Norteño Pipeline Company

First Revised Volume No. 1

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Effective Date: 04/01/1996, Docket: CP96- 81-007, Status: Effective

Original Sheet No. 254 Original Sheet No. 254 : Superseded

GENERAL TERMS AND CONDITIONS

(continued)

gas for receipt and delivery. Shipper shall cause

the operator(s) to deliver and receive the

confirmed quantity of natural gas, as may be

adjusted, and Norte¤o shall receive and deliver

the appropriate quantity of natural gas, after

reductions, as identified in the applicable rate

schedule and/or executed Service Agreement.

17.2 Operating conditions may, from time to time, cause

a temporary and unintentional imbalance between

the total MMBTU of natural gas that Norte¤o is

scheduled to receive under the executed Service

Agreement and the quantities of natural gas that

Norte¤o delivers under the executed Service

Agreement. Shipper shall schedule make-up gas

attributable to imbalances when Norte¤o, in its

reasonable discretion, determines that it can

practicably receive or deliver such imbalance.

17.3 Norte¤o shall schedule all quantities of gas in

sequence as follows:

(a) First, among Norte¤o's firm Shippers

utilizing Primary Receipt and Delivery Points

unless curtailment is required, as provided

by Section 15 of these General Terms and

Conditions; then,

(b) Second, among Norte¤o's firm Shippers

utilizing Alternate Receipt and/or Delivery

Points, unless curtailment is required as

provided by Section 15 of these General Terms

and Conditions; and

(c) Third, among Norte¤o's interruptible Shippers

on the basis of price. The interruptible

Shipper paying the highest rate, no exceeding

the maximum applicable rate, will receive the

highest priority. Interruptible Shippers

paying the same rate will be given equal

priority, unless curtailment is required as

set forth in Section 15 of these General

Terms and conditions.