Puget Sound Energy, Inc.

Original Volume No. 1

Effective Date: 11/01/1998, Docket: CP98-250-002, Status: Effective

Original Sheet No. 40 Original Sheet No. 40 : Effective

terms and conditions of this Agreement. The Project Operator

shall operate in accordance with its standard operating procedures

as amended from time-to-time, and in accordance with the

requirements of all applicable valid laws and regulations of

governmental bodies having jurisdiction, including, but not

limited to 49 C.F.R. Parts 192 and 199.

6.4.1 The Project Operator's standard operating procedures

are subject to review of the Committee upon the request of any

Owner. If the Committee disapproves of the Project Operator's

standard operating procedures, the Owners and the Project Operator

will agree upon alternate operating procedures. In the event such

agreement cannot be reached, the issue will be resolved pursuant

to arbitration as provided in ARTICLE 9; provided that, the

Project Operator may voluntarily resign upon three (3) months'

notice.

6.4.2 Routine Services. The Project Operator will obtain and

furnish all materials, equipment, services, supplies, spare parts,

and labor necessary for the routine operation and maintenance

including planned major overhaul and planned replacement ("Routine

Services"). Such Routine Services will include, but will not be

limited to, the following:

6.4.2.1 Plan, control, operate and maintain the Storage Project;

pay all construction costs and operating expenses and make lease

rental payments and secure appropriate insurance.

6.4.2.2 Operate the Storage Project, including the meter

station(s) situated at the Storage Project Delivery Point, in

accordance with the Storage Service Rights of Owners, and the

decisions of the Committee.

6.4.2.3 Transfer working gas or cushion gas between Zone 2 and

Zone 9, as necessary to provide the Storage Service Rights of the

Owners and to ensure for the efficient and reliable operation of

the Storage Project.