K N Interstate Gas Transmission Co.

Third Revised Volume No. 1-B

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Effective Date: 01/01/1997, Docket: RP97- 81-001, Status: Effective

Substitute Original Sheet No. 89 Substitute Original Sheet No. 89 : Superseded

Superseding: Original Sheet No. 89

GENERAL TERMS AND CONDITIONS FOR SERVICES - continued

36. NEGOTIATED RATES

36.1 Transporter and Shipper may mutually agree in

writing to a Negotiated Rate for service under any

rate schedule contained in Transporter's Tariff. A

Negotiated Rate shall mean a rate or rate formula

for service, the individual components of which may

exceed the maximum reservation charge, if

applicable, or commodity charge, and/or be less

than the minimum commodity charge as shown on Sheet

No. 4 of Volume 1-A of Transporter's Tariff for

that service. ransporter's Recourse Rate is

available to any Shipper that does not desire to

negotiate a rate with Transporter. Transporter

shall make any filings at the FERC necessary to

effectuate a Negotiated Rate.

36.2 For purposes of curtailment of interruptible

services pursuant to Section 16.3 and for

scheduling interruptible services pursuant to

Section 22.6, Shippers which have agreed to pay a

Negotiated Rate which exceeds the maximum tariff

rate, when calculated on a 100 percent load factor

basis, will be considered to be paying the maximum

Recourse Rate. For purposes of exercising the right

of first refusal pursuant to Section 18, the

highest rate the original firm Shipper must match

if it wishes to continue its firm service is the

maximum Recourse Rate applicable to such service.