Pacific Gas Transmission Company

First Revised Volume No. 1-A

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Effective Date: 02/02/1998, Docket: GT98- 17-000, Status: Effective

Third Revised Sheet No. 16A Third Revised Sheet No. 16A : Effective

Superseding: Second Revised Sheet No. 16A

RATE SCHEDULE FTS-1

FIRM TRANSPORTATION SERVICE

(Continued)

3.11 Reservation Charge Credit - Malin Primary Delivery Point

If PG&E GT-NW fails to deliver to Malin, Oregon ninety-five percent

(95%) or more of the aggregate Confirmed Daily Nominations (as

hereinafter defined) of all Shippers with a Malin primary

delivery point receiving service under this rate schedule

(hereinafter referred to as the "Non-Deficiency Amount") for

more than twenty-five (25) days in any given Contract Year, then

for each day during that Contract Year in excess of twenty-five

(25) days that PG&E GT-NW so fails to deliver the Non-Deficiency

Amount (a "Credit Day") Shipper, as its sole remedy, shall be

entitled to a Reservation Charge Credit calculated in the manner

hereinafter set forth.

For the purpose of this Paragraph 3.10, Confirmed Daily

Nomination shall mean for any day, the lesser of (1) Shipper's

Maximum Daily Quantity or (2) the actual quantity of gas that

the connecting pipeline upstream of PG&E GT-NW is capable of

delivering for Shipper's account to PG&E GT-NW at Shipper's primary

point of receipt(s) on PG&E GT-NW less Shipper's requirement to

provide compressor fuel and line losses under the Statement of

Effective Rates and Charges of PG&E GT-NW's FERC Gas Tariff, First

Revised Volume No. 1-A or (3) the quantity of gas that Pacific Gas

And Electric Company (PG&E) is capable of accepting at Malin for

Shipper's account or (4) Shipper's nomination to PG&E GT-NW.

The Reservation Charge Credit for each Credit Day for a

particular Shipper shall be computed as follows:

Reservation Charge A B - C

Credit for Each ____ x _____

Credit Day = (30.4 ) ( B )

where A = Shipper's Monthly Reservation Charge

B = Shipper's confirmed daily nomination for the

Credit Day

C = Actual quantity of gas delivered by PG&E GT-NW to PG&E

Malin for Shipper's account for the Credit Day

Except as provided for in Paragraph 3.11 of this rate schedule,

this Reservation Charge Credit is Shipper's sole remedy for

nondelivery of gas by PG&E GT-NW.

(Continued)