Gas Transmission Northwest Corp.

Third Revised Volume No. 1-A

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Effective Date: 10/06/2003, Docket: RP04- 23-000, Status: Effective

Original Sheet No. 229 Original Sheet No. 229 : Effective

GENERAL TERMS AND CONDITIONS

(Continued)

38. INCREMENTAL FUEL REALLOCATION MECHANISM

When at least one incremental fuel surcharge is currently in effect

on the GTN system under this FERC Gas Tariff, new Shippers, taking

either long-term firm (LTF) capacity that is available on the GTN

system or LTF capacity that is permanently released pursuant to

Paragraph 28 of these General Terms and Conditions, will be subject

to the highest incremental fuel rate where such fuel rate otherwise

applies to expansion Shippers on the GTN system. LTF capacity that

is available on the GTN system includes, but is not limited to:

capacity that is subject to the right of first refusal process where

the existing Shipper has elected to terminate its contract pursuant

to Paragraph 33.1 of these General Terms and Conditions; capacity

that is subject to the right of first refusal process where the

existing Shipper elects not match the highest bid(s) pursuant to

Paragraph 33.2; and capacity that has returned to the pipeline

because of Shipper default or other contract termination.

The fuel rate that applies to new LTF Shipper(s) will be determined

by the following formula, where Incremental Fuel represents the fuel

assumption (in Dth) supporting the original incremental fuel rate

associated with a particular expansion project and Incremental Dth-

miles represents all capacity currently subject to the associated

incremental fuel surcharge.

Incremental Fuel (Dth)

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

Incremental Dth-miles + New LTF Shipper Dth-miles