Southern Natural Gas Company

Seventh Revised Volume No. 1

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Effective Date: 04/01/2001, Docket: RP01-242-000, Status: Effective

Second Revised Sheet No. 103 Second Revised Sheet No. 103 : Effective

Superseding: First Revised Sheet No. 103

GENERAL TERMS AND CONDITIONS

(Continued)

cost of performing the maximum transportation service requested by

SHIPPER for a three (3) month period, furnishes good and sufficient

surety, as determined by COMPANY in its reasonable discretion, in an

amount equal to the cost of performing the maximum transportation

service requested by SHIPPER for a three (3) month period, or

furnishes a guaranty from a creditworthy party that said creditworthy

party will be responsible for payment of all charges and penalties

assessed by COMPANY but not paid by SHIPPER. COMPANY shall not be

required to perform services under a PAL Service Agreement for any SHIPPER

who is or has become insolvent, or who fails to demonstrate

creditworthiness, or who fails to make payments pursuant to Section 15

hereof (except if SHIPPER has disputed a bill and made provision for such

payment in accordance with Section 15.3 hereof); provided, however, such

SHIPPER may receive service if SHIPPER makes a security deposit or

furnishes good and sufficient surety in an amount equal to the quantity of

the gas to be parked or loaned at the value of the gas per dth, for a

period of three months, or provides COMPANY with a guaranty from a

creditworthy party that said creditworthy party will be responsible for

the value of the gas including payment of all charges and penalties

assessed by COMPANY but not paid by SHIPPER.

(e) Subject to other provisions of COMPANY'S firm transportation Rate

Schedules and these General Terms and Conditions, Receipt Point(s)

may be added to or deleted from Exhibit A to a Service Agreement,

Delivery Point(s) may be added to or deleted from Exhibit B to a

Service Agreement if the additional Delivery Point(s) are in the same

zone as the current Delivery Points, the Maximum Daily Receipt

Quantities or Maximum Daily Delivery Quantities may be increased or

decreased, or the term of any Service Agreement may be extended

wherein the parties have agreed to an "evergreen" or "rollover" provi-

sion; provided that the Transportation Demand specified in the Service

Agreement is not increased. Such changes shall not affect SHIPPER'S

priority of service under a firm transportation Rate Schedule.

To request any of the changes to a Service Agreement specified above,

SHIPPER shall submit a request in writing on the form set forth in Section

2.1(a) above.

(f) It is recognized that the conversion to transportation services in lieu of

bundled sales services will not result in the freeing up of equivalent

firm capacity on each portion of COMPANY'S system. COMPANY

shall not be obligated to accept any request for firm transportation

service unless adequate firm capacity is available without the

construction of additional facilities by COMPANY on every portion of

COMPANY'S