Southern Natural Gas Company

Seventh Revised Volume No. 1

Effective Date: 03/01/2000, Docket: RP99-496-000, Status: Suspended

Third Revised Sheet No. 195 Third Revised Sheet No. 195 : Suspended

Superseding: Second Revised Sheet No. 195

GENERAL TERMS AND CONDITIONS

(Continued)

Section 29.1(b) (continued)

The COMPANY shall remit to GRI only those revenues actually collected.

With respect to discounted transactions, the pertinent GRI surcharge

will be discounted first and, if the discount is less than the

surcharge, the difference will be remitted to GRI. In addition, GRI

Adjustment Charges apply to those rate schedules in Volume No. 2 of

this FERC Gas Tariff which provide for the collection of the GRI

Adjustment Charges, provided that such charges shall not be applicable

to SHIPPERS which are interstate pipelines and which include in their

rates a charge for RD&D by GRI.

transportation of gas to and from a SHIPPER'S storage account under Rate

Schedule CSS or ISS of this Tariff, the following provisions shall apply.

For those SHIPPERS paying a Small Shipper Charge under an FT or FT-NN

Service Agreement, the GRI Adjustment Charge shall be assessed when gas is

transported from the storage account for subsequent delivery. For all other

SHIPPERS under Rate Schedules FT, FT-NN or IT, the GRI Adjustment Charge

shall be assessed on deliveries of gas to such CSS or ISS storage account,

but shall not be assessed on the transportation of gas from a storage

account for subsequent delivery.

29.2 Basis of the GRI Adjustment Charge:

The Rate Schedules specified in Section 29.1 hereof shall include an

increment for a GRI Adjustment Charge for RD&D. Such adjustment charge

shall be that increment, adjusted to COMPANY'S pressure base and heating

value, if required, which has been approved by Commission orders approving

GRI's RD&D expenditures.

29.3 Filing Procedure:

The proposed effective date of filings pursuant to this subsection shall be

January 1 of each year unless, for good cause shown, a different effective date

is allowed by valid Commission order. Any such filing shall not become

effective unless it becomes effective without suspension or refund obligations.