Panhandle Eastern Pipe Line Company

First Revised Volume No. 1

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Effective Date: 02/01/2002, Docket: RP00-395-003, Status: Effective

Second Revised Sheet No. 86 Second Revised Sheet No. 86 : Superseded

Superseding: Substitute First Revised Sheet No. 86

RATE SCHEDULE TBS

TRANSPORTATION BALANCING SERVICE

1. AVAILABILITY

This Rate Schedule is available for combined firm Natural Gas

Transportation and Storage service performed by Panhandle Eastern

Pipe Line Company (hereinafter called Panhandle) for any party

(hereinafter called Shipper):

(a) which has executed a Transportation Balancing Service

Agreement in the form prescribed under Panhandle's FERC

Gas Tariff for service under this Rate Schedule;

(b) which has executed a Transportation Agreement under Rate

Schedule FT, EFT, SCT, IT, EIT, LFT or HFT or is the agent

of such a party; and

(c) which has executed a Storage Agreement subject to

Panhandle's Rate Schedule IOS or an eligible Storage

Agreement under Rate Schedule FS consistent with Section 2

below.

2. APPLICABILITY AND CHARACTER OF SERVICE

Panhandle shall provide Transportation Balancing Service with

respect to the Transportation of Natural Gas up to the Maximum Daily

Contract Quantity (MDCQ) set out in the designated Transportation

Agreements under Rate Schedule FT, EFT, SCT, IT, EIT, LFT, or HFT by

coordinating injections and withdrawals from firm Storage service

under Rate Schedule IOS or a qualifying Storage Agreement under Rate

Schedule FS up to the Maximum Stored Quantity (MSQ), Maximum Daily

Injection Quantity (MDIQ) and Maximum Daily Withdrawal Quantity

(MDWQ) set out in Shipper's Storage Agreement, subject to the

availability of capacity, the General Terms and Conditions herein and

the further provisions of the Transportation Balancing Service

Agreement. Storage service under Rate Schedule FS shall qualify to

be utilized for service under Rate Schedule TBS if the FS Storage

Agreement provides for both injections and withdrawals at any time

during the year.

In no event shall Panhandle be obligated to provide any

Transportation Balancing Service for which capacity is not available

or which would require the construction or acquisition of new

facilities or the modification or expansion of existing facilities.

The quantity of Transportation Balancing Service ("TBS")

available to Shipper shall be defined by the capacity of the Storage

Service Agreement specified in the TBS Agreement.