Gulf States Transmission Corporation

Original Volume No. 1

Effective Date: 10/01/2001, Docket: RP00-405-001, Status: Effective

Second Revised Sheet No. 50B Second Revised Sheet No. 50B : Effective

Superseding: First Revised Sheet No. 50B

GENERAL TERMS AND CONDITIONS (Continued)

(f) Penalties: If a Shipper fails to comply with an OFO, it shall

be subject to twice the otherwise applicable daily charges as

provided in the applicable rate schedule for any volume of gas

by which it deviated from the requirements of the OFO. A

Shipper shall not incur any charges or penalties if such charges

or penalties would not have been incurred but for Shipper's

compliance with an OFO, including any preliminary action taken

by Shipper in response to a warning issued by Transporter as a

precondition to an OFO. A Shipper shall not incur any penalties

if the OFO was necessitated exclusively by Transporter's

negligence or willful misconduct.

(g) Liability of Transporter: Transporter shall not be liable for

any costs incurred by any Shipper in complying with an OFO.

Transporter shall not be responsible for any damages that result

from any interruption in Shipper's service that is a result of a

Shipper's failure to comply promptly and fully with an OFO, and

the noncomplying Shipper shall indemnify Transporter against any

claims of responsibility. However, Transporter shall use

reasonable efforts to minimize any such costs or damages, and

nothing herein shall exempt Transporter from liability in the

event of Transporter's negligence or willful misconduct.

(h) Unilateral Action: In the event that (1) Shipper does not

respond to an OFO, or (2) the actions taken thereunder are

insufficient to correct the system problem for which the OFO was

issued, or (3) there is insufficient time to carry out the

procedures with respect to OFOs, Transporter may periodically

take unilateral action, including the curtailment of firm

service, to maintain the operational integrity of Transporter's

system (or any portion thereof). For purposes of this section,

the operational integrity of Transporter's system shall

encompass the integrity of the physical system and the

preservation of physical assets and their performance, the

overall operating performance of the entire physical system as

an entity (or any portion thereof), and the maintenance (on a

reliable and operationally sound basis) of total system

deliverability and the quality of gas delivered. Transporter

shall flow through to non-offending Shippers as a non-

discriminatory credit to their bills, net unauthorized overrun

penalties received under this section.