Texas Eastern Transmission Corporation

Sixth Revised Volume No. 1

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Effective Date: 06/01/1993, Docket: RS92- 11-009, Status: Effective

Original Sheet No. 635 Original Sheet No. 635 : Effective

GENERAL TERMS AND CONDITIONS

(Continued)

(D) Surcharge Adjustment:

(1) Applicable Shrinkage Deferred Account

Pipeline shall record in the Applicable Shrinkage Deferred

Account the net monetary value of all transactions involving

gas differences as a result of the operation of this Section

15 and the imbalance resolution procedures of Section 8 of

the General Terms and Conditions, as well as other

requirements for Pipeline's purchase of gas due to

unanticipated events which threaten the operational integrity

of Pipeline's system.

The applicable Shrinkage Deferred Account shall be

accumulated in twelve-month accumulation periods,

September-August, except for the initial accumulation period

which will begin on the effective date of this Section 15.6

and extend through the following August and shall include any

balance carried forward from the prior periods. Such balance

carried forward from prior periods shall include the effect

of Pipeline's entry to the PGA account for the value of gas

differences which were accrued in Pipeline's ASA Deferred

Account under Section 37 of the General Terms and Conditions

of its FERC Gas Tariff, Fifth Revised Volume No. 1 but were

not amortized because of the implementation of this Sixth

Revised Volume No. 1 pursuant to Order No. 636.

(2) Disposition of Gas Differences

At Pipeline's discretion quantities of gas required to

support under-realization of in-kind compensation may be

obtained by Pipeline from gas available as a result of the

operation of the imbalance resolution procedures contained in

Section 8 of the General Terms and Conditions, may be

obtained by Pipeline by means of purchase arrangements

available to Pipeline, or may be obtained by Pipeline from

other sources. At Pipeline's discretion quantities of gas

available to Pipeline as a result of over-realization of

in-kind compensation may be utilized for any system gas needs

or may be disposed of in accordance with the provisions of

Section 8.3 of these General Terms and Conditions.

(3) ASA Usage Surcharge

The net monetary value recorded in the Applicable Shrinkage

Deferred Account at the end of each accumulation period shall

be used to develop an ASA Usage Surcharge which shall be

applicable to all Usage Charge determinants for ASA Rate

Schedules for each projected annual period beginning December

1 of each year. The ASA Usage Surcharge for ASA Rate

Schedules