Caledonia Gas And Storage

Original Volume No. 1

Effective Date: 12/05/2007, Docket: RP08- 57-000, Status: Effective

First Revised Sheet No. 53 First Revised Sheet No. 53 : Effective

Superseding: Superseding Original Sheet No. 53

11. FUEL REIMBURSEMENT

11.1 Categories of Fuel Usage. Fuel usage is comprised of fuel utilized

and lost and unaccounted for volumes to the extent required for the operation

and maintenance of Caledonia’s Facility.

11.2 Fuel Reimbursement. Fuel Reimbursement shall be calculated

separately for services under FSS, ISS and ILS Rate Schedules. Each Fuel

Reimbursement charge shall be negotiated by Caledonia and Customer.

Reimbursement of fuel must be made in kind (as a percentage of injection in

Dth), as set forth in Customer’s Service Agreement(s).

12. TITLE AND RISK OF LOSS

(a) Title. Customer warrants that it will have good title to all natural

gas delivered to Caledonia for storage, and that such Gas will be free and

clear of all liens, encumbrances and claims whatsoever, and that it will

indemnify Caledonia and save it harmless from all suits, actions, debts,

amounts, damages, costs, losses and expenses arising from or out of adverse

claims of any and all persons to said Gas.

(b) Risk of Loss. As between Customer and Caledonia, Customer shall be in

control and possession of the Gas prior to Delivery to Caledonia for injection

at the Point(s) of Receipt and after at the Point(s) of Delivery, and shall

indemnify and hold Caledonia harmless from any damage or injury caused

thereby. Caledonia shall be in control and possession of the Gas after the

Delivery of the same for injection at the Point(s) of Receipt and until

Delivery by Caledonia to Customer at the Point(s) of Delivery, and shall

indemnify and hold Customer harmless from any damage or injury caused thereby,

except for damages and injuries caused by the sole negligence of Customer.

The risk of loss for all Gas injected into, stored in and withdrawn from

storage shall remain with Customer, and Caledonia shall not be liable to

Customer for any loss of Gas, except as may be occasioned due to the

intentional or grossly negligent acts or omissions of Caledonia. Any losses

of Gas, unless due to the intentional or grossly negligent acts or omissions

of Caledonia, shall be shared proportionately by all Customers. Customer

retains title to Gas at all times.

13. GAS TITLE TRANSFERS

13.1 Title Transfers of Gas in Storage.

(a) A Customer that has executed a Service Agreement under FSS and ISS

Rate Schedules may sell Storage Inventory to any other Customer that has

executed a Service Agreement under FSS, AISS and ISS Rate Schedules or AILS

and ILS Rate Schedules if related to a return of a prior loan of Gas

if:

(i) Customer selling Storage Inventory provides notification to

Caledonia’s dispatcher prior to the nomination deadline and provides Caledonia

with written verification of the transfer within three business Days;

and