Tres Palacios Gas Storage LLC

Original Volume No. 1

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Effective Date: 08/01/2008, Docket: RP08-424-000, Status: Effective

Original Sheet No. 141 Original Sheet No. 141

GENERAL TERMS AND CONDITIONS

(Continued)

11.2 Receipt and Delivery Rates. TRES PALACIOS has

designed the facilities required to wheel, store, inject and

withdraw Gas based on "normal" operating pressures maintained by

the Transporter(s) at the Point(s) of Receipt/Delivery with

allowances for reasonable fluctuations. In the event that

conditions on the Transporter's system vary substantially from

this "normal" design condition coincident with high levels of

Customer receipt or delivery activity, TRES PALACIOS' capability

to receive or deliver the quantities set forth in its Storage

Service Agreements may be impaired, resulting in an interruption

in service. If this happens, capacity will be allocated pursuant

to Section 5 of the General Terms and Conditions of this FERC Gas

Tariff. Customer agrees to indemnify and hold TRES PALACIOS

harmless for any loss caused by any such interruption in service.

12. TITLE AND RISK OF LOSS

12.1 Customer warrants for itself, its successors and

assigns, that it will have at the time of delivery of Gas for

injection, storage, parking or wheeling hereunder either good

title to or the right to have the Gas transported or stored.

Customer warrants for itself, its successors and assigns, that the

Gas it delivers hereunder shall be free and clear of all liens,

encumbrances, or claims whatsoever; and that it will indemnify

TRES PALACIOS and save it harmless from all claims, suits,

actions, damages, costs and expenses arising directly or

indirectly from or with respect to the title and/or right to Gas

tendered to TRES PALACIOS hereunder.

12.2 As between Customer and TRES PALACIOS, (x) Customer

shall be deemed to be in control and possession of the Gas prior

to delivery to TRES PALACIOS for wheeling, parking, storage or

injection at the Point(s) of Receipt and after redelivery by TRES

PALACIOS to Customer at the Point(s) of Delivery, and shall

indemnify and hold TRES PALACIOS harmless from any damage or

injury caused thereby, and (y) TRES PALACIOS shall be deemed to be

in control and possession of the Gas after the receipt of Gas at

the Point(s) of Receipt and until TRES PALACIOS' redelivery of an

equivalent quantity of Gas to Customer at the Point(s) of

Delivery, and shall indemnify and hold Customer harmless from any

damage or injury caused thereby, except for damages and injuries

caused by the sole negligence of Customer. Notwithstanding

anything to the contrary set forth in this Section 12.2, the risk

of loss of any quantity of Gas wheeled through, injected into,

parked or stored in and withdrawn from the TRES PALACIOS storage

facilities shall remain with Customer, and TRES PALACIOS shall not

be liable to Customer for any loss of Gas, except as may be the

consequence of the intentional or negligent acts or omissions of

TRES PALACIOS. Any losses of Gas, unless resulting from the

intentional or negligent act or omissions of TRES PALACIOS, shall

be apportioned among and shared proportionally by all Customers

under Rate Schedules FSS, ISS, FP, IP and IHBS on the basis of the

percentage which each Customer's Storage Inventory as of the Day

immediately preceding the Day on which a loss occurs bore to the

total amount of Gas in all Customers' Storage Inventories on such

Day.