Horizon Pipeline Company, L.L.C.

Original Volume No. 1

Effective Date: 04/18/2002, Docket: CP00-129-001, Status: Effective

Original Sheet No. 146 Original Sheet No. 146 : Effective

GENERAL TERMS AND CONDITIONS

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10.3 BALANCING CHARGES WITH OPERATIONAL FLOW ORDERS

(a) On any day when an Operational Flow Order (but

not a Critical Time) is in effect, if actual receipts and

deliveries allocated to a Shipper at any point or under any

Agreement do not conform to the sum of such Shipper's confirmed

nominations to such point and/or Agreement, Balancing Service

Charges will be assessed on such variances that are detrimental to

Horizon's system, based on the conditions described in or giving

rise to the Operational Flow Order. Notwithstanding the foregoing,

Balancing Service Charges shall not be assessed for variances at

Receipt Points unless explicitly stated in the Operational Flow

Order. The Operational Flow Order shall also state whether the

charges are to be based on variances at individual points, by zone

or by other aggregation. Balancing Service Charges during this

period will be as follows, based on the variance between actual

receipts and deliveries and the applicable confirmed nominations:

VARIANCE CHARGE

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0% to 3% No additional charges

3% to 10% Greater of $1.00/Dth or 50% of AMIP

10% to 20% Greater of $2.00/Dth or 1 times AMIP

20% to 50% Greater of $4.00/Dth or 2 times AMIP

Above 50% Greater of $8.00/Dth or 4 times AMIP

(b) Shipper shall in addition pay all applicable

charges specified in Sections 10.2(a)(1) and 10.2(b). Where

Balancing Service Charges apply under this Section 10.3, they shall

be in lieu of Balancing Service Charges under Section 10.2(a)(2),

but the charges identified in the prior sentence shall still apply.

10.4 CHARGES DURING CRITICAL TIMES

(a) On any day when a Critical Time is in effect, if

actual receipts and/or actual deliveries allocated to Shipper at

any point or under any Agreement for services provided by Horizon

under the Commission's Regulations at 18 C.F.R. Part 284 do not

conform to the sum of confirmed nominated volumes applicable to

such point or Agreement, Balancing Service Charges will be assessed

for the variances that are to the detriment of Horizon's system.

Balancing Service Charges in effect during a Critical Time will be

as follows: