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North Baja Pipeline, LLC
FERC Gas Tariff
Original Volume No. 1

Original Sheet No. 104

                   GENERAL TERMS AND CONDITIONS OF SERVICE
                                 (Continued)

1.  DEFINITIONS (Continued)

    1.25  Forward Haul:  The term "Forward Haul" shall refer to 
          transportation service on NBP's system in which the nominated 
          direction of flow from receipt point to delivery point is in the 
          same direction as physical gas flow on the NBP system. 

    1.26  Backhaul:  Transportation service on NBP's system in the opposite 
          direction of a Forward Haul as defined in Paragraph 1.25 above. 

    1.27  Primary Path:  The transportation path established by the receipt 
          and delivery points as set forth in Shipper's executed Service 
          Agreement.  A Shipper's Primary Path may be either a Forward Haul 
          or a Backhaul as defined in Paragraphs 1.25 and 1.26 above.

    1.28  Reverse Path:  The transportation path that is in the opposite 
          direction of that Shipper's Primary Path as defined in Paragraph 
          1.27 above.  A Shipper's Reverse Path may be either a Forward Haul 
          or a Backhaul as defined in Paragraphs 1.25 and 1.26 above.  
          Reverse Path transactions rely upon secondary point rights and are 
          subject to the operating conditions of NBP's pipeline and will not 
          be made available to Shipper if NBP determines, in its sole 
          discretion, that such transportation is operationally infeasible 
          or otherwise not available.

     1.29 Negotiated Rate:  A rate (including a Negotiated Rate Formula) 
          that NBP and a Shipper have agreed will be charged for service 
          under Rate Schedules FTS-1, ITS-1, or PAL-1 where, for all or a 
          portion of the contract term, one or more of the individual 
          components of such rate may exceed the maximum rate, or be less 
          than the minimum rate, for such component set forth in NBP's 
          tariff for the given service.  Any Agreement entered into after 
          the effective date of this subsection which provides for a rate 
          under Rate Schedules FTS-1, ITS-1, PAL-1 other than the applicable 
          maximum rate shall contain a provision setting out the mutual 
          agreement of the parties as to whether the pricing terms represent 
          a discounted rate or a negotiated rate. 

                                                                  (Continued)

Issued by: John A Roscher, Director of Rates & Regulatory Affairs
Issued on: June 6, 2002                       Effective on: August 12, 2002
Filed to comply with order of the Federal Energy Regulatory Commission, Docket 
No. CP01-22-000, et al., issued May 18, 2001, 95 FERC ¶ 61,259
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