Horizon Pipeline Company, L.L.C.

Original Volume No. 1

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

Original Sheet No. 197 Original Sheet No. 197 : Effective

GENERAL TERMS AND CONDITIONS

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17. PRE-GRANTED ABANDONMENT, CONTRACT ROLLOVERS AND RIGHT OF FIRST REFUSAL

17.1 GENERAL

Subject to Section 17.3, service performed by Horizon

under Part 284 of the Commission's Regulations shall expire, and

shall be automatically abandoned, upon contract termination under:

(a) any FTS transportation Agreement with a primary term of less

than one (1) year; and (b) any ITS transportation Agreement

regardless of term. Service under any FTS transportation Agreement

with a term of one (1) year or greater shall expire, and shall be

automatically abandoned, on contract termination unless service is

continued pursuant to Sections 17.2 or 17.3.

17.2 RIGHT OF FIRST REFUSAL

(a) Any Shipper under an FTS Agreement with a term of

one (1) year or greater shall have the right to continue receiving

service after the expiration of its existing Agreement if, pursuant

to the Right of First Refusal procedures set forth in this Section

17.2, it matches the price and term offered for such service by any

other bidder; provided, however, that (irrespective of the price

offered by the existing Shipper or any bidder) Horizon shall not be

required to provide service at a discount from its applicable

maximum rate unless it otherwise agrees; and, provided further that

if a bid is submitted for a Negotiated Rate or Negotiated Rate

Formula under Section 33 of these General Terms and Conditions, the

existing Shipper need match only the value of that bid utilizing the

Recourse Rate in lieu of the Negotiated Rate or Negotiated Rate

Formula consistent with said Section 33.

(b) To exercise the Right of First Refusal, Shipper must

provide Horizon with notice via DART of its intent to do so in a form

specified by Horizon and must submit such notice at least six (6) months

prior to the expiration of the existing Agreement. Horizon shall advise

Shipper in writing of the date by which such notice must be submitted at

least three (3) months prior to the last day on which such notice can be

made on a timely basis. Such notice must specify a desired term of

service and the desired MDQ in total and at each Receipt and Delivery

Point. If the requested MDQ is greater than the existing MDQ in total

and at each Receipt and Delivery Point, any such increase shall be

treated as a request for new service under the applicable Rate Schedule

and only the original MDQ shall be subject to the Right of First Refusal

under this Section. The Right of First Refusal may apply to a portion of

the original Shipper's then effective service. Any notice specifying a

decrease in MDQ in total or at any point shall not affect the existing

Agreement during its remaining term.