Alabama-Tennessee Natural Gas Company

Second Revised Volume No. 1

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

First Revised Sheet No. 85 First Revised Sheet No. 85 : Superseded

Superseding: ORIGINAL SHEET NO. 85

GENERAL TERMS AND CONDITIONS (continued)

of ten per cent (10%) or 50 Dth of the scheduled daily

quantity applicable to that Delivery Point as

specified in the Customer Nomination Form(s). On any

day that such a party takes gas in excess of the daily

limit applicable to that Delivery Point, without the

prior consent of Transporter, such party shall be

subject to an Unauthorized Overrun Charge of fifteen

dollars ($15.00) for each Dth of excess volumes taken

or delivered beyond the greater of ten percent (10%)

or 50 Dth allowable variation.

(c) Monthly Imbalances - Unless Transporter and the

applicable OBA Party, or Shipper in the case of

deliveries to a point not covered by an OBA, mutually

agree to an alternate method, each month Transporter

and the OBA Party shall Cash-Out any imbalance

between deliveries and scheduled nominations at the

Delivery Point(s) as provided under Section 3.7(d)

herein. Transporter shall divide the monthly

imbalance by the sum of all scheduled nominations for

all days of the month for each Delivery Point(s)

covered by the OBA to determine the percentage

monthly imbalance for the purpose of the Cash-Out as

set forth hereinafter.

(d) Cash-Out Provision - As soon as practicable following

the end of each month, Transporter shall send each OBA

Party, or each Shipper in the case of deliveries to a

point not covered by an OBA, a statement detailing the

daily and/or monthly imbalance quantity, the credit

due the Shipper or OBA Party if deliveries are less

than scheduled nominations, or a bill for the amount

due Transporter if deliveries are greater than

scheduled nominations, subject to the Billing and

Payment Articles set forth under the General Terms

and Conditions of Transporter's FERC Gas Tariff.

Transporter shall determine the Cash-Out price,

before adjustments, for each upstream pipeline that

has interconnecting facilities with Transporter in

accordance with the Cash-Out procedures under the

currently effective tariff of each such upstream

pipeline. A Cash-Out price shall be determined for

each Delivery Point on Transporter. The Cash-Out

price shall be a weighted average price determined by

calculating a supply percentage for each such

upstream pipeline based upon the amount of gas