Kern River Gas Transmission Company

Second Revised Volume No. 1

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

Original Sheet No. 840 Original Sheet No. 840 : Superseded

RATE SCHEDULE SH-1

Kern River Firm Transportation Services

(Continued)

ARTICLE 5 - CAPACITY RELEASE PROGRAM (Continued)

5.11 Further Conditions on Release of Transportation Rights. (Continued)

maximum rates, charges and surcharges set forth in this Tariff,

all as may be revised from time to time, notwithstanding any

discount to such rates, charges or surcharges then in effect for

the Releasing Shipper. The Release Reservation Rate and Release

Reservation Surcharges shall for all purposes of this Article 5 be

stated in relation to and on the same basis as the Monthly

Reservation Rate set forth in this Tariff for service under this

Governing Rate Schedule, subject to the additional provisions of

Section 5.4(b) concerning any Release Reservation Rate or Release

Reservation Surcharges which may be paid on a one-part volumetric

basis. The maximum rate that may be charged for a Release shall

not be affected by the amount of any marketing fee paid by the

Releasing Shipper to Transporter in accordance with Section 5.12.

(e) All terms and conditions of service provided under any Release

must be consistent with and shall be subject to all terms and

conditions of the Releasing Shipper's Service Agreement, and with

all applicable terms and conditions of this Tariff, including

without limitation the provisions on nominations, scheduling and

curtailment of Transportation service as set forth in Article 13

of this Rate Schedule. Any subsequent Release hereunder by a

Replacement Shipper additionally must be consistent with the terms

and conditions of such Replacement Shipper's Released

Transportation Service Agreement and any and all effective

Exhibits "RS" and Exhibits "RP" thereto.

(f) Transporter may reject any Release Request or any bid which does

not conform in all respects to the requirements of this Article 5,

and such rejected Release Request or bid shall be deemed null and

void from the time of such rejection.

(g) Transporter shall accept nominations, schedule Transportation,

afford priority of service and curtail service based on

instructions and communications from the Releasing Shipper and