Texas Eastern Transmission Corporation

Sixth Revised Volume No. 1

Effective Date: 12/01/2000, Docket: RP01- 69-000, Status: Effective

Second Revised Sheet No. 596A Second Revised Sheet No. 596A : Effective

Superseding: First Revised Sheet No. 596A

GENERAL TERMS AND CONDITIONS

(Continued)

RP88-67, et al. (Phase II/PCBs) (Texas Eastern Transmission Corp., 58 FERC ¶ 61,295

(1992)) ("PCB-Related Cost Settlement"), and the PCB-related cost components shall be

deemed recovered in a manner consistent with such settlement and revenues recovered

under Rate Schedules IT-1, PTI, ISS-1, VKIT and LLIT and any other applicable

interruptible Rate Schedule shall be accounted for in accordance with such settlement.

11. POLICY WITH RESPECT TO FEES AND CONSTRUCTION OF NEW FACILITIES

11.1 Except as provided in Section 11.2 herein, Customer shall reimburse Pipeline (a) for

the costs of any facilities installed by Pipeline with Customer's consent to receive,

measure, transport or deliver natural gas for Customer's account and (b) for any and

all filings and approval fees required in connection with Customer's Service Agreement

that Pipeline is obligated to pay to the Commission or any other governmental authority

having jurisdiction. Any reimbursement due Pipeline by Customer pursuant to this

Section 11.1 shall be due and payable to Pipeline within ten (10) days of receipt by

Customer of Pipeline's bill(s) for same; provided, however, subject to Pipeline's

consent such reimbursement, plus carrying charges thereon, may be amortized over a

mutually agreeable period not to extend beyond the primary contract term of the service

agreement between Pipeline and Customer. Carrying charges shall be computedutilizing

interest factors acceptable to both Pipeline and Customer.

11.2 Pipeline may waive from time to time, at its discretion, all or a portion of the

facility cost reimbursement requirement set forth in Section 11.1 for Rate Schedules

CDS, FT-1, SCT, PTI, IT-1, LLFT, LLIT, VKFT, VKIT, SS-1 and FSS-1 if Customer provides

Pipeline adequate assurances of transportation throughput to make construction of the

facilities economical to Pipeline. All requests for waiver shall be handled by

Pipeline in a manner which is not unduly discriminatory. For purposes of determining

whether a project is economical, Pipeline will evaluate projects on the basis of

various economic criteria, which will include the estimated transportation throughput,

cost of the facilities, operating and maintenance as well as administrative and general

expenses attributable to the facilities, the revenues Pipeline estimates will be

generated as a result of such construction, and the availability of capital funds on

terms and conditions acceptable to Pipeline. In estimating the revenues to be

generated, Pipeline will evaluate the existence of capacity limitations downstream of

the facilities, the marketability of the capacity, the location of the markets, the

interruptible versus the firm nature of the transportation service, and other similar

factors which impact whether the available deliverability will actually be transported.