Natural Gas Pipeline Company Of America

Seventh Revised Volume No. 1

Effective Date: 04/18/2008, Docket: RP08-319-000, Status: Effective

Original Sheet No. 501 Original Sheet No. 501 : Pending

GENERAL TERMS AND CONDITIONS

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(i) twenty percent (20%) of the first $300

million in Supply Realignment Costs;

(ii) twenty-eight percent (28%) of the

Supply Realignment Costs in excess of $300 million, but less than

$500 million; and

(iii) thirty-five percent (35%) of Supply

Realignment Costs in excess of $500 million. Interest shall be

assessed on the principal amounts allocated above in accordance with

Section 38.10(a)(3) of these General Terms and Conditions. If this

calculation results in an amount of Supply Realignment Costs plus

interest in excess of the cap of $408 million, as adjusted under

subsections (a)(5) and (b)(1), Natural's recovery of Supply

Realignment Costs from the Natural Customer Group shall be limited

to $408 million consistent with subsection (b)(1) except for any

adjustment under subsections (a)(5) and (b)(1). If the calculation

results in an amount less than the cap of $408 million, as adjusted

under subsections (a)(5) and (b)(1), Natural shall make refunds to

the Natural Customer Group in accordance with the reconciliation

procedures in Section 38.10(a) of these General Terms and

Conditions.

Realignment Costs from Natural Customer Group members shall be

resolved consistent with the NCG Settlement. In particular, issues

of eligibility and prudence are subject to Article IV of the NCG

Settlement.

(d) (1) This Section 38.4 sets out a comprehensive

procedure with respect to the allocation of Supply Realignment Costs

to, and collection of Supply Realignment Costs from, members of the

Natural Customer Group, including Coal Gas costs under Section 38.8

of these General Terms and Conditions. For purposes of this

mechanism, any actual or imputed collection of Supply Realignment

Costs by Natural from other customers shall not reduce such

recoveries from the Natural Customer Group members nor [except as

provided in subsection (d)(2)] shall the Natural Customer Group

members be entitled to any credit or refund as a result of Natural

having collected or being deemed to have collected any Supply

Realignment Costs from any other Shipper; provided, however, nothing

herein shall be read as inconsistent with the crediting provisions

of Section 38.7 or with the additional collections under Section

38.10(a)(5).