Kern River Gas Transmission Company

Second Revised Volume No. 1

Effective Date: 07/01/2000, Docket: RP00-288-000, Status: Effective

Original Sheet No. 827 Original Sheet No. 827 : Superseded

RATE SCHEDULE SH-1

Kern River Firm Transportation Services

(Continued)

ARTICLE 5 - CAPACITY RELEASE PROGRAM (Continued)

5.5 Bidding for Transportation Rights. (Continued)

pursuant to this Section 5.5(d) may, at any time during the

Bidding Period, submit one or more subsequent bids in accordance

with this Section 5.5 for the same Release Request; provided,

however, that Bidder may not submit a subsequent bid without first

withdrawing an existing bid, and provided further that any

subsequent bid submitted must contain a higher Total Release

Reservation Charge than contained in any previous bid which Bidder

has submitted for the same Release Request.

5.6 Determination of Successful Bidder.

(a) GISB 5.3.3: "For the capacity release business process timing

model, only the following methodologies are required to be

supported by capacity release service providers and provided to

releasing shippers as choices from which they may select and, once

chosen, should be used in determining the awards from the bid(s)

submitted. They are: 1) highest rate, 2) net revenue and 3)

present value. Other choices of bid evaluation methodology

(including other releasing shipper defined evaluation

methodologies) can be accorded similar timeline evaluation

treatment at the discretion of the capacity release service

provider. However, the capacity release service provider is not

required to offer other choices or similar timeline treatment for

other choices, nor, is the capacity release service provider held

to the timeline should the releasing shipper elect another method

of evaluation."

The Release Request must specify one of the following three

methodologies for determining the award from the bids submitted:

1) highest rate, 2) net revenue, or 3) present value. GISB 5.3.4:

"When the capacity release service provider makes awards of

capacity for which there have been multiple bids meeting minimum

conditions, the capacity release facilitator should award the

bids, best bid first, until all offered capacity is awarded." If