Pacific Gas Transmission Company

First Revised Volume No. 1-A

Effective Date: 07/06/2002, Docket: RP02-362-000, Status: Effective

First Revised Sheet No. 68B First Revised Sheet No. 68B : Effective

Superseding: Original Sheet No. 68B

TRANSPORTATION GENERAL TERMS AND CONDITIONS

18. OPERATING PROVISIONS (Continued)

18.1 Firm Service (Continued)

(e) Valuation of Bids (Continued)

The specific bid evaluation methodology to be used, including,

where appropriate, the data to be used for evaluation of

Negotiated Rate Formula bids, will be included as part of

PG&E GT-NW’s open season posting under Paragraph 18.1(c) with

sufficient specificity to allow a prospective shipper to

calculate the value of its bid and duplicate PG&E GT-NW’s results.

Irrespective of whether a bid(s) has the highest NPV of the bids

received, PG&E GT-NW may reject bids for service that (i) may

detrimentally impact the operational integrity of Transporter's

system; (ii) do not satisfy all the terms of the specified

posting; or (iii) contain terms and conditions other than those

set forth in PG&E GT-NW’s FERC Gas Tariff.

If the NPV of any Negotiated Rate revenues would exceed the NPV

of the revenue stream produced by paying the Maximum Rate over

the same period of time, then the Shipper bidding the Negotiated

Rate shall be considered to be paying the Maximum Rate for

purposes of determining the bid with the greatest economic value.

(Continued)