North Baja Pipeline, LLC

Original Volume No. 1

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Effective Date: 08/12/2002, Docket: RP02-363-008, Status: Effective

Second Revised Sheet No. 152 Second Revised Sheet No. 152 : Effective

Superseding: First Revised Sheet No. 152

GENERAL TERMS AND CONDITIONS OF SERVICE

(Continued)

16. BALANCING (Continued)

16.1 (Continued)

(b) Actual delivered quantity exceeds actual confirmed receipt

quantity (Continued)

If, at the end of the three (3) day period the difference

between the actual quantity received and the delivered

quantity is in excess of five (5) percent of the delivered

quantity or one thousand (1000) Dth, whichever is greater,

the excess quantity shall be subject to a penalty equal to

twice the rate for service under Rate Schedule ITS-1 as set

forth on effective Tariff Sheet No. 4. If the imbalance is

not corrected within forty-five (45) days of NBP's notice of

an imbalance, the imbalance shall be cashed-out at a premium

to the Cash Out Index Price as follows:

(i) Imbalance Cash Out Index Price

Percent Premium

--------- --------------------

0% - 5% 0%

> 5% - 10% 10%

>10% - 15% 15%

>15% - 20% 20%

>20% 25%

(ii) Shipper's final imbalance on any Agreement shall be

cashed out at a price calculated by multiplying the

final imbalance by the applicable rate as determined

above.

(iii)Cash out amounts received by NBP will be used to

offset any purchases of linepack necessitated by

Shipper's imbalance. Net cash will be credited to all

shippers in accordance with Paragraph 16.1(d).

In the event the operational integrity of NBP's system is

threatened, NBP may, without notice, adjust Shipper requests

for confirmation from receipt or delivery markets on NBP's

system. In addition, NBP may issue an Operational Flow Order

consistent with Paragraph 18 of these General Terms and

Conditions of Service, and Shipper will be subject to

tolerances and penalties as provided for in Paragraph 18.5.