Portland Natural Gas Transmission System

Second Revised Volume No. 1

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

Original Sheet No. 379 Original Sheet No. 379 : Effective

GENERAL TERMS AND CONDITIONS (Continued)

20.4 Reservation Charge Reimbursement. Transporter shall be obligated

to refund reservation charges collected from firm Shippers applicable to Days

in which firm service is interrupted, only if and to the extent that

Transporter is reimbursed for such reservation charges through insurance

proceeds and such Shipper is not recompensed for such reservation charges

through any other primary insurance. Such refunds shall be computed by

allocating to each firm Shipper for which service was interrupted a pro rata

share of the attributable insurance proceeds received by Transporter based on

the proportion that the eligible amount of each such Shipper's affected

reservation charge payments bears to the sum of the eligible amounts of all

such Shippers' affected reservation charge payments. The affected reservation

charge payments for each Shipper shall be computed by multiplying the

Shipper's Daily applicable reservation rate by the quantity of Gas not

delivered by reason of the interruption in firm service, not to exceed such

Shipper's MDQ. The eligible amount of such affected reservation charge

payments shall be the portion of the affected reservation charge payments for

which the Shipper is not eligible to be recompensed through other primary

insurance. For purposes of this Section 20.4, the Shipper's Daily applicable

reservation rate under Rate Schedule FT shall be determined by multiplying the

reservation rate applicable to the service that was interrupted by twelve(12)

and dividing the product by 365. Nothing herein shall obligate a firm Shipper

to maintain primary insurance which recompenses it, in whole or in part, for

reservation charges paid on Days when Transporter interrupts service.

20.5 Unavailability of Capacity. Transporter shall not be liable to

any person for any curtailment or interruption of service to Shipper due to

Force Majeure or other unforeseen circumstances; repair, maintenance, other

construction, or testing procedures necessary to maintain operational

capability on the System; and/or efforts to comply with applicable regulatory

requirements.

20.6 Termination of Gas Transportation Contract. If either

Transporter or Shipper shall fail to perform any of the material covenants or

obligations imposed upon it by the Gas Transportation Contract, subject to the

applicable provisions of this Tariff, then in such event the other party may

at its option terminate said contract and discontinue service by proceeding as

follows: the party not in default shall cause a written notice to be served on

the party in default stating specifically the cause for terminating the

contract and declaring it to be the intention of the party giving the notice

to terminate the same; thereupon the party in default shall have thirty (30)

Days after the service of the aforesaid notice in which to remedy or remove

the cause or causes stated in the notice for terminating the contract, and if

within said period of thirty (30)