Alabama-Tennessee Natural Gas Company

Second Revised Volume No. 1

Effective Date: 09/01/1993, Docket: RS92- 27-003, Status: Effective

Original Sheet No. 135 Original Sheet No. 135 : Superseded

GENERAL TERMS AND CONDITIONS (Continued)

reflect changes in that rate resulting from

increases or decreases billed by its upstream gas

pipeline supplier(s) or changes in Transporter's

through-put. Further, at the end of the five (5)

year period, Transporter shall compare the amount

collected by the Volumetric Take-Or-Pay Surcharge

to the amount to be recovered through that

surcharge and either bill or refund any over-or-

under recovery on a pro rata basis. Such

adjustment shall not include any amounts which are

uncollected because of discounting of

Transporter's interruptible transportation rates.

(e) Transporter shall be entitled to carrying charges

computed consistent with the method used by

Tennessee as approved by the Commission, on the

difference between amounts recovered by

Transporter and the total amount to be recovered

from Transporter's jurisdictional business.

26.2 Refunds: Any refund of take-or-pay amounts received by

Transporter from Tennessee will be refunded to

Transporter's customers on the same basis as the

refunded amount, including carrying charges, was

collected from the customers.

26.3 Payment: The amount of each jurisdictional customer's

Take-or-Pay Charge, as calculated pursuant to Section

26.1 above, shall be due and payable consistent with

the method described in Section 6.1 of General Terms

and Conditions of Transporter's FERC Gas Tariff,

Original Volume No. 1.

27. CONVERSION OF FIRM CONTRACTS

27.1 Upon the effective date of Transporter's filing in FERC

Docket No. RS92-27, any Buyer receiving service under

Transporter's Rate Schedule G as of November 1, 1992,

Rate Schedule SG as of May 18, 1992 or which had a Firm

Direct Sales Contract as of May 18, 1992 shall convert

its full sales contract entitlement under said sales

Rate Schedule to firm transportation service and shall

execute an FT or FT-SG Contract, as applicable, in

accordance with the provisions of Transporter's Rate

Schedule FT or FT-SG.