Eastern Shore Natural Gas Company

Second Revised Volume No. 1

Effective Date: 03/01/2009, Docket: RP09-337-000, Status: Effective

First Revised Sheet No. 194 First Revised Sheet No. 194

Superseding: Original Sheet No. 194

EASTERN SHORE NATURAL GAS COMPANY

GENERAL TERMS AND CONDITIONS

(Continued)

29. Capacity Release (Continued)

(k) Billing and Payment

(1) A Replacement Shipper shall be billed by TSP and

shall make payments to TSP in accordance with the

terms of TSP?s FERC Gas Tariff and either the

Replacement Shipper?s executed Service Agreement or

Releasing Shipper?s executed Service Agreement,

whichever is applicable. Transportation Service

Provider shall (i) bill Releasing Shipper for the full

reservation charge, applicable reservation-related

surcharges and any other fixed charges for which

Releasing Shipper is otherwise obligated to TSP, reduced

by a credit(s) equal to either the reservation charge

bid by Replacement Shipper, or the reservation charge

portion of amounts billed to a Replacement Shipper

paying a volumetric rate(s); and (ii) bill the

Replacement Shipper for (a) the reservation charge bid

by that Replacement Shipper (except for period during

which the Releasing Shipper has recalled the

capacity), (b) all commodity charges, or all charges

under a volumetric rate(s), and any minimum

volumetric commitment agreed to but not met by the

Replacement Shipper, (c) any commodity surcharges, (d)

any penalties or imbalance correction costs

associated with the released capacity, and (e) any

applicable overrun charges. For all payments

received from Replacement Shipper, TSP shall

allocate such payment first to the reservation

charge (or to the reservation charge component under

a volumetric rate) and then any amounts above that

level to the commodity charge (or to the commodity

charge component under a volumetric rate).

Replacement Shipper may, upon notice to TSP and

approval of the Releasing Shipper, appoint Releasing

Shipper as its agent to receive such billings from

TSP. The charges shall be pro-rated for a

billing Month if necessary. TSP shall not

provide a reservation charge to the Releasing

Shipper in a Permanent Release.