Puget Sound Energy, Inc.

Original Volume No. 1

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Effective Date: 01/03/2004, Docket: RP04-100-000, Status: Effective

Original Sheet No. 97 Original Sheet No. 97 : Effective




to the




1. The Owners intend to have a single project, phased-in over up to seven

water withdrawal/gas injection cycles, beginning in 2002 and finishing

in 2008, which is intended to expand the Jackson Prairie cushion and

working gas capacity by a total of approximately 10.5 Bcf. This project

shall be known as the "2002 - 2008 Expansion Project."


2. During the expansion phases of the 2002 - 2008 Expansion Project, the

Owners' respective Shares of Storage Service Rights, but not their

respective Ownership Percentages, may vary. Although at this time, it

is the Owners' intent that the 2002 - 2008 Expansion Project shall go

forward on an equal ownership basis among the Owners, upon completion of

the 2002 - 2008 Expansion Project, it is possible that the Owners'

Storage Service Rights and their Ownership Percentages may not be equal,

as discussed further in paragraph 8 hereof.


3. Commencing in 2002, on or before July 15th of each year, the Project

Operator will provide written notice to each of the Owners as to the

expected amount of water withdrawal and as to each Owner's expected 1/3

share of cushion and working gas additions required for the next water

withdrawal and injection period (March through October of the next

calendar year). By July 31st of each year, each Owner will notify, in

writing, the Project Operator of its intent either to participate in the

next expansion phase or not to participate. If any Owner elects not to

participate or fails to notify the Project Operator, such Owner will be

deemed to be a Deferring Party.


4. If any Owner elects not to participate and not to inject its one-third

share of the applicable cushion and working gas for that water

withdrawal and injection period, then the remaining Owners have the

right to develop for their account(s) the Deferring Party's deferred