Panhandle Eastern Pipe Line Company

First Revised Volume No. 1

Effective Date: 01/23/1999, Docket: RP99-192-000, Status: Effective

Second Revised Sheet No. 321N Second Revised Sheet No. 321N : Superseded

Superseding: Substitute First Revised Sheet No. 321N

GENERAL TERMS AND CONDITIONS (Continued)

(3) "Stranded Transportation Cost Volumetric

Surcharge" or "ST Volumetric Surcharge" shall

mean the currently effective surcharge

applicable to service under Rate Schedules IT

and EIT, as shown on Tariff Sheet Nos. 7 and

8 of First Revised Volume No. 1.

(4) "Section 18.13 Recovery Period" shall mean

the three (3) year period which shall

commence on July 1, 1994 and shall terminate

on June 30, 1997.

(5) "Section 18.13 Reconciliation Recovery

Period" shall mean the twelve (12) months

commencing on the first day of the month

following Commission approval of Panhandle's

Reconciliation filing as provided for in

Section 18.13(g).

(6) "Levelized Interest" shall mean the interest

amount resulting from the projected

amortization of the ST Costs over the Section

18.13 Recovery Period in accordance with

Section 154.501(d) of the Commission's

Regulations.

(d) Mechanism for Recovery of Stranded Transportation

Costs

Ninety percent (90%) of Panhandle's ST Costs,

including Levelized Interest, shall be recovered

by means of the ST Reservation Surcharge. The ST

Reservation Surcharge applicable to service under

Rate Schedule SCT shall be converted to a

Volumetric Surcharge at a 52.5% load factor. The

ST Reservation Surcharge shall be stated on

effective Tariff Sheet Nos. 4, 5, 6 and 15 of

Panhandle's FERC Gas Tariff, First Revised Volume

No. 1 and shall become a part of the stated rates

for service provided under such Rate Schedules.