Williams Natural Gas Company

Second Revised Volume No. 1

Effective Date: 10/01/1993, Docket: RS92- 12-003, Status: Effective

Original Sheet No. 266 Original Sheet No. 266 : Superseded

GENERAL TERMS AND CONDITIONS

14. TRANSITION COSTS AND EXIT FEES (Cont'd)

(iii) The current Transportation Cost Rate Adjustment

(Reservation (or Demand) and Commodity) reflected in

the Rates and Charges in WNG's Tariff shall be

determined (1) in the first TCRA filing by subtracting

the Initial Transportation Cost Rate from the Current

Transportation Cost Rate, and (2) in succeeding

filings, by subtracting the Transportation Cost Rate in

WNG's preceding TCRA from the Current Transportation

Cost Rate. The Reservation (or Demand) Current

Transportation Cost Rate Adjustment shall be applied to

all of the reservation (or demand) rates under Rate

Schedules TSS(P), TSS(M), FTS(P) and FTS(M) and to the

Rate Schedules STS(P), STS(M), SFT(P) and SFT(M)

commodity rates using an imputed load factor of equal

to the load factor in effect for the derivation of such

one-part rates.

(e) Unrecovered Transportation Cost Account

WNG shall establish and maintain an Unrecovered

Transportation Cost Account for the collection of the

Transportation Costs under the Affected Rate Schedules as a

sub-account of FERC Account No. 186.

(i) Each month the Unrecovered Transportation Cost Account

shall be (i) debited by WNG's actual Transportation

Costs (net of any cost reductions or revenues from

WNG's assignment or temporary release of its capacity

or obligations related to those actual Transportation

Costs), and (ii) credited by the actual revenues

received attributable to the Transportation Costs

reflected in WNG's Rates, which revenues shall be

determined by multiplying (a) the actual Reservation

(or Demand) and Commodity billing units under the

Affected Rate Schedules for the billing month by (b)

the effective Current Transportation Cost Rate

determined in accordance with Article 14.5(d).