Venice Gathering System, L. L. C.

Original Volume No. 1

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Effective Date: 01/01/1998, Docket: CP97-533-002, Status: Effective

Original Sheet No. 110 Original Sheet No. 110 : Effective

GENERAL TERMS AND CONDITIONS

(Continued)

11.5 Reliance on Operational Information

Customers may rely on operational information

provided by VGS to adjust their imbalances during a month.

Where the calculation of an imbalance using the operational

information provided by VGS will result in an imbalance

being cashed-out at a tier price more favorable to Customer,

VGS will cash-out such imbalance at the more favorable tier.

11.6 Prior Period Adjustments

Any imbalance resulting from a prior period

adjustment will first be used to reduce the cash-out

quantity for the month in which the imbalance was incurred.

Customer may then elect to net the imbalance across

Customer's agreements for the month prior to the month in

which the adjustment is made. Customer may trade any

remaining imbalance with other Customers up until the

twenty-fifth day of the month in which Customer was notified

of the adjustment. Imbalances not netted or traded will be

cashed out at 100% of Spot Index Price for the month in

which the imbalance was incurred.

11.7 Imbalance Nominations

For each day on which Customer desires to schedule

the delivery of gas to VGS or the receipt of gas from VGS

for the resolution of an accrued under- or over-delivery

within a month, Customer shall submit to VGS, in a

nomination, the daily quantity of gas, expressed in Dths,

that it has available for delivery or the quantity of gas

Customer desires to receive, in accordance with the

nomination procedures set forth in Section 6. Such

deliveries and receipts shall be scheduled as operating

conditions reasonably permit. The scheduling priority for

such nominations shall be the priority of the service

agreement on which the imbalance accrued.