Southern Natural Gas Company

Seventh Revised Volume No. 1

Effective Date: 09/01/2003, Docket: RP00-476-005, Status: Effective

Substitute Original Sheet No. 212I.05 Substitute Original Sheet No. 212I.05 : Superseded

Superseding: Original Sheet No. 212I.05

GENERAL TERMS AND CONDITIONS

(Continued)

41. OPERATIONAL FLOW ORDERS (OFOs)

41.2 (d)(continued)

It is provided, however, that if COMPANY has issued a penalty

notice pursuant to Section 41.2(a) for (i) a Delivery Point

where electronic measurement has not been installed or has not

been installed to meter at least 75% of the volumes where the

Delivery Point is comprised of more than one measurement

station, or (ii) a group of Delivery Points where electronic

measurement has not been installed to meter at least 75% of the

volume from the Delivery Points, then the penalty assessed

under this Section 41.2(d) shall be $5.00 per Dth. For purposes

of determining the 75% threshold, COMPANY shall use the volumes

metered at each measurement station during the twelve-month

period ending annually on March 31. Payments pursuant to this

Section 41.2 shall not, under any circumstances, be considered

as giving SHIPPER the right to take Unauthorized Overrun Gas;

nor shall such payment exclude or limit any other remedies

available to COMPANY or to another SHIPPER against SHIPPER for

failure to limit its taking of gas to its Daily Entitlement.