High Island Offshore System, L.L.C.

Third Revised Volume No. 1

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

Second Revised Sheet No. 122 Second Revised Sheet No. 122 : Effective

Superseding: Substitute First Revised Sheet No. 122

GENERAL TERMS AND CONDITIONS

(Continued)

end of such additional fixed period, again exercise a right of first

refusal under this Section 16 for such capacity. HIOS reserves the right

to initiate the posting, competitive bidding, and right of first refusal

procedures in this Section 16 in advance of any successive extension of

the existing Transportation Agreement.

17. CAPACITY RELEASE

17.1 Eligibility. Subject to the procedures and conditions set forth in the

following subsections of this Section 17, any holder of firm capacity

rights under Rate Schedule FT-1 of this Tariff, including any person that

acquired such rights through release pursuant to such procedures and

conditions, may release all such rights, or a part thereof, to another

person. Any such person that seeks to release firm capacity rights is

hereinafter referred to as a "Releasing Shipper". The person to whom

such rights are released is hereinafter referred to as the "Replacement

Shipper". For the purposes of certain provisions of this Section 17, the

"Replacement Shipper" may be referred to as the "Prearranged Shipper" as

that term is defined in subsection 17.4 of this Section 17, where

applicable.

17.2 Limitations on Releases. Any proposed release of capacity under this

Section 17 shall be subject to the following limitations:

17.2(a) The Capacity Release timeline is applicable to all parties

involved in the Capacity Release process; however, it is only

applicable if (1) all information provided by the parties to the

transaction is valid and the Replacement Shipper has been

determined to be creditworthy, in accordance with Sections 2.2(k)

and 5, hereof, before the capacity release bid is tendered and

(2) there are no special terms or conditions of the release.