East Tennessee Natural Gas Company

Second Revised Volume No. 1

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Effective Date: 08/01/1998, Docket: RP98-350-000, Status: Effective

Second Revised Sheet No. 152 Second Revised Sheet No. 152 : Superseded

Superseding: First Revised Sheet No. 152

GENERAL TERMS AND CONDITIONS (Continued)

18.7 Determination of Successful Bidder for Storage 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 may be accorded the timeline

treatment described in Section 18.6. However, the Releasing Shipper may

choose another bid evaluation method. This request shall be accorded the

timeline treatment described in Section 18.6. 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 winning

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 present value in the same manner set forth in

Section 17.7(b) of the General Terms and Conditions, except that Bid Maximum

Daily LNGS Quantities shall be substituted for Bid Quantity in the formula

provided.

bid or bids having the highest present value in the same manner set forth in

Section 17.7(c) of the General Terms and Conditions, except that Bid Maximum

Daily LNGS Quantities shall be substituted for Bid Quantity in the formula

provided.

(d) The awarding of the released LNGS service, including the award of such

rights to a Pre-arranged Bidder, shall be done pursuant to the procedures

established in Section 17.7 of Transporter's General Terms and Conditions

for the awarding of released transportation rights.

(e) GISB Standard 5.3.9 (Version 1.2) states: If the transportation service

provider requires amendments for each release, the transportation service

provider should automate the process of amending contracts and this may be

the subject of a global agreement between the parties. Therefore, pursuant

to this GISB standard, prior to the commencement of service pursuant to a

temporary release, Transporter shall prepare and transmit to the successful

Bidder an Exhibit "R-1" to its Released Storage Service Agreement stating

the Released Maximum Daily LNGS Quantity and Winter Season Quantity, rates,

term, and Maximum Daily Quantities at all Primary Delivery Points, governing

rate schedule, and any special terms and conditions for each awarded

release. An identical Exhibit "R-1" shall be added to the Releasing

Shipper's Storage Service Agreement, to reflect that the Releasing Shipper

has released all or a portion of its storage rights and the terms of such

release. A Replacement Shipper that subsequently obtains additional storage

rights by successfully bidding on a subsequent Release Request is not

required to execute an additional Released Storage Service Agreement;

rather, each such additional successful bid shall be the subject of an

additional exhibit (designated sequentially "Exhibit R-2", "Exhibit R-3",

etc.) to be added to such Replacement Shipper's Released Storage Service

Agreement. Transporter shall prepare all exhibits for Releasing Shippers

and Replacement Shippers based on the information in the applicable Release

Request and the successful bid, and each such exhibit shall be deemed

incorporated in the agreement to which it relates and shall thereby amend

such agreement effective upon commencement of service to the Replacement

Shipper. Such exhibits shall not require execution by the Releasing Shipper

or Replacement Shipper to become effective.