Williams Natural Gas Company

Second Revised Volume No. 1

Effective Date: 08/12/1996, Docket: RP96-311-000, Status: Effective

Third Revised Sheet No. 250A Third Revised Sheet No. 250A : Superseded

Superseding: 2 Sub Second Revised Sheet No. 250A

GENERAL TERMS AND CONDITIONS

13. FUEL AND LOSS REIMBURSEMENT (Cont'd)

Production Area and the Market Area based on quantities received in

each area, including volumes received into the Market Area at the

Production Area/Market Area interface.

Actual fuel consumed at each compressor station or other fuel

consuming facility attributable to storage operations is measured.

Storage loss is calculated annually based on shut-in pressure tests

taken at the end of the injection cycle.

Actual fuel consumed in each gathering area is also measured and

assigned to the gathering area where the facility is located.

Gathering area losses are specifically identified to each area

through measurement at the interface between the gathering area and

the Production Area.

Over or under recovery of fuel and loss in each area is calculated

by comparing the actual fuel and loss incurred during the preceding

twelve month period (October through September) to the quantity of

gas retained under the fuel and loss reimbursement percentage which

was in effect during each month of such period. The quantity

retained is calculated using the actual fuel and loss reimbursement

percentage before adjustment for under or over recoveries during

the prior period.

13.3 Zero Fuel Charge on Certain Backhaul Transactions

WNG will assess a zero charge for the fuel component of its fuel

and loss reimbursement percentage and will charge only the loss

component of such fuel and loss reimbursement percentage for

transactions between the receipt and delivery points for each path

specified below.

Path I

Receipt Points

Any receipt point on the Rawlins-Hesston line located east of the

Chalk Bluffs interconnect with Public Service Co. of Colorado, in

Weld County, Colorado and west of WNG's Hesston compressor station,

in Harvey County, Kansas.