Scg Pipeline Inc.

Original Volume No. 1

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Effective Date: 11/01/2003, Docket: RP03-611-000, Status: Effective

Original Sheet No.115 Original Sheet No.115 : Superseded

GENERAL TERMS AND CONDITIONS

(continued)

(b) Definition of a Positive Imbalance. A Positive Imbalance shall mean

excess receipts under a transportation agreement.

(c) Definition of a Negative Imbalance. A Negative

Imbalance shall mean excess deliveries under a transportation agreement.

12.2 Shipper shall cash out imbalances created as a result of post-Month

changes to prior Month receipt or delivery allocation, measurement or other

adjustments (Prior Period Adjustments) made in that current Month at the

average of the weekly References Spot Prices applicable to the Month of gas

flow pursuant to GT&Cs Section 12.7.

12.3 Netting. For each Month, all cumulative Transportation Imbalances will

be netted among each firm and/or interruptible transportation agreement under

which the Shipper, the Imbalance Agent and the billable party coincide.

12.4 Trading. Trading of the previous Month’s netted imbalances will be

allowed between Imbalance Agents (or the Shipper if no Imbalance Agent exists)

from the 1st calendar day until the end of the 17th Business Day following the

end of the Month. Trading will be allowed when the resulting trade will

reduce the imbalances for each Shipper or their Imbalance Agent. There will

be no fee for trading.

12.5 Final Resolution of Transportation Imbalances. If Shipper has an

imbalance remaining after the close of the trading period, such imbalance will

be cashed out in accordance with the cash out provisions set forth in this

Section 12.

12.6 Shipper or their Agents may nominate transactions (in accordance with

GT&Cs Section 6) during the Month to correct imbalances. Third parties may

offer imbalance management services to Shippers on Pipeline’s system.

Pipeline’s ability to receive or deliver imbalance quantities shall be

dependent upon Pipeline’s physical operations, and Pipeline is under no

obligation to allow receipt or delivery of such quantities for resolution of

imbalances if it determines, in its sole opinion, such activity would

jeopardize pipeline operations.