Transcolorado Gas Transmission Company LLC

Second Revised Volume No. 1

Effective Date: 12/28/2007, Docket: RP08-167-000, Status: Effective

Original Sheet No. 231 Original Sheet No. 231 : Effective

GENERAL TERMS AND CONDITIONS

6. CAPACITY RELEASE BY FIRM SHIPPERS (Continued)

6.10 Bid Evaluation Procedure.

(a) Unless specifically requested otherwise by a Releasing

Shipper in its Capacity Release Request, Qualified Bids for released capacity

shall be evaluated pursuant to Sections 6.10(b) through 6.10(g) below. Any

Qualified Bid which does not meet a minimum price condition stated in the

Capacity Release Request shall be rejected outright. Any Qualified Bid with a

contingency must have such contingency eliminated before 3:00 p.m. CCT

following the close of the open season, unless the Releasing Shipper's offer

has specified a later time; otherwise, such Qualified Bid will be rejected.

(b) TransColorado shall calculate a Bid Value and Unit Bid

Value for each Qualified Bid and Prearranged Release (if any), and shall

calculate the Winning Bid Value, as follows:

(i) For each month, the volume and reservation charge per

Dth stated in the Qualified Bid shall be multiplied together to derive a gross

monthly revenue figure. If the Qualified Bids contain volumetric-based charges

permitted by the Capacity Release Request, then the gross monthly revenue

figure shall be equal to any minimum amount designated by the bidder to be

billed as a reservation charge even if there is no (or insufficient) flow.

(ii) Each gross monthly revenue figure shall be discounted

to a net present value figure as of the first day of the capacity release as

sought in the Capacity Release Request, using the current Federal Energy

Regulatory Commission interest rate as defined in 18 C.F.R. Section

154.501(d).

(iii) The net present value figures for the proposed release

shall be summed, and such sum shall be the Bid Value.

(iv) The Unit Bid Value is defined to equal the Bid Value

divided by the product of: (1) the highest volume of capacity (in Dth) sought

in the Qualified Bid for any day; multiplied by (2) the release term (in

months) in the Capacity Release Request; and multiplied further by (3) thirty

and four-tenths (30.4).