TransColorado Gas Transmission Company

Original Volume No. 1

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Effective Date: 11/01/2001, Docket: RP02- 5-000, Status: Effective

Original Sheet No. 118 Original Sheet No. 118 : Superseded

RATE SCHEDULE PALS

4. VALID REQUESTS FOR PALS AGREEMENT(S) AND FOR PALS RO(S)

4.1 A request for service under this Rate Schedule PALS shall be

valid as of the date received if it complies with this Section 4 and

contains adequate information on all of the items specified in

Sections 4.3(a) and 4.3(b), subject to any necessary verification of

such information and to the following:

(a) A request shall not be valid and TransColorado shall

not be required to grant any such request: (1) which could in

TransColorado's judgment interfere with efficient operation of its

system or with service to any firm Shipper; (2) which would require

the construction, modification, expansion, or acquisition of any

facilities to enable it to perform such services; provided, however,

that TransColorado may agree in its reasonable discretion to

construct, modify, expand, or acquire any facilities; (3) unless and

until Shipper has provided TransColorado with the information required

in Section 4.2 hereof and the assurances required under Section 1.3

hereof; (4) if TransColorado determines, based on the credit analysis

referenced in Section 4.2(d), that Shipper does not possess sufficient

financial stability to make it reasonably likely the service provided

hereunder will be paid for on a timely basis; (5) if the service

requested would not comply with this Rate Schedule PALS; or (6) if the

service requested is at less than the applicable maximum rate;

provided, however, that TransColorado may agree to provide service

hereunder at a discount consistent with this Rate Schedule PALS.

Nothing herein is intended to govern the scheduling and curtailment of

service once a request for service has been granted pursuant to

Section 4 hereof and while Agreements under this Rate Schedule are in

effect. Such matters are governed by Section 3 of this Rate Schedule

and the applicable General Terms and Conditions of this Tariff.

(b) TransColorado may agree, however, to construct, modify,

expand or acquire facilities to perform service under this Rate

Schedule PALS on a non-discriminatory basis whenever such is deemed,

in TransColorado's reasonable judgment, to be economically,

operationally and technically feasible, subject to the following

conditions:

(1) TransColorado has received an executed revised

service agreement from existing and prospective Shipper(s) requesting

such additional facilities or expansion of capacity;

(2) TransColorado does not have physical facilities

or adequate capacity in the system to accommodate requests for service

of existing and prospective Shippers accepted by TransColorado

pursuant to Section 4.1 hereof;