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. 226 Original Sheet No. 226 : Effective

GENERAL TERMS AND CONDITIONS

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allocation purposes, as if the rate(s) paid had been equal to the

Recourse Rate. Any Shipper, existing or new, paying the Recourse

Rate(s) has the same right to capacity as a Shipper willing to pay

a higher Negotiated Rate(s) or rate(s) under a Negotiated Rate

Formula. If the Negotiated Rate or the rate under a Negotiated

Rate Formula is higher than the corresponding Recourse Rate, the

Recourse Rate rather than the Negotiated Rate will be used as the

price cap for release capacity pursuant to Section 15.8 of these

General Terms and Conditions and for the Right of First Refusal

pursuant to Section 18.2 of these General Terms and Conditions.

Where the Negotiated Rate(s) or rate(s) under a Negotiated Rate

Formula results in revenue which is greater than the Recourse Rate

during certain portions of the relevant evaluation period but less

than the revenue at the Recourse Rate during other portions of the

relevant evaluation period (but the revenue pursuant to the

Negotiated Rate(s) or rate(s) under a Negotiated Rate Formula

equals or exceeds that which would be generated at the Recourse

Rate for the entire evaluation period), the value of bids and

requests at the Negotiated Rate(s) or rate(s) under a Negotiated

Rate Formula shall be evaluated as though the Recourse Rate

applied under such bid or request for the entire evaluation

period. Where the Negotiated Rate(s) or rate(s) under the

Negotiated Rate Formula result in revenue which is less than

revenue at the Recourse Rate over the relevant evaluation period,

the value of the bids or requests at the Negotiated Rate(s) or

rate(s) under the Negotiated Rate Formula shall be evaluated based

on such lower revenue and shall be afforded a correspondingly

lower priority than bids or requests at the Recourse Rate.

33.3 ACCOUNTING FOR COSTS AND REVENUES

The allocation of costs to, and the recording of

revenues from service at Negotiated Rate(s) will follow Horizon's

normal practices associated with all of its services under this

Tariff. Horizon will maintain separate records of Negotiated Rate

and Negotiated Rate Formula transactions for each billing period.

These records shall include the volumes transported, the billing

determinants (contract MDQ), the rates charged and the revenue

received associated with such transactions. Horizon will

separately identify such transactions in Statements G, I and J (or

their equivalent) filed in any general rate proceeding. Should

Horizon institute a tariff provision to flow through on a current

basis to its Shippers the impact of certain transportation

transactions, the treatment of revenues from Negotiated Rate(s) or

Negotiated Rate Formula(s) shall be specified in such provision.