Portland Natural Gas Transmission System

Second Revised Volume No. 1

Effective Date: 09/01/2006, Docket: RP06-449-000, Status: Effective

Original Sheet No. 212 Original Sheet No. 212 : Effective

5.3 Transporter intends to provide PAL service at given Parking Points

and Loan Points to Shippers on a first-come, first-served basis. It is

possible that Transporter will receive nominations for more Park or Loan

capacity that it can make available, and can therefore not satisfy the

nominations of all Shippers. When submitting a Park or Loan bid, a Shipper may

determine if it wishes to receive a prorated portion of the capacity for which

it submitted a nomination, or alternatively, if it wishes to cancel the

nomination if the entire order cannot be filled. As a default choice, if

Shipper does not make such an election and Transporter cannot grant Shipper

all of the Park or Loan capacity it requested, Shipper shall be allocated a

prorated portion of its Park or Loan capacity request.

5.4 The Park or Loan quantity of Gas in Shipper's account for all Loan

Points on any Day shall not exceed the MLQ set forth in Shipper's PAL Service

Agreement. Transporter may reject any nomination if Shipper nominates

quantities when the balance(s) in Shipper's account exceeds the MLQ or when

giving effect to the nomination will result in a balance(s) in Shipper's

account that exceeds the MLQ.

5.5 A shipper that wishes to close its Parked or Loaned position must

make a nomination to close the position. Nominations to close Park or Loan

positions must be in accordance with Section 7 of Pipeline's General Terms and

Conditions. Nominations to close existing Park or Loan positions shall take

precedent over nominations for new Park or Loan quantities, as applicable, and

the available quantities shall be adjusted accordingly prior to allocating

such capacity to new requests for PAL service.