Trunkline Gas Company

First Revised Volume No. 1

Effective Date: 11/17/1996, Docket: RP97- 42-000, Status: Effective

Second Revised Sheet No. 236 Second Revised Sheet No. 236 : Effective

Superseding: First Revised Sheet No. 236

GENERAL TERMS AND CONDITIONS

(Continued)

27.TRANSITION COSTS (Continued)

27.2 Gas Supply Cost Surcharge

(A) Purpose

This Section 27.2 establishes the means by which Trunkline

shall recover its Gas Supply Realignment (GSR) Costs.

Trunkline may make one or more separate rate filings to

recover GSR Costs.

(B) Definitions

(1) GSR Costs are actual payments made in cash by Trunkline,

or amounts for which Trunkline has incurred a written

obligation or commitment to pay, to a seller of Natural

Gas, for buyouts, buydowns, contract reformation or

payments to resolve or respond to litigation or

arbitration proceedings attributable to customer

elections made pursuant to 18 C.F.R. 284.14(d) and

carrying charges, calculated in accordance with Section

154.501(d) of the Commission's Regulations, on payments

from the later of the date such payments are made or the

date of the rate filing made to recover such payments.

(2) Initial GSR Cost Collection Period will consist of the

three years commencing with the effective date of the

rate filing to recover GSR Costs.

(3) Carryover GSR Cost Collection Period will consist of

each annual extension in accordance with Section 27.2(F)

hereof to complete the full recovery of Trunkline's GSR

Costs.

Ninety percent (90%) of Trunkine's GSR Costs, including

carrying charges, shall be recovered by means of a GSR

Reservation Surcharge applicable to service under Rate

Schedules FT, SST, EFT, QNT and LFT. The GSR Reservation

Surcharge applicable to service under Rate Schedule SST shall

be converted to a Volumetric Surcharge at a sixty percent

(60%) load factor rate. The GSR Reservation Surcharge shall