Destin Pipeline Company, L.L.C.

Original Volume No. 1

Effective Date: 09/01/2002, Docket: RP00-321-001, Status: Effective

First Revised Sheet No. 128 First Revised Sheet No. 128 : Effective

Superseding: Original Sheet No. 128

GENERAL TERMS AND CONDITIONS

(Continued)

Section 25.1 (continued)

25.2 Penalty

(a) All quantities tendered to COMPANY and/or taken by

SHIPPER(S) on a daily basis in violation of COMPANY's OFO shall

constitute unauthorized receipts or deliveries for which a charge

of $25 per Dth shall be assessed and paid by SHIPPER(S).

(b) Penalty Crediting: Net penalties shall be credited back to

all shippers that complied with the OFO (compliant shippers).

Transporter's out-of-pocket expenses incurred or revenues

foregone as a direct result of the OFO violation(s) shall reduce

any penalties collected to determine the net penalty amount to be

credited. The net penalty amount shall be credited to the second

month's invoice from the month of collection and shall be

credited based on the pro rata share of each compliant shipper's

gas volumes transported by the total compliant shippers

throughput for the month of the OFO violation. If direct

expenses or foregone revenues are greater than the penalty

collected, no crediting shall occur. To the extent COMPANY has

collected penalties subject to Section 25.2(a), COMPANY will file

a report July 1 of each year commencing with the approval of

Section 25.2, detailing the penalty revenues received from

Section 25.2(a), COMPANY'S out-of-pocket expenses incurred or

revenues foregone, and net penalty amounts credited back to the

compliant shippers.

25.3 Exemptions

SHIPPERS will be exempt from penalties on imbalances

pursuant to Section 14 herein that result from

complying with an OFO. SHIPPERS will be allowed to

correct OFO created imbalances until the end of the

month following the month in which any such imbalance

occurs, based on the then current operations of

COMPANY's pipeline system. Upon an OFO becoming

effective as specified in the OFO or as provided in

this Section 25.3, SHIPPER or operator of the

facilities