National Fuel Gas Supply Corporation

Third Revised Volume No. 1

Effective Date: 04/01/1997, Docket: RP97-201-000, Status: Effective

First Revised Sheet No. 184 First Revised Sheet No. 184 : Superseded

Superseding: Original Sheet No. 184

GENERAL TERMS AND CONDITIONS

14. ALLOCATION AND IMBALANCES

14.1 Introduction. Imbalances result whenever the amount of gas a

Shipper receives from Transporter's system differs from the amount

that Shipper delivered into Transporter's system (net of various

adjustments). Imbalances can result from a difference between the

amount of gas nominated at a particular receipt or delivery point

and the amount of gas measured actually passing through that point.

This Section 14 describes Transporter's methodology for allocating

shortfalls and overruns at receipt and delivery points, and

includes the various control measures intended to discourage,

minimize and correct imbalances. Scheduled receipts and deliveries

will be the basis for allocation of actual deliveries or receipts.

The allocation methodology applied to actual deliveries or receipts

shall be determined in accordance with an Operational Balancing

Agreement as set forth in Section 14.2 hereof, information supplied

by Shipper or other entities as set forth in Sections 14.3(b) and

14.4(b) hereof, or the default methodologies set forth in Sections

14.3(c) and 14.4(c) hereof.

14.2 Operational Balancing Agreements

(a) Any imbalances arising under any transportation agreement

between Shipper and Transporter that are attributable to

variances (1) between actual receipts of natural gas and

scheduled receipts of natural gas at receipt points into

Transporter's system, or (2) between actual deliveries of

natural gas and scheduled deliveries of natural gas at

delivery points from Transporter's system, which receipt

and/or delivery points are subject to Operational Balancing

Agreements, as more fully described in subsection (b) hereof,

on the day or days such variances arise, will be resolved by

Transporter pursuant to the terms of the applicable Operation-

al Balancing Agreement and Shipper shall not be subject to any

imbalance charges or penalties pursuant to its service

agreements with Transporter for such imbalances.