Alabama-Tennessee Natural Gas Company

Second Revised Volume No. 1

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

Original Sheet No. 96A Original Sheet No. 96A : Superseded

GENERAL TERMS AND CONDITIONS (continued)

3.13 Determination of Successful Bidder

Transporter shall determine the successful Bidder in

accordance with the following procedures:

(a) Bid evaluation methodologies: The Releasing Shipper

shall specify in the Release Request one of the

following bid evaluation methodologies: (i) highest

rate, (ii) maximum net revenue, or (iii) highest

present value. A Release Request may specify a

different bid evaluation methodology, but such

alternate methodology may, delay the award of the

capacity. If Releasing Shipper fails to specify a bid

evaluation methodology, then Transporter will use the

maximum net revenue methodology to evaluate any bids

received and accepted which meet Releasing Shipper's

minimum requirements specified in the Release Request.

(b) Net revenue method: If the net revenue ("NR") method is

chosen, Transporter shall determine the bid or bids

having the highest NR using the following formula:

NR = (Bid Rate) X (Bid Term) X (Bid MDQ)

where

Bid Rate = the reservation charge which Bidder

has agreed to pay; for volumetric bids the rate

is calculated by multiplying the bid rate by

30.4167 (average days per month in a 365 day

year).

Bid Term = the term proposed by the bidder, in

months.

Bid MDQ = the MDQ stated in the Bid.