Garden Banks Gas Pipeline, LLC

Original Volume No. 1

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Effective Date: 11/01/1999, Docket: RP00- 19-000, Status: Effective

First Revised Sheet No. 308 First Revised Sheet No. 308 : Effective

Superseding: Original Sheet No.308

FORM OF NGL BANK AGREEMENT

ARTICLE V

SETTLEMENTS

Cont'd

5.1 Settlement Calculations cont'd

b) NGL Bank settlements shall be calculated for each

Receipt Point on Transporter's Facility for each shipper based

upon the shipper's GPM (gallons per MCF of natural gas) at each

Receipt Point relative to the weighted average GPM for all

Receipt Points on Transporter's Facility, as further set forth on

Exhibit "B", attached hereto and incorporated herein by

reference. The total Theoretical Revenue for each shipper's NGL

components at each Receipt Point shall be reduced by subtracting

the "Shrinkage Cost" at each Receipt Point. For purposes of this

Agreement, Shrinkage Cost shall be defined as the sum of the

products derived when multiplying the "Heat Content" for each of

the adjusted NGL components by the respective "Value of the

BTU's" for each of the adjusted NGL components. For purposes of

this Agreement, the Heat Content for the adjusted NGL components

shall be as set forth under the heading "Gross Heating Value,

Btu/gal, fuel as liquid" in the most current GPA Publication

2145, currently Publication 2145-96. For heptane and heavier

hydrocarbons, however, the Heat Content shall be the sum of the

products derived by multiplying the heptane Heat Content by 50%

and by multiplying the hexane Heat Content by 50%. For purposes

of this Agreement, the Value of the BTU's shall be determined

monthly based on the numerical average of the Index Price quotes

published in the first issue of Inside F.E.R.C.'s Gas Market

Report for the month of production, under the heading "Prices of

Spot Gas Delivered To Pipelines" for: (1) ANR Pipeline Co.,

Louisiana; (2) Columbia Gulf Transmission Co., Louisiana; (3)

Tennessee Gas Pipeline Co. La. & Offshore (zone 1); (4)

Transcontinental Gas Pipe Line Corp., Zone 3 (pooling points);

and (5) Market Center Spot-Gas Prices, South Louisiana, Henry

Hub. From time-to-time, Administrator shall review the

aforementioned Index Prices and make adjustments as reasonably

necessary for purposes of determining the value of the Btu's.

c) If, after performing the calculations described in

Section 5.1.a (and its subsections) and Section 5.1.b, the

monthly theoretical gross processing margin calculated for ethane

is negative, then for purposes of making NGL Bank settlements to

shippers, ethane will not be included for that particular month.

This is representative of "ethane rejection" experienced in gas

processing. If, after performing the calculations described in

Section 5.1.a (and its subsections) and Section 5.1.b, the

monthly theoretical gross processing margin calculated for

propane is also negative, then no NGL Bank settlements will be

made on any NGL components for that particular month, and only

the fee for administrating the NGL Bank will be charged by the

Administrator as described in Section 5.3.