North Baja Pipeline, LLC

Original Volume No. 1

Effective Date: 04/24/2010, Docket: RP10-510-000, Status: Effective

First Revised Sheet No. 154 First Revised Sheet No. 154

Superseding: Original Sheet No. 154

GENERAL TERMS AND CONDITIONS OF SERVICE

(Continued)

16. BALANCING (Continued)

16.1 (Continued)

quantity (Continued)

Imbalance and overrun penalties will be based on the lesser

of the impact from operational or actual data. In the event

that any penalty would otherwise be applicable under these

provisions as a direct consequence of any action or failure

to take action by NBP or the failure of any facility under

NBP's control, or an event of force majeure as defined in

these General Terms and Conditions of Service, said penalty

shall not apply.

Interruptible Shippers will be notified whether penalties

will apply on the day their volumes are reduced. NBP shall

waive non-critical penalties for bumped shippers on the day

of the bump. Waiver of non-critical penalties shall not

relieve the shipper from the obligation to take corrective

action to eliminate ongoing imbalances.

The payment of a penalty in dollars pursuant to this

Paragraph 16 shall under no circumstances be considered as

giving any Shipper the right to deliver or take overrun

quantities.

(d) Crediting of Penalties

(i) Applicability. Penalty Revenues net of costs incurred

by NBP and collected as a result of imposition of any

penalty imposed under this Section 16 and as provided

elsewhere in this FERC Gas Tariff will be refunded

annually to all Shippers with interest calculated in

accordance with §154.501 of the Commission's

regulations.

(ii) Calculation of Credit Amount. Each Shipper shall

receive an allocation of penalty revenues based on the

proportion of the revenues received during the 12-

month period from each Shipper divided by the total

revenue received from all Shippers during such period.

(Continued)