East Tennessee Natural Gas Company

Second Revised Volume No. 1

Effective Date: 11/02/1998, Docket: RP99- 59-000, Status: Effective

Third Revised Sheet No. 140 Third Revised Sheet No. 140 : Superseded

Superseding: Second Revised Sheet No. 140

GENERAL TERMS AND CONDITIONS (Continued)

(b) The deadlines set forth in this Section 17.6 are only applicable if (i) all the

information provided by the parties to the transaction is valid and the

Replacement Shipper has been determined to be creditworthy before the capacity

release bid is tendered; and (ii) there are no special terms or conditions of the

release. Nominations by the winning bidder may be submitted for the next gas flow

day or at the times otherwise specified for intra-day or hourly nominations.

17.7 Determination of Successful Bidder of Transportation Rights

(a) Bid Evaluation Methodologies: The Releasing Shipper shall specify in the Release

Request one of the following bid evaluation methodologies: (i) highest rate, (ii)

net revenue, or (iii) present value. A Release Request submitted specifying one

of these methods shall be accorded the timeline treatment described in Section

17.6. However, the Releasing Shipper may choose another bid evaluation method.

This request shall be accorded the timeline treatment described in Section 17.6.

Transporter shall apply the method chosen to determine the successful Bidder.

Transporter's application of Releasing Shipper's bid evaluation method shall

result in as many successful bidders as mandated thereby, provided that the

volumes released to each successful bidder shall be no less than one dekatherm.

If the Releasing Shipper desires to award to more than one winner, the Releasing

Shipper should allow for the acceptance of partial TQ bids.

(b) If the present value method is chosen, then Transporter shall determine the bid or

bids having the highest net present value ("PV") based on the following formula:

PV= (Bid Rate) x (Bid Quantity) x 1-(1+i)

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where

Bid Rate = for firm releases, the reservation charge that the Bidder has

agreed to pay; for recallable releases, the usage charge that the

Bidder has agreed to pay.

Bid Quantity = the Released Transportation Quantity stated in the Bid.