U-T Offshore System, L.L.C.

Third Revised Volume No. 1

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Effective Date: 06/01/1997, Docket: RP97-146-001, Status: Effective

Third Revised Sheet No. 34 Third Revised Sheet No. 34 : Superseded

Superseding: Second Revised Sheet No. 34

GENERAL TERMS AND CONDITIONS

1. DEFINITIONS

1.1 The term "Associated Liquids" shall mean condensate (without free water)

produced in conjunction with the production of Gas to be transported in the

System and liquefiable hydrocarbons contained in such Gas but not including oil.

1.2 The term "Btu" shall mean one (1) British thermal unit, the amount of heat

required to raise the temperature of one (1) pound of water one (1) degree

Fahrenheit at sixty (60) degrees Fahrenheit. (Btu is measured on a dry basis

at 14.73 psia.)

1.3 The term "Maximum Daily Quantity" shall mean the aggregate of the Maximum Daily

Volumes of Gas, expressed in Dth per day, which U-TOS, subject to Rate Schedules

FT and IT and the terms and provisions of the Transportation Agreement executed

by U-TOS and the Shipper, has agreed to accept for transportation for the

account of Shipper from the Points of Receipt as set forth in Exhibit A of the

Transportation Agreement.

1.4 The term "Central Time" shall mean Central Clock Time, which includes the

recognition of Daylight Savings Time.

1.5 The term "Day" or "Gas Day" shall mean a period of 24 consecutive hours, ending

at 9:00 a.m. Central Time.

1.6 The term "Equivalent Volumes" shall mean the sum of the volumes of Gas,

expressed in Dth, received by U-TOS for the account of shipper at the Points of

Receipt identified in Exhibit A of the Transportation Agreement during any given

period of time, (a) reduced by (i) Shipper's Share of compressor fuel and the

Unaccounted For Gas determined by multiplying Shipper's nominated volume for

that same period of time by the ratio of U-TOS' total system compressor fuel and

Unaccounted For Gas volume during the three consecutive calendar months that

immediately precede the calendar month before such period of time to U-TOS'

total system received volume during the same three calendar months (it being the

intent that the ratio used best projects U-TOS' actual compressor fuel and

Unaccounted For Gas volume), and (ii) any Gas vented as provided for in Section

7.13 during the same period of time and (b) adjusted for any variations in Btu

content, it being the intent of the parties that the volumes of Gas redelivered

at the Point of Delivery set forth in Exhibit A of the Transportation Agreement

be the thermal equivalent of the volumes of Gas delivered at the Points of

Receipt of such Transportation Agreement for transportation, as adjusted in (a)

above. In the event the ownership of Gas lost as a result of an event of force

majeure can be reasonably identified, the volume thereof shall be charged to the

owner or owners so identified. With respect to adjustment (a)(i) above, where

the given period of time under consideration is greater than one calendar month,

each calendar month shall be considered discretely such that the nomination for

each calendar month, or part thereof, shall be multiplied by the ratio derived

pursuant to (a)(i) for each corresponding calendar month.

1.7 The term "F.E.R.C." or "Commission" shall mean the Federal Energy Regulatory

Commission or any Commission, agency or other federal governmental body

succeeding substantially to the powers of such Commission.

1.8 The term "Gas" shall mean natural gas, including casinghead gas produced with

crude oil, gas from gas wells and gas from condensate wells.