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. 160 Original Sheet No. 160 : Effective

The board so constituted shall meet within ten (10)

Days after the identity of the third arbitrator is

determined, at which time the board shall set a

reasonable schedule so that the parties may submit

evidence and argument as they may see fit and be

represented by counsel. The action of a majority of

the members of the board shall govern and, unless

otherwise agreed by both parties or otherwise set forth

in any Agreement, their decision shall be rendered

within seventy-two (72) hours from the conclusion of

submission of the evidence, shall be in writing, and

shall be final and binding on the parties. Each party

shall pay the expense of the arbitrator selected by it

and its own attorney's fees and costs associated with

preparation of its case. All other costs of the

arbitration shall be divided between the parties

according to a method mutually agreed to by them at the

outset of the arbitration proceeding and, failing such

agreement, according to the decision of a majority of

the members of the arbitration board, which shall

likewise be final and binding on the parties. Without

regard to any terms of any Agreement which may appear

to be in conflict with this Section 28, neither party

shall be entitled to recovery or reimbursement of costs

incurred. Procedures not specified in the Agreement

are established by the provisions of the Texas General

Arbitration Act.

29. MISCELLANEOUS

29.1 Audit - Shipper and Transporter shall maintain

books and records relating to their operation and

performance under a Transportation Agreement in

order that the provisions of the Agreement can

adequately be administered. Shipper and

Transporter shall have the right, during the term

of such Agreement and within a two-Year period

following its expiration, to enter upon the

premises of the other party at reasonable times

for the purposes of examining and auditing all

books and records relating directly to

performance under the Agreement. Audits shall be

conducted at the sole expense of the party

conducting the audit. Such party shall furnish

the other party a report stating the results of

any audit and the basis of those results. If any

such report discloses that any error has occurred

and that, as a result, an overpayment or an