Scg Pipeline Inc.

Original Volume No. 1

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

Original Sheet No.116 Original Sheet No.116 : Superseded

GENERAL TERMS AND CONDITIONS

(continued)

12.7 Resolution of Monthly Imbalances and Cashout.

(a) All imbalances accrued by Shipper under its transportation agreements

and Pooling Service Agreement shall be resolved on a monthly basis pursuant to

the provisions herein. After each Month of transportation on Pipeline's

system, Pipeline will calculate the imbalance which exists between the

quantities of gas allocated each day to Shipper for its account at the Receipt

Points during that Month and the quantities of gas allocated each day to

Shipper for its account at the Delivery Points during that Month. All such

imbalances (over-deliveries and under-deliveries to Pipeline) accrued by

Shipper under each of its transportation or supply pool balancing agreements

(or any such agreements under which Shipper has been appointed imbalance

aggregation agent with authority to make and receive payments under this

section) will be combined to derive a "Net Monthly Imbalance" (in Dt) for

purposes of the following calculations.

Shipper's Net Monthly Imbalance then will be divided by the lesser of: (i) the

actual Dts of gas received or (ii) the actual Dts of gas delivered under all

such agreements during the Month to produce Shipper's Net Imbalance Percentage

for the Month. If Shipper has elected to be allocated the variances in

deliveries at specified Delivery Points under a Swing PDA, then such Shipper's

Net Imbalance Percentage shall be determined by dividing its Net Monthly

Imbalance by the sum of: (i) the lesser of the actual Dts received or

delivered under all of said Shipper's agreements during the Month, and (ii)

the actual Dts allocated to third-party Shippers' transportation agreements at

the Delivery Points where Shipper has elected to be allocated the variance in

deliveries during the Month. In the event the Net Monthly I