Pinnacle Pipeline Company

ORIGINAL VOLUME NO. 1

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Effective Date: 10/08/2003, Docket: RP04-102-001, Status: Effective

Original Sheet No. 155 Original Sheet No. 155 : Effective

quantity and duration. If the Shipper elects to

match the Highest Bid, it must execute a new

Transportation Agreement that contains the terms

of the Highest Bid; provided, however, that

Shipper shall not be required to pay any rate

higher than the maximum applicable recourse rate.

If the Shipper fails to match the offer presented

by Transporter, Transporter shall enter into a

Firm Transportation Agreement with the Person

submitting the competing offer.

22.4 If Transporter receives no bids at the maximum

applicable recourse rate and Transporter refuses

to accept a lower bid, Transporter may abandon

service to Shipper, unless Shipper agrees to pay

the maximum applicable recourse rate for a period

of one year, or if Transporter and Shipper

negotiate the terms and conditions of a Firm

Transportation Agreement extension.

23. CREDITING OF PENALTIES

Penalties Net of Out-of-Pocket Costs - Transporter will

flow through to its Shippers the amount of all out-of-

pocket costs incurred and collected as a direct result

of the Shipper conduct that was penalized pursuant to

sections 8.1(b) and 8.3 of the GT&C. Transporter will

net all revenues received pursuant to those sections

against the costs incurred for such revenues.

Transporter will credit the net amount to those

Shippers that were not billed pursuant to those

sections during the applicable Month.

24. INCORPORATION IN RATE SCHEDULES AND TRANSPORTATION

AGREEMENTS

These General Terms and Conditions are incorporated in

and are made a part of Transporter's Rate Schedules and

Transportation Agreements. To the extent there is any

inconsistency between terms in these General Terms and

Conditions and terms in Transporter's Rate Schedules or

Transportation Agreements, these General Terms and

Conditions shall govern.