National Fuel Gas Supply Corporation

Fourth Revised Volume No. 1

Effective Date: 01/01/1999, Docket: RP99-180-001, Status: Effective

Alt. Sub. First Revised Sheet No. 389 Alt. Sub. First Revised Sheet No. 389 : Effective

Superseding: Original Sheet No. 389

GENERAL TERMS AND CONDITIONS

14. ALLOCATION AND IMBALANCES (Cont'd.)

To preserve the operational integrity of its system,

Transporter may at its option (exercised on a non-

discriminatory basis) cash out the Cumulative Monthly

Imbalance of a Shipper which has elected to resolve

imbalances in kind, subject to the following requirements,

if either:

(i) the Shipper has not submitted a nomination for the

transportation, injection or withdrawal of gas within

the three (3) month period immediately preceding the

exercise of Transporter's option hereunder; or

(ii) the aggregated Cumulative Monthly Imbalances of all

Shippers in a given activity month exceed five percent

(5%) of Transporter's total deliveries in that month,

excluding deliveries that month to EFT Shippers who

have positive storage balances under Rate Schedule ESS.

(iii) Only Shippers with a Cumulative Monthly Imbalance in

the same direction (positive or negative) as the

aggregated imbalance described in subparagraph (ii)

above, for that same given activity month, in excess of

five (5) times that Shipper's MITL for that month shall

be cashed out pursuant to subparagraph (ii);

(iv) whenever Transporter exercises its option, the entire

Cumulative Monthly Imbalances of all Shippers described

in subparagraph (i) or (ii) above shall be cashed out

simultaneously;

(v) Transporter may exercise its option with respect to

imbalances for a given activity month no less than

twenty five (25) days following the end of that

activity month, and no more than thirty-one (31) days

following the end of that activity month;

(vi) the cash-out shall be accomplished in the manner

specified by Section 14.10 hereof, except that the

cash-out price shall be the Index as defined in Section

14.10(a) hereof, applicable to the time period for

which the Shipper last submitted a nomination for the

transportation, injection or withdrawal of gas, without

adjustment by 110% or 90%; and