Panhandle Eastern Pipe Line Company

First Revised Volume No. 1

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

Original Sheet No. 115 Original Sheet No. 115 : Superseded

RATE SCHEDULE DVS (Continued)

DELIVERY VARIANCE SERVICE

If the DVS Party is a delivery point operator, the MDVQ shall

be added to the absolute value of the calculated tolerance Quantity

for the delivery meter as provided in Section 12.11(h) of the General

Terms and Conditions. Any variance then remaining shall be allocated

back to the applicable Transportation Agreement(s) based on the

predetermined allocation methodology for the designated Point of

Delivery and shall be subject to the daily scheduling charge.

The service provided hereunder shall not affect the scheduling

priorities of the underlying Transportation Agreements, as set forth

in Section 8 of the General Terms and Conditions. Also, the service

provided hereunder shall not affect the calculation of any overrun

charge or overrun penalty applicable to the underlying Transportation

Agreement(s).

In no event shall Panhandle be obligated to provide any

Delivery Variance 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.

3. RATES

The rates and charges for service under Rate Schedule DVS shall

be:

3.1 Reservation Charge

The reservation charge applicable to this Rate Schedule

shall be the product of the MDVQ times the reservation rate

per Dt. as set forth on the effective Tariff Sheet No. 18.

The service charge shall be pro-rated for the first and

last contract Months to adjust for the number of Days

during those Months service was available.

3.2 Commodity Charge

The commodity charge applicable to this Rate Schedule shall

be the product of the actual Quantity of Gas applicable to

the Delivery Variance Service each Day times the commodity

rate per Dt. as set forth on the effective Tariff Sheet

No. 18.