Kern River Gas Transmission Company

Second Revised Volume No. 1

Effective Date: 08/01/2009, Docket: RP09-723-000, Status: Effective

Fifth Revised Sheet No. 94 Fifth Revised Sheet No. 94

Superseding: Substitute Fourth Revised Sheet No. 94

. GENERAL TERMS AND CONDITIONS .

(Continued)

5. INVOICING AND PAYMENT (Continued)

5.4 Correction of Invoicing Errors. In the event an error is

discovered in any invoice rendered by Transporter, Shipper must

contest such amount in writing within six months from the date

that the invoice was rendered, otherwise the invoice will be

deemed correct. Transporter will correct any invoicing errors

(after a rebuttal period of three months or less) within thirty

(30) days of the date that Shipper and Transporter agree that an

invoicing error occurred.

5.5 Failure to Pay Invoices. Should Shipper fail to pay any of the

amount of any invoice when such amount is due, unless such failure

to pay is the result of Transporter's error, Shipper will pay a

late charge which will be added to the next regular monthly

invoice rendered to Shipper under this Section 5; provided,

however that no invoice will be issued if the amount owed is for

late charges only and the total amount is less than $25.00. Such

late charge will be determined by multiplying (a) the unpaid

portion of the invoice by (b) the ratio of the number of days from

the due date to the date of actual payment to 365, and (c) the

annual interest rate as determined in accordance with 18 C.F.R.

Section 154.501(d)(1) or any successor provision of the FERC's

Regulations. If such failure to pay continues for thirty (30)

days after payment is due, Transporter, in addition to any other

remedy it may have under the Transportation Service Agreement, may

suspend Transportation service until the full amount of all

outstanding invoices, including interest applicable thereto, is

paid; provided, however, that Transporter will provide Shipper

with a minimum of five (5) days' notice before service is

suspended. Transporter will suspend a Shipper's reservation

charges while that Shipper's service is suspended. Transporter may

also permanently terminate Transportation service; provided,

however, that Transporter will provide both Shipper and the

Commission with a minimum of thirty (30) days' notice before

service is terminated. Notices to suspend and/or terminate

service may be provided on or after the date payment is due if

shipper fails to make payment in full on or before that date.

Transporter will not be entitled to suspend further delivery of

Gas if Shipper in good faith (a) disputes the amount of any such

invoice or part thereof in writing; (b) pays the Transporter such

amounts as it concedes to be correct; and provides documentation

identifying the basis for the dispute.