K O Transmission Company

Original Volume No. 1

Effective Date: 06/01/1997, Docket: RP97-339-000, Status: Effective

First Revised Sheet No. 016 First Revised Sheet No. 016 : Effective

Superseding: Substitute Original Sheet No. 016

RATE SCHEDULE FTS

Firm Transportation Service (con't.)

subject to operational flow orders to the extent provided in this Rate Schedule

or in Section 19 (Operational Flow Orders) of the General Terms and Conditions.

(c)

Transporter shall not be obligated on any Day to accept gas in excess of the

lesser of (i) Shipper's Transportation Demand plus Retainage, or (ii) Shipper's

Scheduled Daily Receipt Quantity. Transporter also shall not be obligated on

any Day to deliver more gas to Shipper than the lesser of: (i) Shipper's

Transportation Demand, (ii) Shipper's Scheduled Daily Delivery Quantity, or (iii)

the quantity of gas Transporter receives for Shipper less Retainage. For the

purposes of balancing any imbalances in Shipper's account, Shipper may deliver

or take quantities in excess of the above limitations in accordance with the

provisions of Sections 6 (Operating Conditions) and 12 (Nominating,

Scheduling and Monitoring) of the General Terms and Conditions.

(d)

Service Rights under an FTS Service Agreement may be released and assigned in

accordance with Section 4 (Release and Assignment of Service Rights) of the

General Terms and Conditions. Service to a Replacement Shipper under any

such release and assignment shall be subject to the provisions set forth in this

Rate Schedule and in the applicable General Terms and Conditions.

(e)

The interconnection points shall be incorporated by reference in Shipper's

FTS Service Agreement(s).

3. Rate

(a)

The unit rate charges to be paid by Shipper, set forth in paragraph (b) below,

shall be no higher than the applicable total effective maximum rate charges and

no lower than the applicable total effective minimum rate charges set forth in

the currently effective Sheet No. 10 of this Tariff.

(b)

For all service rendered under this Rate Schedule, Shipper each

month shall pay Transporter the charges set forth below unless a lower charge is

specified in the Shipper's FTS Service Agreement: