El Paso Natural Gas Company

Second Revised Volume No. 1A

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Effective Date: 04/01/2006, Docket: RP05-422-000, Status: Effective

Original Sheet No. 379 Original Sheet No. 379 : Superseded

TRANSPORTATION GENERAL TERMS AND CONDITIONS

(Continued)

38. RIGHT-OF-WAY ("ROW") SURCHARGE (Continued)

38.2 Procedures (Continued)

(b) No later than March 31 of each year after 2006, Transporter

shall file with the Commission an Annual ROW Cost Filing to

be effective May 1 explaining the calculation of the

forecasted annual cost, the true-up computation of the

prior year cost and revenue, and the development of the new

surcharge rate.

(c) Annual filings shall include a true-up provision to

reconcile any over- or under-recovery of costs.

(d) The ROW Surcharge shall be calculated at the end of each

annual period by dividing the cost of the annual ROW

payment by Transporter's actual transportation billing

determinants, adjusted for discounts, for all

transportation rate schedules except Rate Schedules PAL and

ISS.

38.3 Surcharge. The surcharge will be applied to the volumetric

(usage) component of the rate under all rate schedules included in

this Volume No. 1-A Tariff, except for Rate Schedules PAL and ISS

service. The surcharge will be discountable at Transporter's

discretion.

38.4 ROW Usage Deferred Account. Transporter shall maintain a Deferred

Account for the period of 12 months ending March 31 ("Deferral

Period") prior to the beginning of each ROW annual period.

(a) Annually, Transporter shall determine the actual ROW costs

(for periods of less than 12 months, the annual costs shall

be allocated pro rata) and shall compare those costs to

actual monthly revenue.