Kinder Morgan Interstate Gas Transmission LLC

Fourth Revised Volume No. 1-B

Effective Date: 12/28/1999, Docket: GT00- 19-000, Status: Effective

Original Sheet No. 52E Original Sheet No. 52E : Effective

GENERAL TERMS AND CONDITIONS - continued

(b) Transporter shall calculate a Bid Value and Unit Bid

Value for each Qualified Bid and Prearranged Release (if any), and

shall calculate the Winning Bid Value, as follows:

(1) For each month, the volume and reservation

charge per Dth stated in the Qualified Bid shall be multiplied

together to derive a gross monthly revenue figure. If the Qualified

Bids contain volumetric-based charges permitted by the Capacity

Release Request, then the gross monthly revenue figure shall be equal

to any minimum amount designated by the bidder to be billed as a

reservation charge even if there is no (or insufficient) flow.

(2) Each gross monthly revenue figure shall be

discounted to a net present value figure as of the first day of the

capacity release as sought in the Capacity Release Request, using the

current Federal Energy Regulatory Commission interest rate as defined

in 18 C.F.R. Section 154.501(d)(1).

(3) The net present value figures for the proposed

release shall be summed, and such sum shall be the Bid Value.

(4) The Unit Bid Value is defined to equal the Bid

Value divided by the product of: (i) the highest volume of capacity

(in Dth) sought in the Qualified Bid for any day; multiplied by (ii)

the release term (in months) in the Capacity Release Request; and

multiplied further by (iii) thirty and four-tenths (30.4).

possible total Bid Value (Winning Bid Value) for the capacity in the

Capacity Release Request shall be the winning Qualified Bid(s). A

Qualified Bid may be allocated less than its Maximum Bid Volume, but

in no event shall the Qualified Bid be allocated less than its

Minimum Bid Volume. It is recognized that this procedure is intended

to result in the highest possible total Bid Value for the Releasing

Shipper consistent with the Qualified Bids, and it is possible that a

Qualified Bid with the highest individual Unit Bid Value may be

rejected partially or in its entirety.

(d) If there is more than one combination of Qualified

Bids with a total Bid Value equal to the Winning Bid Value this

Section 23.10(d) provides the procedure for selecting just one such

combination, and thereby the winning Qualified Bid(s).