Kern River Gas Transmission Company

Second Revised Volume No. 1

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Effective Date: 01/01/2004, Docket: RP04- 68-000, Status: Effective

First Revised Sheet No. 855 First Revised Sheet No. 855 : Effective

Superseding: Original Sheet No. 855

RATE SCHEDULE SH-1

Kern River Firm Transportation Services

(Continued)

ARTICLE 6 - RATES (Continued)

6.7 Authorized Overrun Rate. (Continued)

6.7.2 Overrun Gas. Upon Shipper's request, Transporter, at its option,

may accept Overrun Gas for transportation hereunder, on a fully

interruptible basis, for which Shipper shall pay Transporter the

Authorized Overrun Rate. Interruption of Overrun Gas shall be

consistent with Section 10.1 of this Rate Schedule.

6.7.3 Calculation of Authorized Overrun Rate. Shipper's Authorized

Overrun Rate in effect at any time shall be the rate as shown on

Sheet No. 5.

6.8 Rights to Seek Modifications. Transporter's rates, charges,

classifications and services as set forth in the Firm Transportation

Service Agreement and this Rate Schedule are subject to regulation by

the FERC under the Natural Gas Act. Transporter shall have the right to

file from time to time with the FERC under Section 4 of the Natural Gas

Act and to place into effect such changes in this Rate Schedule, the

Firm Transportation Service Agreement, and other applicable terms of

Transporter's Tariff as Transporter may find necessary from time to time

to assure Transporter just and reasonable rates and charges and terms

and conditions of service and Shipper shall have the right to oppose

such changes. Shipper shall have the rights available to it under

Section 5 of the Natural Gas Act to assure Shipper just and reasonable

rates and charges and terms and conditions. Waivers of these statutory

rights, if any, shall be as provided in the Firm Transportation Service

Agreement between Transporter and Shipper.