Midcoast Interstate Transmission, Inc.

Second Revised Volume No. 1

Effective Date: 10/01/1997, Docket: GT97- 71-000, Status: Effective

First Revised Sheet No. 227 First Revised Sheet No. 227 : Effective

Superseding: ORIGINAL SHEET NO. 227

OPERATIONAL BALANCING AGREEMENT (continued)

(For Use at Points of Delivery)

ARTICLE I

NOMINATIONS AND CONFIRMATIONS

1.1 Confirmation of Nominations - Prior to the beginning of the

month in which service is to commence, Transporter and the OBA

Party shall confirm the quantities nominated to be transported

by Transporter at the Delivery Point(s) commencing on the

first day of the month following the confirmation. Any

modification to such confirmed quantities shall be confirmed

by Transporter and the OBA Party prior to the commencement of

the revised service. The OBA Party shall notify Transporter

of any errors in the confirmed nominations within two business

days of receipt of such information from Transporter. If the

OBA Party fails to respond to Transporter's request to confirm

the quantities to be transported and/or purchased at any

Delivery Point(s) in accordance with the above, then this

Agreement shall terminate upon written notice from Transporter

at the end of that calendar month.

1.2 Allocations Based on Confirmed Nominations - The Parties

intend that the quantity actually delivered at the Delivery

Point(s) will be equal to the confirmed nominations. The OBA

Party shall use all reasonable efforts to ensure that the

quantities actually delivered at the Delivery Point(s) are

equal to the confirmed nominations. Unless prohibited by

applicable law or regulation, all transportation services by

Transporter shall be allocated each day based upon the

confirmed nominations set forth in Section 1.1 above, or by

such other methods as may be mutually agreed to by both

Parties.

1.3 Allocation of Variances - The difference on any day between

the confirmed nominations set forth in Section 1.1 above and

the actual quantity delivered at the Delivery Point(s) shall

be the Daily Operational Imbalance and such imbalance shall be

allocated to this Agreement. The difference between the sum

of all confirmed nominations set forth in Section 1.1 above

during a calendar month and the total quantity delivered at

the Delivery Point(s) during the calendar month shall be the

Monthly Operational Imbalance. Any Operational Imbalances

will be corrected in accordance with Article II.