K N Interstate Gas Transmission Co.

Second Revised Volume No. 1-A

Effective Date: 11/01/1994, Docket: RP94-397-000, Status: Effective

First Revised Sheet No. 43 First Revised Sheet No. 43 : Superseded

Superseding: Original Sheet No. 43

RATE SCHEDULE IT - continued

Imbalance as Rate as a % of Average Market Index*

% of Actual Deliveries K N Charge K N Credit

---------------------- -------------- ---------------------

More than 10% 125% 75%

* Average of the first of month and mid-month market indices

defined as the average of 1) the first of month index and the

mid-point of the aftermarket range for CIG as reported by

"Inside FERC Gas Market Report" and 2) average of the weighted

monthly average of all weekly surveys for CIG in "Natural Gas

Intelligence" for the month in which the imbalance occurred.

(5) Any imbalance less than ten percent (10%) tolerance remaining

upon expiration of an IT agreement will be cashed out at the

index price defined above.

5.3 Shipper shall reimburse Transporter for:

a. ADDITIONAL FACILITY CHARGE. When Transporter in its

reasonable discretion agrees to add new facilities or expand

existing facilities, including compression, in order to

provide service, Transporter will require:

(1) A contribution-in-aid of construction associated with

such facilities, including a gross-up for applicable

state and federal income tax expense; and/or

(2) A reimbursement schedule setting the terms, the rate, and

the conditions for reimbursement of the additional

facility charge, including an obligation to reimburse

Transporter, upon demand, for any unamortized capital

charges, under an agreed upon amortization schedule,

which may remain if service by Transporter to Shipper

under this rate schedule is terminated prior to the end

of said amortization period.