Columbia Gulf Transmission Company

Second Revised Volume No. 1

Effective Date: 07/01/1996, Docket: RP96-261-000, Status: Effective

Second Revised Sheet No. 400 Second Revised Sheet No. 400 : Effective

Superseding: First Revised Sheet No. 400

OPERATIONAL BALANCING AGREEMENT (Cont'd)

2.2 During any given month, estimated meter quantities (mcf) shall be used by each Party on a

daily basis to determine the estimated Daily Operational Imbalance, if any, at the Interconnection Point(s)

for any given day. The Parties shall promptly make such physical flow adjustments as may be necessary in order

to prevent, reduce or eliminate any Daily Operational Imbalance. The daily variance in the estimated Daily

Operational Imbalance should not exceed five percent (5%) of the aggregate quantities nominated for the day,

nor two percent (2%) of the aggregate monthly quantities.

2.3 The sum of estimated Daily Operational Imbalances for each day in a given month shall

constitute the estimated Monthly Operational Imbalance for such month. By the fifth day of the month following

any given month in which an estimated Monthly Operational Imbalance arises, the measuring Party, as identified

on Exhibit "A", will notify the other Party as to the estimated Monthly Operational Imbalance for the prior

month, and the Parties shall promptly make such physical flow modifications as may be necessary to reduce or

eliminate any such Monthly Operational Imbalance.

2.4 The actual MMBtu at the Interconnection Point(s) each month will be determined and the actual

Monthly Operational Imbalance communicated by the allocating Party to the other Party in writing as soon as

possible, but in no case later than the fifteenth day of the month following the month in which the actual

Monthly Operational Imbalance arises. The Parties shall correct any actual Monthly Operational Imbalance by

the end of the month within which the actual Monthly Operational Imbalance is determined, or within such

longer period of time as may be agreed to by the Parties. Deliveries of gas to correct actual Monthly

Operational Imbalances may be made between the parties at the Interconnection Point(s) set forth on Exhibit

"A", or at any other point of interconnection between the respective facilities of the Parties as may be

mutually agreed to by the Parties.

2.5 Any gas volumes received and delivered to correct an Operational Imbalance shall be adjusted

for variations in Btu content in accordance with the applicable provisions of the FERC Gas Tariff of the Party

which received the gas. Measurement of gas for all purposes hereunder shall be in accordance with the

provisions set forth in the measuring Party's then effective FERC Gas Tariff.

2.6 In the event that a capacity constraint occurs on either Party's pipeline system which

results in curtailment of deliveries through an Interconnection Point, the Party on whose system the constraint

has occurred shall determine the appropriate reallocation of quantities due to curtailment as pursuant to the

provisions of Article I. If the constraint occurs at the Interconnection Point, the Party which owns the meter

at the Interconnection Point shall be deemed to have the constraint on its system.

ARTICLE III

TERM

3.1 This Agreement shall be effective and the procedures set forth in this Agreement shall be

implemented as of the day and year first above written, and shall continue in effect month-to-month thereafter;

provided, however that either Party may terminate this Agreement at any time by giving forty-eight (48) hours

prior written notice of termination to the other Party, to be effective at the end of the month of such

notification.