Transwestern Pipeline Company

Second Revised Volume No. 1

Effective Date: 09/01/1995, Docket: RP95-271-001, Status: Effective

7th Revised Sheet No. 8 7th Revised Sheet No. 8 : Effective

Superseding: 6th Revised Sheet No. 8

RATE SCHEDULE FTS-1

Firm Transportation Service

(continued)

3. RATE

The applicable rates for the purpose of computing charges under

this Rate Schedule are set forth in the currently effective Rate

Sheets of this tariff and are incorporated herein. For all natural

gas delivered to Shipper each month under this Rate Schedule, Shipper

shall pay Transporter each month the sum of the applicable

Reservation Charge, Transport Charge and Overrun Charge as set forth

in Sections 3.1, 3.2, 3.3, 3.4, 3.5, and 3.6.

3.1 (a) Reservation Charge: The applicable Reservation Charge (plus any

applicable surcharges) multiplied by the Monthly Demand Billing

Units or MAXDTQ related to the Primary Receipt and Delivery

Points as set forth in Shipper's currently effective applicable

FTS-1 Service Agreement, times the number of days in the billing

month.

(b) Additional Reservation Charge for Alternate Point(s): If a Shipper

nominates and transports using Alternate Receipt Point(s) or

Alternate Delivery Point(s) that are outside the Shipper's Primary

Path, then Shipper will pay an additional reservation charge, not to

exceed the maximum applicable tariff rate, as negotiated between

Shipper and Transporter, applicable to such service outside the

Primary Path. Such rate will apply on a daily basis for as long as

any alternate point outside the Primary Path is utilized.

3.2 (a) Except as provided in Section 3.2(c), the Reservation Charge that

Shipper pays to Transporter under this Rate Schedule shall be

reduced at Shipper's election for any failure by Transporter to

deliver the quantities of gas that have been nominated and

confirmed in accordance with Section 22 of the General Terms and

Conditions of this Tariff (up to the aggregate MAXDTQ), less

Transport Fuel, during the calendar months of December, January,

February, July, and August. The reduction shall be calculated based

upon the ratio of (i) the volume of gas that had been nominated

and confirmed, less Transport Fuel, but not delivered during the

month to (ii) the total volumes of gas nominated and confirmed

during the month, less Transport Fuel, times (iii) the total

Reservation Charge owed Transporter for that month.