Texas Eastern Transmission, L P

Seventh Revised Volume No. 1

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Effective Date: 11/16/2009, Docket: RP10-53-000, Status: Effective

Second Revised Sheet No. 355 Second Revised Sheet No. 355

Superseding: First Revised Sheet No. 355

RATE SCHEDULE PAL

(Continued)

7.6 Title to loaned quantities shall be transferred to Customer and Customer shall be

obligated to pay for each Dekatherm of such Gas at a price equal to 150% of the average

Gas Daily posting for the "Midpoint" price for the geographical region, as defined in

Sections 8.5(A) and 8.5(B)(3) of the General Terms and Conditions, for the seven Day

period beginning three Days before the Day in which the loan occurred, in the event

that any of the following situations occur:

(a) Pipeline's operating conditions require Pipeline to notify Customer that deliveries

of Customer's loaned quantities must be suspended or reduced, and Customer fails to

comply with such notification; and/or

(b) Pipeline's operating conditions require Pipeline to notify Customer that all or a

part of Customer's loaned quantities must be returned to Pipeline, and Customer

fails to comply within the specified time frame; and/or

(c) The PAL account reflects a balance at the termination date of the associated Exhibit

A to the Customer's PAL Service Agreement or at the end of any mutually agreed upon

extension of the termination date.

If Pipeline notifies Customer, pursuant to Sections 7.2 and 7.6(a), that deliveries of

Customer's loaned quantities must be suspended or reduced, only those quantities taken

by the Customer in violation of the notification shall be transferred to Customer and

Customer shall be obligated to pay for each Dekatherm of such Gas at a price calculated

as described above in this Section 7.6. Pipeline shall credit the Applicable Shrinkage

Deferred Account as provided in Section 15 of the General Terms and Conditions, with

the net proceeds from the operation of this Section 7.6.

8. BALANCES

8.1 All PAL balance quantities reside at the PAL Point of Transaction at which the original

park or loan quantity was nominated, and must be resolved at that PAL Point of

Transaction by taking delivery of the Park Balance or returning the Loan Balance to

Pipeline, as applicable. Balances incurred under this Rate Schedule PAL shall be

resolved via in-kind balancing during the remaining term of the transaction, which term

is specified in Exhibit(s) A to the Customer's PAL Service Agreement. Customer may

resolve park and/or loan balances by transporting such balances between PAL Points of

Transaction. The transportation shall be accomplished by Customer's submission of a

nomination under Customer's executed transportation service agreement and the

subsequent scheduling and confirmation processes pursuant to Section 4 of the General

Terms and Conditions.

Customer shall be required to reduce to zero each park and/or loan Quantity of Gas at

each PAL Point of Transaction no later than the termination date of the Exhibit(s) A to

the Customer's PAL Service Agreement, or prior to any mutually agreed upon extension of

that term, applicable to that quantity. Any balances remaining upon the termination

date of the Exhibit(s) A to the Customer's PAL Service Agreement, or any mutually

agreed upon extension of that term, shall be resolved in accordance with Sections 7.5

and 7.6, as applicable, of this Rate Schedule PAL.

Pipeline shall debit or credit, as appropriate, the Applicable Shrinkage Deferred

Account as provided in Section 15 of the General Terms and Conditions, with the net

proceeds, from the operation of this Section 8.

8.2 If Customer's PAL account reflects a park balance at the termination date of the

associated Exhibit A to Customer's PAL Service Agreement or at the end of any mutually

agreed upon extension of the termination date, and the balance has not been resolved

pursuant to Section 7.5(c) of this Rate Schedule PAL, the term of the transaction will

be extended until the earlier of (i) such time as the balance is reduced to zero or

(ii) operating conditions require the removal of the balance pursuant to Section 7.5(c)