K O Transmission Company

Original Volume No. 1

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Effective Date: 11/02/1998, Docket: RP99- 82-000, Status: Effective

Second Revised Sheet No. 97 Second Revised Sheet No. 97 : Effective

Superseding: First Revised Sheet No. 97

GENERAL TERMS AND CONDITIONS (continued)

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

(c)

Allocations. If confirming parties cannot agree on an allocation methodology, "pro

rata based upon confirmed nominations" shall be used as the default method. Types of

allocation methods include, but are not limited to, Ranked, Pro Rata, Percentage and

Swing. Month-end allocations shall be based on a measurement closing date of the fifth

business day after the business month. If actual quantities are not available,

quantities will be estimated by Transporter. Disputed allocations shall be communicated

to

Transporter within six months of the initial month-end allocation, with a three month

rebuttal. This time limitation shall not apply in the case of deliberate omission or

misrepresentation, or mutual mistake of fact. No party's other statutory or

contractual rights are affected by this provision.

(d)

Prior Period Adjustments. Prior period measurement adjustments will be taken back

to the production month and reflected as such on invoices, imbalance statements and

allocation statements. Measurement corrections shall be processed within six months of

the end of the flow month, with a three month rebuttal period. This time limitation

shall not apply in the case of deliberate omission or misrepresentation, or mutual

mistake of fact. No party's other statutory or contractual rights are affected by this

provision.

12.4 Shipper's Notice of Changes

Except for reasons of force majeure, as described in Section 18 (Force Majeure and

Curtailment) of the Tariff's General Terms and Conditions, Shipper shall notify

Transporter or cause Transporter to be notified at least 24 hours in advance of any

anticipated material change in the daily quantity of gas Shipper desires to deliver or

cause to be delivered to Transporter for transportation under Transporter's

Rate Schedules. If an unanticipated or force majeure event causes a material

change in the quantity of gas Shipper will deliver or cause to be delivered to

Transporter for transportation, Shipper shall notify or cause Transporter to be

notified as soon as possible after occurrence of that event. In the event of such

material changes, Shipper shall tender or cause to be tendered to Transporter such

estimated daily quantities at flow rates as close as possible to uniform hourly rates.

Departures by Shipper from the daily quantities that it has notified Transporter it

intends to tender to Transporter under a Rate Schedule shall be kept to a minimum and

in no event shall exceed the amount permitted by operating conditions.

12.5 Monitoring

(a) Transporter may monitor: (i) the daily tenders of gas by or on behalf of any

Shipper; (ii) the quantities delivered by an Intermediate Transporter on behalf of

Shipper; and (iii) the daily usage of gas by Shipper. Transporter may do so for the

purpose of monitoring on an hourly, daily, weekly, or monthly basis the quantities

being tendered to and delivered by Transporter and thereby maintain, as nearly as

possible, a concurrent balance between receipts and deliveries of gas. The approximate

quantities

determined by Transporter in that monitoring process shall be referred to herein as

Monitored Quantities.

(b) Monitoring may be performed by Transporter using either the estimates or

actual data received by Transporter pursuant to this Section or actual meter readings

by Transporter. Transporter may make reasonable adjustments to Shipper's Scheduled

Daily Delivery Quantity and Scheduled Daily Receipt Quantity based upon either the

Monitored Quantities or the actual data received by Transporter pursuant to the

provisions of this Section. Transporter may make such adjustments upon telephonic

notice to