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Original Sheet No. 283 Original Sheet No. 283 : Superseded

FORM OF SERVICE AGREEMENT

FOR FIRM TRANSPORTATION SERVICE

(continued)

ARTICLE VI

Facilities

6.1 Norte¤o shall not be obligated to, but may, at its

reasonable discretion and to the extent that such

decisions are nondiscriminatory, construct or acquire

new facilities, or expand existing facilities, in order

to perform service under this Agreement. For purposes

of this Agreement and Section 5 of Rate Schedule FT-

___, an expanded facility shall be deemed to be a new

facility. If in Norte¤o's reasonable judgment it is

necessary to construct or acquire new facilities, or to

expand existing facilities, in order to enable Norte¤o

to receive or deliver Shipper's MDTQ at the Receipt

Point(s) and Delivery Point(s), and Norte¤o determines

as provided herein to construct, acquire, or expand

such facilities, then Norte¤o shall notify Shipper of

the additional costs required. Subject to agreement

and approval by Norte¤o and Shipper of the cost to be

reimbursed by Shipper and subject to receipt and

acceptance by Norte¤o of any necessary authorization,

permits and approvals, such facilities shall be

constructed, acquired or expanded to permit the receipt