Kinder Morgan Interstate Gas Transmission LLC

Fourth Revised Volume No. 1-B

Effective Date: 06/17/2001, Docket: RP01-422-000, Status: Effective

First Revised Sheet No. 53B First Revised Sheet No. 53B : Effective

Superseding: Original Sheet No. 53B

GENERAL TERMS AND CONDITIONS - continued

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EXAMPLE (7) Assume:

Capacity Release Request = 100,000/day for 5 years

Qualified Bids (which were all received through Transporter's

Interactive Web Site):

Maximum Bid Unit Bid Minimum

Volume Term Value Bid Volume

----------- ------- -------- ----------

Bid (a) 50,000/day 5 years $.18 50,000

Bid (b) 50,000/day 5 years $.18 50,000

Bid (c) 50,000/day 5 years $.18 50,000

Winning Qualified Bids: The two Qualified Bids shown as received

earliest by Transporter's Interactive Web Site shall each receive

their Maximum Bid Volume.

Explanation: Clearly, any two Bids in combination have the same

Winning Bid Value. Since the Bids are completely inflexible and have

equivalent Maximum Bid Volumes and equivalent Minimum Bid Volumes,

only Section 23.10(d)(3)(C) can be used to break the tie. The tie

breaker looks to the Qualified Bid(s) shown as received earliest on

Transporter's Interactive Web Site.

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(e) In no event shall this Section 23.10 result in

winning Qualified Bids with a total volume in excess of the capacity

specified in the Capacity Release Request.

(f) The bid evaluation procedure set forth in this

Section 23.10 shall only consider Qualified Bids to the extent they

provide for an objectively quantifiable payment by the Qualified

Bidder. A Qualified Bid based on a percentage of Transporter's

reservation charge shall be evaluated by Transporter based solely on

the maximum reservation charge being charged by Transporter for such

service as of the end of the open season.