Pacific Gas Transmission Company

First Revised Volume No. 1-A

Effective Date: 03/01/2001, Docket: RP99-518-019, Status: Pending

First Revised Sheet No. 7B First Revised Sheet No. 7B : Pending

Superseding: Original Sheet No. 7B

STATEMENT OF EFFECTIVE RATES AND CHARGES

FOR TRANSPORTATION OF NATURAL GAS

(Continued)

NEGOTIATED RATE AGREEMENTS UNDER RATE SCHEDULE FTS-1

Explanatory Footnotes for Negotiated Rates under Rate Schedule FTS-1

/6 Under this agreement, there are two distinct rate structures that will

apply to the volumes flowed. The first 10,000 Dth flowed each day will be

charged at the 100% load factor equivalent of the Reservation Charge plus

Delivery Charge plus ACA Charge plus GRI.

Any volumes in excess of 10,000 Dth flowed each day will be charged

according to the following formula. [(The Gas Daily Index price for

Malin minus the Gas Daily Index price for Stanfield minus an Allowance

for fuel) x 70%].

In the event Sempra does not ship the Minimum Monthly Delivered Quantity,

the monthly bill shall be adjusted to equal the sum of (10,000 Dth x 31

days x $.274946/Dth) and (2,000 Dth x 31 days x the monthly average of

(the Gas Daily Index price for Malin minus the Gas Daily Index price for

Stanfield) x 70%.

The Allowance for Fuel shall be calculated using the following expression:

[(Stanfield Index)/(1.0 - fuel expressed as a decimal)] - Stanfield Index

Fuel shall be reimbursed in kind at the applicable monthly percentage as

posted on GTN’s EBB.