W T G Hugoton, LP

Original Volume No. 1

Effective Date: 08/01/2007, Docket: CP06- 90-002, Status: Effective

Original Sheet No. 278 Original Sheet No. 278 : Effective

GENERAL TERMS AND CONDITIONS

45. CREDITING MECHANISMS

45.1 Penalty Crediting Mechanism. WTG Hugoton will record all penalty

revenues collected pursuant to Sections 19, 27, or 28 of the General Terms and

Conditions, and all reasonable, incremental out-of-pocket costs incurred to

handle imbalances caused by shipper conduct that results in such imbalances,

in separate accounts. On a monthly basis, WTG Hugoton will net such penalty

revenues, along with interest calculated pursuant to the regulations of the

Commission, against such reasonable, incremental out-of-pocket costs.

Shippers under Rate Schedules FT and IT that did not incur penalties during

the applicable month pursuant to Sections 19.7, 27.1, and 28.7 of the General

Terms and Conditions ("Non-Offending Shippers") shall be entitled to a credit

determined under the following procedure:

(i) Each Non-Offending Shipper's credit shall be the sum of (a) 0.5 times

the ratio of the actual revenues billed for services to the Non-

Offending Shipper during the month to the actual revenues billed for

services to all Non-Offending Shippers, and (b) 0.5 times the ratio of

the MDQ of the Non-Offending Shipper for the month to the total MDQ of

all Non-Offending Shippers. Each such Shipper's cumulative annual

credit, if any, shall be reflected as a credit to the billing

statement(s) due to such Shipper on the ninth (9th) business Day of the

next Month. If no such billing statement is due to any Non-Offending

Shipper, then the credit shall be paid to such Shipper in cash. WTG

Hugoton will not issue a check for Shipper credits totaling less than

$50 for the year;

(ii) Any negative balance, and any positive balance less than $100,000 shall

be carried forward, with interest calculated pursuant to the

Commission's regulations, to the next determination applicable under

this section; and

(iii) Within ninety (90) days of the end of the 12th full calendar month

following the in-service date of WTG Hugoton's pipeline system, and at

the end of the same month in each succeeding year, WTG Hugoton will

file a report with the Commission showing its penalty revenues, the

costs netted against penalty revenues, and the resulting credits for

each month.