Panhandle Eastern Pipe Line Company, LP

THIRD REVISED VOLUME NO. 1

Effective Date: 06/30/2004, Docket: RP04-321-000, Status: Effective

Original Sheet No. 320 Original Sheet No. 320 : Effective

GENERAL TERMS AND CONDITIONS

(Continued)

(d) Determination of the Dakota Gasification Transition

Cost Surcharge

The Dakota Gasification Transition Cost Surchage shall

be determined on the basis of (1) the design units

underlying Panhandle's currently effective

Deliverability Charge for firm service and the Monthly

Inventory Charge for interruptible service for the

Market Area component of Rate Schedules WS, PS and FS

and the Market Area component of Rate Schedule IWS,

respectively, and (2) the Dakota Gasification

Transition Costs for the three (3) Months preceding

the effective date of the Surcharge on an "as-billed"

basis to reflect the basis of the billings submitted

to Panhandle by ANR. In addition, commencing with the

Surcharge to be effective on June 1, 1995, each Dakota

Gasification Transition Cost Surcharge shall be

adjusted as necessary to recover or to return the

balance in Panhandle's Unrecovered Dakota Gasification

Transition Cost Account as of two (2) Months prior to

June 1 over twelve (12) billing periods beginning each

June 1.

(e) Unrecovered Dakota Gasification Transition Cost

Account

Panhandle shall maintain an Unrecovered Dakota

Gasification Transition Cost Account to record the

cummulative monthly difference between actual Dakota

Gasification Transition Costs incurred and the actual

amounts recovered by Panhandle for Dakota Gasification

Transition Costs.

(f) Crediting of Refunds Received, Debiting of Additional

Surcharges

Commencing with the effective date of this Section

18.6, Panhandle shall credit all refunds received

which are related to its Dakota Gasification

Transition Costs to its Unrecovered Dakota

Gasification Transition Cost Account. Commencing with

the effective date of this Section 18.6, Panhandle

shall debit any similarly attributable additional

surcharge for its Dakota Gasification Transition Costs

to its Unrecovered Dakota Gasification Transition Cost

Account.