Southern Natural Gas Company

Seventh Revised Volume No. 1

Effective Date: 03/01/2005, Docket: RP04-523-000, Status: Effective

Original Sheet No. 212I.07A Original Sheet No. 212I.07A : Effective

41.3(c) (cont.)

(4) percent of the daily quantities delivered by COMPANY at the

Delivery Point, the group level, or the operator level,

respectively, then the scheduling penalty shall not be assessed

hereunder. Subject to the provisions of Section 41.3(d) below,

the scheduling penalty shall be equal to the maximum

Transportation Charge under the IT Rate Schedule multiplied by the

quantities in excess of the allowed variance, provided, however,

that such penalty shall be waived for an interruptible SHIPPER

whose scheduled volumes are bumped by a firm intra-day nomination

but shall be waived only for the day that such bumping occurs.

(d) If COMPANY has given notice that it is assessing one of the

foregoing scheduling penalties under Section 41.3(b) or (c) at a

Receipt or Delivery Point on a day when it is also limiting

receipts or deliveries at such point, then COMPANY shall so specify

in its notice. The scheduling penalty assessed on any such day

shall be equal to $15.00 per Dth multiplied by the quantities in

excess of the allowed variance under the applicable provision

above.