Southern Natural Gas Company

Seventh Revised Volume No. 1

Effective Date: 10/01/2004, Docket: RP04-523-002, Status: Effective

Original Sheet No. 212J.01 Original Sheet No. 212J.01 : Effective

GENERAL TERMS AND CONDITIONS

(Continued)

42.2 If COMPANY has agreed to a discount with a SHIPPER under Rate

Schedule FT or FT-NN and the discount is limited to receipts from

or deliveries to a specific receipt or delivery point(s) or both,

as provided in 42.1(5) above, SHIPPER may request that it retain

its discount in the event it or an ACQUIRING SHIPPER elects to use

an alternate Exhibit A-1 receipt or Exhibit B-1 delivery point

within the same zone or an upstream zone as the Exhibit A receipt

or Exhibit B delivery point. There shall be a rebuttable

presumption that SHIPPER will retain its discount while it or an

ACQUIRING SHIPPER is utilizing the alternate point(s) in the event

there is an effective discount provided by COMPANY to other

shipper(s) at such alternate point(s). COMPANY may rebut this

presumption by demonstrating that the service to the SHIPPER

requesting to retain its discount at the alternate point(s) is not

similarly situated to the service under which the discount

existing at the alternate point has been granted. In the event

SHIPPER's request to retain its discount is granted for service to

the alternate point, SHIPPER shall pay the higher of its

discounted rate shown on the Exhibit E to its Service Agreement or

the lowest effective discounted rate provided to a similarly

situated shipper at the alternate point(s). Nothing contained

herein shall entitle a shipper to capacity or a discount

downstream of the rate zone for which the original discount has

been granted. In the event a SHIPPER does not retain its discount

or the discount at the alternate Exhibit A-1 Receipt Point or

Exhibit B-1 Delivery Point is higher than SHIPPER's discount, the

Reservation Charge billed to SHIPPER under SHIPPER's Service

Agreement shall be prorated based on the total actual volumes

allocated to the alternate receipt or delivery point.

42.3 A SHIPPER may request to retain its discount for service as

provided in Section 42.2 above by submitting a request to

COMPANY's Customer Services Department in writing on the form

provide by COMPANY no less than two (2) hours prior to the

nomination deadline in which it plans to nominate use of the

alternate point(s). COMPANY shall respond to all valid requests

received between 7:00 a.m. and 4:00 p.m. CCT on COMPANY's business

days and inform SHIPPER within two (2) hours of receipt of the

request whether the discount may be retained; provided, however,

that COMPANY shall have until 8:30 a.m. CCT on the subsequent

business day to respond to any such requests received by it after

4:00 p.m. and prior to 7:00 a.m. CCT on business days or received

at any time on non-business days.