K O Transmission Company

Original Volume No. 1

Effective Date: 07/10/2004, Docket: RP00-394-003, Status: Effective

First Revised Sheet No. 60 First Revised Sheet No. 60 : Effective

Superseding: Original Sheet No. 60

GENERAL TERMS AND CONDITIONS (continued)

4. Release and Assignment of Service Rights (con't.)

4.11 Discount Retention Policy

(a)

Applicability. This section sets forth Transporter's procedures for processing

a Shipper's request to retain its previously negotiated discount rate with

Transporter, in accordance with Colorado Interstate Gas Company, 95 FERC

61,321 (2001).

(b)

Discount Retention Procedures. A Shipper with a previously negotiated discount

rate with Transporter limited to service at a specific receipt and delivery point

can request that it be permitted to retain that discount rate when seeking to use an

alternate point, as part of its capacity release or use of its flexible receipt and

delivery point rights under this Tariff. Transporter will process requests to

retain discounts within one hour of the request where such request is made

one hour prior to the 5:00 p.m. central clock time Evening Nomination. For

requests made less than one hour prior to the 5:00 p.m. Evening Nomination,

Transporter will process the request by 8:30 a.m. central clock time the next

morning. In such cases, a discount rate will not be retained by the Shipper if

the pipeline can demonstrate that it has not granted a discount with respect

to a similarly situated Shipper at that point. If the discount is to be retained,

the Shipper will pay the higher of its contractual rate or the discount rate

applicable to the similarly situated Shipper receiving a discount at that point.