Tennessee Gas Pipeline Company

FIFTH REVISED VOLUME NO. 1

Effective Date: 07/01/2003, Docket: RP03-389-000, Status: Effective

Original Sheet No. 337B Original Sheet No. 337B : Effective

GENERAL TERMS AND CONDITIONS (continued)

(i) Notwithstanding any release hereunder, a Releasing Shipper shall

remain responsible for payment of the reservation charge for firm

transportation service released; provided, however, that

Transporter and any Shipper may, in connection with their

agreement to a Negotiated Rate under a firm transportation rate

schedule, agree upon Releasing Shipper payment obligations and

procedures and crediting mechanisms in the event of a capacity

release that vary from or are in addition to those set forth

herein and in Subsection (j) of this Section. The Releasing

Shipper will be billed for its full contractual reservation

charge liability to Transporter but shall simultaneously receive

a demand credit equaling the demand charges for which Transporter

has invoiced the Replacement Shipper. In addition, if the

commodity rate is discounted in accord with Section 11.11(e) of

this Article, then Transporter shall credit to the Releasing

Shipper's demand liability the difference between the commodity

rate billed the Replacement Shipper and the discounted IT rate

posted by Transporter. A demand rate for the purposes of this

Section consists of (i) the base demand rate, and (ii) all

applicable surcharges, provided that for releases made on a

volumetric basis, the demand charges shall equal (i) the daily

demand rate multiplied by the applicable volume plus (ii) all

applicable surcharges. A Releasing Shipper paying a discounted

rate shall be entitled to receive any revenues from the release

of its capacity that exceed the amount of the applicable

surcharges.

(j) Transporter shall invoice Replacement Shipper in accordance with

Article V of the General Terms and Conditions based upon the

rates, charges and surcharges incorporated into the

Transportation Service Agreement as a result of the release. The

reservation charges for the Replacement Shipper will include the

reservation rate at which the firm transportation service is

released including all adjustments subject to Sections 11.11(d)

and 11.11(i) above. The commodity charges for the Replacement

Shipper will include the maximum commodity rate including all

adjustments subject to Section 11.11(d) above; provided if the

commodity rate has been discounted in accord with Section

11.11(e) of this Article, Tennessee shall bill the Replacement

Shipper the discounted rate.