High Island Offshore System, L.L.C.

Third Revised Volume No. 1

Effective Date: 07/01/2003, Docket: RP03-221-000, Status: Effective

Third Revised Sheet No. 116 Third Revised Sheet No. 116 : Effective

Superseding: Second Revised Sheet No. 116

GENERAL TERMS AND CONDITIONS

(Continued)

16.4(c) The maximum reservation charge stated on the then-effective

Sheet No. 10 of this Tariff;

16.4(d) Any other terms or conditions that would attend use of the

capacity; and

16.4(e) A statement that any bid for the capacity shall be subject to

the right of first refusal of the Existing Shipper, as

specified in this Section 16.

The information specified in this subsection 16.4 shall be posted on

HIOS' Interactive Internet Website until 150 days prior to the end of

the primary term of the existing Transportation Agreement.

16.5 Bidding Procedures. Any person that has prequalified as a prospective

shipper under the provisions of subsection 16.6 of this Section 16

("Qualified Bidder") may submit a bid that is consistent with the posted

information ("Qualified Bid") for available capacity. HIOS shall

receive binding Qualified Bids for the available capacity, or any

portion thereof, for the entire period that the information is posted.

Qualified Bids may be communicated to HIOS by mail, facsimile or HIOS'

Interactive Internet Website. The date of receipt will be recorded for

each Qualified Bid. A Qualified Bid must be submitted on the HIOS

Qualified Bid Form, as set forth on Sheet Nos. 184-186 of this Tariff,

and must include the following information:

16.5(a) The legal name of the Qualified Bidder, and the name, title,

address, telephone number, and facsimile number of the

individual responsible for the Qualified Bid;

16.5(b) The amount of capacity, by receipt point, delivery point, and

in total, that the Qualified Bidder proposes to take;