Petal Gas Storage Company

Original Volume No. 1

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Effective Date: 03/15/2002, Docket: CP00- 59-002, Status: Effective

Second Revised Sheet No. 7 Second Revised Sheet No. 7 : Effective

Superseding: First Revised Sheet No. 7

FSS RATE SCHEDULE

FIRM STORAGE SERVICE (Continued)

4.2 Obligations of Customers for Payment of Charges.

A Customer (including a Replacement Customer), who releases its right to

capacity on any basis for a period less than the remaining term of the

original Customer's FSS Agreement, remains responsible for compliance

with all terms and conditions of such Agreement, which shall remain in

effect, and for payment to Petal of the amount of any Storage Capacity

and Deliverability Charge not paid by the Replacement Customer. A

Customer (including a Replacement Customer) who releases its right to

capacity for the full remaining term of such original Customer's FSS

Agreement, shall be released from its obligations under such Agreement

subject to the following conditions: First, upon obtaining the consent

of Petal, which consent shall not be unreasonably withheld, and second,

upon receiving the approval of Petal's lenders/note holders.

4.3 Notification to Petal.

To release its capacity rights, a Customer must notify Petal in writing

or via Petal's EBB of the terms and conditions of the release. The

notification must include:

(a) The Releasing Customer's name, contract number, and phone number

of the individual responsible for authorizing the release of

capacity.

(b) The effective date(s) of the release.

(c) The volume(s) subject to release.

(d) The MDIQs, TMDIQ, MDWQs and TMDWQ subject to release.

(e) The minimum acceptable rate(s). Releasing Customer has the

choice to specify dollars and cents or percents of maximum tariff

rate in the denomination of bids. Once the choice is made by the

Releasing Shipper, the bids shall comport with the choice.

(f) Whether the capacity is offered on a permanent or temporary basis,

and on a firm or recallable basis. If on a recallable basis,

include the conditions, if any, upon which the Releasing Customer

may recall the capacity.

(g) The criteria by which Petal shall evaluate the bids. A Releasing

Customer may select: 1) the present-value formula specified in

Section 4.2 of the General Terms and Conditions of this Tariff,

2) net revenue, 3) highest rate, or 4) state its own

nondiscriminatory criteria, subject to Petal's approval.

(h) The method by which capacity shall be awarded if tied bids are

received. If no method for awarding capacity to tied bids is

specified, the capacity will be awarded