Alabama-Tennessee Natural Gas Company

Second Revised Volume No. 1

Effective Date: 06/01/1997, Docket: RP97-165-001, Status: Effective

First Revised Sheet No. 52 First Revised Sheet No. 52 : Superseded

Superseding: ORIGINAL SHEET NO. 52

RATE SCHEDULE IT (continued)

general system rates. The applicable Incidental Charges

shall be stated in the IT Contract.

5.4 Imbalance Charge: In addition to the charges in Sections

5.1, 5.2 and 5.3, Transporter may charge Shipper an

Imbalance Charge as provided in Section 3 of the General

Terms and Conditions.

5.5 Take-or-Pay Charge: If applicable, Transporter shall

charge Shipper each month the Volumetric Take-or-Pay

Surcharge as shown on the currently effective Tariff Sheet

No. 4A.

5.6 Transition Cost: If applicable, Transporter shall charge

Shipper each month the amount of transition cost, as

determined pursuant to Section 33 of the General Terms and

Conditions of Transporter's FERC Gas Tariff.

6. FUEL AND LOSSES

Included in each of Shipper's nominations for transportation

shall be the quantity of gas required for Transporter's system

fuel and losses ("Fuel Quantity"), associated with rendering

transportation service pursuant to this Rate Schedule. The Fuel

Quantity shall be calculated by multiplying the Fuel Retention

Factor shown on the effective Tariff Sheet No. 4 times the

quantity of gas nominated for transportation pursuant to this

Rate Schedule with the result of this calculation rounded to the

nearest whole dekatherm [(1-Fuel Retention Factor % / 100) x

Receipt Quantity = Delivery Quantity]. The winter and summer

Fuel Quantity shall be separately stated. Transporter may

redetermine the Fuel Retention Factor, such redetermination to

be effective January 1 of any year, by filing revised tariff

sheets and supporting workpapers with the FERC.