Tennessee Gas Pipeline Company


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Effective Date: 10/01/2003, Docket: RP00-477-005, Status: Effective

Tenth Revised Sheet No. 209 Tenth Revised Sheet No. 209 : Effective

Superseding: Eighth Revised Sheet No. 209


Schedule LMS - MA

Load Management Service - Market Area (continued)


For purposes of determining the tier at which an imbalance will be cashed

out, the price will apply only to volumes within a tier. For example, if

there is a 7% imbalance, volumes that make up the first 5% of the

imbalance are priced at 100% of the LP. Volumes making up the remaining

2% of the imbalance are priced at 85% of the LP.


(d) Access to Information - Upon request, Transporter will make available

within one business day following the production day the best information

it has concerning the total physical deliveries at applicable delivery

points. In addition, Transporter will make available by electronic means

the best information it has concerning the scheduled and allocated

deliveries at all of Operator's delivery points. No later than 11:00 a.m.

Central Time on the first full business day following the production day,

this information regarding the scheduled and allocated deliveries shall

become "Operational Data" and Operators will be entitled to rely on the

Operational Data for purposes of correcting imbalances during the month.

Imbalances will be cashed out on the basis of actual deliveries and

scheduled quantities; provided that the penalty level and pricing

associated with imbalances will be based upon the lesser of (1) the

monthly operational imbalance reported by Transporter based upon the

Operational Data or (2) the monthly imbalance based upon actual receipts

and deliveries at such locations.


(e) Limitation on Penalties - Any imbalances caused by an event which excuses

performance under Article X of the General Terms and Conditions or caused

by an action of Transporter, will not be included in the calculation of

the % monthly imbalance for purposes of determining the appropriate cash

out level of this Rate Schedule.


(f) If Transporter, from time to time, uses temporary third party storage and

associated transportation service to balance its system or to avoid

circumstances which would require restrictions on gas flows, Transporter

shall post on PASSKEY twice per calendar year its need for such

additional storage and the specific area where the assistance is needed.

Transporter shall accept competitive bids to meet its need and post the

results of the auction.


(g) Disposition of Net Cashout Balance


(i) On an annual basis for the period commencing September 1 and ending

August 31 ("Annual Cashout Period"), Transporter shall determine

its Net Cashout Balance and file with the Commission a Cashout

Report stating that balance by November 30 immediately following

the Annual Cashout Period. Transporter will calculate its Net

Cashout Balance in accord with that certain Stipulation and

Agreement in Docket Nos. RP95-64 et al., filed on March 25, 1999

and approved by Commission order dated April 28, 1999 ("Cashout

Settlement"). Pursuant to the Cashout Settlement, the following

items are the only items to be included in the calculation of

Transporter's Net Cashout Balance:


Item No. 1. Net Annual Cashout Activity: For the Annual Cashout

Period, Tennessee shall determine its Net Cashout Activity. Net

Cashout Activity is defined as: (a) the net revenue or net cost

experienced by Tennessee from all monthly cashout sales and

purchases pursuant to Rate Schedules LMS-MA and LMS-PA of this FERC

Gas Tariff (collectively, "LMS Rate Schedules") [including the

revenues received and costs avoided pursuant to application of the

cashout penalty provisions under Sections 7(c)(vii)(C) and (D) of

Rate Schedule LMS-MA and Sections 7(d)(iii) and (iv) of Rate

Schedule LMS-PA] and (b) the net quantity in dekatherms of gas sold

or purchased, pursuant to the LMS Rate Schedules (i.e. the quantity

by which cashout sales exceed