K O Transmission Company

Original Volume No. 1

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Effective Date: 04/01/2009, Docket: RP09-394-000, Status: Effective

Third Revised Sheet No. 96 Third Revised Sheet No. 96

Superseding: Substitute Second Revised Sheet No. 96

GENERAL TERMS AND CONDITIONS (continued)

12. Nominating, Scheduling and Monitoring (con't.)

Transporter shall award capacity first to the Shippers paying the applicable

maximum rate under Rate Schedule ITS. In situations where Shippers are paying

less than the applicable maximum rate, Transporter shall allocate the remaining

capacity based on the rate paid from the highest rate to the lowest rate. Among

Shippers paying the same rate, Transporter shall allocate capacity: a) first to

those Shippers flowing gas during the previous month (on a pro rata basis based

on each Shipper's quantities flowing on the fourth business day preceding the

first day of that month, up to but not exceeding such flowing quantities); and

b) second to those Shippers who were not flowing gas during the previous month

(on a pro rata basis based on nominated quantities for service during the

upcoming month, up to but not exceeding nominated quantities).

(b)

If intra-day nominations require an allocation of the pipeline system, the

following will describe the circumstances that allow a higher priority service

to bump a lower priority service:

(i) Evening Nomination Cycle: For nominations received by 6:00 p.m.

(central clock time) and to be effective at the start of the upcoming

gas day, nomination increases at a primary point under Rate Schedule

FTS will not bump nominations at a secondary receipt point that is

submitted and scheduled within the timely nomination cycle.

Nomination increases submitted under Rate Schedule FTS will have

priority over nominated and scheduled quantities under Rate Schedule

ITS and overruns under Rate Schedule FTS and may bump such quantities

effective at 9:00 a.m. (central clock time) the next day. Nomination

increases submitted under Rate Schedule ITS and overruns under Rate

Schedule FTS shall be subject to available unscheduled capacity and

will not bump scheduled quantities.

(ii) Intra-day 1 Nomination Cycle: For nominations received by 10:00 a.m.

(central clock time) and to be effective at 5:00 p.m. on the current

gas day, nomination increases at a primary point under Rate Schedule

FTS will not bump nominations at a secondary receipt point that is

submitted and scheduled within the timely or Evening nomination

cycle. Nomination increases submitted under Rate Schedule FTS will

have priority over nominated and scheduled quantities under Rate

Schedule ITS and overruns under Rate Schedule FTS and may bump such

quantities effective at 5:00 p.m. (central clock time) on the same

gas day. Nomination increases submitted under Rate Schedule ITS

and overruns under Rate Schedule FTS shall be subject to available

unscheduled capacity and will not bump scheduled quantities.

(iii) Intra-day 2 Nomination Cycle: For nominations received by 5:00 p.m.

(central clock time) and to be effective at 9:00 p.m. on the same

gas day, nomination increases regardless of Rate Schedule shall be

subject to available unscheduled capacity and shall not bump

scheduled quantities.

Transporter shall notify parties that are bumped during Evening and Intra-day

1 nomination cycles by providing the scheduled quantities information and

through Internet e-mail. Shipper is responsible for providing Transporter the

Internet e-mail address to be used for this notification.