Kern River Gas Transmission Company

Second Revised Volume No. 1

Effective Date: 07/01/2009, Docket: RP09-616-000, Status: Effective

Second Revised Sheet No. 202 Second Revised Sheet No. 202

Superseding: First Revised Sheet No. 202

GENERAL TERMS AND CONDITIONS

(Continued)

26. SEGMENTATION (Continued)

If releasing Shipper's TMDQ is subject to adjustment

pursuant to Section 25.4 of the General Terms and

Conditions, the pre-release TMDQ will be determined by (1)

dividing releasing Shipper's DMDQ immediately prior to the

release by the system average Btu used to convert releasing

Shipper's MDQ to DMDQ; and (2) multiplying the result by

releasing Shipper's base average Btu as described in Section

25.4.

(d) To the extent that delivery point capacity is available,

scheduled nominations for forward hauls and backhauls to the

same delivery point may exceed shipper's current TMDQ.

(e) All segmented releases are subject to the capacity release

provisions contained in Section 15 of the General Terms and

Conditions.

26.3 Pre-Scheduling Adjustments to Nominations.

Before any nominations for segmented capacity are submitted for

confirmation and scheduling in accordance with Sections 13.1 and

13.2 of the General Terms and Conditions, Transporter will adjust

such nominations, if necessary, as follows:

(a) If a Shipper's nominations exceed its current TMDQ on any

portion of Transporter's mainline, nominations will be

reduced to equal such Shipper's current TMDQ, using the

rankings provided by Shipper, where applicable.

(b) If the combined total of releasing and replacement Shippers'

nominations for any portion of Transporter's mainline exceed

releasing Shipper's pre-release TMDQ as defined in Section

26.2 (c), nominations will be reduced to equal such TMDQ in

accordance with (1) and (2) below:

(1) Within-the-path nominations will have a higher

priority than out-of-path nominations.

(2) To the extent that the combined total of releasing and

replacement Shippers' out-of-path nominations for any

portion of Transporter's mainline exceed releasing

Shipper's pre-release TMDQ, both the releasing

Shipper's and the replacement Shipper's nominations

will be reduced on a pro rata basis, based on each

Shipper's nominations, so that the combined

nominations are equal to releasing Shipper's pre-

release TMDQ.