Central Kentucky Transmission Company

Original Volume No. 1

Effective Date: 05/01/2006, Docket: CP05- 48-002, Status: Effective

Original Sheet No. 102 Original Sheet No. 102 : Effective

GENERAL TERMS AND CONDITIONS

(Continued)

8.2 Receipt Point Allocation. Differences at a receipt point shall be

allocated (1) in accordance with the provisions of an OBA, if an OBA covers

such point; or (2) pro rata among all Shippers at that receipt point on the

basis of the Scheduled Daily Receipt Quantities, unless the upstream point

operator providing the point confirmation submits a PDA to the allocating

party before the start of the Gas Day, and Transporter accepts the PDA.

8.3 Predetermined Allocation Method (PDA).

(a) As used in this Section 8, a PDA is an agreement by or among

point operators, prior to the beginning of the Gas Day, at the receipt

point to allocate the difference between the scheduled daily quantity and

the actual daily flow of gas in a mutually agreeable manner. Types of

allocation methods include, but are not limited to, Ranked, Pro Rata,

Percentage, Swing, and Operator Provided Value. If the two parties cannot

agree upon an allocation methodology, pro rata based upon confirmed

nominations shall be used as the default method. PDAs shall be provided by

the interconnecting operator, and for multi-tiered allocations, may be

provided by the upstream titleholders or Shippers. Interconnecting

operators at receipt locations shall provide a PDA to allocate to upstream

titleholders. Upstream titleholders may provide a PDA to allocate to the

parties taking possession of their gas at a receipt location. Shippers may

provide a PDA to allocate to their nominations at the receipt location.

(b) If confirming parties cannot agree upon an allocation

methodology at the receipt point, pro rata based upon confirmed nominations

shall be used as the default method.