Scg Pipeline Inc.

Original Volume No. 1

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

Original Sheet No.146 Original Sheet No.146 : Superseded

GENERAL TERMS AND CONDITIONS

(continued)

21.5 Shipper Warranty. Shipper warrants that all upstream and downstream

transportation and/or service arrangements are in place, or will be in place

as of the requested effective date of service, and that it has advised the

upstream and downstream transporters of the Receipt Points and Delivery Points

under this Agreement and any quantity and quality limitations for each point

as specified on Exhibits A and B attached to the effective Service Agreement

or elsewhere in Pipeline’s Tariff. Shipper agrees to indemnify and hold

Pipeline harmless for refusal to transport gas hereunder in the event any

upstream or downstream transporter fails to receive or deliver gas as

contemplated by this Tariff. Shipper agrees to indemnify and hold Pipeline

harmless from all suits, actions, debts, accounts, damages, costs, losses and

expenses (including reasonable attorneys fees) arising from or out of breach

of any warranty by Shipper herein. Pipeline shall not be obligated to provide

or continue service hereunder in the event of any breach of warranty.

21.6 Effect of Interconnecting Operations. In the event that any upstream

entity involved in handling Shipper's gas refuses or is unable to deliver gas

to Pipeline, Pipeline shall not be required to continue deliveries of gas on

behalf of Shipper to the extent of such refusal or inability to deliver gas to

Pipeline. In the event that any downstream entity involved in handling

Shipper's gas refuses or is unable to receive gas from Pipeline, Pipeline

shall have the right to reduce deliveries of gas on behalf of Shipper to the

extent of such refusal or inability by the downstream entity to receive gas.

22. FUEL RETAINAGE QUANTITY

22.1 General. Periodically rates and charges under Pipeline's Tariff shall

be adjusted to reflect changes in Pipeline's expenditures such as the Fuel

Retainage Quantity. Such expenditures shall include both expenditures

chargeable to operations as well as expenditures includable in rate base.

During the term of the Service Agreements executed hereunder, Pipeline will

periodically track changes in its requirement to retain gas in-kind for the

Fuel Retainage Quantity used to provide service for Shippers.