TransColorado Gas Transmission Company

Original Volume No. 1

Effective Date: 11/01/2001, Docket: RP02- 5-001, Status: Effective

Substitute Original Sheet No. 125 Substitute Original Sheet No. 125 : Superseded

RATE SCHEDULE PALS

(1) By mutual agreement between TransColorado and

Shipper, which is consistent with the pro forma agreement set out in

this Tariff, discounts or negotiated rates may be limited to specific

volumes and/or specific periods.

(2) If a Shipper has submitted a nomination for a

payback on a loan or a withdrawal on a park, and that nomination is

consistent with the PALS RO but is not confirmed by TransColorado, the

Park/Loan Balance Rate shall only be assessed as if the nomination had

been confirmed. Pursuant to Section 3.1 of this Rate Schedule, the

Shipper is obligated to continue to nominate on subsequent days until

TransColorado is able to confirm the nomination, unless the parties

agree on a revised PALS RO.

(b) Shipper shall pay any other applicable charges, penalties

and fees set out in this Rate Schedule PALS or the General Terms and

Conditions of this Tariff. Deviations from the approved PALS RO

nominated volumes when compared to the allocated volumes will be

assessed cashout charges under Section 12.6 of the General Terms and

Conditions of this Tariff.

maximum rates set forth in this Tariff applicable to Rate Schedule PALS,

which rates are hereby incorporated herein, unless a lower rate for the

charge in subsection (a) is specified in the PALS RO. However, where a

Shipper has agreed to pay a Negotiated Rate or a rate under a Negotiated

Rate Formula, the rates assessed hereunder shall be governed by Section

23 of the General Terms and Conditions of this Tariff. A request for

service at a Negotiated Rate or a rate under a Negotiated Rate Formula

shall specify the Negotiated Rate or Negotiated Rate Formula on which

the Shipper is willing to agree.

(d) The charges referenced herein cover only Park and Loan

Services. Shipper must contract separately for any transportation

service required for Shipper to move gas to or away from the point(s)

specified in the PALS RO.

6.2 Authorized overrun charges apply if a Shipper nominates and

TransColorado confirms volumes in excess of the approved MAQ and/or MDQ

in the PALS agreement, or if Shipper fails to comply with any quantity

or timing parameter in a PALS RO (unless the failure results from

TransColorado not confirming a nomination properly submitted).

Authorized overrun charges will be assessed at the maximum PALS rate,

unless otherwise agreed to in writing by TransColorado. An unauthorized

overrun charge of up to $15 per Dth applies if the overrun is not

nominated and confirmed. TransColorado may waive or discount

unauthorized overrun charges on a non-discriminatory basis.