High Island Offshore System, L.L.C.

Third Revised Volume No. 1

Effective Date: 10/01/2007, Docket: RP06-540-004, Status: Effective

Fourth Revised Sheet No. 5 Fourth Revised Sheet No. 5 : Effective

Superseding: Substitute Third Revised Sheet No. 5

PRELIMINARY STATEMENT

3. Main Line Capacity*

The procedure to be followed by a new shipper, in order to receive firm or

interruptible transportation service on HIOS' main line, is set forth in

Section 2 of the General Terms and Conditions for Rate Schedules FT-1, FT-2,

and IT.

4. Lateral Line Capacity

4.1 The maximum obligation of HIOS to receive gas at any Point of Receipt is

set forth in the Transportation Agreements referenced in Paragraph 2

above.

4.2 To the extent that firm capacity is available on any lateral in excess of

the total obligation of HIOS to receive volumes on such lateral, it is the

policy of HIOS to allocate such available firm capacity to shippers, both

existing and new, on a "first come, first served" and non-discriminatory

basis.**

4.3 To the extent that "interruptible capacity" is available on any lateral of

the system, on any day, after all nominations for "interruptible overrun

capacity" have been satisfied, HIOS will allocate such capacity to any

shipper, having Points of Receipt on the lateral, on a "first come, first

served basis" as set forth in Section 7.9 of the General Terms and

Conditions.***

5. Posting of Available Firm Capacity

To the extent that firm capacity is available on the mainline or on the lateral

lines that is in excess of the total contracted obligation for that line, HIOS

will post by line such available capacity on its Interactive Internet Website.

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* HIOS' main line is that segment of its system which lies between High Island

Block A-264 and West Cameron Block 167.

** With respect to a new shipper, that shipper must first receive an allocation of

firm capacity on the main line before its request for firm lateral capacity will

be considered. As to an existing firm shipper, it is assumed that such a

shipper already has available to it the necessary firm main line capacity.

Short haul entitlements require main line capacity only.

*** With respect to a new shipper, that shipper must first receive an allocation of

interruptible capacity on the main line before its request for interruptible

lateral capacity will be considered. As to an existing interruptible shipper, it

is assumed that such a shipper already has available to it the necessary

interruptible main line capacity.