Kinder Morgan Interstate Gas Transmission LLC

Second Revised Volume No. 1-D

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

Original Sheet No. 28 Original Sheet No. 28 : Effective

GENERAL TERMS AND CONDITIONS FOR SERVICES - continued

Multiple bids (defined as different bids made for

different portions of the total capacity) will be

permitted.

18.4 BEST OFFER

Transporter will determine which bid constitutes the

best offer by determining the highest economic unit

value (per Dth of capacity) to Transporter. A

calculation based on the formula and interest rate set

forth in Section 23.5 will be used to determine the

highest economic unit value. The comparative economic

unit value of each bid will be determined by

calculating the Net Present Value (NPV) of the

reservation charges of each offer over either the term

of the offer or five (5) years, whichever is less, and

then dividing by the quantity of the respective bid.

However, if the bid is at maximum rate and the term is

more than five (5) years, the entire term will be

considered in determining the economic unit value.

In the event equivalent offers are submitted, the

capacity will be made available on a pro rata basis to

the equal bidders. Should any one of the equal bidders

veto their pro rata allocation of the capacity,

Transporter will then conduct a lottery to select the

winning bidder, who will then, if the bid is not

matched under Section 18.5 below, be allotted its

requested capacity. The remainder of said capacity, if

any, will be available to the other equal bidder(s) on

a pro rata basis, which will again trigger the

veto/lottery selection process.

Transporter will post the name of the winning bidder of

the gas for a period of no less than five (5) work

days.