Paiute Pipeline Company

Second Revised Volume No. 1-A

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Effective Date: 11/05/2006, Docket: RP07- 12-000, Status: Effective

Third Revised Sheet No. 116 Third Revised Sheet No. 116 : Effective

Superseding: Second Revised Sheet No. 116

GENERAL TERMS AND CONDITIONS

(Continued)

15. REVENUE CREDITING FOR CAPACITY RELEASES (FIRM)

(Continued)

15.4 Credit Amounts and Offset Procedure: (Continued)

of the amount of any bill for service under

such Shipper's executed Service Agreement upon at

least one (1) week's notice to Paiute and such

Shipper. Once terminated, the capacity rights and

the responsibility to pay all charges applicable to

the released capacity shall revert to the Releasing

Shipper.

16. PREGRANTED ABANDONMENT AND RIGHT-OF-FIRST-REFUSAL

16.1 Pregranted Abandonment:

Unless otherwise provided in Shipper's Service

Agreement, Paiute shall be entitled to make use of

pregranted abandonment under Section 7(b) of the

Natural Gas Act for long-term (twelve [12] months or

more) firm transportation services, as authorized by

Section 284.221(d) of the Commission's Regulations,

upon the expiration of the contractual term or upon

termination of each individual transportation

arrangement, and shall seek bids from competing

Shippers interested in acquiring such firm

transportation service, as provided below.

16.2 Right-of-First-Refusal:

A Shipper may avoid pregranted abandonment of

service due to the expiration of a Firm Service

Agreement which provides for a primary term of

twelve (12) months or more and which (1) was

executed on or after March 27, 2000 and provides

for service at the applicable maximum rate, or (2)

was in effect on March 27, 2000. Such Shipper may

continue receiving the contracted service by

matching competing bid(s) in accordance with the

procedures described below; provided, however, that

in no event will the Shipper be required to match a

bid that exceeds the applicable maximum rate for

such service.

16.2 Notice of Desire to Extend Service:

To avail itself of its right-of-first-refusal, a

long-term Shipper must give Paiute notice of its

desire to extend such service not later than (1) the

date of the contract termination notice period

provided for in the Shipper's Service Agreement, or

(2) twelve (12) months prior to the expiration of the

term of the Service Agreement, whichever occurs

first. Such notice must specify the term of the

desired extension and the rate that the long-term

Shipper is willing to pay during such term.