Kern River Gas Transmission Company

Second Revised Volume No. 1

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

First Revised Sheet No. 737 First Revised Sheet No. 737

Superseding: Original Sheet no. 737

. RATE SCHEDULE MO-1 .

Kern River Firm Transportation Services

(Continued)

ARTICLE VIII - INVOICING AND PAYMENT (Continued)

8.7 Disputed Invoices. NAESB WGQ 3.3.19: "If invoice is in dispute, pay

portion not in dispute and provide documentation identifying basis for

dispute."

8.8 Adjustment of Invoicing Errors. In the event an error is discovered in

the amount billed in any invoice rendered by Transporter, such error

shall be adjusted within 30 days of the determination thereof, provided

that claim therefor shall have been made within six (6) months from the

date of such invoice.

8.9 Financial Requirements. As a necessary condition for entering into the

Transportation Service Agreement, Transporter requires a corporate

guarantee satisfactory to Transporter of Shipper's obligations under the

Transportation Service Agreement from a creditworthy affiliate of

Shipper. It is understood and agreed that Transporter is not required

to commence service or continue to perform service under the

Transportation Service Agreement if Shipper, or, if applicable, its

parent, in its role as guarantor, fails to demonstrate creditworthiness

as reasonably determined by Transporter.

Transporter's determination of creditworthiness for purposes of this

Rate Schedule shall be based upon a review of such person's financial

statements, bank references, trade references, and such other

information relating to the person's financial status and payment

history as is ordinarily required by lending institutions to establish

creditworthiness.

Transporter shall provide a written explanation and notice to Shipper

and, if applicable, to its guarantor, of any future determination of a

change in such person's credit status which may lead to the imposition

of additional credit supports as provided for herein.