National Fuel Gas Supply Corporation

Fourth Revised Volume No. 1

Effective Date: 01/01/2002, Docket: RP00-399-004, Status: Effective

First Revised Sheet No. 365 First Revised Sheet No. 365 : Effective

Superseding: Original Sheet No. 365

GENERAL TERMS AND CONDITIONS

10. CAPACITY RELEASE(Cont'd)

otherwise have no further obligations with regard to the Existing

Shipper's Notice. Upon acceptance of the award, the Potential or

Prearranged Shipper, shall hereinafter be referred to as the

Replacement Shipper.

10.7 Obligations of Existing Customer

The service agreements of the Existing Shipper releasing capacity

will remain in full force and effect, with a portion of the

proceeds attributable to any release credited to the Existing

Shipper's bill as provided in Section 10.9 hereof. The Existing

Shipper shall remain liable to Transporter under the terms of its

service agreement with Transporter during and irrespective of any

assignments of the rights and obligations under the service

agreement for all reservation, demand and capacity charges, and any

surcharges applicable to such charges, but excluding commodity or

usage charges and imbalance penalties.

Where an Existing Shipper proposes to release or has released all

its capacity to a Replacement Shipper for the entire remaining term

of the applicable service agreement between Transporter and the

Existing Shipper, the Existing Shipper may request Transporter to

release the Existing Shipper from any further obligations to

Transporter upon the effectiveness of a new source service

agreement between Transporter and the Replacement Shipper.

Transporter shall be under no obligation to grant such requests

unless the Replacement Shipper (i) agrees to pay for the released

capacity at Transporter's maximum rates and (ii) demonstrates to

Transporter that it possesses sufficient financial stability, or if

it provides such security as is necessary, to make Transporter

reasonably secure that the Replacement Shipper will pay for service

on a timely basis throughout the remaining term of the service

agreement between Transporter and the Existing Shipper.

Transporter shall exercise its discretion under this provision in a

non-discriminatory manner.

As set forth in the first paragraph of this Section 10, the

capacity release timeline will not be applicable if the Existing

Shipper requests Transporter to release it from further

obligations; provided however, that said timeline shall apply if

the Existing Shipper's notice expressly indicates that the release

is not contingent upon Transporter's determination under this

provision.