*Kern River Gas Transmission Company*

*Second Revised Volume No. 1*

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Effective Date: 12/01/2007, Docket: RP08- 01-000, Status: Effective

**Fourth Revised Sheet No. 125 **Fourth Revised Sheet No. 125 : Effective

Superseding: Third Revised Sheet No. 125

. GENERAL TERMS AND CONDITIONS .

(Continued)

13. SCHEDULING OF RECEIPTS AND DELIVERIES (Continued)

13.2 Scheduling Process. (Continued)

a) First, among Shippers submitting within-

the-path nominations through the

constrained area, pro rata based on each

Shipper's current TMDQ in the constrained

area; and

b) Second, among Shippers submitting out-of-

path nominations through the constrained

area, pro rata based on each Shipper's

confirmed, out-of-path nominations through

the constrained area.

(ii) To Shippers nominating Interruptible

Transportation Service and Authorized Overrun

Service.

If available mainline capacity is insufficient

to accommodate the total Quantities nominated,

then available capacity will be allocated as

follows:

a) First, based on rate paid, in the priority

and sequence described below. For index-

based, discounted rates, the rate used for

scheduling purposes will be the rate

calculated from the most current index

prices available prior to the Timely

Nomination Cycle set forth in NAESB WGQ

1.3.2.

1) To Shippers paying the Maximum Base

Tariff Rate, including (i) Shippers

paying a Negotiated Rate where the

Negotiated Rate is a stated rate per

Dekatherm that is greater than or

equal to the Maximum Base Tariff

Rate, and (ii) Shippers paying a

discounted Rate based on index

prices where such rate would

otherwise exceed the Maximum Base

Tariff Rate, but is capped at the

Maximum Base Tariff Rate.

2) To Shippers paying less than the

Maximum Base Tariff Rate, from

highest rate to lowest rate,

including Shippers paying a

Negotiated Rate where the Negotiated

Rate is a stated rate per Dekatherm

that is lower than the Maximum Base

Tariff Rate but higher than the

Minimum Base Tariff Rate,