions set forth below in this Article 8.

SECTION 8.02. LEGAL DEFEASANCE AND DISCHARGE.

                  Upon the Issuers' exercise under Section 8.01 hereof of the
option applicable to this Section 8.02, the Issuers and the Subsidiary
Guarantors shall, subject to the satisfaction of the conditions set forth in
Section 8.04 hereof, be deemed to have been discharged from their respective
Obligations and certain other obligations with respect to all outstanding Notes
and Guarantees, as applicable, on the date the conditions set forth below are
satisfied (hereinafter, "Legal Defeasance"). For this purpose, Legal Defeasance
means that the Issuers and the Subsidiary Guarantors shall be deemed to have
paid and discharged the entire Indebtedness represented by the outstanding
Notes, which shall thereafter be deemed to be "outstanding" only for the
purposes of Section 8.05 hereof and the other Sections of this Indenture
referred to in clauses (a) and (b) of this sentence below, and to have satisfied
all its other obligations under such Notes and this Indenture (and the Trustee,
on demand of and at the expense of the Issuers, shall execute proper instruments
acknowledging the same), except for the following provisions which shall survive
until otherwise terminated or discharged hereunder: (a) the rights of Holders of
outstanding Notes to receive solely from the trust fund described in Section
8.04 hereof, and as more fully set forth in such Section, payments in respect of
the principal of, premium, if any, and interest and Additional Interest, if any,
on such Notes when such payments are due (but not the Change of Control Payment
or the payment pursuant to the Asset Sale Offer), (b) the Issuers' obligations
with respect to such Notes under Sections 2.03, 2.04, 2.06, 2.07, 2.10 and 4.02
hereof, (c) the rights, powers, trusts, duties and immunities of the Trustee
hereunder and the Issuers' and the Subsidiary Guarantors' obligations in
connection therewith, (d) the Issuers' rights of optional redemption and (e)
this Article 8. Subject to

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compliance with this Article 8, the Issuers may exercise the option under this
Section 8.02 notwithstanding the prior exercise of its option under Section 8.03
hereof.

SECTION 8.03. COVENANT DEFEASANCE.

                  Upon the Issuers' exercise under Section 8.01 hereof of the
option applicable to this Section 8.03, the Issuers and the Subsidiary
Guarantors shall, subject to the satisfaction of the conditions set forth in
Section 8.04 hereof, be released from its obligations under the covenants
contained in Sections 3.09, 4.06, 4.07, 4.08, 4.09, 4.10, 4.11, 4.12, 4.13,
4.14, 4.15, 4.16, 4.18 and 5.01(a)(iv) hereof and any covenant added to this
Indenture subsequent to the Issue Date pursuant to Section 9.01 hereof with
respect to the outstanding Notes on and after the date the conditions set forth
below are satisfied (hereinafter, "Covenant Defeasance"), and the Notes shall
thereafter be deemed not "outstanding" for the purposes of any direction,
waiver, consent or declaration or act of Holders (and the consequences of any
thereof) in connection with such covenants, but shall continue to be deemed
"outstanding" for all other purposes hereunder (it being understood that such
Notes shall not be deemed outstanding for accounting purposes). For this
purpose, Covenant Defeasance means that, with respect to the outstanding Notes,
the Issuers may omit to comply with and shall have no liability in respect of
any term, condition or limitation set forth in any such covenant, whether
directly or indirectly, by reason of any reference elsewhere herein to any such
covenant or by reason of any reference in any such covenant to any other
provision herein or in any other document and such omission to comply shall not
constitute a Default or an Event of Default under Section 6.01 hereof, but,
except as specified above, the remainder of this Indenture and such Notes shall
be unaffected thereby. In addition, upon the Issuers' exercise under Section
8.01 hereof of the option applicable to this Section 8.03 hereof, subject to the
satisfaction of the conditions set forth in Section 8.04 hereof, Sections
6.01(c) through 6.01(g) hereof shall not constitute Events of Default.

SECTION 8.04. CONDITIONS TO LEGAL OR COVENANT DEFEASANCE.

                  The following shall be the conditions to the application of
either Section 8.02 or 8.03 hereof to the outstanding Notes:

                  In order to exercise either Legal Defeasance or Covenant
Defeasance:

                  (a)      the Issuers must irrevocably deposit with the
Trustee, in trust, for the benefit of the Holders, cash in United States
dollars, non-callable U.S. Government Obligations, or a combination thereof, in
such amounts as shall be sufficient, in the opinion of a nationally recognized
firm of independent public accountants, to pay the principal of, premium, if
any, and interest, on the outstanding Notes at the Stated Maturity thereof or on
the applicable redemption date, as the case may be, and the Partnership must
specify whether the Notes are being defeased to maturity or to a particular
redemption date;

                  (b)      in the case of an election under Section 8.02 hereof,
the Issuers shall have delivered to the Trustee an Opinion of Counsel in the
United States reasonably acceptable to the Trustee confirming that (A) the
Partnership has received from, or there has been published by, the Internal
Revenue Service a ruling or (B) since the Issue Date, there has been a change in
the applicable federal income tax law, in either case to the effect

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that, and based thereon such Opinion of Counsel shall confirm that, the Holders
of the outstanding Notes will not recognize income, gain or loss for federal
income tax purposes as a result of such Legal Defeasance and will be subject to
federal income tax on the same amounts, in the same manner and at the same times
as would have been the case if such Legal Defeasance had not occurred;

                  (c)      in the case of an election under Section 8.03 hereof,
the Partnership shall have delivered to the Trustee an Opinion of Counsel in the
United States reasonably acceptable to the Trustee confirming that the Holders
of the outstanding Notes will not recognize income, gain or loss for federal
income tax purposes as a result of such Covenant Defeasance and will be subject
to federal income tax on the same amounts, in the same manner and at the same
times as would have been the case if such Covenant Defeasance had not occurred;

                  (d)      no Default or Event of Default shall have occurred
and be continuing on the date of such deposit (other than a Default or Event of
Default resulting from the incurrence of Indebtedness all or a portion of the
proceeds of which shall be applied to such deposit) or insofar as Sections
6.01(h) and 6.01(i) hereof are concerned, at any time in the period ending on
the 91st day after the date of deposit;

                  (e)      such Legal Defeasance or Covenant Defeasance shall
not result in a breach or violation of, or constitute a default under, any
material agreement or instrument (other than this Indenture) to which either of
the Issuers or any Restricted Subsidiary of the Partnership is a party or by
which either of the Issuers or any Restricted Subsidiary of the Partnership is
bound;

                  (f)      the Partnership shall have delivered to the Trustee
an Opinion of Counsel to the effect that after the 91st day following the
deposit, the trust funds will not be subject to the effect of any applicable
bankruptcy, insolvency, reorganization or similar laws affecting creditors'
rights generally;

                  (g)      the Partnership shall have delivered to the Trustee
an Officers' Certificate stating that the deposit was not made by such Issuer
with the intent of preferring the Holders over any other creditors of such
Issuer or the Subsidiary Guarantors or with the intent of defeating, hindering,
delaying or defrauding other creditors of such Issuer; and

                  (h)      the Partnership shall have delivered to the Trustee
an Officers' Certificate and an Opinion of Counsel, each stating that all
conditions precedent provided for or relating to the Legal Defeasance or the
Covenant Defeasance have been complied with.

SECTION 8.05. DEPOSITED MONEY AND GOVERNMENT SECURITIES TO BE HELD IN TRUST;
              OTHER MISCELLANEOUS PROVISIONS.

                  Subject to Section 8.06 hereof, all money and non-callable
U.S. Government Obligations (including the proceeds thereof) deposited with the
Trustee (or other qualifying trustee, collectively for purposes of this Section
8.05, the "Trustee") pursuant to Section 8.04 hereof in respect of the
outstanding Notes shall be held in trust and applied by the Trustee, in
accordance with the provisions of such Notes and this Indenture, to the payment,
either directly or through any Paying Agent (including either Issuer acting as a

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Paying Agent) as the Trustee may determine, to the Holders of such Notes of all
sums due and to become due thereon in respect of principal, premium, if any, and
interest, and Additional Interest, if any, but such money need not be segregated
from other funds except to the extent required by law.

                  The Issuers and the Subsidiary Guarantors shall pay and
indemnify the Trustee against any tax, fee or other charge imposed on or
assessed against the cash or non-callable U.S. Government Obligations deposited
pursuant to Section 8.04 hereof or the principal and interest received in
respect thereof other than any such tax, fee or other charge which by law is for
the account of the Holders of the outstanding Notes.

                  Anything in this Article 8 to the contrary notwithstanding,
the Trustee shall deliver or pay to the Issuers from time to time upon the
request of the Issuers any money or non-callable U.S. Government Obligations
held by it as provided in Section 8.04 hereof which, in the opinion of a
nationally recognized firm of independent public accountants expressed in a
written certification thereof delivered to the Trustee (which may be the opinion
delivered under Section 8.04(a) hereof), are in excess of the amount thereof
that would then be required to be deposited to effect an equivalent Legal
Defeasance or Covenant Defeasance.

SECTION 8.06. REPAYMENT TO ISSUERS.

                  Any money deposited with the Trustee or any Paying Agent, or
then held by an Issuer, in trust for the payment of the principal of, premium,
if any, interest or Additional Interest, if any, on any Note and remaining
unclaimed for two years after such principal, and premium, if any, interest or
Additional Interest, if any, has become due and payable shall, subject to
applicable escheat law, be paid to the Issuers on the request of the Issuers or
(if then held by an Issuer) shall be discharged from such trust; and the Holder
of such Note shall thereafter, as a creditor, look only to the Issuers or
Subsidiary Guarantors for payment thereof, and all liability of the Trustee or
such Paying Agent with respect to such trust money, and all liability of such
Issuer as trustee thereof, shall thereupon cease; provided, however, that the
Trustee or such Paying Agent, before being required to make any such repayment,
may at the expense of the Issuers cause to be published once, in The New York
Times and The Wall Street Journal (national edition), notice that such money
remains unclaimed and that, after a date specified therein, which shall not be
less than 30 days from the date of such notification or publication, any
unclaimed balance of such money then remaining shall be repaid to the Issuers.

SECTION 8.07. REINSTATEMENT.

                  If the Trustee or Paying Agent is unable to apply any United
States dollars or U.S. Government Obligations in accordance with Section 8.02 or
8.03 hereof, as the case may be, by reason of any order or judgment of any court
or governmental authority enjoining, restraining or otherwise prohibiting such
application, then the Issuers' and the Subsidiary Guarantors' Obligations under
this Indenture, the Notes and the Guarantees, as applicable, shall be revived
and reinstated as though no deposit had occurred pursuant to Section 8.02 or
8.03 hereof until such time as the Trustee or Paying Agent is permitted to apply
all such money in accordance with Section 8.02 or 8.03 hereof, as the case may
be; provided, however, that, if the Issuers or the Subsidiary Guarantors make
any payment of

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principal of, premium, if any, interest or Additional Interest, if any, on any
Note following the reinstatement of its Obligations, the Issuers and the
Subsidiary Guarantors shall be subrogated to the rights of the Holders of such
Notes to receive such payment from the money held by the Trustee or Paying
Agent.

                                    ARTICLE 9
                        AMENDMENT, SUPPLEMENT AND WAIVER

SECTION 9.01. WITHOUT CONSENT OF HOLDERS OF NOTES.

                  Notwithstanding Section 9.02 of this Indenture, the Issuers
and the Subsidiary Guarantors and the Trustee may amend or supplement this
Indenture, the Guarantees, or the Notes without the consent of any Holder of a
Note:

                  (a)      to cure any ambiguity, defect or inconsistency;

                  (b)      to provide for uncertificated Notes in addition to or
in place of certificated Notes or to alter the provisions of Article 2 hereof
(including the related definitions) in a manner that does not materially
adversely affect any Holder;

                  (c)      to provide for the assumption of an Issuer's or a
Subsidiary Guarantor's obligations to the Holders of the Notes in the case of a
merger or consolidation or sale of all or substantially all of such Issuer's or
Subsidiary Guarantors' assets pursuant to Article 5 hereof;

                  (d)      to add or release Subsidiary Guarantors pursuant to
the terms of this Indenture;

                  (e)      to make any change that would provide any additional
rights or benefits to the Holders of the Notes or surrender any right or power
conferred upon the Issuers or the Subsidiary Guarantors by this Indenture that
does not adversely affect the legal rights hereunder of any Holder of the Notes;
or

                  (f)      to comply with requirements of the SEC in order to
effect or maintain the qualification of this Indenture under the TIA;

                  (g)      to evidence or provide for the appointment under this
Indenture of a successor Trustee;

                  (h)      to add additional Events of Default; or

                  (i)      to secure the Notes and/or the Guarantees.

                  Upon the request of the Issuers accompanied by a resolution of
the Board of Directors of the General Partner (in the case of the Partnership),
and of the Board of Directors of GulfTerra Finance and each of the Subsidiary
Guarantors (in the case of GulfTerra Finance and the Subsidiary Guarantors),
authorizing the execution of any such amended or supplemental Indenture, and
upon receipt by the Trustee of the documents described in Section 9.06 hereof,
the Trustee shall join with the Issuers and each of the

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Subsidiary Guarantors in the execution of any amended or supplemental Indenture
authorized or permitted by the terms of this Indenture and to make any further
appropriate agreements and stipulations that may be therein contained, but the
Trustee shall not be obligated to enter into such amended or supplemental
Indenture that affects its own rights, duties or immunities under this Indenture
or otherwise.

SECTION 9.02. WITH CONSENT OF HOLDERS OF NOTES.

                  Except as provided below in this Section 9.02, the Issuers,
the Subsidiary Guarantors and the Trustee may amend or supplement this Indenture
(including Sections 3.09, 4.06 and 4.07 hereof), the Guarantees, and the Notes
with the consent of the Holders of at least a majority in principal amount of
the Notes then outstanding (including, without limitation, consents obtained in
connection with a purchase of, or tender offer or exchange offer for, the
Notes), and, subject to Sections 6.04 and 6.07 hereof, any existing Default or
Event of Default (other than a Default or Event of Default in the payment of the
principal of, premium, if any, or interest on the Notes, except a payment
default resulting from an acceleration that has been rescinded) or compliance
with any provision of this Indenture, the Guarantees or the Notes may be waived
with the consent of the Holders of a majority in principal amount of the then
outstanding Notes (including consents obtained in connection with a tender offer
or exchange offer for the Notes).

                  Upon the request of the Issuers accompanied by a resolution of
the Board of Directors of the General Partner (in the case of the Partnership)
and of the Board of Directors of GulfTerra Finance and each of the Subsidiary
Guarantors (in the case of GulfTerra Finance and each of the Subsidiary
Guarantors) authorizing the execution of any such amended or supplemental
Indenture, and upon the filing with the Trustee of evidence satisfactory to the
Trustee of the consent of the Holders of Notes as aforesaid, and upon receipt by
the Trustee of the documents described in Section 9.06 hereof, the Trustee shall
join with the Issuers and each of the Subsidiary Guarantors in the execution of
such amended or supplemental Indenture unless such amended or supplemental
Indenture affects the Trustee's own rights, duties or immunities under this
Indenture or otherwise, in which case the Trustee may in its discretion, but
shall not be obligated to, enter into such amended or supplemental Indenture.

                  It shall not be necessary for the consent of the Holders of
Notes under this Section 9.02 to approve the particular form of any proposed
amendment or waiver, but it shall be sufficient if such consent approves the
substance thereof.

                  After an amendment, supplement or waiver under this Section
becomes effective, the Issuers shall mail to the Holders of Notes affected
thereby a notice briefly describing the amendment, supplement or waiver. Any
failure of the Issuers to mail such notice, or any defect therein, shall not,
however, in any way impair or affect the validity of any such amended or
supplemental Indenture or waiver. Subject to Sections 6.04 and 6.07 hereof, the
Holders of a majority in aggregate principal amount of the Notes then
outstanding may waive compliance in a particular instance by the Issuers with
any provision of this Indenture or the Notes. However, without the consent of
each Holder affected, an amendment or waiver may not (with respect to any Notes
held by a non-consenting Holder):

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                  (a)      reduce the principal amount of Notes whose Holders
must consent to an amendment, supplement or waiver;

                  (b)      reduce the principal of or change the fixed maturity
of any Note or alter or waive any of the provisions with respect to the
redemption of the Notes, except as provided above with respect to Sections 3.09,
4.06 and 4.07 hereof;

                  (c)      reduce the rate of or change the time for payment of
interest, including default interest, on any Note;

                  (d)      waive a Default or Event of Default in the payment of
principal of or premium, if any, interest or Additional Interest, if any, on the
Notes (except a rescission of acceleration of the Notes by the Holders of at
least a majority in aggregate principal amount of the then outstanding Notes and
a waiver of the payment default that resulted from such acceleration);

                  (e)      make any Note payable in money other than that stated
in the Notes;

                  (f)      make any change in the provisions of this Indenture
relating to waivers of past Defaults or the rights of Holders of Notes to
receive payments of principal of or premium, if any, or interest on the Notes;

                  (g)      waive a redemption payment with respect to any Note
(other than a payment required by the covenants contained in Sections 3.09, 4.06
or 4.07 hereof;

                  (h)      except as otherwise permitted by this Indenture,
release any Subsidiary Guarantor from any of its Obligations under its Guarantee
or this Indenture, or change any Guarantee in any manner that would adversely
affect the right of Holders; or

                  (i)      make any change in Section 6.04 or 6.07 hereof or in
the foregoing amendment and waiver provisions (except to increase any percentage
set forth therein).

SECTION 9.03. COMPLIANCE WITH TRUST INDENTURE ACT.

                  Every amendment or supplement to this Indenture, the
Guarantees, or the Notes shall be set forth in an amended or supplemental
Indenture that complies with the TIA as then in effect.

SECTION 9.04. REVOCATION AND EFFECT OF CONSENTS.

                  Until an amendment, supplement or waiver becomes effective, a
consent to it by a Holder of a Note is a continuing consent by the Holder of a
Note and every subsequent Holder of a Note or portion of a Note that evidences
the same debt as the consenting Holder's Note, even if notation of the consent
is not made on any Note. However, any such Holder of a Note or subsequent Holder
of a Note may revoke the consent as to its Note if the Trustee receives written
notice of revocation before the date the waiver, supplement or amendment becomes
effective. An amendment, supplement or waiver becomes effective in accordance
with its terms and thereafter binds every Holder.

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SECTION 9.05. NOTATION ON OR EXCHANGE OF NOTES.

                  The Trustee may place an appropriate notation about an
amendment, supplement or waiver on any Note thereafter authenticated. The
Issuers in exchange for all Notes may issue and the Trustee shall authenticate
new Notes (accompanied by a notation of the Guarantees duly endorsed by the
Subsidiary Guarantors) that reflect the amendment, supplement or waiver.

                  Failure to make the appropriate notation or issue a new Note
shall not affect the validity and effect of such amendment, supplement or
waiver.

SECTION 9.06. TRUSTEE TO SIGN AMENDMENTS, ETC.

                  The Trustee shall sign any amended or supplemental Indenture
authorized pursuant to this Article 9 if the amendment or supplement does not
adversely affect the rights, duties, liabilities or immunities of the Trustee.
The Issuers and the Subsidiary Guarantors may not sign an amendment or
supplemental Indenture until the Board of Directors of the General Partner
approves it. In executing any amended or supplemental indenture, the Trustee
shall be entitled to receive and (subject to Section 7.01) shall be fully
protected in relying upon, an Officers' Certificate of the Board of Directors of
the General Partner and an Opinion of Counsel stating that the execution of such
amended or supplemental indenture is authorized or permitted by this Indenture.

SECTION 9.07. EFFECT OF SUPPLEMENTAL INDENTURES.

                  Upon the execution of any supplemental indenture under this
Article 9, this Indenture shall be modified in accordance therewith, and such
supplemental indenture shall form a part of this Indenture for all purposes; and
every Holder of Notes theretofore or thereafter authenticated and delivered
hereunder shall be bound thereby. After a supplemental indenture becomes
effective, the Issuers shall mail to Holders a notice briefly describing such
amendment. The failure to give such notice to all Holders, or any defect
therein, shall not impair or affect the validity of an amendment under this
Section.

                                   ARTICLE 10
                                   GUARANTEES

SECTION 10.01. GUARANTEES.

                  Subject to the provisions of this Article 10, each of the
Subsidiary Guarantors hereby, jointly and severally, unconditionally guarantees
to each Holder of a Note authenticated and delivered by the Trustee and to the
Trustee and its successors and assigns, irrespective of the validity and
enforceability of this Indenture, the Notes or the Obligations of the Issuers
hereunder or thereunder, that: (a) the principal of, premium, interest and
Additional Interest, if any, on the Notes shall be promptly paid in full when
due, whether at the maturity or interest payment or mandatory redemption date,
by acceleration, redemption or otherwise, and interest on the overdue principal
of, premium, interest and Additional Interest, if any, on the Notes, if any, if
lawful, and all other Obligations of the Issuers to the Holders or the Trustee
under this Indenture and the Notes shall be promptly paid in full or performed,
all in accordance with the terms of this

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Indenture and the Notes; and (b) in case of any extension of time of payment or
renewal of any Notes or any of such other obligations, that same shall be
promptly paid in full when due or performed in accordance with the terms of the
extension or renewal, whether at Stated Maturity, by acceleration or otherwise.
Failing payment when due of any amount so guaranteed or any performance so
guaranteed for whatever reason, the Subsidiary Guarantors shall be jointly and
severally obligated to pay the same immediately. The Subsidiary Guarantors
hereby agree that to the fullest extent permitted by applicable law, their
obligations hereunder shall be unconditional, irrespective of the validity,
regularity or enforceability of the Notes or this Indenture, the absence of any
action to enforce the same, any waiver or consent by any Holder of the Notes
with respect to any provisions of this Indenture and the Notes, the recovery of
any judgment against the Issuers, any action to enforce the same or any other
circumstance which might otherwise constitute a legal or equitable discharge or
defense of a Subsidiary Guarantor. To the fullest extent permitted by applicable
law, each Subsidiary Guarantor hereby waives diligence, presentment, demand of
payment, filing of claims with a court in the event of insolvency or bankruptcy
of the Issuers, any right to require a proceeding first against the Issuers,
protest, notice and all demands whatsoever and covenant that the Guarantees
shall not be discharged except by complete performance of the obligations
contained in the Notes and this Indenture.

                  If any Holder or the Trustee is required by any court or
otherwise to return to the Issuers or Subsidiary Guarantors, or any custodian,
trustee, liquidator or other similar official acting in relation to either the
Issuers or Subsidiary Guarantors, any amount paid by either to the Trustee or
such Holder, these Guarantees, to the extent theretofore discharged, shall be
reinstated in full force and effect. Each Subsidiary Guarantor agrees that it
shall not be entitled to any right of subrogation in relation to the Holders in
respect of any Obligations guaranteed hereby until payment in full of all
Obligations guaranteed hereby.

                  Each Subsidiary Guarantor further agrees that, as between the
Subsidiary Guarantors, on the one hand, and the Holders and the Trustee, on the
other hand, (x) the maturity of the Obligations guaranteed hereby may be
accelerated as provided in Article 6 hereof for the purposes of these
Guarantees, notwithstanding any stay, injunction or other prohibition preventing
such acceleration in respect of the Obligations guaranteed hereby, and (y) in
the event of any declaration of acceleration of such Obligations as provided in
Article 6 hereof, such Obligations (whether or not due and payable) shall
forthwith become due and payable by the Subsidiary Guarantors for the purpose of
these Guarantees. The Subsidiary Guarantors shall have the right to seek
contribution from any non-paying Subsidiary Guarantor so long as the exercise of
such right does not impair the rights of the Holders under these Guarantees.

SECTION 10.02. LIMITATION OF GUARANTOR'S LIABILITY.

                  Each Subsidiary Guarantor and, by its acceptance hereof, each
Holder hereby confirms that it is its intention that the Guarantee by such
Subsidiary Guarantor not constitute a fraudulent transfer or conveyance for
purposes of the Bankruptcy Law, the Uniform Fraudulent Conveyance Act, the
Uniform Fraudulent Transfer Act or any similar federal or state law to the
extent applicable to the Guarantees. To effectuate the foregoing

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<PAGE>

intention, each such Person hereby irrevocably agrees that the Obligation of
such Subsidiary Guarantor under its Guarantee under this Article 10 shall be
limited to the maximum amount as shall, after giving effect to such maximum
amount and all other (contingent or otherwise) liabilities of such Subsidiary
Guarantor that are relevant under such laws, and after giving effect to any
rights to contribution of such Subsidiary Guarantor pursuant to any agreement
providing for an equitable contribution among such Subsidiary Guarantor and
other Affiliates of the Issuers of payments made by guarantees by such parties,
result in the Obligations of such Subsidiary Guarantor in respect of such
maximum amount not constituting a fraudulent conveyance. Each Holder, by
accepting the benefits hereof, confirms its intention that, in the event of
bankruptcy, reorganization or other similar proceeding of either of the Issuers
or any Subsidiary Guarantor in which concurrent claims are made upon such
Subsidiary Guarantor hereunder, to the extent such claims shall not be fully
satisfied, each such claimant with a valid claim against such Issuer shall be
entitled to a ratable share of all payments by such Subsidiary Guarantor in
respect of such concurrent claims.

SECTION 10.03. EXECUTION AND DELIVERY OF GUARANTEES.

                  To evidence the Guarantees set forth in Section 10.01 hereof,
each Subsidiary Guarantor hereby agrees that a notation of the Guarantees
substantially in the form of Exhibit D shall be endorsed by an Officer of such
Subsidiary Guarantor on each Note authenticated and delivered by the Trustee and
that this Indenture shall be executed on behalf of such Subsidiary Guarantor by
its President or one of its Vice Presidents.

                  Each Subsidiary Guarantor hereby agrees that the Guarantees
set forth in Section 10.01 shall remain in full force and effect notwithstanding
any failure to endorse on each Note a notation of the Guarantees.

                  If an Officer or Officer whose signature is on this Indenture
or on the Guarantees no longer holds that office at the time the Trustee
authenticates the Note on which the notation of the Guarantees are endorsed, the
Guarantees shall be valid nevertheless.

                  The delivery of any Note by the Trustee, after the
authentication thereof hereunder, shall constitute due delivery of the
Guarantees set forth in this Indenture on behalf of the Subsidiary Guarantors.

SECTION 10.04. SUBSIDIARY GUARANTORS MAY CONSOLIDATE, ETC., ON CERTAIN TERMS.

                  (a)      Except as set forth in Articles 4 and 5 hereof,
nothing contained in this Indenture or in any of the Notes shall prevent any
consolidation or merger of the Partnership or a Subsidiary Guarantor with or
into the Partnership or another Subsidiary Guarantor or shall prevent any sale
or conveyance of the property of a Subsidiary Guarantor as an entirety or
substantially as an entirety, to the Partnership or another Subsidiary
Guarantor.

                  (b)      Except as set forth in Articles 4 and 5 hereof,
nothing contained in this Indenture or in any of the Notes shall prevent any
consolidation or merger of a Subsidiary Guarantor with or into another Person
other than the Partnership or another Subsidiary

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<PAGE>

Guarantor (whether or not affiliated with the Subsidiary Guarantor), or
successive consolidations or mergers in which a Subsidiary Guarantor or its
successor or successors shall be a party or parties, or shall prevent any sale
or conveyance of the property of a Subsidiary Guarantor as an entirety or
substantially as an entirety, to a person other than the Partnership (whether or
not affiliated with the Subsidiary Guarantor) authorized to acquire and operate
the same; provided, however, that such transaction meets all of the following
requirements: (i) each Subsidiary Guarantor hereby covenants and agrees that,
upon any such consolidation, merger, sale or conveyance, the Guarantee contained
herein, and the due and punctual performance and observance of all of the
covenants and conditions of this Indenture to be performed by such Subsidiary
Guarantor, shall be expressly assumed (in the event that the Subsidiary
Guarantor is not the surviving corporation in the merger or consolidation), by
supplemental indenture satisfactory in form to the Trustee, executed and
delivered to the Trustee, by the Person formed by such consolidation, or into
which the Subsidiary Guarantor shall have been merged, or by the Person which
shall have acquired such property, and (ii) immediately after giving effect to
such transaction, no Default or Event of Default exists. In case of any such
consolidation, merger, sale or conveyance and upon the assumption by the
successor Person by supplemental indenture, executed and delivered to the
Trustee and satisfactory in form to the Trustee, of the Guarantees contained
herein and the due and punctual performance of all of the covenants and
conditions of this Indenture to be performed by the Subsidiary Guarantor, such
successor shall succeed to and be substituted for the Subsidiary Guarantor with
the same effect as if it had been named herein as a Subsidiary Guarantor. Such
successor thereupon may cause to be signed any or all of the notations of the
Guarantees to be endorsed upon all of the Notes issuable hereunder which
theretofore shall not have been signed by the Issuers and delivered to the
Trustee. All the Guarantees so issued shall in all respects have the same legal
rank and benefit under this Indenture as the Guarantees theretofore and
thereafter issued in accordance with the terms of this Indenture as though all
of such Guarantees had been issued at the date of the execution hereof.

SECTION 10.05. RELEASES.

                  Concurrently with any sale of assets (including, if
applicable, all of the Equity Interests of any Subsidiary Guarantor), any Liens
in favor of the Trustee in the assets sold thereby shall be released; provided
that in the event of an Asset Sale, the Net Proceeds from such sale or other
disposition are treated in accordance with the provisions of Section 4.07
hereof. The Guarantee or the obligations under Section 10.04 hereof of a
Subsidiary Guarantor will be released (i) in connection with any sale or other
disposition of all or substantially all of the assets of such Subsidiary
Guarantor (including by way of merger or consolidation), if the Partnership
applies the Net Proceeds of that sale or other disposition in accordance with
Section 4.07 hereof; or (ii) in connection with the sale or other disposition of
all of the Equity Interests of a Subsidiary Guarantor, if the Partnership
applies the Net Proceeds of that sale in accordance with Section 4.07 hereof; or
(iii) if the Partnership designates any Restricted Subsidiary that is a
Subsidiary Guarantor as an Unrestricted Subsidiary; or (iv) at such time as such
Subsidiary Guarantor ceases to guarantee any other Indebtedness of the
Partnership. Upon delivery by the Partnership to the Trustee of an Officers'
Certificate to the effect that such sale or other disposition was

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made by the Partnership in accordance with the provisions of this Indenture,
including without limitation Section 4.07 hereof or such Guarantee is to be
released pursuant to the provisions of the immediately preceding sentence, the
Trustee shall execute any documents reasonably required in order to evidence the
release of any Subsidiary Guarantor from its obligations under its Guarantees.
Any Subsidiary Guarantor not released from its obligations under its Guarantee
shall remain liable for the full amount of principal of and interest on the
Notes and for the other obligations of any Subsidiary Guarantor under this
Indenture as provided in this Article 10.

SECTION 10.06. "TRUSTEE" TO INCLUDE PAYING AGENT.

                  In case at any time any Paying Agent other than the Trustee
shall have been appointed by the Issuers and be then acting hereunder, the term
"Trustee" as used in this Article 10 shall in such case (unless the context
shall otherwise require) be construed as extending to and including such Paying
Agent within its meaning as fully and for all intents and purposes as if such
Paying Agent were named in this Article 10 in place of the Trustee.

                                   ARTICLE 11
                           SATISFACTION AND DISCHARGE

SECTION 11.01. SATISFACTION AND DISCHARGE.

                  This Indenture shall upon the request of the Issuers cease to
be of further effect (except as to surviving rights of registration of transfer
or exchange of Notes herein expressly provided for, the Issuers' obligations
under Section 7.07 hereof, the Issuers' rights of optional redemption under
Article 3 hereof, and the Trustee's and the Paying Agent's obligations under
Section 11.02 and 11.03 hereof) and the Trustee, at the expense of the Issuers,
shall execute proper instruments acknowledging satisfaction and discharge of
this Indenture when

                  (a)      either

                           (i)      all Notes therefore authenticated and
                  delivered (other than (A) Notes which have been destroyed,
                  lost or stolen and which have been replaced or paid as
                  provided in Section 2.07 and (B) Notes for whose payment money
                  has been deposited in trust with the Trustee or any Paying
                  Agent and thereafter paid to the Issuers or discharged from
                  such trust) have been delivered to the Trustee for
                  cancellation; or

                           (ii)     all such Notes not theretofore delivered to
                  the Trustee for cancellation

                                    (A)      have become due and payable; or

                                    (B)      shall become due and payable at
                           their Stated Maturity within one year, or

                                    (C)      are to be called for redemption
                           within one year under arrangements satisfactory to
                           the Trustee for the giving of notice of

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<PAGE>

                           redemption by the Trustee in the name, and at the
                           expense, of the Issuers,

                  and the Issuers, in the case of clause (A), (B) or (C) above,
                  have irrevocably deposited or caused to be deposited with the
                  Trustee as trust funds in trust for such purpose money or U.S.
                  Government Obligations in an amount sufficient (as certified
                  by an independent public accountant designated by the Issuers)
                  to pay and discharge the entire indebtedness of such Notes not
                  theretofore delivered to the Trustee for cancellation, for
                  principal (and premium, if any) and interest, if any, to the
                  date of such deposit (in the case of Notes which have become
                  due and payable) or the Stated Maturity or redemption date, as
                  the case may be;

                  (b)      the Issuers have paid or caused to be paid all other
sums then due and payable hereunder by the Issuers;

                  (c)      no Default or Event of Default with respect to the
Notes shall have occurred and be continuing on the date of such deposit and
after giving effect to such deposit; and

                  (d)      the Issuers have delivered to the Trustee an
Officers' Certificate and an Opinion of Counsel, each stating that all
conditions precedent herein provided for relating to the satisfaction and
discharge of this Indenture have been complied with.

                  Notwithstanding the satisfaction and discharge of this
Indenture, the Issuers' obligations in Sections 2.03, 2.04, 2.06, 2.07, 2.11,
7.07, 7.08, 11.02, 11.03 and 11.04, and the Trustee's and Paying Agent's
obligations in Section 11.03 shall survive until the Notes are no longer
outstanding. Thereafter, only the Issuers' obligations in Section 11.03 shall
survive.

                  In order to have money available on a payment date to pay
principal (and premium, if any, on) or interest on the Notes, the U.S.
Government Obligations shall be payable as to principal (and premium, if any) or
interest at least one Business Day before such payment date in such amounts as
shall provide the necessary money. The U.S. Government Obligations shall not be
callable at the issuer's option.

SECTION 11.02. APPLICATION OF TRUST.

                  All money deposited with the Trustee pursuant to Section 11.01
shall be held in trust and, at the written direction of the Issuers, be invested
prior to maturity in non-callable U.S. Government Obligations, and applied by
the Trustee in accordance with the provisions of the Notes and this Indenture,
to the payment, either directly or through any Paying Agent as the Trustee may
determine, to the Persons entitled thereto, of the principal (and premium, if
any) and interest for the payment of which money has been deposited with the
Trustee; but such money need not be segregated from other funds except to the
extent required by law.

SECTION 11.03. REPAYMENT OF THE ISSUERS.

                  The Trustee and the Paying Agent shall promptly pay to the
Issuers upon written request any excess money or securities held by them at any
time.

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<PAGE>

                  Subject to applicable escheat laws, the Trustee and the Paying
Agent shall notify the Issuers of, and pay to the Issuers upon written request,
any money held by them for the payment of principal or interest that remains
unclaimed for two years after the date upon which such payment shall have become
due; provided that the Issuers shall have either caused notice of such payment
to be mailed to each Holder of the Notes entitled thereto no less than 30 days
prior to such repayment or within such period shall have published such notice
in a financial newspaper of widespread circulation published in The City of New
York, including, without limitation, The Wall Street Journal (national edition).
After payment to the Issuers, Holders entitled to the money must look to the
Issuers for payment as general creditors unless an applicable abandoned property
law designates another Person, and all liability of the Trustee and such Paying
Agent with respect to such money shall cease. In the absence of a written
request from the Issuers to return unclaimed funds to the Issuers, the Trustee
shall from time to time deliver all unclaimed funds to or as directed by
applicable escheat authorities, as determined by the Trustee in its sole
discretion, in accordance with the customary practices and procedures of the
Trustee. Any unclaimed funds held by the Trustee pursuant to this Section 11.03
shall be held uninvested and without any liability for interest.

SECTION 11.04. REINSTATEMENT.

                  If the Trustee or Paying Agent is unable to apply any money or
U.S. Government Obligations in accordance with Section 11.01 by reason of any
legal proceeding or by reason of any order or judgment of any court of
governmental authority enjoining, restraining or otherwise prohibiting such
application, the Issuers' and Subsidiary Guarantors' Obligations under this
Indenture, the Notes and the Guarantees shall be revived and reinstated as
though no deposit has occurred pursuant to Section 11.01 until such time as the
Trustee or Paying Agent is permitted to apply all such money or U.S. Government
Obligations in accordance with Section 11.02, provided, however, that if the
Issuers or the Subsidiary Guarantors have made any payment of interest on or
principal of any Notes because of the reinstatement of their Obligations, the
Issuers or such Subsidiary Guarantors shall be subrogated to the rights of the
Holders of such Notes to receive such payment from the money or U.S. Government
Obligations held by the Trustee or Paying Agent.

                                   ARTICLE 12
                                  MISCELLANEOUS

SECTION 12.01. TRUST INDENTURE ACT CONTROLS.

                  If any provision of this Indenture limits, qualifies or
conflicts with the duties imposed by TIA Section 318(c), the imposed duties
shall control.

SECTION 12.02. NOTICES.

                  Any notice or communication by the Issuers or the Trustee to
the others is duly given if in writing and delivered in Person or mailed by
first class mail (registered or certified, return receipt requested), telecopier
or overnight air courier guaranteeing next day delivery, to the others' address:

                  If to the Issuers or any Subsidiary Guarantor:

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                           GulfTerra Energy Partners, L.P.
                           4 Greenway Plaza
                           Houston, Texas 77046
                           Telecopier No.: (713) 420-2131
                           Attention: Chief Financial Officer

                  With a copy to:

                           Akin, Gump, Strauss, Hauer & Feld, L.L.P.
                           1900 Pennzoil Place, South Tower
                           711 Louisiana Street
                           Houston, Texas 77002
                           Telecopier No.: (713) 236-0822
                           Attention: J. Vincent Kendrick

                  If to the Trustee or Paying Agent:

                           Wells Fargo Bank, National Association
                           505 Main Street
                           Suite 301
                           Fort Worth, Texas 76102
                           Attention: Melissa Scott

                  The Issuers, any Subsidiary Guarantor or the Trustee, by
notice to the others may designate additional or different addresses for
subsequent notices or communications.

                  All notices and communications (other than those sent to
Holders) shall be deemed to have been duly given: at the time delivered by hand,
if personally delivered; five Business Days after being deposited in the mail,
postage prepaid, if mailed; when receipt acknowledged, if sent by facsimile
transmission; and the next Business Day after timely delivery to the courier, if
sent by overnight air courier guaranteeing next day delivery.

                  Any notice or communication to a Holder shall be mailed by
first class mail, certified or registered, return receipt requested, or by
overnight air courier guaranteeing next day delivery to its address shown on the
register kept by the Registrar. Any notice or communication shall also be so
mailed to any Person described in TIA Section 313(c), to the extent required by
the TIA. Failure to mail a notice or communication to a Holder or any defect in
it shall not affect its sufficiency with respect to other Holders.

                  If a notice or communication is mailed in the manner provided
above within the time prescribed, it is duly given, whether or not the addressee
receives it.

                  If the Issuers mail a notice or communication to Holders, it
shall mail a copy to the Trustee and each Agent at the same time.

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SECTION 12.03. COMMUNICATION BY HOLDERS OF NOTES WITH OTHER HOLDERS OF NOTES.

                  The Trustee is subject to TIA Section 312(b), and Holders may
communicate pursuant thereto with other Holders with respect to their rights
under this Indenture or the Notes. The Issuers, the Subsidiary Guarantors, the
Trustee, the Registrar and anyone else shall have the protection of TIA Section
312(c).

SECTION 12.04. CERTIFICATE AND OPINION AS TO CONDITIONS PRECEDENT.

                  Upon any request or application by the Issuers or any
Subsidiary Guarantor to the Trustee to take any action under this Indenture, the
Issuers or such Subsidiary Guarantors shall furnish to the Trustee:

                  (a)      an Officers' Certificate in form and substance
reasonably satisfactory to the Trustee (which shall include the statements set
forth in Section 12.05 hereof) stating that, in the opinion of the signers, all
conditions precedent and covenants, if any, provided for in this Indenture
relating to the proposed action have been satisfied; and

                  (b)      an Opinion of Counsel in form and substance
reasonably satisfactory to the Trustee (which shall include the statements set
forth in Section 12.05 hereof) stating that, in the opinion of such counsel, all
such conditions precedent and covenants have been satisfied.

                  In any case where several matters are required to be certified
by, or covered by an opinion of, any specified Person, it is not necessary that
all such matters be certified by, or covered by the opinion of, only one such
Person, or that they be so certified or covered by only one document, but one
such Person may certify or give an opinion with respect to some matters and one
or more such Persons as to other matters, and any such Person may certify or
give an opinion as to such matters in one or several documents.

                  Any certificate or opinion of an Officer of the General
Partner, an Issuer or any Subsidiary Guarantor may be based, insofar as it
relates to legal matters, upon a certificate or opinion of, or representations
by, counsel, unless such Officer knows, or in the exercise of reasonable care
should know, that the certificate or opinion or representations with respect to
the matters upon which his certificate or opinion is based are erroneous. Any
such certificate or Opinion of Counsel may be based, and may state that it is so
based, insofar as it relates to factual matters, upon a certificate or opinion
of, or representations by, an Officer or Officers of the General Partner, an
Issuer or such Subsidiary Guarantor stating that the information with respect to
such factual matters is in possession of the General Partner, an Issuer or such
Subsidiary Guarantor, unless such counsel knows, or in the exercise of
reasonable care should know, that the certificate of opinion or representations
with respect to such matters are erroneous.

                  Where any Person is required to make, give or execute two or
more applications, requests, consents, certificates, statements, opinions or
other instruments under this Indenture, they may, but need not, be consolidated
and form one instrument.

                                       106

<PAGE>

SECTION 12.05. STATEMENTS REQUIRED IN CERTIFICATE OR OPINION.

                  Each certificate or opinion with respect to compliance with a
condition or covenant provided for in this Indenture (other than a certificate
provided pursuant to TIA Section 314(a)(4)) shall comply with the provisions of
TIA Section 314(e) and shall include:

                  (a)      a statement that the Person making such certificate
or opinion has read such covenant or condition;

                  (b)      a brief statement as to the nature and scope of the
examination or investigation upon which the statements or opinions contained in
such certificate or opinion are based;

                  (c)      a statement that, in the opinion of such Person, he
or she has made such examination or investigation as is necessary to enable him
or her to express an informed opinion as to whether or not such covenant or
condition has been satisfied; and

                  (d)      a statement as to whether or not, in the opinion of
such Person, such condition or covenant has been satisfied.

SECTION 12.06. RULES BY TRUSTEE AND AGENTS.

                  The Trustee may make reasonable rules for action by or at a
meeting of Holders. The Registrar or Paying Agent may make reasonable rules and
set reasonable requirements for its functions.

SECTION 12.07. NO PERSONAL LIABILITY OF DIRECTORS, OFFICERS, PARTNERS,
               EMPLOYEES, INCORPORATORS, STOCKHOLDERS AND MEMBERS.

                  No past, present or future director, officer, partner,
employee, incorporator, stockholder or member of either of the Issuers, the
General Partner or any Subsidiary Guarantor, as such, shall have any liability
for any Obligations of either of the Issuers or any Subsidiary Guarantor under
the Notes, this Indenture or the Guarantees or for any claim based on, in
respect of, or by reason of, such Obligations or their creation. Each Holder by
accepting a Note waives and releases all such liability. The waiver and release
are part of the consideration for issuance of the Notes.

SECTION 12.08. GOVERNING LAW.

                  THE INTERNAL LAW OF THE STATE OF NEW YORK SHALL GOVERN AND BE
USED TO CONSTRUE THIS INDENTURE, THE NOTES AND THE GUARANTEES.

SECTION 12.09. NO ADVERSE INTERPRETATION OF OTHER AGREEMENTS.

                  This Indenture may not be used to interpret any other
indenture, loan or debt agreement of either of the Issuers or any Subsidiary of
the Partnership or of any other

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<PAGE>

Person. Any such indenture, loan or debt agreement may not be used to interpret
this Indenture or the Guarantees.

SECTION 12.10. SUCCESSORS.

                  All agreements of the Issuers and the Subsidiary Guarantors in
this Indenture, the Notes and the Guarantees shall bind its successors. All
agreements of the Trustee in this Indenture shall bind their respective
successors.

SECTION 12.11. SEVERABILITY.

                  In case any provision in this Indenture, the Notes or the
Guarantees shall be invalid, illegal or unenforceable, the validity, legality
and enforceability of the remaining provisions shall not in any way be affected
or impaired thereby.

SECTION 12.12. COUNTERPART ORIGINALS.

                  The parties may sign any number of copies of this Indenture.
Each signed copy shall be an original, but all of them together represent the
same agreement.

SECTION 12.13. TABLE OF CONTENTS, HEADINGS, ETC.

                  The Table of Contents, Cross-Reference Table and Headings of
the Articles and Sections of this Indenture have been inserted for convenience
of reference only, are not to be considered a part of this Indenture and shall
in no way modify or restrict any of the terms or provisions hereof.

                         [Signatures on following page]

                                       108

<PAGE>

                  IN WITNESS WHEREOF, the parties have executed this Indenture
as of the date first written above. Issuers:

                                    GULFTERRA ENERGY PARTNERS, L.P.

                                    By: GULFTERRA ENERGY COMPANY,
                                        L.L.C., as General Partner

                                    By:  /s/ Keith Forman
                                         ---------------------------------------
                                         Keith Forman, Vice President and
                                         Chief Financial Officer

                                    GULFTERRA ENERGY FINANCE CORPORATION

                                    By:  /s/ Keith Forman
                                         ---------------------------------------
                                         Keith Forman, Vice President and
                                         Chief Financial Officer

<PAGE>

                                    Subsidiary Guarantors:

                               CAMERON HIGHWAY PIPELINE GP, L.L.C. *
                               CAMERON HIGHWAY PIPELINE I, L.P. *
                               CRYSTAL HOLDING, L.L.C.*
                               FIRST RESERVE GAS, L.L.C. *
                               FLEXTREND DEVELOPMENT COMPANY, L.L.C. *
                               GULFTERRA ALABAMA INTRASTATE, L.L.C.*
                               GULFTERRA FIELD SERVICES, L.L.C.*
                               GULFTERRA GC, L.P. *
                               GULFTERRA HOLDING I, L.L.C. *
                               GULFTERRA HOLDING II, L.L.C. *
                               GULFTERRA HOLDING III, L.L.C. *
                               GULFTERRA HOLDING IV, L.P. *
                               GULFTERRA HOLDING V, L.P. *
                               GULFTERRA INTRASTATE, L.P. *
                               GULFTERRA NGL STORAGE, L.L.C.*
                               GULFTERRA OIL TRANSPORT, L.L.C.
                               GULFTERRA OPERATING COMPANY, L.L.C. *
                               GULFTERRA SOUTH TEXAS, L.P. *
                               GULFTERRA TEXAS PIPELINE, L.P*.
                               HATTIESBURG GAS STORAGE COMPANY
                                  By: FIRST RESERVE GAS, L.L.C., in its capacity
                                      as 50% general partner of Hattiesburg Gas
                                      Storage Company*
                                  By: HATTIESBURG INDUSTRIAL GAS SALES, L.L.C.,
                                      in its capacity as 50% general partner of
                                      Hattiesburg Gas Storage Company*
                               HATTIESBURG INDUSTRIAL GAS SALES, L.L.C.*
                               HIGH ISLAND OFFSHORE SYSTEM, L.L.C.
                                  By: GULFTERRA ENERGY PARTNERS, L.P.,
                                      its sole member*
                               MANTA RAY GATHERING COMPANY, L.L.C.*
                               PETAL GAS STORAGE, L.L.C.*
                               POSEIDON PIPELINE COMPANY, L.L.C.*

                               *By: /s/ Keith Forman
                                    -----------------------------------
                               Name:  Keith Forman
                               Title: Vice President and Chief Financial Officer

<PAGE>

                               Trustee:

                               WELLS FARGO BANK, NATIONAL
                               ASSOCIATION, as Trustee

                               By:   /s/ Melissa Scott
                                     ----------------------
                               Name: Melissa Scott
                               Title: Vice President

<PAGE>

                                   SCHEDULE A

Schedule of Subsidiary Guarantors

Cameron Highway Pipeline GP, L.L.C.
Cameron Highway Pipeline I, L.P.
Crystal Holding, L.L.C.
First Reserve Gas, L.L.C.
Flextrend Development Company, L.L.C.
GulfTerra Alabama Intrastate, L.L.C.
GulfTerra Field Services, L.L.C.
GulfTerra GC, L.P.
GulfTerra Holding I, L.L.C.
GulfTerra Holding II, L.L.C.
GulfTerra Holding III, L.L.C.
GulfTerra Holding IV, L.P.
GulfTerra Holding V, L.P.
GulfTerra Intrastate, L.P.
GulfTerra NGL Storage, L.L.C.
GulfTerra Oil Transport, L.L.C.
GulfTerra Operating Company, L.L.C.
GulfTerra South Texas, L.P.
GulfTerra Texas Pipeline, L.P.
Hattiesburg Gas Storage Company
Hattiesburg Industrial Gas Sales, L.L.C.
High Island Offshore System, L.L.C.
Manta Ray Gathering Company, L.L.C.
Petal Gas Storage, L.L.C.
Poseidon Pipeline Company, L.L.C.

                                Schedule A Page 1

<PAGE>

                                                                       EXHIBIT A

                                 (Face of Note)

THIS GLOBAL NOTE IS HELD BY THE DEPOSITARY (AS DEFINED IN THE INDENTURE
GOVERNING THIS NOTE) OR ITS NOMINEE IN CUSTODY FOR THE BENEFIT OF THE BENEFICIAL
OWNERS HEREOF, AND IS NOT TRANSFERABLE TO ANY PERSON UNDER ANY CIRCUMSTANCES
EXCEPT THAT (I) THE TRUSTEE MAY MAKE SUCH NOTATIONS HEREON AS MAY BE REQUIRED
PURSUANT TO SECTION 2.06 OF THE INDENTURE, (II) THIS GLOBAL NOTE MAY BE
EXCHANGED PURSUANT TO SECTION 2.06(a) OF THE INDENTURE, (III) THIS GLOBAL NOTE
MAY BE DELIVERED TO THE TRUSTEE FOR CANCELLATION PURSUANT TO SECTION 2.11 OF THE
INDENTURE AND (IV) THIS GLOBAL NOTE MAY BE TRANSFERRED TO A SUCCESSOR DEPOSITARY
WITH THE PRIOR WRITTEN CONSENT OF THE ISSUERS.(1)

UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR NOTES IN DEFINITIVE
FORM, THIS NOTE MAY NOT BE TRANSFERRED EXCEPT AS A WHOLE BY THE DEPOSITARY TO A
NOMINEE OF THE DEPOSITARY OR BY A NOMINEE OF THE DEPOSITARY TO THE DEPOSITARY OR
ANOTHER NOMINEE OF THE DEPOSITARY OR BY THE DEPOSITARY OR ANY SUCH NOMINEE TO A
SUCCESSOR DEPOSITARY OR A NOMINEE OF SUCH SUCCESSOR DEPOSITARY. UNLESS THIS
CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST
COMPANY (55 WATER STREET, NEW YORK, NEW YORK) ("DTC"), TO THE ISSUER OR THEIR
AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE
ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR SUCH OTHER NAME AS MAY BE
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO
CEDE & CO. OR SUCH OTHER ENTITY AS MAY BE REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.(1) *THIS NOTE (OR ITS PREDECESSOR)
WAS ORIGINALLY ISSUED IN A TRANSACTION EXEMPT FROM REGISTRATION UNDER THE UNITED
STATES SECURITIES ACT OF 1933 (THE "SECURITIES ACT"), AND THIS NOTE MAY NOT BE
OFFERED, SOLD OR OTHERWISE TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR AN
APPLICABLE EXEMPTION THEREFROM. EACH PURCHASER OF THIS NOTE IS HEREBY NOTIFIED
THAT THE SELLER OF THIS NOTE MAY BE RELYING ON THE EXEMPTION FROM THE PROVISIONS
OF SECTION 5 OF THE SECURITIES ACT PROVIDED BY RULE 144A THEREUNDER.

THE HOLDER OF THIS NOTE AGREES FOR THE BENEFIT OF THE ISSUERS OF THIS NOTE THAT:
(A) THIS NOTE MAY BE OFFERED, RESOLD, PLEDGED OR OTHERWISE TRANSFERRED, ONLY (I)
TO GULFTERRA ENERGY PARTNERS, L.P., GULFTERRA ENERGY FINANCE CORPORATION, OR ANY
OF THEIR SUBSIDIARIES, (II) IN THE UNITED STATES TO A PERSON WHOM THE SELLER

                                Exhibit A Page 1

<PAGE>

REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER (AS DEFINED IN RULE 144A
UNDER THE SECURITIES ACT) IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE
144A, (III) OUTSIDE THE UNITED STATES IN AN OFFSHORE TRANSACTION IN ACCORDANCE
WITH RULE 904 UNDER THE SECURITIES ACT, (IV) PURSUANT TO AN EXEMPTION FROM
REGISTRATION UNDER THE SECURITIES ACT PROVIDED BY RULE 144 THEREUNDER (IF
AVAILABLE), (V) TO AN INSTITUTIONAL "ACCREDITED INVESTOR" WITHIN THE MEANING OF
RULE 501(A)(1), (2), (3) OR (7) UNDER THE SECURITIES ACT THAT IS AN
INSTITUTIONAL ACCREDITED INVESTOR ACQUIRING THE SECURITY FOR ITS OWN ACCOUNT OR
FOR THE ACCOUNT OF SUCH INSTITUTIONAL ACCREDITED INVESTOR, IN EACH CASE IN A
MINIMUM PRINCIPAL AMOUNT OF THE SECURITIES OF $250,000, FOR INVESTMENT PURPOSES
AND NOT WITH A VIEW TO OR FOR OFFER OR SALE IN CONNECTION WITH ANY DISTRIBUTION
IN VIOLATION OF THE SECURITIES ACT, OR (VI) PURSUANT TO AN EFFECTIVE
REGISTRATION STATEMENT UNDER THE SECURITIES ACT, IN EACH OF CASES (I) THROUGH
(VI) IN ACCORDANCE WITH ANY APPLICABLE SECURITIES LAWS OF ANY STATE OF THE
UNITED STATES, AND (B) THE HOLDER WILL, AND EACH SUBSEQUENT HOLDER IS REQUIRED
TO, NOTIFY ANY PURCHASER OF THIS NOTE FROM IT OF THE RESALE RESTRICTIONS
REFERRED TO IN (A) ABOVE.

                                                             CUSIP: ____________

               6 1/4% [Series A] [Series B] Senior Notes due 2010

No. ______                                                        $ ____________

                         GULFTERRA ENERGY PARTNERS, L.P.
                                       and
                      GULFTERRA ENERGY FINANCE CORPORATION

promise to pay to _______________________ or registered assigns, the principal
sum of _________________________ Dollars of the United States of America or such
greater or lesser amount as may from time to time be endorsed on the Schedule of
Exchanges of Interests in the Global Note(1) on June 1, 2010.

Interest Payment Dates: June 1 and December 1 of each year

Record Dates: May 15 and November 15

Reference is hereby made to the further provisions of this Note set forth on the
reverse hereof, which further provisions shall for all purposes have the same
effect as if set forth at this place.

----------------

(1) This is included in Global Notes only

*        Legend appears only on the Series A Notes.

                                Exhibit A Page 2

<PAGE>

Unless the certificate of authorization hereon has been duly executed by the
Trustee referred to on the reverse hereof by manual signature, this Note shall
not be entitled to any benefit of this Indenture or be valid or obligatory for
any purpose.

Dated: ________ ___, ____

GULFTERRA ENERGY FINANCE                  GULFTERRA ENERGY PARTNERS, L.P.
CORPORATION

                                          By: GulfTerra Energy Company, L.L.C.,
                                              as General Partner

By: ________________________________      By: __________________________________
Name: ______________________________      Name: ________________________________
Title: _____________________________      Title: _______________________________

Certificate of Authentication:

This is one of the Notes referred to in the within-mentioned Indenture.

WELLS FARGO BANK, NATIONAL ASSOCIATION, as Trustee

By: ______________________________________
    Authorized Signatory

Date of Authentication: ________ ___, ____

                                Exhibit A Page 3

<PAGE>

                                 [Back of Note]
                6 1/4% [Series A] [Series B] Senior Note due 2010

                  Capitalized terms used herein shall have the meanings assigned
to them in the Indenture referred to below unless otherwise indicated.

                  1.       Interest. GulfTerra Energy Partners, L.P., a Delaware
limited partnership (the "Partnership"), and GulfTerra Energy Finance
Corporation, a Delaware corporation ("GulfTerra Finance" and, together with the
Partnership, the "Issuers"), promise to pay interest on the principal amount of
this Note at 6 1/4% per annum and shall pay any Additional Interest payable
pursuant to Section 5 of the Registration Rights Agreement referred to below.
The Issuers will pay interest and Additional Interest, if any, semi-annually on
June 1 and December 1 of each year, or if any such day is not a Business Day, on
the next succeeding Business Day (each an "Interest Payment Date"). Interest on
the Notes will accrue from the most recent date to which interest has been paid
or, if no interest has been paid, from the Issue Date; provided that if there is
no existing Default in the payment of interest, and if this Note is
authenticated between a record date referred to on the face hereof and the next
succeeding Interest Payment Date, interest shall accrue from such next
succeeding Interest Payment Date; provided, further, that the first Interest
Payment Date shall be December 1, 2003. The Issuers shall pay interest
(including post-petition interest in any proceeding under any Bankruptcy Law) on
overdue principal and premium, if any, from time to time on demand at the rate
then in effect; the Issuers shall pay interest (including post-petition interest
in any proceeding under any Bankruptcy Law) on overdue installments of interest
and Additional Interest (without regard to any applicable grace periods) from
time to time on demand at the same rate to the extent lawful. Interest will be
computed on the basis of a 360-day year comprised of twelve 30-day months.

                  2.       Method of Payment. The Issuers will pay interest on
the Notes (except defaulted interest) and Additional Interest to the Persons who
are registered Holders of Notes at the close of business on the May 15 or
November 15 next preceding the Interest Payment Date, even if such Notes are
cancelled after such record date and on or before such Interest Payment Date,
except as provided in Section 2.12 of the Indenture with respect to defaulted
interest. The Notes will be payable as to principal, premium and interest and
Additional Interest, if any, at the office or agency of the Paying Agent and
Registrar maintained for such purpose within the City and State of New York, or,
at the option of the Issuers, payment of interest and Additional Interest, if
any, may be made by check mailed to the Holders at their addresses set forth in
the register of Holders, and provided that payment by wire transfer of
immediately available funds will be required with respect to principal of and
interest, premium and Additional Interest, if any, on, all Global Notes and all
other Notes the Holders of which shall have provided wire transfer instructions
to the Issuers or the Paying Agent. Such payment shall be in such coin or
currency of the United States of America as at the time of payment is legal
tender for payment of public and private debts.

                  3.       Paying Agent and Registrar. Initially, Wells Fargo
Bank, National Association, the Trustee under the Indenture, will act as Paying
Agent and Registrar. The

                                Exhibit A Page 4

<PAGE>

Issuers may change any Paying Agent or Registrar without notice to any Holder.
The Issuers or any of the Subsidiary Guarantors may act in any such capacity.

                  4.       Indenture. The Issuers issued the Notes under an
Indenture dated as of July 3, 2003 ("Indenture") among the Issuers, the
Subsidiary Guarantors and the Trustee. The terms of the Notes include those
stated in the Indenture and those made part of the Indenture by reference to the
Trust Indenture Act of 1939, as amended (15 U.S. Code Sections 77aaa-77bbbb).
The Notes are subject to all such terms, and Holders are referred to the
Indenture and such Act for a statement of such terms. To the extent any
provision of this Note conflicts with the express provisions of the Indenture,
the provisions of the Indenture shall govern and be controlling. The Notes are
unsecured general obligations of the Issuers.

                  5.       Optional Redemption. The Issuers shall have the
option to redeem the Notes, in whole or in part from time to time, on at least
30 but not more than 60 days' prior notice mailed to the registered address of
each Holder of Notes to be so redeemed, at a redemption price equal to the
greater of (i) 100 percent of the principal amount of Notes to be redeemed plus
accrued and unpaid interest on the principal amount being redeemed to the date
of redemption or (ii) the sum of (a) the present values of the Remaining
Scheduled Payments on such Notes, discounted to the date of redemption, on a
semiannual basis (assuming a 360-day year consisting of twelve 30-day months),
at the Treasury Rate plus 50 basis points plus (b) accrued and unpaid interest
on the principal amount being redeemed to the date of redemption.

                  6.       Mandatory Redemption. Except as set forth in
paragraph 7 below, the Issuers shall not be required to make mandatory
redemption payments with respect to the Notes.

                  7.       Repurchase at Option of Holder. Subject to the
additional terms and conditions set forth in the Indenture:

                  (a)      If there is a Change of Control, each Holder of Notes
will have the right to require the Issuers to repurchase all or any part (equal
to $1,000 or an integral multiple thereof) of such Holder's Notes (the "Change
of Control Offer") at a purchase price equal to 101% of the aggregate principal
amount of the Notes repurchased plus accrued and unpaid interest, if any,
thereon, and Additional Interest, if any, thereon, to the date of purchase,
subject to the satisfaction of the Tender Condition in the event of a Change of
Control that does not result in a Ratings Downgrade. Within 30 days following
any Change of Control, the Issuers shall mail a notice to each Holder setting
forth the procedures governing the Change of Control Offer as required by the
Indenture and information regarding such other matters as is required under
Section 4.06 of the Indenture. The Holder of this Note may elect to have this
Note or a portion hereof in an authorized denomination purchased, subject to the
satisfaction of the Tender Condition in the event of a Change of Control that
does not result in a Ratings Downgrade, by completing the form entitled "Option
of Holder to Elect Purchase" appearing below and tendering this Note pursuant to
the Change of Control Offer.

                                Exhibit A Page 5

<PAGE>

                  (b)      If the Issuers or any Restricted Subsidiary of the
Partnership consummates an Asset Sale, the Issuers shall promptly commence a pro
rata offer to all Holders of Notes and all holders of other Indebtedness that is
pari passu in right of paymentwith the Notes containing provisions similar to
those set forth in the Indenture with respect to offers to purchase or redeem
with the proceeds of sales of assets (an "Asset Sale Offer") pursuant to Section
3.09 of the Indenture to purchase the maximum principal amount of Notes and such
other pari passu Indebtedness that may be purchased out of the Excess Proceeds
at an offer price in cash in an amount equal to 100% of the principal amount
thereof plus accrued and unpaid interest thereon, if any, and Additional
Interest (in the case of the Notes) thereon, if any, to the date of purchase in
accordance with the procedures set forth in the Indenture. If the aggregate
principal amount of Notes surrendered by Holders thereof exceeds the amount of
Excess Proceeds allocated for repurchase of Notes, the Trustee shall select the
Notes to be purchased on a pro rata basis. Holders of Notes that are the subject
of an offer to purchase will receive an Asset Sale Offer from the Issuers prior
to any related purchase date and may elect to have such Notes purchased by
completing the form entitled "Option of Holder to Elect Purchase" on the reverse
of the Notes.

                  8.       Notice of Redemption. Notice of redemption will be
mailed at least 30 days but not more than 60 days before the redemption date to
each Holder whose Notes are to be redeemed at its registered address. Notes in
denominations larger than $1,000 may be redeemed in part but only in whole
multiples of $1,000, unless all of the Notes held by a Holder are to be
redeemed. On and after the redemption date interest and Additional Interest, if
any, cease to accrue on Notes or portions thereof called for redemption unless
the Issuers defaults in making such redemption payment.

                  9.       Denominations, Transfer, Exchange. The Notes are in
registered form without coupons in denominations of $1,000 and integral
multiples of $1,000. The transfer of Notes may be registered and Notes may be
exchanged as provided in the Indenture. The Registrar and the Trustee may
require a Holder, among other things, to furnish appropriate endorsements and
transfer documents and the Issuers may require a Holder to pay any taxes and
fees required by law or permitted by the Indenture. The Issuers need not
exchange or register the transfer of any Note or portion of a Note selected for
redemption, except for the unredeemed portion of any Note being redeemed in
part. Also, it need not exchange or register the transfer of any Notes for a
period of 15 days before the mailing of a notice of redemption or during the
period between a record date and the corresponding Interest Payment Date.

                  10.      Persons Deemed Owners. The registered Holder of a
Note may be treated as its owner for all purposes.

                  11.      Amendment, Supplement and Waiver. Subject to certain
exceptions, the Indenture or the Notes may be amended or supplemented with the
consent of the Holders of at least a majority in principal amount of the then
outstanding Notes, and any existing default or compliance with any provision of
the Indenture, the Guarantees, or the Notes may be waived with the consent of
the Holders of a majority in principal amount of the then outstanding Notes.
Without the consent of any Holder of a Note, the Indenture, the

                                Exhibit A Page 6

<PAGE>

Guarantees, or the Notes may be amended or supplemented to cure any ambiguity,
defect or inconsistency, to provide for uncertificated Notes in addition to or
in place of certificated Notes, to provide for the assumption of an Issuer's or
a Subsidiary Guarantor's obligations to Holders of the Notes in case of a merger
or consolidation or sale of all or substantially all of such Issuer's or
Subsidiary Guarantor's assets, to add or release Subsidiary Guarantors pursuant
to the terms of the Indenture, to make any change that would provide any
additional rights or benefits to the Holders of the Notes or surrender any right
or power conferred upon the Issuers or the Subsidiary Guarantors by the
Indenture that does not adversely affect the rights under the Indenture of any
such Holder, to comply with the requirements of the SEC in order to effect or
maintain the qualification of the Indenture under the Trust Indenture Act, to
evidence or provide for the acceptance of appointment under the Indenture of a
successor Trustee, to add additional Events of Default or to secure the Notes
and/or the Guarantees.

                  12.      Defaults and Remedies. Events of Default include in
summary form: (i) default for 30 days in the payment when due of interest on or
Additional Interest, if any, with respect to the Notes; (ii) default in payment
when due of the principal of or premium, if any, on the Notes; (iii) failure by
the Partnership or any of its Restricted Subsidiaries to comply with Sections
3.09, 4.06 and 4.07 of the Indenture; (iv) failure by the Partnership for 60
days after notice to the Issuers by the Trustee or to the Issuers and the
Trustee by Holders of at least 25% in principal amount of the Notes then
outstanding to comply with certain other agreements in the Indenture or the
Notes (provided that no such notice need be given, and an Event of Default shall
occur, 60 days after a failure by an Issuer or any Restricted Subsidiary of the
Partnership to comply with the covenants in section 4.08, 4.09 or 5.01 of the
Indenture, unless theretofore cured); (v) default under any mortgage, indenture
or instrument under which there may be issued or by which there may be secured
or evidenced any Indebtedness for money borrowed by an Issuer or any Restricted
Subsidiary of the Partnership (or the payment of which is guaranteed by an
Issuer or any Restricted Subsidiary of the Partnership), whether such
Indebtedness or guarantee now exists, or is created after the date of the
Indenture, if that default (a) is caused by a failure to pay principal of or
premium, if any, or interest on such Indebtedness prior to the expiration of the
grace period provided in such Indebtedness on the date of such default (a
"Payment Default") or (b) results in the acceleration of such Indebtedness prior
to its express maturity and, in each case, the principal amount of any such
Indebtedness, together with the principal amount of any other such Indebtedness
under which there has been a Payment Default or the maturity of which has been
so accelerated, aggregates $40.0 million or more; (vi) the failure by an Issuer
or any Restricted Subsidiary of the Partnership to pay final judgments by courts
of competent jurisdiction aggregating in excess of $40.0 million, which
judgments are not paid, discharged or stayed for a period of 60 days; (vii)
except as permitted by the Indenture, any Guarantee of a Subsidiary Guarantor
shall be held in any judicial proceeding to be unenforceable or invalid or shall
cease for any reason to be in force and effect or any Subsidiary Guarantor, or
any Person acting on behalf of any Subsidiary Guarantor, shall deny or disaffirm
its obligations under its Guarantee; and (viii) certain events of bankruptcy or
insolvency with respect to an Issuer or any Restricted Subsidiary of the
Partnership that is a Significant Subsidiary or any group of Restricted
Subsidiaries that, taken as a whole, would constitute a Significant Subsidiary.
If any Event of Default occurs and is continuing, the Trustee may or at the

                                Exhibit A Page 7

<PAGE>

request of the Holders of at least 25% in principal amount of the then
outstanding Notes shall declare all the Notes to be due and payable.
Notwithstanding the foregoing, so long as any Credit Facility shall be in full
force and effect, if an Event of Default pursuant to clause (v) above with
regard to such Credit Facility shall have occurred and be continuing, the Notes
shall not become due and payable until the earlier to occur of (x) five Business
Days following delivery of written notice of such acceleration of the Notes to
the agent under such Credit Facility and (y) the acceleration of any
Indebtedness under such Credit Facility. Notwithstanding the foregoing, in the
case of an Event of Default arising from certain events of bankruptcy or
insolvency, with respect to an Issuer, any Restricted Subsidiary of the
Partnership constituting a Significant Subsidiary or any group of Restricted
Subsidiaries of the Partnership that, taken together, would constitute a
Significant Subsidiary, all outstanding Notes will become due and payable
without further action or notice. Holders may not enforce the Indenture or the
Notes except as provided in the Indenture. Subject to certain limitations,
Holders of a majority in principal amount of the then outstanding Notes may
direct the Trustee in its exercise of any trust or power. The Trustee may
withhold from Holders of the Notes notice of any continuing Default or Event of
Default (except a Default or Event of Default relating to the payment of
principal or interest) if it determines that withholding notice is in their
interest.

The Holders of a majority in aggregate principal amount of the Notes then
outstanding by notice to the Trustee may on behalf of the Holders of all of the
Notes waive any existing Default or Event of Default and its consequences under
the Indenture except a continuing Default or Event of Default in the payment of
interest or Additional Interest, if any, on, or the principal or premium, if
any, of the Notes. The Partnership is required to deliver to the Trustee
annually a statement regarding compliance with the Indenture, and the Issuers
are required upon becoming aware of any Default or Event of Default, to deliver
to the Trustee a statement specifying such Default or Event of Default.

                  13.      Trustee Dealings with Partnership. The Trustee, in
its individual or any other capacity, may make loans to, accept deposits from,
and perform services for the Partnership or its Affiliates, and may otherwise
deal with the Partnership or its Affiliates, as if it were not the Trustee.

                  14.      No Recourse Against General Partner. The General
Partner shall not have any liability for any Obligations of either of the
Issuers or any Subsidiary Guarantor under the Notes, the Indenture or the
Guarantees, or for any claim based on, in respect of, or by reason of, such
Obligations or their creation. Each Holder by accepting a Note waives and
releases all such liability. The waiver and release are part of the
consideration for the issuance of the Notes.

                  15.      No Recourse Against Others. A past, present or future
director, officer, partner, employee, incorporator, stockholder or member of an
Issuer, the General Partner or any Subsidiary Guarantor, as such, shall not have
any liability for any Obligations of either of the Issuers or any Subsidiary
Guarantor under the Notes, the Indenture or the Guarantees or for any claim
based on, in respect of, or by reason of, such Obligations or their creation.
Each Holder by accepting a Note waives and releases all such liability. The
waiver and release are part of the consideration for the issuance of the Notes.

                                Exhibit A Page 8

<PAGE>

                  16.      Authentication. This Note shall not be valid until
authenticated by the manual signature of the Trustee or an authenticating agent.

                  17.      Abbreviations. Customary abbreviations may be used in
the name of a Holder or an assignee, such as: TEN COM (= tenants in common), TEN
ENT (= tenants by the entireties), JT TEN (= joint tenants with right of
survivorship and not as tenants in common), CUST (= Custodian), and U/G/M/A (=
Uniform Gifts to Minors Act).

                  18.      Additional Rights and Obligations of Holders of
Restricted Global Notes and Restricted Definitive Notes. In addition to the
rights provided to Holders of Notes under the Indenture, Holders of Restricted
Global Notes and Restricted Certificated Notes shall have all the rights and
obligations set forth in the Registration Rights Agreement dated as of July 3,
2003, among the Issuers, the Subsidiary Guarantors and the parties named on the
signature pages thereof (the "Registration Rights Agreement").

                  19.      CUSIP Numbers. Pursuant to a recommendation
promulgated by the Committee on Uniform Security Identification Procedures, the
Issuers have caused CUSIP numbers to be printed on the Notes and the Trustee may
use CUSIP numbers in notices of redemption as a convenience to Holders. No
representation is made as to the accuracy of such numbers either as printed on
the Notes or as contained in any notice of redemption and reliance may be placed
only on the other identification numbers placed thereon.

                  The Issuers will furnish to any Holder upon written request
and without charge a copy of the Indenture and/or the Registration Rights
Agreement.

         Requests may be made to:

                           El Paso Energy Partners, L.P.
                           4 Greenway Plaza
                           Houston, Texas 77046
                           Attention: Chief Financial Officer

         with a copy to:
                           Akin, Gump, Strauss, Hauer & Feld, L.L.P.
                           1900 Pennzoil Place, South Tower
                           711 Louisiana Street
                           Houston, Texas 77002
                           Attention: J. Vincent Kendrick

                                Exhibit A Page 9

<PAGE>

                              [FORM OF ASSIGNMENT]

                  To assign this Note, fill in the form below: (I) or (we)
assign and transfer this Note to:

________________________________________________________________________________
                  (Insert assignee's soc. sec. or tax I.D. no.)

________________________________________________________________________________
             (Print or type name, address and zip code of assignee)

and irrevocably appoint_________________________________________________________
to transfer this Note on the books of the Issuers. The agent may substitute
another to act for him.

Date: _____________________         Your Signature: ______________________
                                                   (Sign exactly as name appears
                                                    on the other side of this
                                                    Security)

                              Signature Guarantee*

------------------------

*        NOTICE: The Signature must be guaranteed by an Institution which is a
         member of one of the following recognized signature Guarantee Programs:
         (i) The Securities Transfer Agent Medallion Program (STAMP); (ii) The
         New York Stock Exchange Medallion Program (MNSP); (iii) The Stock
         Exchange Medallion Program (SEMP); or (iv) in such other guarantee
         program acceptable to the Trustee.

                                Exhibit A Page 10

<PAGE>

                       OPTION OF HOLDER TO ELECT PURCHASE

                  If you want to elect to have this Note purchased by the
Issuers pursuant to Section 3.09, 4.07 or 4.06 of the Indenture, check the box
below:

                  [ ] Section 3.09 and 4.07            [ ] Section 4.06

                  If you want to elect to have only part of the Note purchased
by the Issuers pursuant to Section 3.09, 4.07 or Section 4.06 of the Indenture,
state the amount you elect to have purchased (must be an integral multiple of
$1,000):

$___________________

Date: _________________________    Your Signature: _____________________________
                                                   (Sign exactly as your name
                                                   appears on the Note)

                                   Tax Identification No._______________________

                              Signature Guarantee**

---------------------

**       NOTICE: The Signature must be guaranteed by an Institution which is a
         member of one of the following recognized signature Guarantee Programs:
         (i) The Securities Transfer Agent Medallion Program (STAMP); (ii) The
         New York Stock Exchange Medallion Program (MNSP); (iii) The Stock
         Exchange Medallion Program (SEMP); or (iv) in such other guarantee
         program acceptable to the Trustee.

                                Exhibit A Page 11

<PAGE>

             SCHEDULE OF EXCHANGES OF INTERESTS IN THE GLOBAL NOTE*

                  The following exchanges of a part of this Global Note for an
interest in another Global Note or for a Certificated Note, or exchanges of a
part of another Global Note or Certificated Note for an interest in this Global
Note, have been made:

<TABLE>
<CAPTION>
                                                                                                   Principal amount
                               Signature of                                                         of this Global
                           authorized signatory     Amount of decrease      Amount of increase      Note following
                            of Trustee or Note      in Principal amount     in Principal amount     such decrease
Date of Exchange                 Custodian          of this Global Note     of this Global Note     (or increase)
----------------           --------------------     -------------------     -------------------    ----------------
<S>                        <C>                      <C>                     <C>                    <C>
</TABLE>

------------------------

*        This schedule should only be included if the Note is issued in global
         form.

                                Exhibit A Page 12

<PAGE>

                                                                       EXHIBIT B

                         FORM OF CERTIFICATE OF TRANSFER

Wells Fargo Bank, National Association
[Address]

[Registrar address block]

                           Re:      6 1/4% Senior Notes due 2010 of GulfTerra
                                    Energy Partners, L.P. and GulfTerra Energy
                                    Finance Corporation

                  Reference is hereby made to the Indenture, dated as of July 3,
2003 (the "Indenture"), between GulfTerra Energy Partners, L.P. and GulfTerra
Energy Finance Corporation, as issuers (the "Issuers"), the Persons acting as
guarantors and named herein (the "Subsidiary Guarantors") and Wells Fargo Bank,
National Association, as trustee. Capitalized terms used but not defined herein
shall have the meanings given to them in the Indenture.

                  ___________________________________________, (the
"Transferor") owns and proposes to transfer the Note[s] or interest in such
Note[s] specified in Annex A hereto, in the principal amount of
$_________________________ in such Note[s] or interests (the "Transfer"), to
_______________________________ (the "Transferee"), as further specified in
Annex A hereto. In connection with the Transfer, the Transferor hereby certifies
that:

                             [CHECK ALL THAT APPLY]

                  1.   [ ] Check if Transferee will take delivery of a
beneficial interest in the 144A Global Note or a Certificated Note Pursuant to
Rule 144A. The Transfer is being effected pursuant to and in accordance with
Rule 144A under the United States Securities Act of 1933, as amended (the
"Securities Act"), and, accordingly, the Transferor hereby further certifies
that the beneficial interest or Certificated Note is being transferred to a
Person that the Transferor reasonably believed and believes is purchasing the
beneficial interest or Certificated Note for its own account, or for one or more
accounts with respect to which such Person exercises sole investment discretion,
and such Person and each such account is a "qualified institutional buyer"
within the meaning of Rule 144A in a transaction meeting the requirements of
Rule 144A and such Transfer is in compliance with any applicable blue sky
securities laws of any state of the United States. Upon consummation of the
proposed Transfer in accordance with the terms of the Indenture, the transferred
beneficial interest or Certificated Note will be subject to the restrictions on
transfer enumerated in the Private Placement Legend printed on the 144A Global
Note and/or the Certificated Note and in the Indenture and the Securities Act.

                  2.   [ ] Check if Transferee will take delivery of a
beneficial interest in the Regulation S Global Note or a Certificated Note
pursuant to Regulation S. The Transfer is being effected pursuant to and in
accordance with Rule 903 or Rule 904 under the Securities Act and, accordingly,
the Transferor hereby further certifies that (i) the Transfer is not being made
to a person in the United States and (x) at the time the buy

                                Exhibit B Page 1

<PAGE>

order was originated, the Transferee was outside the United States or such
Transferor and any Person acting on its behalf reasonably believed and believes
that the Transferee was outside the United States or (y) the transaction was
executed in, on or through the facilities of a designated offshore securities
market and neither such Transferor nor any Person acting on its behalf knows
that the transaction was prearranged with a buyer in the United States, (ii) no
directed selling efforts have been made in contravention of the requirements of
Rule 903(b) or Rule 904(b) of Regulation S under the Securities Act, (iii) the
transaction is not part of a plan or scheme to evade the registration
requirements of the Securities Act, and (iv) if the proposed transfer is being
made prior to the expiration of the Distribution Compliance Period, the transfer
is not being made to a U.S. Person or for the account or benefit of a U.S.
Person (other than an Initial Purchaser). Upon consummation of the proposed
transfer in accordance with the terms of the Indenture, the transferred
beneficial interest or Certificated Note will be subject to the restrictions on
Transfer enumerated in the Private Placement Legend printed on the Regulation S
Global Note and/or the Certificated Note and in the Indenture and the Securities
Act.

                  3.   [ ] Check and complete if Transferee will take
delivery of a beneficial interest in the Restricted Global Note or a
Certificated Note pursuant to any provision of the Securities Act other than
Rule 144A or Regulation S. The Transfer is being effected in compliance with the
transfer restrictions applicable to beneficial interests in Restricted Global
Notes and Restricted Certificated Notes and pursuant to and in accordance with
the Securities Act and any applicable blue sky securities laws of any state of
the United States, and accordingly the Transferor hereby further certifies that
(check one):

                  (a)  [ ] such Transfer is being effected pursuant to and in
accordance with Rule 144 under the Securities Act;

                                       or

                  (b)  [ ] such Transfer is being effected to the Partnership,
GulfTerra Finance or a Restricted Subsidiary of the Partnership;

                                       or

                  (c)  [ ] such Transfer is being effected to an Institutional
Accredited Investor and pursuant to an exemption from the registration
requirements of the Securities Act other than Rule 144A, Rule 144 or Rule 904,
and the Transferor hereby further certifies that the Transfer complies with the
transfer restrictions applicable to beneficial interests in a Restricted Global
Note or Restricted Certificated Notes and the requirements of the exemption
claimed, which certification is supported by (1) a certificate executed by the
Transferee in the form of Exhibit E to the Indenture and (2) if such Transfer is
in respect of a principal amount of Notes at the time of transfer of less than
$250,000, an Opinion of Counsel provided by the Transferor or the Transferee (a
copy of which the Transferor has attached to this certification), to the effect
that such Transfer is in compliance with the Securities Act. Upon consummation
of the proposed transfer in accordance with the terms of the Indenture, the
transferred beneficial interest or Certificated Note will be subject to the
restrictions on transfer enumerated in the Private Placement Legend printed on
the

                                Exhibit B Page 2

<PAGE>

Restricted Global Note and/or the Certificated Notes and in the Indenture and
the Securities Act.

                  4.   [ ] Check if Transferee will take delivery of a
beneficial interest in an Unrestricted Global Note or of an Unrestricted
Certificated Note.

                  (a)  [ ] Check if Transfer is pursuant to Rule 144. (i)
The Transfer is being effected pursuant to and in accordance with Rule 144 under
the Securities Act and in compliance with the transfer restrictions contained in
the Indenture and any applicable blue sky securities laws of any state of the
United States and (ii) the restrictions on transfer contained in the Indenture
and the Private Placement Legend are not required in order to maintain
compliance with the Securities Act. Upon consummation of the proposed Transfer
in accordance with the terms of the Indenture, the transferred beneficial
interest or Certificated Note will no longer be subject to the restrictions on
transfer enumerated in the Private Placement Legend printed on the Restricted
Global Notes, on Restricted Certificated Notes and in the Indenture.

                  (b)  [ ] Check if Transfer is Pursuant to Regulation S.
(i) The Transfer is being effected pursuant to and in accordance with Rule 903
or Rule 904 under the Securities Act and in compliance with the transfer
restrictions contained in the Indenture and any applicable blue sky securities
laws of any state of the United States and (ii) the restrictions on transfer
contained in the Indenture and the Private Placement Legend are not required in
order to maintain compliance with the Securities Act. Upon consummation of the
proposed Transfer in accordance with the terms of the Indenture, the transferred
beneficial interest or Certificated Note will no longer be subject to the
restrictions on transfer enumerated in the Private Placement Legend printed on
the Restricted Global Notes, on Restricted Certificated Notes and in the
Indenture.

                  (c)  [ ] Check if Transfer is Pursuant to Other Exemption.
(i) The Transfer is being effected pursuant to and in compliance with an
exemption from the registration requirements of the Securities Act other than
Rule 144, Rule 903 or Rule 904 and in compliance with the transfer restrictions
contained in the Indenture and any applicable blue sky securities laws of any
State of the United States and (ii) the restrictions on transfer contained in
the Indenture and the Private Placement Legend are not required in order to
maintain compliance with the Securities Act. Upon consummation of the proposed
Transfer in accordance with the terms of the Indenture, the transferred
beneficial interest or Certificated Note will not be subject to the restrictions
on transfer enumerated in the Private Placement Legend printed on the Restricted
Global Notes or Restricted Certificated Notes and in the Indenture.

                  (d)  [ ] Check if Transfer is Pursuant to an Effective
Registration Statement. The transfer is being effected pursuant to an effective
registration statement under the Securities Act and in compliance with the
prospectus delivery requirements of the Securities Act. Upon consummation of the
proposed Transfer in accordance with the terms of the Indenture, the transferred
beneficial interest or Certificated Note will not be subject to the restrictions
on transfer enumerated in the Private Placement Legend printed on the Restricted
Global Notes or Restricted Certificated Notes and in the Indenture.

                                Exhibit B Page 3

<PAGE>

                  This certificate and the statements contained herein are made
for your benefit and for the benefit of the Issuers, the Subsidiary Guarantors
and J.P. Morgan Securities Inc., Banc One Capital Markets, Inc., BNP Paribas
Securities Corp., Credit Lyonnais Securities (USA) Inc., Credit Suisse First
Boston LLC, Fortis Investment Services LLC, The Royal Bank of Scotland PLC,
Scotia Capital (USA) Inc., SunTrust Capital Markets, Inc. and Wachovia
Securities, LLC (collectively, the "Initial Purchasers"), the Initial Purchasers
of such Notes being transferred. We acknowledge that you, the Issuers, the
Subsidiary Guarantors and the Initial Purchasers will rely upon our
confirmations, acknowledgments and agreements set forth herein, and we agree to
notify you promptly in writing if any of our representations or warranties
herein ceases to be accurate and complete.

[Insert Name of Transferor]

By: _____________________________________
Name: ___________________________________
Title: __________________________________

Dated: ________ ___, ____

cc: Issuers
    Initial Purchasers

                                Exhibit B Page 4

<PAGE>

                       ANNEX A TO CERTIFICATE OF TRANSFER

1.       The Transferor owns and proposes to transfer the following:

                            [CHECK ONE OF (a) OR (b)]

         (a)      [ ] a beneficial interest in the:

                  (i)      [ ] 144A Global Note (CUSIP ______), or

                  (ii)     [ ] Regulation S Global Note (CUSIP ______), or

                  (iii)    [ ] Restricted Global Note (CUSIP ______); or

         (b)      [ ] a Restricted Certificated Note.

2.       After the Transfer the Transferee will hold:

                                   [CHECK ONE]

         (a)      [ ] a beneficial interest in the:

                  (i)      [ ] 144A Global Note (CUSIP ______), or

                  (ii)     [ ] Regulation S Global Note (CUSIP ______), or

                  (iii)    [ ] Restricted Global Note (CUSIP ______), or

                  (iv)     [ ] Unrestricted Global Note (CUSIP ______); or

         (b)      [ ] a Restricted Certificated Note; or

         (c)      [ ] an Unrestricted Certificated Note,

in accordance with the terms of the Indenture.

                                Exhibit B Page 5

<PAGE>

                                                                       EXHIBIT C

                         FORM OF CERTIFICATE OF EXCHANGE

Wells Fargo Bank, National Association
[Address]

[Registrar address block]

                           Re:      6 1/4% Senior Notes due 2010 of GulfTerra
                                    Energy Partners, L.P. and GulfTerra Energy
                                    Finance Corporation

                              (CUSIP _____________)

                  Reference is hereby made to the Indenture, dated as of July 3,
2003 (the "Indenture"), between GulfTerra Energy Partners, L.P. and GulfTerra
Energy Finance Corporation, as issuers (the "Issuers"), the Persons acting as
guarantors and named therein (the "Subsidiary Guarantors") and Wells Fargo Bank,
National Association, as trustee. Capitalized terms used but not defined herein
shall have the meanings given to them in the Indenture.

                  _____________________________, (the "Owner") owns and proposes
to exchange the Note[s] or interest in such Note[s] specified herein, in the
principal amount of $_________________________ in such Note[s] or interests (the
"Exchange"). In connection with the Exchange, the Owner hereby certifies that:

                  1. Exchange of Restricted Certificated Notes or Beneficial
Interests in a Restricted Global Note for Unrestricted Certificated Notes or
Beneficial Interests in an Unrestricted Global Note

                  (a) [ ] Check if Exchange is from beneficial interest in a
Restricted Global Note to beneficial interest in an Unrestricted Global Note. In
connection with the Exchange of the Owner's beneficial interest in a Restricted
Global Note for a beneficial interest in an Unrestricted Global Note in an equal
principal amount, the Owner hereby certifies (i) the beneficial interest is
being acquired for the Owner's own account without transfer, (ii) such Exchange
has been effected in compliance with the transfer restrictions applicable to the
Global Notes and pursuant to and in accordance with the United States Securities
Act of 1933, as amended (the "Securities Act"), (iii) the restrictions on
transfer contained in the Indenture and the Private Placement Legend are not
required in order to maintain compliance with the Securities Act and (iv) the
beneficial interest in an Unrestricted Global Note is being acquired in
compliance with any applicable blue sky securities laws of any state of the
United States.

                  (b) [ ] Check if Exchange is from beneficial interest in a
Restricted Global Note to Unrestricted Certificated Note. In connection with the
Exchange of the Owner's beneficial interest in a Restricted Global Note for an
Unrestricted Certificated Note, the Owner hereby certifies (i) the Certificated
Note is being acquired for the Owner's own account without transfer, (ii) such
Exchange has been effected in compliance with the

                                Exhibit C Page 1

<PAGE>

transfer restrictions applicable to the Restricted Global Notes and pursuant to
and in accordance with the Securities Act, (iii) the restrictions on transfer
contained in the Indenture and the Private Placement Legend are not required in
order to maintain compliance with the Securities Act and (iv) the Certificated
Note is being acquired in compliance with any applicable blue sky securities
laws of any state of the United States.

                  (c) [ ] Check if Exchange is from Restricted Certificated Note
to beneficial interest in an Unrestricted Global Note. In connection with the
Owner's Exchange of a Restricted Certificated Note for a beneficial interest in
an Unrestricted Global Note, the Owner hereby certifies (i) the beneficial
interest is being acquired for the Owner's own account without transfer, (ii)
such Exchange has been effected in compliance with the transfer restrictions
applicable to Restricted Certificated Notes and pursuant to and in accordance
with the Securities Act, (iii) the restrictions on transfer contained in the
Indenture and the Private Placement Legend are not required in order to maintain
compliance with the Securities Act and (iv) the beneficial interest is being
acquired in compliance with any applicable blue sky securities laws of any state
of the United States.

                  (d) [ ] Check if Exchange is from Restricted Certificated Note
to Unrestricted Certificated Note. In connection with the Owner's Exchange of a
Restricted Certificated Note for an Unrestricted Certificated Note, the Owner
hereby certifies (i) the Unrestricted Certificated Note is being acquired for
the Owner's own account without transfer, (ii) such Exchange has been effected
in compliance with the transfer restrictions applicable to Restricted
Certificated Notes and pursuant to and in accordance with the Securities Act,
(iii) the restrictions on transfer contained in the Indenture and the Private
Placement Legend are not required in order to maintain compliance with the
Securities Act and (iv) the Unrestricted Certificated Note is being acquired in
compliance with any applicable blue sky securities laws of any state of the
United States.

                  2. Exchange of Restricted Certificated Notes or Beneficial
Interests in Restricted Global Notes for Restricted Certificated Notes or
Beneficial Interests in Restricted Global Notes

                  (a) [ ] Check if Exchange is from beneficial interest in a
Restricted Global Note to Restricted Certificated Note. In connection with the
Exchange of the Owner's beneficial interest in a Restricted Global Note for a
Restricted Certificated Note with an equal principal amount, the Owner hereby
certifies that the Restricted Certificated Note is being acquired for the
Owner's own account without transfer. Upon consummation of the proposed Exchange
in accordance with the terms of the Indenture, the Restricted Certificated Note
issued will continue to be subject to the restrictions on transfer enumerated in
the Private Placement Legend printed on the Restricted Certificated Note and in
the Indenture and the Securities Act.

                  (b) [ ] Check if Exchange is from Restricted Certificated Note
to beneficial interest in a Restricted Global Note. In connection with the
Exchange of the Owner's Restricted Certificated Note for a beneficial interest
in the [CHECK ONE] [ ] 144A Global Note, [ ] Regulation S Global Note, [ ]
Restricted Global Note, with an equal principal amount, the Owner hereby
certifies (i) the beneficial interest is being acquired for the

                                Exhibit C Page 2

<PAGE>

Owner's own account without transfer and (ii) such Exchange has been effected in
compliance with the transfer restrictions applicable to the Restricted Global
Notes and pursuant to and in accordance with the Securities Act, and in
compliance with any applicable blue sky securities laws of any state of the
United States. Upon consummation of the proposed Exchange in accordance with the
terms of the Indenture, the beneficial interest issued will be subject to the
restrictions on transfer enumerated in the Private Placement Legend printed on
the relevant Restricted Global Note and in the Indenture and the Securities Act.

                  This certificate and the statements contained herein are made
for your benefit and the benefit of the Issuers, the Subsidiary Guarantors and
J.P. Morgan Securities Inc., Banc One Capital Markets, Inc., BNP Paribas
Securities Corp., Credit Lyonnais Securities (USA) Inc., Credit Suisse First
Boston LLC, Fortis Investment Services LLC, The Royal Bank of Scotland PLC,
Scotia Capital (USA) Inc., SunTrust Capital Markets, Inc. and Wachovia
Securities, LLC (collectively, the "Initial Purchasers"), the Initial Purchasers
of such Notes being transferred. We acknowledge that you, the Issuers, the
Subsidiary Guarantors and the Initial Purchasers will rely upon our
confirmations, acknowledgments and agreements set forth herein, and we agree to
notify you promptly in writing if any of our representations or warranties
herein ceases to be accurate and complete.

[Insert Name of Owner]

By: ____________________________________
Name: __________________________________
Title: _________________________________

Dated: ________ ___, ____

cc: Issuers
    Initial Purchasers

                                Exhibit C Page 3

<PAGE>

                                                                       EXHIBIT D

                           FORM OF GUARANTEE NOTATION

                  Subject to the limitations set forth in the Indenture (the
"Indenture") referred to in the Note upon which this notation is endorsed, each
of the entities listed on Schedule A hereto (hereinafter referred to as the
"Subsidiary Guarantors," which term includes any successor or additional
Subsidiary Guarantor under the Indenture, (i) has unconditionally guaranteed:
(a) the due and punctual payment of the principal of and premium, interest and
Additional Interest on the Notes, whether at maturity or interest payment date,
by acceleration, call for redemption or otherwise, (b) the due and punctual
payment of interest on the overdue principal of and premium, interest and
Additional Interest, if any, if lawful, on the Notes, (c) the due and punctual
performance of all other Obligations of the Issuers to the Holders or the
Trustee, all in accordance with the terms set forth in the Indenture, and (d) in
case of any extension of time of payment or renewal of any Notes or any of such
other obligations, the prompt payment in full thereof when due or performance
thereof in accordance with the terms of the extension or renewal, whether at
Stated Maturity, by acceleration or otherwise and (ii) has agreed to pay any and
all costs and expenses (including reasonable attorneys' fees) incurred by the
Trustee or any Holder in enforcing any rights under this Guarantee.

                  This Guarantee Notation is subject to the limitations set
forth in the Indenture, including Article 10 thereof.

                  No member, stockholder, partner, officer, employee, director
or incorporator, as such, past, present or future, of the Subsidiary Guarantors
shall have any personal liability under this Guarantee by reason of his or its
status as such member, manager, partner, stockholder, officer, employee,
director or incorporator.

                  The Guarantee shall be binding upon each Subsidiary Guarantor
and its successors and assigns and shall inure to the benefit of the successors
and assigns of the Trustee and the Holders and, in the event of any transfer or
assignment of rights by any Holder or the Trustee, the rights and privileges
herein conferred upon that party shall automatically extend to and be vested in
such transferee or assignee, all subject to the terms and conditions hereof.

                  Each Guarantee shall not be valid or obligatory for any
purpose until the certificate of authentication on the Note upon which this
notation of Guarantee is noted shall have been executed by the Trustee under the
Indenture by the manual signature of one of its authorized officers.

                  Certain of the Subsidiary Guarantors may be released from
their Guarantees upon the terms and subject to the conditions provided in the
Indenture.

                                Exhibit D Page 1

<PAGE>

                               CAMERON HIGHWAY PIPELINE GP, L.L.C. *
                               CAMERON HIGHWAY PIPELINE I, L.P. *
                               CRYSTAL HOLDING, L.L.C.*
                               FIRST RESERVE GAS, L.L.C. *
                               FLEXTREND DEVELOPMENT COMPANY, L.L.C. *
                               GULFTERRA ALABAMA INTRASTATE, L.L.C.*
                               GULFTERRA FIELD SERVICES, L.L.C.*
                               GULFTERRA GC, L.P. *
                               GULFTERRA HOLDING I, L.L.C. *
                               GULFTERRA HOLDING II, L.L.C. *
                               GULFTERRA HOLDING III, L.L.C. *
                               GULFTERRA HOLDING IV, L.P. *
                               GULFTERRA HOLDING V, L.P. *
                               GULFTERRA INTRASTATE, L.P. *
                               GULFTERRA NGL STORAGE, L.L.C.*
                               GULFTERRA OIL TRANSPORT, L.L.C.
                               GULFTERRA OPERATING COMPANY, L.L.C. *
                               GULFTERRA SOUTH TEXAS, L.P. *
                               GULFTERRA TEXAS PIPELINE, L.P*.
                               HATTIESBURG GAS STORAGE COMPANY
                                    By: FIRST RESERVE GAS, L.L.C., in its
                                        capacity as 50% general partner of
                                        Hattiesburg Gas Storage Company*
                                    By: HATTIESBURG INDUSTRIAL GAS SALES,
                                        L.L.C., in its capacity as 50% general
                                        partner of Hattiesburg Gas Storage
                                        Company*
                               HATTIESBURG INDUSTRIAL GAS SALES, L.L.C.*
                               HIGH ISLAND OFFSHORE SYSTEM, L.L.C.
                                    By: GULFTERRA ENERGY PARTNERS, L.P.,
                                        its sole member*
                               MANTA RAY GATHERING COMPANY, L.L.C.*
                               PETAL GAS STORAGE, L.L.C.*
                               POSEIDON PIPELINE COMPANY, L.L.C.*

                               *By: ________________________________
                               Name:  Keith Forman
                               Title: Vice President and Chief Financial Officer

                                Exhibit D Page 2

<PAGE>

                               Trustee:

                               WELLS FARGO BANK, NATIONAL
                               ASSOCIATION, as Trustee

                               By:    ________________________________________
                               Name:  ________________________________________
                               Title: ________________________________________

                                Exhibit D Page 3

<PAGE>

                                                                       EXHIBIT E

                            FORM OF CERTIFICATE FROM
                   ACQUIRING INSTITUTIONAL ACCREDITED INVESTOR

GulfTerra Energy Partners, L.P.
4 Greenway Plaza
Houston, Texas 77046

Wells Fargo Bank, National Association
[Address]

                           Re:      GulfTerra Energy Partners, L.P.
                                    GulfTerra Energy Finance Corporation
                                    6 1/4% Senior Notes due 2010

                  Reference is hereby made to the Indenture, dated as of July 3,
2003 (the "Indenture"), among El Paso Energy Partners, L.P. (the "Partnership")
and El Paso Energy Partners Finance Corporation ("GulfTerra Finance"), as
issuers (the "Issuers"), the Subsidiaries named therein, as Subsidiary
Guarantors, and Wells Fargo Bank, National Association, as trustee. Capitalized
terms used but not defined herein shall have the meanings given to them in the
Indenture.

                  In connection with our proposed purchase of $_______________
aggregate principal amount of:

                  (a)      [ ] a beneficial interest in a Global Note, or

                  (b)      [ ] a Certificated Note,

                  we confirm that:

                  1. We understand that any subsequent transfer of the Series A
Notes or any interest therein is subject to certain restrictions and conditions
set forth in the Indenture and the undersigned agrees to be bound by, and not to
resell, pledge or otherwise transfer the Series A Notes or any interest therein
except in compliance with, such restrictions and conditions and the United
States Securities Act of 1933, as amended (the "Securities Act").

                  2. We understand that the offer and sale of the Series A Notes
have not been registered under the Securities Act, and that the Series A Notes
and any interest therein may not be offered or sold except as permitted in the
following sentence. We agree, on our own behalf and on behalf of any accounts
for which we are acting as hereinafter stated, that if we should sell the Series
A Notes or any interest therein, we will do so only (A) to the Partnership,
GulfTerra Finance, or any subsidiary of the Partnership, (B) in the United
States to a person who the seller reasonably believes is a "qualified
institutional buyer" (as defined in Rule 144A under the Securities Act) in a
transaction meeting the requirements of Rule 144A, (C) outside the United States
in an offshore transaction in accordance with Rule 904 under the Securities Act,
(D) pursuant to an exemption from registration under

                                Exhibit E Page 1

<PAGE>

the Securities Act provided by Rule 144 thereunder (if available), (E) to an
institutional "accredited investor" within the meaning of Rule 501(A)(1), (2),
(3) or (7) under the Securities Act that is an institutional accredited investor
acquiring the security for its own account or for the account of such
institutional accredited investor, in each case in a minimum principal amount of
the securities of $250,000, for investment purposes and not with a view to or
for offer or sale in connection with any distribution in violation of the
Securities Act or (F) pursuant to an effective registration statement under the
Securities Act, in each cases (A) through (E) in accordance with any applicable
securities laws of any state of the United States, and we further agree to
provide to any person purchasing a Certificated Note or beneficial interest in a
Global Note from us in a transaction meeting the requirements of clauses (A)
through (E) of this paragraph a notice advising such purchaser that resales
thereof are restricted as stated herein.

                  3. We understand that, on any proposed resale of the Series A
Notes or beneficial interest therein, we will be required to furnish to you and
the Company such certification, legal opinions and other information as you and
the Company may reasonably requires to confirm that the proposed sale complies
with the foregoing restrictions. We further understand that the Series A Notes
purchased by us will bear a legend to the foregoing effect.

                  4. We are an institutional "accredited investor" (as defined
in Rule 501(a)(1), (2), (3) or (7) of Regulation D under the Securities Act) and
have such knowledge and experience in financial and business matters as to be
capable of evaluating the merits and risks of our investment in the Series A
Notes, and we and any accounts for which we are acting are each able to bear the
economic risk of our or its investment. We are acquiring the Series A Notes for
investment purposes and not with a view to, or for offer or sale in connection
with, any distribution in violation of the Securities Act.

                  5. We are acquiring the Series A Notes or beneficial interest
therein purchased by us for our own account or for one or more accounts (each of
which is an institutional "accredited investor") as to each of which we exercise
sole investment discretion.

                  You and the Issuers are entitled to rely upon this letter and
are irrevocably authorized to produce this letter or a copy hereof to any
interested party in any administrative or legal proceedings or official inquiry
with respect to the matters covered hereby.

                             __________________________________________________
                             [Insert Name of Institutional Accredited
                             Investor]

                             By: ___________________________________
                             Name:
                             Title:

Dated: ________ ___, ____

                                Exhibit E Page 2<PAGE>

                                                                  EXECUTION COPY

                                                                     EXHIBIT 4.M

                                  A/B EXCHANGE
                          REGISTRATION RIGHTS AGREEMENT

                            Dated as of July 3, 2003

                                  by and among

                         GulfTerra Energy Partners, L.P.

                      GulfTerra Energy Finance Corporation

                 The Subsidiary Guarantors listed on Schedule A

                                       and

                           J.P. Morgan Securities Inc.

                         Banc One Capital Markets, Inc.

                          BNP Paribas Securities Corp.

                      Credit Lyonnais Securities (USA) Inc.

                         Credit Suisse First Boston LLC

                         Fortis Investment Services LLC

                         The Royal Bank of Scotland plc

                            Scotia Capital (USA) Inc.

                         Suntrust Capital Markets, Inc.

                            Wachovia Securities, LLC

<PAGE>

         This Registration Rights Agreement (this "Agreement") is made and
entered into as of July [11], 2003 by and among GulfTerra Partners, L.P., a
Delaware limited partnership (the "Partnership"), GulfTerra Energy Finance
Corporation, a Delaware corporation ("GulfTerra Finance" and, together with the
Partnership, the "Issuers"), each of the entities listed on Schedule A attached
hereto (each, a "Subsidiary Guarantor" and collectively, the "Subsidiary
Guarantors"), J.P. Morgan Securities Inc., Banc One Capital Markets, Inc., BNP
Paribas Securities Corp., Credit Lyonnais Securities (USA) Inc., Credit Suisse
First Boston LLC, Fortis Investment Services LLC, The Royal Bank of Scotland
plc, Scotia Capital (USA) Inc., SunTrust Capital Markets, Inc., Wachovia
Securities, LLC, (each an "Initial Purchaser" and, collectively, the "Initial
Purchasers"), each of whom has agreed to purchase the Issuers' 6 1/4 % Series A
Senior Notes due 2010 (such notes being purchased on the date hereof being
referred to as the "Series A Notes") pursuant to the Purchase Agreement (as
defined below).

         This Agreement is made pursuant to the Purchase Agreement, dated June
26, 2003 (the "Purchase Agreement"), by and among the Issuers, the Subsidiary
Guarantors and the Initial Purchasers. In order to induce the Initial Purchasers
to purchase the Series A Notes, the Issuers have agreed to provide the
registration rights set forth in this Agreement. The execution and delivery of
this Agreement is a condition to the obligations of the Initial Purchasers set
forth in Section 2 of the Purchase Agreement. Capitalized terms used herein and
not otherwise defined shall have the meaning assigned to them in the Indenture,
dated July 3, 2003, (the "Indenture"), among the Issuers, the Subsidiary
Guarantors and Wells Fargo Bank, as trustee (the "Trustee"), relating to the
Series A Notes and the Series B Notes.

         The parties hereby agree as follows:

         Section 1.        Definitions. As used in this Agreement, the following
capitalized terms shall have the following meanings:

         Act: The Securities Act of 1933, as amended.

         Affiliate: As defined in Rule 144 of the Act.

         Broker-Dealer: Any broker or dealer registered under the Exchange Act.

         Certificated Securities: Definitive Notes, as defined in the Indenture.

         Closing Date: The date hereof.

         Commission: The Securities and Exchange Commission.

         Consummate: An Exchange Offer shall be deemed "Consummated" for
purposes of this Agreement upon the occurrence of (a) the filing and
effectiveness under the Act of the Exchange Offer Registration Statement
relating to the Series B Notes to be issued in the Exchange Offer, (b) the
maintenance of such Exchange Offer Registration Statement continuously effective
and the keeping of the Exchange Offer open for a period not less than the period
required pursuant to Section 3(b) hereof and (c) the delivery by the Issuers to
the Registrar under the Indenture of Series B Notes in the same aggregate
principal amount as the aggregate principal amount of Series A Notes tendered by
Holders thereof pursuant to the Exchange Offer.

<PAGE>

         Consummation Deadline: As defined in Section 3(b) hereof.

         Effectiveness Deadline: As defined in Sections 3(a) and 4(a) hereof.

         Exchange Act: The Securities Exchange Act of 1934, as amended.

         Exchange Offer: The exchange and issuance by the Issuers of a principal
amount of Series B Notes (which shall be registered pursuant to the Exchange
Offer Registration Statement) equal to the outstanding principal amount of
Series A Notes that are tendered by such Holders in connection with such
exchange and issuance.

         Exchange Offer Registration Statement: The Registration Statement
relating to the Exchange Offer, including the related Prospectus.

         Exempt Resales: The transactions in which the Initial Purchasers
propose to sell the Series A Notes to certain "qualified institutional buyers,"
as such term is defined in Rule 144A under the Act and pursuant to Regulation S
under the Act.

         Filing Deadline: As defined in Sections 3(a) and 4(a) hereof.

         Holders: As defined in Section 2 hereof.

         Partnership Agreement: The Second Amended and Restated Agreement of
Limited Partnership of El Paso Energy Partners, L.P., dated as of February 13,
1993, amended and restated effective as of August 31, 2000, as such may be
amended, modified or supplemented from time to time.

         Prospectus: The prospectus included in a Registration Statement at the
time such Registration Statement is declared effective, as amended or
supplemented by any prospectus supplement and by all other amendments thereto,
including post-effective amendments, and all material incorporated by reference
into such Prospectus.

         Recommencement Date: As defined in Section 6(d) hereof.

         Registration Default: As defined in Section 5 hereof.

         Registration Statement: Any registration statement of the Issuers and
the Subsidiary Guarantors relating to (a) an offering of Series B Notes pursuant
to an Exchange Offer or (b) the registration for resale of Transfer Restricted
Securities pursuant to the Shelf Registration Statement, in each case, (i) that
is filed pursuant to the provisions of this Agreement and (ii) including the
Prospectus included therein, all amendments and supplements thereto (including
post-effective amendments) and all exhibits and material incorporated by
reference therein.

         Regulation S: Regulation S promulgated under the Act.

         Rule 144: Rule 144 promulgated under the Act.

                                        2

<PAGE>

         Series B Notes: The Issuers' 6 1/4% Series B Senior Notes due 2010 to
be issued pursuant to the Indenture: (i) in the Exchange Offer or (ii) as
contemplated by Section 4 hereof.

         Shelf Registration Statement: As defined in Section 4 hereof.

         Suspension Notice: As defined in Section 6(d) hereof.

         TIA: The Trust Indenture Act of 1939 (15 U.S.C. Section 77aaa-77bbbb)
as in effect on the date of the Indenture.

         Transfer Restricted Securities: Each Series A Note, until the earliest
to occur of (a) the date on which such Series A Note is exchanged in the
Exchange Offer for a Series B Note which is entitled to be resold to the public
by the Holder thereof without complying with the prospectus delivery
requirements of the Act, (b) the date on which such Series A Note has been
disposed of in accordance with a Shelf Registration Statement (and the
purchasers thereof have been issued Series B Notes), or (c) the date on which
such Series A Note is distributed to the public pursuant to Rule 144 under the
Act (and purchasers thereof have been issued Series B Notes) and each Series B
Note issued to a Broker-Dealer in the Exchange Offer until the date on which
such Series B Note is disposed of by such Broker-Dealer pursuant to the "Plan of
Distribution" contemplated by the Exchange Offer Registration Statement
(including the delivery of the Prospectus contained therein).

         Section 2.        Holders. A Person is deemed to be a holder of
Transfer Restricted Securities (each, a "Holder") whenever such Person owns
Transfer Restricted Securities.

         Section 3.        Registered Exchange Offer.

                  (a)      Unless the Exchange Offer shall not be permitted by
         applicable federal law (after the procedures set forth in Section
         6(a)(i) below have been complied with), the Issuers and the Subsidiary
         Guarantors shall (i) cause the Exchange Offer Registration Statement to
         be filed with the Commission as soon as practicable after the Closing
         Date, but in no event later than 95 days after the Closing Date (such
         95th day being the "Filing Deadline"), (ii) use its best efforts to
         cause such Exchange Offer Registration Statement to become effective at
         the earliest possible time, but in no event later than 150 days after
         the Closing Date (such 150th day being the "Effectiveness Deadline"),
         (iii) in connection with the foregoing, (A) file all pre-effective
         amendments to such Exchange Offer Registration Statement as may be
         necessary in order to cause it to become effective, (B) file, if
         applicable, a post-effective amendment to such Exchange Offer
         Registration Statement pursuant to Rule 430A under the Act and (C)
         cause all necessary filings, if any, in connection with the
         registration and qualification of the Series B Notes to be made under
         the Blue Sky laws of such jurisdictions as are necessary to permit
         Consummation of the Exchange Offer, and (iv) upon the effectiveness of
         such Exchange Offer Registration Statement, commence and Consummate the
         Exchange Offer. The Exchange Offer shall be on the appropriate form
         permitting (i) registration of the Series B Notes to be offered in
         exchange for the Series A Notes that are Transfer Restricted Securities
         and (ii) resales of Series B Notes by Broker-Dealers that tendered into
         the Exchange Offer Series A Notes that such Broker-Dealer acquired for
         its own account as a

                                        3

<PAGE>

         result of market making activities or other trading activities (other
         than Series A Notes acquired directly from the Issuers or any of their
         Affiliates) as contemplated by Section 3(c) below.

                  (b)      The Issuers and the Subsidiary Guarantors shall use
         their respective best efforts to cause the Exchange Offer Registration
         Statement to be effective continuously, and shall keep the Exchange
         Offer open for a period of not less than the minimum period required
         under applicable federal and state securities laws to Consummate the
         Exchange Offer; provided, however, that in no event shall such period
         be less than 20 Business Days. The Issuers and the Subsidiary
         Guarantors shall cause the Exchange Offer to comply with all applicable
         federal and state securities laws. No securities other than the Series
         B Notes shall be included in the Exchange Offer Registration Statement.
         The Issuers and the Subsidiary Guarantors shall use their respective
         best efforts to cause the Exchange Offer to be Consummated on the
         earliest practicable date after the Exchange Offer Registration
         Statement has become effective, but in no event later than 180 days
         after the Closing Date (such 180th day being the "Consummation
         Deadline").

                  (c)      The Issuers shall include a "Plan of Distribution"
         section in the Prospectus contained in the Exchange Offer Registration
         Statement and indicate therein that any Broker-Dealer who holds
         Transfer Restricted Securities that were acquired for the account of
         such Broker-Dealer as a result of market-making activities or other
         trading activities (other than Series A Notes acquired directly from
         the Issuers or any Affiliate of the Issuers) may exchange such Transfer
         Restricted Securities pursuant to the Exchange Offer. Such "Plan of
         Distribution" section shall also contain all other information with
         respect to such sales by such Broker-Dealers that the Commission may
         require in order to permit such sales pursuant thereto, but such "Plan
         of Distribution" shall not name any such Broker-Dealer or disclose the
         amount of Transfer Restricted Securities held by any such
         Broker-Dealer, except to the extent required by the Commission as a
         result of a change in policy, rules or regulations after the date of
         this Agreement.

         Because such Broker-Dealer may be deemed to be an "underwriter" within
         the meaning of the Act and must, therefore, deliver a prospectus
         meeting the requirements of the Act in connection with its initial sale
         of any Series B Notes received by such Broker-Dealer in the Exchange
         Offer, the Issuers and Subsidiary Guarantors shall permit the use of
         the Prospectus contained in the Exchange Offer Registration Statement
         by such Broker-Dealer to satisfy such prospectus delivery requirement.
         To the extent necessary to ensure that the prospectus contained in the
         Exchange Offer Registration Statement is available for sales of Series
         B Notes by such Broker-Dealers, the Issuers and the Subsidiary
         Guarantors agree to use their respective best efforts to keep the
         Exchange Offer Registration Statement continuously effective,
         supplemented, amended and current as required by and subject to the
         provisions of Sections 6(a) and (c) hereof and in conformity with the
         requirements of this Agreement, the Act and the policies, rules and
         regulations of the Commission as announced from time to time, for a
         period of one year from the Consummation Deadline or such shorter
         period as will terminate when all Transfer Restricted Securities
         covered by such Registration Statement have been sold pursuant thereto.
         The Issuers and the Subsidiary Guarantors shall provide

                                        4

<PAGE>

         sufficient copies of the latest version of such Prospectus to such
         Broker-Dealers, promptly upon request, and in no event later than one
         day after such request, at any time during such period.

         Section 4.        Shelf Registration.

                  (a)      Shelf Registration. If (i) the Exchange Offer is not
         permitted by applicable law (after the Issuers and the Subsidiary
         Guarantors have complied with the procedures set forth in Section
         6(a)(i) below) or (ii) if any Holder of Transfer Restricted Securities
         shall notify the Issuers within 20 Business Days following the
         Consummation Deadline that (A) such Holder was prohibited by law or
         Commission policy from participating in the Exchange Offer or (B) such
         Holder may not resell the Series B Notes acquired by it in the Exchange
         Offer to the public without delivering a prospectus and the Prospectus
         contained in the Exchange Offer Registration Statement is not
         appropriate or available for such resales by such Holder or (C) such
         Holder is a Broker-Dealer and holds Series A Notes acquired directly
         from the Issuers or any of their Affiliates, then the Issuers and the
         Subsidiary Guarantors shall:

                           (x)      cause to be filed, on or prior to 30 days
                  after the earlier of (i) the date on which the Issuers
                  determine that the Exchange Offer Registration Statement
                  cannot be filed as a result of clause (a)(i) above and (ii)
                  the date on which the Issuers receive the notice specified in
                  clause (a)(ii) above, (such earlier date, the "Filing
                  Deadline"), a shelf registration statement pursuant to Rule
                  415 under the Act (which may be an amendment to the Exchange
                  Offer Registration Statement (the "Shelf Registration
                  Statement")), relating to all Transfer Restricted Securities,
                  and

                           (y)      shall use their respective best efforts to
                  cause such Shelf Registration Statement to become effective on
                  or prior to 60 days after the Filing Deadline for the Shelf
                  Registration Statement (such 60th day the "Effectiveness
                  Deadline").

         If, after the Issuers and the Subsidiary Guarantors have filed an
         Exchange Offer Registration Statement that satisfies the requirements
         of Section 3(a) above, the Issuers are required to file and make
         effective a Shelf Registration Statement solely because the Exchange
         Offer is not permitted under applicable federal law (i.e., clause
         (a)(i) above), then the filing of the Exchange Offer Registration
         Statement shall be deemed to satisfy the requirements of clause (x)
         above; provided that, in such event, the Issuers and the Subsidiary
         Guarantors shall remain obligated to meet the Effectiveness Deadline
         set forth in clause (y).

         To the extent necessary to ensure that the Shelf Registration Statement
         is available for sales of Transfer Restricted Securities by the Holders
         thereof entitled to the benefit of this Section 4(a) and the other
         securities required to be registered therein pursuant to Section
         6(b)(ii) hereof, the Issuers and the Subsidiary Guarantors shall use
         their respective best efforts to keep any Shelf Registration Statement
         required by this Section 4(a) continuously effective, supplemented,

                                        5

<PAGE>

         amended and current as required by and subject to the provisions of
         Sections 6(b) and (c) hereof and in conformity with the requirements of
         this Agreement, the Act and the policies, rules and regulations of the
         Commission as announced from time to time, for a period of at least two
         years (as extended pursuant to Section 6(d)) following the Closing
         Date, or such shorter period as will terminate when all Transfer
         Restricted Securities covered by such Shelf Registration Statement have
         been sold pursuant thereto.

                  (b)      Provision by Holders of Certain Information in
         Connection with the Shelf Registration Statement. No Holder of Transfer
         Restricted Securities may include any of its Transfer Restricted
         Securities in any Shelf Registration Statement pursuant to this
         Agreement unless and until such Holder furnishes to the Issuers in
         writing, within 20 days after receipt of a request therefor, the
         information specified in Item 507 or 508 of Regulation S-K, as
         applicable, of the Act for use in connection with any Shelf
         Registration Statement or Prospectus (or preliminary Prospectus)
         included therein. No Holder of Transfer Restricted Securities shall be
         entitled to liquidated damages pursuant to Section 5 hereof unless and
         until such Holder shall have provided all such information. Each
         selling Holder agrees to promptly furnish additional information
         required to be disclosed in order to make the information previously
         furnished to the Issuers by such Holder not materially misleading.

         Section 5.        Liquidated Damages. If (i) any Registration Statement
required by this Agreement is not filed with the Commission on or prior to the
applicable Filing Deadline, (ii) any such Registration Statement has not been
declared effective by the Commission on or prior to the applicable Effectiveness
Deadline, (iii) the Exchange Offer has not been Consummated on or prior to the
Consummation Deadline or (iv) any Registration Statement required by this
Agreement is filed and declared effective but shall thereafter cease to be
effective or fail to be usable for its intended purpose without being succeeded
within 2 days by a post-effective amendment to such Registration Statement that
cures such failure and that is itself declared effective within 2 days of filing
such post-effective amendment to such Registration Statement (each such event
referred to in clauses (i) through (iv), a "Registration Default"), then the
Issuers and the Subsidiary Guarantors hereby jointly and severally agree to pay
to each Holder of Transfer Restricted Securities affected thereby liquidated
damages in an amount equal to $.05 per week per $1,000 in principal amount of
Transfer Restricted Securities held by such Holder for each week or portion
thereof that the Registration Default continues for the first 90-day period
immediately following the occurrence of such Registration Default. The amount of
the liquidated damages shall increase by an additional $.05 per week per $1,000
in principal amount of Transfer Restricted Securities with respect to each
subsequent 90-day period until all Registration Defaults have been cured, up to
a maximum amount of liquidated damages of $.50 per week per $1,000 in principal
amount of Transfer Restricted Securities; provided that the Issuers and the
Subsidiary Guarantors shall in no event be required to pay liquidated damages
for more than one Registration Default at any given time. Notwithstanding
anything to the contrary set forth herein, (1) upon filing of the Exchange Offer
Registration Statement (and/or, if applicable, the Shelf Registration
Statement), in the case of (i) above, (2) upon the effectiveness of the Exchange
Offer Registration Statement (and/or, if applicable, the Shelf Registration
Statement), in the case of (ii) above, (3) upon Consummation of the Exchange
Offer, in the case of (iii) above, or (4) upon the filing of a post-effective
amendment to the Registration Statement

                                        6

<PAGE>

or an additional Registration Statement that causes the Exchange Offer
Registration Statement (and/or, if applicable, the Shelf Registration Statement)
to again be declared effective or made usable in the case of (iv) above, the
accrual of liquidated damages payable with respect to the Transfer Restricted
Securities as a result of such clause (i), (ii), (iii) or (iv), as applicable,
shall cease.

         All accrued liquidated damages shall be paid to the Holders entitled
thereto, in the manner providing for the payment of interest in the Indenture,
on each Interest Payment Date, as more fully set forth in the Indenture and the
Notes; provided however, that any accrued liquidated damages that are unpaid at
the time any Notes cease to be Transfer Restricted Securities upon consummation
of the Exchange Offer shall be paid on or promptly after the date of such
consummation to the Holders of record of such Transfer Restricted Securities on
such date. Notwithstanding the fact that any securities for which liquidated
damages are due cease to be Transfer Restricted Securities, all obligations of
the Issuers and the Subsidiary Guarantors to pay liquidated damages with respect
to securities shall survive until such time as such obligations with respect to
such securities shall have been satisfied in full.

                                        7

<PAGE>

         Section 6.        Registration Procedures.

                  (a)      Exchange Offer Registration Statement. In connection
         with the Exchange Offer, the Issuers and the Subsidiary Guarantors
         shall (x) comply with all applicable provisions of Section 6(c) below,
         (y) use their respective best efforts to effect such exchange and to
         permit the resale of Series B Notes by Broker-Dealers that tendered in
         the Exchange Offer Series A Notes that such Broker-Dealer acquired for
         its own account as a result of its market making activities or other
         trading activities (other than Series A Notes acquired directly from
         the Issuers or any of their Affiliates) being sold in accordance with
         the intended method or methods of distribution thereof, and (z) comply
         with all of the following provisions:

                           (i)      If, following the date hereof there has been
                  announced a change in Commission policy with respect to
                  exchange offers such as the Exchange Offer, that in the
                  reasonable opinion of counsel to the Issuers raises a
                  substantial question as to whether the Exchange Offer is
                  permitted by applicable federal law, the Issuers and the
                  Subsidiary Guarantors hereby agree to seek a no-action letter
                  or other favorable decision from the Commission allowing the
                  Issuers and the Subsidiary Guarantors to Consummate an
                  Exchange Offer for such Transfer Restricted Securities. The
                  Issuers and the Subsidiary Guarantors hereby agree to pursue
                  the issuance of such a decision to the Commission staff level.
                  In connection with the foregoing, the Issuers and the
                  Subsidiary Guarantors hereby agree to take all such other
                  actions as may be requested by the Commission or otherwise
                  required in connection with the issuance of such decision,
                  including without limitation (A) participating in telephonic
                  conferences with the Commission, (B) delivering to the
                  Commission staff an analysis prepared by counsel to the
                  Issuers setting forth the legal bases, if any, upon which such
                  counsel has concluded that such an Exchange Offer should be
                  permitted and (C) diligently pursuing a resolution (which need
                  not be favorable) by the Commission staff.

                           (ii)     As a condition to its participation in the
                  Exchange Offer, each Holder of Transfer Restricted Securities
                  (including, without limitation, any Holder who is a Broker
                  Dealer) shall furnish, upon the request of the Issuers, prior
                  to the Consummation of the Exchange Offer, a written
                  representation to the Issuers and the Subsidiary Guarantors
                  (which may be contained in the letter of transmittal
                  contemplated by the Exchange Offer Registration Statement) to
                  the effect that (A) it is not an Affiliate of the Issuers, (B)
                  it is not engaged in, and does not intend to engage in, and
                  has no arrangement or understanding with any Person to
                  participate in, a distribution of the Series B Notes to be
                  issued in the Exchange Offer, (C) it is acquiring the Series B
                  Notes in its ordinary course of business and (D) if the
                  undersigned is a Broker-Dealer, the Series A Notes being
                  tendered constitute Series A Notes acquired as the result of
                  market-making activities or other trading activities (other
                  than Series A Notes acquired directly from the Issuers or any
                  of their Affiliates). As a condition to its participation in
                  the Exchange Offer, each Holder shall acknowledge and agree
                  that (x) any person participating in Exchange Offer with the
                  intention or for the purpose of

                                        8

<PAGE>

                  distributing the Series B Notes, (1) could not, under
                  Commission policy as in effect on the date of this Agreement,
                  rely on the position of the Commission enunciated in Morgan
                  Stanley and Co., Inc. (available June 5, 1991) and Exxon
                  Capital Holdings Corporation (available May 13, 1988), as
                  interpreted in the Commission's letter to Shearman & Sterling
                  dated July 2, 1993, and similar no-action letters (including,
                  if applicable, any no-action letter obtained pursuant to
                  clause (i) above), and (2) must comply with the registration
                  and prospectus delivery requirements of the Act in connection
                  with a secondary resale transaction and that such a secondary
                  resale transaction must be covered by an effective
                  registration statement containing the selling security holder
                  information required by Item 507 or 508, as applicable, of
                  Regulation S-K and (y) any Broker-Dealer that pursuant to the
                  Exchange Offer receives Series B Notes for its own account in
                  exchange for Series A Notes which it acquired for its own
                  account as a result of market-making activities or other
                  trading activities must deliver a prospectus meeting the
                  requirements of the Securities Act in connection with any
                  resale of such Series B Notes.

                           (iii)    Prior to effectiveness of the Exchange Offer
                  Registration Statement, the Issuers and the Subsidiary
                  Guarantors shall provide a supplemental letter to the
                  Commission (A) stating that the Issuers and the Subsidiary
                  Guarantors are registering the Exchange Offer in reliance on
                  the position of the Commission enunciated in Exxon Capital
                  Holdings Corporation (available May 13, 1988), Morgan Stanley
                  and Co., Inc. (available June 5, 1991) as interpreted in the
                  Commission's letter to Shearman & Sterling dated July 2, 1993,
                  and, if applicable, any no-action letter obtained pursuant to
                  clause (i) above, (B) including a representation that neither
                  the Issuers nor any Subsidiary Guarantor has entered into any
                  arrangement or understanding with any Person to distribute the
                  Series B Notes to be received in the Exchange Offer and that,
                  to the best of the Issuers' and each Subsidiary Guarantor's
                  information and belief, each Holder participating in the
                  Exchange Offer is acquiring the Series B Notes in its ordinary
                  course of business and has no arrangement or understanding
                  with any Person to participate in the distribution of the
                  Series B Notes received in the Exchange Offer and (C) any
                  other undertaking or representation required by the Commission
                  as set forth in any no-action letter obtained pursuant to
                  clause (i) above, if applicable.

                  (b)      Shelf Registration Statement. In connection with the
         Shelf Registration Statement, the Issuers and the Subsidiary Guarantors
         shall:

                           (i)      comply with all the provisions of Section
                  6(c) below and use their respective best efforts to effect
                  such registration to permit the sale of the Transfer
                  Restricted Securities being sold in accordance with the
                  intended method or methods of distribution thereof (as
                  indicated in the information furnished to the Issuers pursuant
                  to Section 4(b) hereof), and pursuant thereto the Issuers and
                  the Subsidiary Guarantors will prepare and file with the
                  Commission a Registration Statement relating to the
                  registration on any appropriate form under the Act, which form
                  shall be available for the sale of the Transfer Restricted
                  Securities in

                                        9

<PAGE>

                  accordance with the intended method or methods of distribution
                  thereof within the time periods and otherwise in accordance
                  with the provisions hereof.

                           (ii)     issue, upon the request of any Holder or
                  purchaser of Series A Notes covered by any Shelf Registration
                  Statement contemplated by this Agreement, Series B Notes
                  having an aggregate principal amount equal to the aggregate
                  principal amount of Series A Notes sold pursuant to the Shelf
                  Registration Statement and surrendered to the Issuers for
                  cancellation; the Issuers shall register Series B Notes on the
                  Shelf Registration Statement for this purpose and issue the
                  Series B Notes to the purchaser(s) of securities subject to
                  the Shelf Registration Statement in the names as such
                  purchaser(s) shall designate.

                  (c)      General Provisions. In connection with any
         Registration Statement and any related Prospectus required by this
         Agreement, the Issuers and the Subsidiary Guarantors shall:

                           (i)      use their respective best efforts to keep
                  such Registration Statement continuously effective and provide
                  all requisite financial statements for the period specified in
                  Section 3 or 4 of this Agreement, as applicable. Upon the
                  occurrence of any event that would cause any such Registration
                  Statement or the Prospectus contained therein (A) to contain
                  an untrue statement of material fact or omit to state any
                  material fact necessary to make the statements therein not
                  misleading or (B) not to be effective and usable for resale of
                  Transfer Restricted Securities during the period required by
                  this Agreement, the Issuers and the Subsidiary Guarantors
                  shall file promptly an appropriate amendment to such
                  Registration Statement curing such defect, and, if Commission
                  review is required, use their respective best efforts to cause
                  such amendment to be declared effective as soon as
                  practicable;

                           (ii)     prepare and file with the Commission such
                  amendments and post-effective amendments to the applicable
                  Registration Statement as may be necessary to keep such
                  Registration Statement effective for the applicable period set
                  forth in Section 3 or 4 hereof, as the case may be; cause the
                  Prospectus to be supplemented by any required Prospectus
                  supplement, and as so supplemented to be filed pursuant to
                  Rule 424 under the Act, and to comply fully with Rules 424,
                  430A and 462, as applicable, under the Act in a timely manner;
                  and comply with the provisions of the Act with respect to the
                  disposition of all securities covered by such Registration
                  Statement during the applicable period in accordance with the
                  intended method or methods of distribution by the sellers
                  thereof set forth in such Registration Statement or supplement
                  to the Prospectus;

                           (iii)    advise each Holder promptly and, if
                  requested by such Holder, confirm such advice in writing, (A)
                  when the Prospectus or any Prospectus supplement or
                  post-effective amendment has been filed, and, with respect to
                  any applicable Registration Statement or any post-effective
                  amendment thereto, when the same has become effective, (B) of
                  any request by the Commission for amendments to the
                  Registration Statement or amendments or supplements to the

                                       10

<PAGE>

                  Prospectus or for additional information relating thereto, (C)
                  of the issuance by the Commission of any stop order suspending
                  the effectiveness of the Registration Statement under the Act
                  or of the suspension by any state securities commission of the
                  qualification of the Transfer Restricted Securities for
                  offering or sale in any jurisdiction, or the initiation of any
                  proceeding for any of the preceding purposes, and (D) of the
                  existence of any fact or the happening of any event that makes
                  any statement of a material fact made in the Registration
                  Statement, the Prospectus, any amendment or supplement thereto
                  or any document incorporated by reference therein untrue, or
                  that requires the making of any additions to or changes in the
                  Registration Statement in order to make the statements therein
                  not misleading, or that requires the making of any additions
                  to or changes in the Prospectus in order to make the
                  statements therein, in the light of the circumstances under
                  which they were made, not misleading. If at any time the
                  Commission shall issue any stop order suspending the
                  effectiveness of the Registration Statement, or any state
                  securities commission or other regulatory authority shall
                  issue an order suspending the qualification or exemption from
                  qualification of the Transfer Restricted Securities under
                  state securities or Blue Sky laws, the Issuers and the
                  Subsidiary Guarantors shall use their respective best efforts
                  to obtain the withdrawal or lifting of such order at the
                  earliest possible time;

                           (iv)     subject to Section 6(c)(i), if any fact or
                  event contemplated by Section 6(c)(iii)(D) above shall exist
                  or have occurred, prepare a supplement or post-effective
                  amendment to the Registration Statement or related Prospectus
                  or any document incorporated therein by reference or file any
                  other required document so that, as thereafter delivered to
                  the purchasers of Transfer Restricted Securities, the
                  Prospectus will not contain an untrue statement of a material
                  fact or omit to state any material fact necessary to make the
                  statements therein, in the light of the circumstances under
                  which they were made, not misleading;

                           (v)      furnish to each Holder in connection with
                  such exchange or sale, if any, before filing with the
                  Commission, copies of any Registration Statement or any
                  Prospectus included therein or any amendments or supplements
                  to any such Registration Statement or Prospectus (including
                  all documents incorporated by reference after the initial
                  filing of such Registration Statement), which documents will
                  be subject to the review and comment of such Holders in
                  connection with such sale, if any, for a period of at least
                  five Business Days, and the Issuers will not file any such
                  Registration Statement or Prospectus or any amendment or
                  supplement to any such Registration Statement or Prospectus
                  (including all such documents incorporated by reference) to
                  which such Holders shall reasonably object within five
                  Business Days after the receipt thereof. A Holder shall be
                  deemed to have reasonably objected to such filing if such
                  Registration Statement, amendment, Prospectus or supplement,
                  as applicable, as proposed to be filed, contains an untrue
                  statement of a material fact or omits to state any material
                  fact necessary to make the statements therein not misleading
                  or fails to comply with the applicable requirements of the
                  Act;

                                       11

<PAGE>

                           (vi)     promptly provide, prior to the filing of any
                  document that is to be incorporated by reference into a
                  Registration Statement or Prospectus, copies of such document
                  to each Holder in connection with such exchange or sale, if
                  any, make the Issuers' and the Subsidiary Guarantors'
                  representatives available for discussion of such document and
                  other customary due diligence matters, and include such
                  information in such document prior to the filing thereof as
                  such Holders may reasonably request;

                           (vii)    make available, at reasonable times, for
                  inspection by each Holder and any attorney or accountant
                  retained by such Holders, all financial and other records, and
                  pertinent corporate documents of the Issuers and the
                  Subsidiary Guarantors and cause the Issuers' and the
                  Subsidiary Guarantors' officers, directors and employees to
                  supply all information reasonably requested by any such
                  Holder, attorney or accountant in connection with such
                  Registration Statement or any post-effective amendment thereto
                  subsequent to the filing thereof and prior to its
                  effectiveness;

                           (viii)   if requested by any Holders in connection
                  with such exchange or sale, promptly include in any
                  Registration Statement or Prospectus, pursuant to a supplement
                  or post-effective amendment if necessary, such information as
                  such Holders may reasonably request to have included therein,
                  including, without limitation, information relating to the
                  "Plan of Distribution" of the Transfer Restricted Securities;
                  and make all required filings of such Prospectus supplement or
                  post-effective amendment as soon as practicable after the
                  Issuers are notified of the matters to be included in such
                  Prospectus supplement or post-effective amendment;

                           (ix)     furnish to each Holder in connection with
                  such exchange or sale, without charge, at least one copy of
                  the Registration Statement, as first filed with the
                  Commission, and of each amendment thereto, including all
                  documents incorporated by reference therein and all exhibits
                  (including exhibits incorporated therein by reference);

                           (x)      deliver to each Holder without charge, as
                  many copies of the Prospectus (including each preliminary
                  prospectus) and any amendment or supplement thereto as such
                  Persons reasonably may request; the Issuers and the Subsidiary
                  Guarantors hereby consent to the use (in accordance with law)
                  of the Prospectus and any amendment or supplement thereto by
                  each selling Holder in connection with the offering and the
                  sale of the Transfer Restricted Securities covered by the
                  Prospectus or any amendment or supplement thereto;

                           (xi)     upon the request of any Holder, enter into
                  such agreements (including underwriting agreements) and make
                  such representations and warranties and take all such other
                  actions in connection therewith in order to expedite or
                  facilitate the disposition of the Transfer Restricted
                  Securities pursuant to any applicable Registration Statement
                  contemplated by this Agreement as may be reasonably requested
                  by any Holder in connection with any sale or resale

                                       12

<PAGE>

                  pursuant to any applicable Registration Statement. In such
                  connection, the Issuers and the Subsidiary Guarantors shall:

                                    (A)      upon request of any Holder, furnish
                           (or in the case of paragraphs (2) and (3), use their
                           best efforts to cause to be furnished) to each
                           Holder, upon Consummation of the Exchange Offer or
                           upon the effectiveness of the Shelf Registration
                           Statement, as the case may be:

                                             (1)      a certificate, dated such
                                    date, signed on behalf of the Issuers and
                                    each Subsidiary Guarantor by (x) the
                                    President or any Vice President and (y) a
                                    principal financial or accounting officer of
                                    each of the Issuers and each Subsidiary
                                    Guarantor, confirming, as of the date
                                    thereof, the matters set forth in Sections
                                    6(aa), 9(a) and 9(b) of the Purchase
                                    Agreement and such other similar matters as
                                    such Holders may reasonably request;

                                             (2)      an opinion, dated the date
                                    of Consummation of the Exchange Offer or the
                                    date of effectiveness of the Shelf
                                    Registration Statement, as the case may be,
                                    of counsel for the Issuers and the
                                    Subsidiary Guarantors covering matters
                                    similar to those set forth in paragraph (e)
                                    of Section 9 of the Purchase Agreement and
                                    such other matters as such Holder may
                                    reasonably request, and in any event
                                    including a statement to the effect that
                                    such counsel has participated in conferences
                                    with officers and other representatives of
                                    the Issuers and the Subsidiary Guarantors,
                                    and representatives of the independent
                                    public accountants for the Issuers and the
                                    Subsidiary Guarantors and have considered
                                    the matters required to be stated therein
                                    and the statements contained therein,
                                    although such counsel has not independently
                                    verified the accuracy, completeness or
                                    fairness of such statements; and that such
                                    counsel advises that, on the basis of the
                                    foregoing, no facts came to such counsel's
                                    attention that caused such counsel to
                                    believe that the applicable Registration
                                    Statement, at the time such Registration
                                    Statement or any post-effective amendment
                                    thereto became effective and, in the case of
                                    the Exchange Offer Registration Statement,
                                    as of the date of Consummation of the
                                    Exchange Offer, contained an untrue
                                    statement of a material fact or omitted to
                                    state a material fact required to be stated
                                    therein or necessary to make the statements
                                    therein not misleading, or that the
                                    Prospectus contained in such Registration
                                    Statement as of its date and, in the case of
                                    the opinion dated the date of Consummation
                                    of the Exchange Offer, as of the date of
                                    Consummation, contained an untrue statement
                                    of a material fact or omitted to state a
                                    material fact required to be stated therein
                                    or necessary in order to make the statements
                                    therein, in the light of the circumstances
                                    under which they were made, not misleading.
                                    Without limiting the foregoing, such counsel
                                    may state further that

                                       13

<PAGE>

                                    such counsel assumes no responsibility for,
                                    and has not independently verified, the
                                    accuracy, completeness or fairness of the
                                    financial statements, notes and schedules
                                    and other financial data included in any
                                    Registration Statement contemplated by this
                                    Agreement or the related Prospectus; and

                                             (3)      a customary comfort
                                    letter, dated the date of Consummation of
                                    the Exchange Offer, or as of the date of
                                    effectiveness of the Shelf Registration
                                    Statement, as the case may be, from the
                                    Issuers' independent accountants, in the
                                    customary form and covering matters of the
                                    type customarily covered in comfort letters
                                    to underwriters in connection with
                                    underwritten offerings, and affirming the
                                    matters set forth in the comfort letters
                                    delivered pursuant to Section 9(g) of the
                                    Purchase Agreement; and

                                    (B)      deliver such other documents and
                           certificates as may be reasonably requested by the
                           selling Holders to evidence compliance with the
                           matters covered in clause (A) above and with any
                           customary conditions contained in any agreement
                           entered into by the Issuers and the Subsidiary
                           Guarantors pursuant to this clause (xi);

                           (xii)    prior to any public offering of Transfer
                  Restricted Securities, cooperate with the selling Holders and
                  their counsel in connection with the registration and
                  qualification of the Transfer Restricted Securities under the
                  securities or Blue Sky laws of such jurisdictions as the
                  selling Holders may request and do any and all other acts or
                  things necessary or advisable to enable the disposition in
                  such jurisdictions of the Transfer Restricted Securities
                  covered by the applicable Registration Statement; provided,
                  however, that neither the Issuers nor any Subsidiary Guarantor
                  shall be required to register or qualify as a foreign
                  corporation where it is not now so qualified or to take any
                  action that would subject it to the service of process in
                  suits or to taxation, other than as to matters and
                  transactions relating to the Registration Statement, in any
                  jurisdiction where it is not now so subject;

                           (xiii)   in connection with any sale of Transfer
                  Restricted Securities that will result in such securities no
                  longer being Transfer Restricted Securities, cooperate with
                  the Holders to facilitate the timely preparation and delivery
                  of certificates representing Transfer Restricted Securities to
                  be sold and not bearing any restrictive legends; and to
                  register such Transfer Restricted Securities in such
                  denominations and such names as the selling Holders may
                  request at least two Business Days prior to such sale of
                  Transfer Restricted Securities;

                           (xiv)    use their respective best efforts to cause
                  the disposition of the Transfer Restricted Securities covered
                  by the Registration Statement to be registered with or
                  approved by such other governmental agencies or authorities as
                  may be necessary to enable the seller or sellers thereof to
                  consummate the

                                       14

<PAGE>

                  disposition of such Transfer Restricted Securities, subject to
                  the proviso contained in clause (xii) above;

                           (xv)     provide a CUSIP number for all Transfer
                  Restricted Securities not later than the effective date of a
                  Registration Statement covering such Transfer Restricted
                  Securities and provide the Trustee under the Indenture with
                  printed certificates for the Transfer Restricted Securities
                  which are in a form eligible for deposit with The Depository
                  Trust Company;

                           (xvi)    otherwise use their respective best efforts
                  to comply with all applicable rules and regulations of the
                  Commission, and make generally available to their security
                  holders with regard to any applicable Registration Statement,
                  as soon as practicable, a consolidated earnings statement
                  meeting the requirements of Rule 158 (which need not be
                  audited) covering a twelve-month period beginning after the
                  effective date of the Registration Statement (as such term is
                  defined in paragraph (c) of Rule 158 under the Act);

                           (xvii)   cause the Indenture to be qualified under
                  the TIA not later than the effective date of the first
                  Registration Statement required by this Agreement and, in
                  connection therewith, cooperate with the Trustee and the
                  Holders to effect such changes to the Indenture as may be
                  required for such Indenture to be so qualified in accordance
                  with the terms of the TIA; and execute and use its best
                  efforts to cause the Trustee to execute, all documents that
                  may be required to effect such changes and all other forms and
                  documents required to be filed with the Commission to enable
                  such Indenture to be so qualified in a timely manner; and

                           (xviii)  provide promptly to each Holder, upon
                  request, each document filed with the Commission pursuant to
                  the requirements of Section 13 or Section 15(d) of the
                  Exchange Act.

                  (d)      Restrictions on Holders. Each Holder agrees by
         acquisition of a Transfer Restricted Security that, upon receipt of the
         notice referred to in Section 6(c)(iii)(C) or any notice from the
         Issuers of the existence of any fact of the kind described in Section
         6(c)(iii)(D) hereof (in each case, a "Suspension Notice"), such Holder
         will forthwith discontinue disposition of Transfer Restricted
         Securities pursuant to the applicable Registration Statement until (i)
         such Holder has received copies of the supplemented or amended
         Prospectus contemplated by Section 6(c)(iv) hereof, or (ii) such Holder
         is advised in writing by the Issuers that the use of the Prospectus may
         be resumed, and has received copies of any additional or supplemental
         filings that are incorporated by reference in the Prospectus (in each
         case, the "Recommencement Date"). Each Holder receiving a Suspension
         Notice hereby agrees that it will either (i) destroy any Prospectuses,
         other than permanent file copies, then in such Holder's possession
         which have been replaced by the Issuers with more recently dated
         Prospectuses or (ii) deliver to the Issuers (at the Issuers' expense)
         all copies, other than permanent file copies, then in such Holder's
         possession of the Prospectus covering such Transfer Restricted
         Securities that was current at the time of receipt of the Suspension
         Notice. The time period regarding the effectiveness of such
         Registration Statement set forth in Section 3 or 4

                                       15

<PAGE>

         hereof, as applicable, shall be extended by a number of days equal to
         the number of days in the period from and including the date of
         delivery of the Suspension Notice to the date of delivery of the
         Recommencement Date.

                  (e)      Effectiveness of Registration Statement.
         Notwithstanding anything to the contrary contained in this Agreement,
         the obligation of the Issuers and the Subsidiary Guarantors hereunder
         to maintain the effectiveness of any Registration Statement and any
         related Prospectus may be suspended, without default or penalty to the
         Issuers or the Subsidiary Guarantors, for one or more periods of time
         as may be required with respect to such Registration Statement if (A)
         the Board of Directors of the General Partner shall have determined
         that the offering and sales under the Registration Statement, the
         filing of such Registration Statement or the maintenance of its
         effectiveness would require disclosure of or would interfere in any
         material respect with any material financing, acquisition, merger,
         offering or other transaction involving the Issuers or the Subsidiary
         Guarantors or would otherwise require disclosure of nonpublic
         information that could materially and adversely affect the Issuers or
         the Subsidiary Guarantors or (B) the Issuers are required by any state
         or federal securities laws to file an amendment or supplement to such
         Registration Statement for the purpose of incorporating quarterly or
         annual information, which is not automatically effective. Further, the
         Issuers and the Subsidiary Guarantors shall be deemed to have used
         their respective best efforts to keep any Registration Statement
         continuously effective if either (A) or (B) above has occurred.

         Section 7.        Registration Expenses.

                  (a)      All expenses incident to the Issuers' and the
         Subsidiary Guarantors' performance of or compliance with this Agreement
         will be borne by the Issuers, regardless of whether a Registration
         Statement becomes effective, including without limitation: (i) all
         registration and filing fees and expenses; (ii) all fees and expenses
         of compliance with federal securities and state Blue Sky or securities
         laws; (iii) all expenses of printing (including printing certificates
         for the Series B Notes to be issued in the Exchange Offer and printing
         of Prospectuses), messenger and delivery services and telephone; (iv)
         all fees and disbursements of counsel for the Issuers, the Subsidiary
         Guarantors and the Holders of Transfer Restricted Securities; (v) all
         application and filing fees in connection with listing the Series B
         Notes on a national securities exchange or automated quotation system
         pursuant to the requirements hereof; and (vi) all fees and
         disbursements of independent certified public accountants of the
         Issuers and the Subsidiary Guarantors (including the expenses of any
         special audit and comfort letters required by or incident to such
         performance).

                  The Issuers will, in any event, bear their and the Subsidiary
         Guarantors' internal expenses (including, without limitation, all
         salaries and expenses of its officers and employees performing legal or
         accounting duties), the expenses of any annual audit and the fees and
         expenses of any Person, including special experts, retained by the
         Issuers or the Subsidiary Guarantors.

                  (b)      In connection with any Registration Statement
         required by this Agreement (including, without limitation, the Exchange
         Offer Registration Statement and the Shelf

                                       16

<PAGE>

         Registration Statement), the Issuers and the Subsidiary Guarantors will
         reimburse the Initial Purchasers and the Holders of Transfer Restricted
         Securities who are tendering Series A Notes in the Exchange Offer
         and/or selling or reselling Series A Notes or Series B Notes pursuant
         to the "Plan of Distribution" contained in the Exchange Offer
         Registration Statement or the Shelf Registration Statement, as
         applicable, for the reasonable fees and disbursements of not more than
         one counsel, who shall be Simpson Thacher & Bartlett LLP, unless
         another firm shall be chosen by the Holders of a majority in principal
         amount of the Transfer Restricted Securities for whose benefit such
         Registration Statement is being prepared.

         Section 8.        Indemnification.

                  (a)      The Issuers and the Subsidiary Guarantors agree,
         jointly and severally, to indemnify and hold harmless each Holder, its
         directors, officers and each Person, if any, who controls such Holder
         (within the meaning of Section 15 of the Act or Section 20 of the
         Exchange Act), from and against any and all losses, claims, damages,
         liabilities or judgments (including without limitation, any legal or
         other expenses incurred in connection with investigating or defending
         any matter, including any action that could give rise to any such
         losses, claims, damages, liabilities or judgments) caused by any untrue
         statement or alleged untrue statement of a material fact contained in
         any Registration Statement, preliminary prospectus or Prospectus (or
         any amendment or supplement thereto) provided by the Issuers to any
         Holder or any prospective purchaser of Series B Notes or registered
         Series A Notes, or caused by any omission or alleged omission to state
         therein a material fact required to be stated therein or necessary to
         make the statements therein not misleading, except insofar as such
         losses, claims, damages, liabilities or judgments are caused by an
         untrue statement or omission or alleged untrue statement or omission
         that is based upon information relating to any of the Holders furnished
         in writing to the Issuers by any of the Holders.

                  (b)      Each Holder of Transfer Restricted Securities agrees,
         severally and not jointly, to indemnify and hold harmless the Issuers
         and the Subsidiary Guarantors, and their respective directors and
         officers, and each Person, if any, who controls (within the meaning of
         Section 15 of the Act or Section 20 of the Exchange Act) the Issuers or
         the Subsidiary Guarantors, to the same extent as the foregoing
         indemnity from the Issuers and the Subsidiary Guarantors set forth in
         Section 8(a) above, but only with reference to information relating to
         such Holder furnished in writing to the Issuers by such Holder
         expressly for use in any Registration Statement. In no event shall any
         Holder, its directors, officers or any Person who controls such Holder
         be liable or responsible for any amount in excess of the amount by
         which the total amount received by such Holder with respect to its sale
         of Transfer Restricted Securities pursuant to a Registration Statement
         exceeds (i) the amount paid by such Holder for such Transfer Restricted
         Securities and (ii) the amount of any damages that such Holder, its
         directors, officers or any Person who controls such Holder has
         otherwise been required to pay by reason of such untrue or alleged
         untrue statement or omission or alleged omission.

                  (c)      In case any action shall be commenced involving any
         Person in respect of which indemnity may be sought pursuant to Section
         8(a) or 8(b) (the "indemnified

                                       17

<PAGE>

         party"), the indemnified party shall promptly notify the Person against
         whom such indemnity may be sought (the "indemnifying person") in
         writing and the indemnifying party shall assume the defense of such
         action, including the employment of counsel reasonably satisfactory to
         the indemnified party and the payment of all fees and expenses of such
         counsel, as incurred (except that in the case of any action in respect
         of which indemnity may be sought pursuant to both Sections 8(a) and
         8(b), a Holder shall not be required to assume the defense of such
         action pursuant to this Section 8(c), but may employ separate counsel
         and participate in the defense thereof, but the fees and expenses of
         such counsel, except as provided below, shall be at the expense of the
         Holder). Any indemnified party shall have the right to employ separate
         counsel in any such action and participate in the defense thereof, but
         the fees and expenses of such counsel shall be at the expense of the
         indemnified party unless (i) the employment of such counsel shall have
         been specifically authorized in writing by the indemnifying party, (ii)
         the indemnifying party shall have failed to assume the defense of such
         action or employ counsel reasonably satisfactory to the indemnified
         party or (iii) the named parties to any such action (including any
         impleaded parties) include both the indemnified party and the
         indemnifying party, and the indemnified party shall have been advised
         by such counsel that there may be one or more legal defenses available
         to it which are different from or additional to those available to the
         indemnifying party (in which case the indemnifying party shall not have
         the right to assume the defense of such action on behalf of the
         indemnified party). In any such case, the indemnifying party shall not,
         in connection with any one action or separate but substantially similar
         or related actions in the same jurisdiction arising out of the same
         general allegations or circumstances, be liable for the fees and
         expenses of more than one separate firm of attorneys (in addition to
         any local counsel) for all indemnified parties and all such fees and
         expenses shall be reimbursed as they are incurred. Such firm shall be
         designated in writing by a majority of the Holders, in the case of the
         parties indemnified pursuant to Section 8(a), and by the Issuers and
         Subsidiary Guarantors, in the case of parties indemnified pursuant to
         Section 8(b). The indemnifying party shall indemnify and hold harmless
         the indemnified party from and against any and all losses, claims,
         damages, liabilities and judgments by reason of any settlement of any
         action (i) effected with its written consent or (ii) effected without
         its written consent if the settlement is entered into more than twenty
         Business Days after the indemnifying party shall have received a
         request from the indemnified party for reimbursement for the fees and
         expenses of counsel (in any case where such fees and expenses are at
         the expense of the indemnifying party) and, prior to the date of such
         settlement, the indemnifying party shall have failed to comply with
         such reimbursement request. No indemnifying party shall, without the
         prior written consent of the indemnified party, effect any settlement
         or compromise of, or consent to the entry of judgment with respect to,
         any pending or threatened action in respect of which the indemnified
         party is or could have been a party and indemnity or contribution may
         be or could have been sought hereunder by the indemnified party, unless
         such settlement, compromise or judgment (i) includes an unconditional
         release of the indemnified party from all liability on claims that are
         or could have been the subject matter of such action and (ii) does not
         include a statement as to or an admission of fault, culpability or a
         failure to act, by or on behalf of the indemnified party.

                                       18

<PAGE>

                  (d)      To the extent that the indemnification provided for
         in this Section 8 is unavailable to an indemnified party in respect of
         any losses, claims, damages, liabilities or judgments referred to
         therein, then each indemnifying party, in lieu of indemnifying such
         indemnified party, shall contribute to the amount paid or payable by
         such indemnified party as a result of such losses, claims, damages,
         liabilities or judgments (i) in such proportion as is appropriate to
         reflect the relative benefits received by the Issuers and the
         Subsidiary Guarantors, on the one hand, and the Holders, on the other
         hand, from their sale of Transfer Restricted Securities or (ii) if the
         allocation provided by clause 8(d)(i) is not permitted by applicable
         law, in such proportion as is appropriate to reflect not only the
         relative benefits referred to in clause 8(d)(i) above but also the
         relative fault of the Issuers and the Subsidiary Guarantors, on the one
         hand, and of the Holder, on the other hand, in connection with the
         statements or omissions which resulted in such losses, claims, damages,
         liabilities or judgments, as well as any other relevant equitable
         considerations. The relative fault of the Issuers and the Subsidiary
         Guarantors, on the one hand, and of the Holder, on the other hand,
         shall be determined by reference to, among other things, whether the
         untrue or alleged untrue statement of a material fact or the omission
         or alleged omission to state a material fact relates to information
         supplied by the Issuers or such Subsidiary Guarantor, on the one hand,
         or by the Holder, on the other hand, and the parties' relative intent,
         knowledge, access to information and opportunity to correct or prevent
         such statement or omission.

                  The Issuers, the Subsidiary Guarantors and each Holder agree
         that it would not be just and equitable if contribution pursuant to
         this Section 8(d) were determined by pro rata allocation (even if the
         Holders were treated as one entity for such purpose) or by any other
         method of allocation which does not take account of the equitable
         considerations referred to in the immediately preceding paragraph. The
         amount paid or payable by an indemnified party as a result of the
         losses, claims, damages, liabilities or judgments referred to in the
         immediately preceding paragraph shall be deemed to include, subject to
         the limitations set forth above, any legal or other expenses incurred
         by such indemnified party in connection with investigating or defending
         any matter, including any action that could have given rise to such
         losses, claims, damages, liabilities or judgments. Notwithstanding the
         provisions of this Section 8, no Holder, its directors, its officers or
         any Person, if any, who controls such Holder shall be required to
         contribute, in the aggregate, any amount in excess of the amount by
         which the total received by such Holder with respect to the sale of
         Transfer Restricted Securities pursuant to a Registration Statement
         exceeds (i) the amount paid by such Holder for such Transfer Restricted
         Securities and (ii) the amount of any damages which such Holder has
         otherwise been required to pay by reason of such untrue or alleged
         untrue statement or omission or alleged omission. No Person guilty of
         fraudulent misrepresentation (within the meaning of Section 11(f) of
         the Act) shall be entitled to contribution from any Person who was not
         guilty of such fraudulent misrepresentation. The Holders' obligations
         to contribute pursuant to this Section 8(d) are several in proportion
         to the respective principal amount of Transfer Restricted Securities
         held by each Holder hereunder and not joint.

         Section 9.        Rule 144A and Rule 144. The Issuers and each
Subsidiary Guarantor agree with each Holder, for so long as any Transfer
Restricted Securities remain outstanding and during any period in which the
Issuers or such Subsidiary Guarantor (i) is not subject to Section

                                       19

<PAGE>

13 or 15(d) of the Exchange Act, to make available, upon request of any Holder,
to such Holder or beneficial owner of Transfer Restricted Securities in
connection with any sale thereof and any prospective purchaser of such Transfer
Restricted Securities designated by such Holder or beneficial owner, the
information required by Rule 144A(d)(4) under the Act in order to permit resales
of such Transfer Restricted Securities pursuant to Rule 144A, and (ii) is
subject to Section 13 or 15(d) of the Exchange Act, to make all filings required
thereby in a timely manner in order to permit resales of such Transfer
Restricted Securities pursuant to Rule 144.

         Section 10.       Miscellaneous.

                  (a)      Remedies. The Issuers and the Subsidiary Guarantors
         acknowledge and agree that any failure by the Issuers and/or the
         Subsidiary Guarantors to comply with their respective obligations under
         Sections 3 and 4 hereof may result in material irreparable injury to
         the Initial Purchasers or the Holders for which there is no adequate
         remedy at law, that it will not be possible to measure damages for such
         injuries precisely and that, in the event of any such failure, the
         Initial Purchasers or any Holder may obtain such relief as may be
         required to specifically enforce the Issuers' and the Subsidiary
         Guarantors' obligations under Sections 3 and 4 hereof. The Issuers and
         the Subsidiary Guarantors further agree to waive the defense in any
         action for specific performance that a remedy at law would be adequate.

                  (b)      No Inconsistent Agreements. Neither the Issuers nor
         any Subsidiary Guarantor will, on or after the date of this Agreement,
         enter into any agreement with respect to its securities that is
         inconsistent with the rights granted to the Holders in this Agreement
         or otherwise conflicts with the provisions hereof. Neither the Issuers
         nor any Subsidiary Guarantor have previously entered into any agreement
         granting any registration rights with respect to its securities to any
         Person other than the registration rights (i) of GulfTerra Energy
         Partners Company and its affiliates in Section 6.14 of the Partnership
         Agreement, (ii) of EPEC Deepwater Gathering Company ("EPEC") and its
         successors pursuant to a registration rights agreement between EPEC and
         the Partnership which was executed in connection with the acquisition
         by the Partnership of an additional interest in Viosca Knoll Gathering
         Company, (iii) of Crystal Gas Storage, Inc. ("Crystal") and its
         successors pursuant to the registration rights agreement dated as of
         August 28, 2000 between Crystal and the Partnership which was executed
         in connection with the acquisition by the Partnership of the Crystal
         storage facilities, (iv) granted under the Partnership Credit Facility
         (as amended, restated and otherwise supplemented through the date
         hereof) and related agreements, (v) of the General Partner and its
         affiliates in Section 6.14 of the Partnership Agreement (vi) in the
         registration rights agreement executed in connection with the November
         2002 acquisition by the Partnership of the San Juan assets and (vii)
         granted pursuant to this Agreement. The rights granted to the Holders
         hereunder do not in any way conflict with and are not inconsistent with
         the rights granted to the holders of the Issuers' and the Subsidiary
         Guarantors' securities under any agreement in effect on the date
         hereof.

                  (c)      Amendments and Waivers. The provisions of this
         Agreement may not be amended, modified or supplemented, and waivers or
         consents to or departures from the provisions hereof may not be given
         unless (i) in the case of Section 5 hereof and this

                                       20

<PAGE>

         Section 10(c)(i), the Issuers have obtained the written consent of
         Holders of all outstanding Transfer Restricted Securities and (ii) in
         the case of all other provisions hereof, the Issuers have obtained the
         written consent of Holders of a majority of the outstanding principal
         amount of Transfer Restricted Securities (excluding Transfer Restricted
         Securities held by the Issuers or their Affiliates). Notwithstanding
         the foregoing, a waiver or consent to departure from the provisions
         hereof that relates exclusively to the rights of Holders whose Transfer
         Restricted Securities are being tendered pursuant to the Exchange
         Offer, and that does not affect directly or indirectly the rights of
         other Holders whose Transfer Restricted Securities are not being
         tendered pursuant to such Exchange Offer, may be given by the Holders
         of a majority of the outstanding principal amount of Transfer
         Restricted Securities subject to such Exchange Offer.

                  (d)      Third Party Beneficiary. The Holders shall be third
         party beneficiaries to the agreements made hereunder between the
         Issuers and the Subsidiary Guarantors, on the one hand, and the Initial
         Purchasers, on the other hand, and shall have the right to enforce such
         agreements directly to the extent they may deem such enforcement
         necessary or advisable to protect its rights or the rights of Holders
         hereunder.

                  (e)      Notices. All notices and other communications
         provided for or permitted hereunder shall be made in writing by
         hand-delivery, first-class mail (registered or certified, return
         receipt requested), telex, telecopier, or air courier guaranteeing
         overnight delivery:

                           (i)      if to a Holder, at the address set forth on
                  the records of the Registrar under the Indenture, with a copy
                  to the Registrar under the Indenture; and

                           (ii)     if to the Issuers or the Subsidiary
                  Guarantors:

                                    GulfTerra Energy Partners, L.P.
                                    4 Greenway Plaza
                                    Houston, Texas 77046
                                    Telecopier No.: (713) 420-5477
                                    Attention: Chief Financial Officer

                                    With a copy to:

                                    Akin, Gump, Strauss, Hauer & Feld, L.L.P.
                                    711 Louisiana Street, Suite 1900
                                    Houston, Texas 77002
                                    Telecopier No.: (713) 236-0822
                                    Attention: J. Vincent Kendrick

                  All such notices and communications shall be deemed to have
         been duly given: at the time delivered by hand, if personally
         delivered; five Business Days after being deposited in the mail,
         postage prepaid, if mailed; when receipt acknowledged, if

                                       21

<PAGE>

         telecopied; and on the next Business Day, if timely delivered to an air
         courier guaranteeing overnight delivery.

                  Copies of all such notices, demands or other communications
         shall be concurrently delivered by the Person giving the same to the
         Trustee at the address specified in the Indenture.

                  (f)      Successors and Assigns. This Agreement shall inure to
         the benefit of and be binding upon the successors and assigns of each
         of the parties, including without limitation and without the need for
         an express assignment, subsequent Holders; provided, that nothing
         herein shall be deemed to permit any assignment, transfer or other
         disposition of Transfer Restricted Securities in violation of the terms
         hereof or of the Purchase Agreement or the Indenture. If any transferee
         of any Holder shall acquire Transfer Restricted Securities in any
         manner, whether by operation of law or otherwise, such Transfer
         Restricted Securities shall be held subject to all of the terms of this
         Agreement, and by taking and holding such Transfer Restricted
         Securities such Person shall be conclusively deemed to have agreed to
         be bound by and to perform all of the terms and provisions of this
         Agreement, including the restrictions on resale set forth in this
         Agreement and, if applicable, the Purchase Agreement, and such Person
         shall be entitled to receive the benefits hereof.

                  (g)      Counterparts. This Agreement may be executed in any
         number of counterparts and by the parties hereto in separate
         counterparts, each of which when so executed shall be deemed to be an
         original and all of which taken together shall constitute one and the
         same agreement.

                  (h)      Headings. The headings in this Agreement are for
         convenience of reference only and shall not limit or otherwise affect
         the meaning hereof.

                  (i)      Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY
         AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.

                  (j)      Severability. In the event that any one or more of
         the provisions contained herein, or the application thereof in any
         circumstance, is held invalid, illegal or unenforceable, the validity,
         legality and enforceability of any such provision in every other
         respect and of the remaining provisions contained herein shall not be
         affected or impaired thereby.

                  (k)      Entire Agreement. This Agreement is intended by the
         parties as a final expression of their agreement and intended to be a
         complete and exclusive statement of the agreement and understanding of
         the parties hereto in respect of the subject matter contained herein.
         There are no restrictions, promises, warranties or undertakings, other
         than those set forth or referred to herein with respect to the
         registration rights granted with respect to the Transfer Restricted
         Securities. This Agreement supersedes all prior agreements and
         understandings between the parties with respect to such subject matter.

                                     * * * *

                                       22

<PAGE>

         IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first written above.

                     Issuers:

                     GULFTERRA ENERGY PARTNERS, L.P.

                     By:/s/ Keith Forman
                        --------------------------------------------------------
                        Keith Forman, Vice President and Chief Financial Officer

                     GULFTERRA ENERGY FINANCE CORPORATION

                     By:/s/ Keith Forman
                        --------------------------------------------------------
                        Keith Forman, Vice President and Chief Financial Officer

<PAGE>

                             Subsidiary Guarantors:

                             CAMERON HIGHWAY PIPELINE GP, L.L.C.*
                             CAMERON HIGHWAY PIPELINE I, L.P.*
                             CRYSTAL HOLDING, L.L.C.*
                             FIRST RESERVE GAS, L.L.C.*
                             FLEXTREND DEVELOPMENT COMPANY, L.L.C.*
                             GULFTERRA ALABAMA INTRASTATE, L.L.C.*
                             GULFTERRA FIELD SERVICES, L.L.C.*
                             GULFTERRA GC, L.P.*
                             GULFTERRA HOLDING I, L.L.C.*
                             GULFTERRA HOLDING II, L.L.C.*
                             GULFTERRA HOLDING III, L.L.C.*
                             GULFTERRA HOLDING IV, L.P.*
                             GULFTERRA HOLDING V, L.P.*
                             GULFTERRA INTRASTATE, L.P*.
                             GULFTERRA NGL STORAGE, L.L.C.*
                             GULFTERRA OIL TRANSPORT, L.L.C.
                             GULFTERRA OPERATING COMPANY, L.L.C.*
                             GULFTERRA SOUTH TEXAS, L.P.*
                             GULFTERRA TEXAS PIPELINE, L.P.*
                             HATTIESBURG GAS STORAGE COMPANY*
                                  By: FIRST RESERVE GAS, L.L.C., in its
                                      capacity as 50% general partner of
                                      Hattiesburg Gas Storage Company*
                                  By: HATTIESBURG INDUSTRIAL GAS SALES, L.L.C.,
                                      in its capacity as 50% general partner of
                                      Hattiesburg Gas Storage Company*
                             HATTIESBURG INDUSTRIAL GAS SALES, L.L.C.*
                             HIGH ISLAND OFFSHORE SYSTEM, L.L.C.
                                  By: GULFTERRA ENERGY PARTNERS, L.P.,
                                      its sole member*
                             MANTA RAY GATHERING COMPANY, L.L.C.*
                             PETAL GAS STORAGE, L.L.C.*
                             POSEIDON PIPELINE COMPANY, L.L.C.*

                             *By:/s/ Keith Forman
                                 ----------------------------------------
                                 Keith Forman, Vice President and
                                 Chief Financial Officer:

<PAGE>

                                    Initial Purchasers:

                                    J.P. MORGAN SECURITIES INC.
                                    BANC ONE CAPITAL MARKETS, INC.
                                    BNP PARIBAS SECURITIES CORP.
                                    CREDIT LYONNAIS SECURITIES (USA) INC.
                                    CREDIT SUISSE FIRST BOSTON LLC
                                    FORTIS INVESTMENT SERVICES LLC
                                    THE ROYAL BANK OF SCOTLAND PLC
                                    SCOTIA CAPITAL (USA) INC.
                                    SUNTRUST CAPITAL MARKETS, INC.
                                    WACHOVIA SECURITIES, LLC

                                    By: J.P. MORGAN SECURITIES INC.

                                    By: /s/Adam Bernard
                                        ----------------------------------
                                        Name:  Adam Bernard
                                        Title: Vice President

<PAGE>

                                   SCHEDULE A

<TABLE>
<CAPTION>
   NAME OF SUBSIDIARY GUARANTOR                            STATE OF ORGANIZATION
   ----------------------------                            ---------------------
<S>                                                        <C>
Cameron Highway Pipeline GP, L.L.C.                              Delaware
Cameron Highway Pipeline I, L.P.                                 Delaware
Crystal Holding, L.L.C.                                          Delaware
First Reserve Gas, L.L.C.                                        Delaware
Flextrend Development Company, L.L.C.                            Delaware
GulfTerra Alabama Intrastate, L.L.C.                             Delaware
GulfTerra Field Services, L.L.C.                                 Delaware
GulfTerra GC, L.P.                                               Delaware
GulfTerra Holding I, L.L.C.                                      Delaware
GulfTerra Holding II, L.L.C.                                     Delaware
GulfTerra Holding III, L.L.C.                                    Delaware
GulfTerra Holding IV, L.P.                                       Delaware
GulfTerra Holding V, L.P.                                        Delaware
GulfTerra Intrastate, L.P.                                       Delaware
GulfTerra NGL Storage, L.L.C.                                    Delaware
GulfTerra Oil Transport, L.L.C.                                  Delaware
GulfTerra Operating Company, L.L.C.                              Delaware
GulfTerra South Texas, L.P.                                      Delaware
GulfTerra Texas Pipeline, L.P.                                   Delaware
Hattiesburg Gas Storage Company                                  Delaware
Hattiesburg Industrial Gas Sales, L.L.C.                         Delaware
High Island Offshore System, L.L.C.                              Delaware
Manta Ray Gathering Company, L.L.C.                              Delaware
Petal Gas Storage, L.L.C.                                        Delaware
Poseidon Pipeline Company, L.L.C.                                Delaware
</TABLE>

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