Williams Natural Gas Company

Second Revised Volume No. 1

Effective Date: 05/01/1997, Docket: RP97- 67-002, Status: Effective

Second Revised Sheet No. 229C Second Revised Sheet No. 229C : Superseded

Superseding: First Revised Sheet No. 229C

GENERAL TERMS AND CONDITIONS

9. SCHEDULING, CURTAILMENT AND IMBALANCES (Cont'd)

(e) For each receipt or delivery point operator, WNG will

aggregate receipts and deliveries which are on the same line

segment and which are otherwise subject to this Article 9.6

for purposes of determining daily balancing penalties. Each

receipt or delivery point is associated with a particular line

segment on WNG's Master Receipt and Delivery Point Lists.

(f) Delivery point operators at Delivery Points where at least 95%

of volumes are measured by EFM, will be penalized during

system-wide periods of daily balancing for hourly deliveries

in excess of 1/16 times the sum of the respective

non-reassigned delivery point MDQ under Rate Schedules TSS and

STS plus the nominated quantity for each day. The penalty is

$10 per Dth or five times the average Gas Daily Index for WNG

for the days in which daily balancing is in effect, whichever

is greater, for excess deliveries.

(g) Payments received by WNG for daily balancing penalties

associated with Unauthorized Under Receipts shall be credited

back to receipt point operators at points equipped with

electronic flow measurement who did not incur any Under

Receipts at such points during the period of daily balancing

for which penalties were received. Payments received by WNG

for daily balancing penalties associated with Unauthorized

Overdeliveries shall be credited back to delivery point

operators at points equipped with electronic flow measurement

who did not incur any Overdeliveries at such point during the

period of daily balancing for which penalties were received.

Such credits shall be allocated based on each operator's pro

rata share of the total receipt or delivery point measured

volumes at these points for the period of daily balancing in

which penalties were incurred.

(h) The payment of a daily balancing penalty shall not under any

circumstances be considered as a substitute for any other

remedies available to WNG against the offending Delivering or

Receiving Party, including, but not limited to, suspension or

reduction of deliveries until Overdeliveries or Under Receipts

are made up.