Kern River Gas Transmission Company

Second Revised Volume No. 1

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Effective Date: 02/25/2001, Docket: RP00-505-002, Status: Effective

Sub First Revised Sheet No. 534 Sub First Revised Sheet No. 534 : Effective

Superseding: Original Sheet No. 534

RATE SCHEDULE CH-1

Kern River Firm Transportation Services

(Continued)

ARTICLE VIII - TERM OF AGREEMENT (Continued)

(b) If Shipper chooses to exercise the foregoing right of first

refusal, Shipper shall give written notice to that effect to

Transporter at least one hundred twenty (120) days prior to the

termination date of its Transportation Service Agreement.

Transporter shall post such notice on its EBB for a minimum period

of sixty (60) days and shall receive any competing offers for such

transportation service only during such period.

(c) If Shipper chooses to exercise the foregoing right of first

refusal, but wishes to retain only a portion of its capacity,

Shipper's MDQ, aggregate Maximum Receipt Volume entitlements and

aggregate Maximum Delivery Volume entitlements all must be

retained by the same percentage.

8.4 Extension to Correct Imbalance. The term of the Transportation Service

Agreement shall continue for a period of time reasonably sufficient to

allow the parties to correct any cumulative imbalances in receipts and

deliveries pursuant to Section 5.2.2 herein.

ARTICLE IX (RESERVED)