Order 637 compliance update

As we're beginning to see the second wave of Order 637 proceeding technical
conferences being scheduled, here is a brief update on the proposed
timetables for the first few dockets. As December kicks off, we are in a
settlement mode in all the cases, with most pipelines in informal discussions
with customers/parties to work towards consensus settlements that can be
filed with the Commission.

** Note that Koch, adamant that segmentation is not operationally feasible on
its system, has circulated a settlement proposal on segmentation. See below.

ANR, RP00-332:

After three technical conferences at FERC, ANR is committed to developing a
total consensus document. ANR is circulating their latest revisions to
customers by December 7th, and customers are meeting without the Commission
or the pipeline to discuss ANR's proposal on December 15th. A follow-up
technical conference at FERC is scheduled for January 11, 2001.

Dominion, RP00-344:

Dominion has held at least five meetings with customers to work out a
settlement in this case. A technical conference, originally scheduled for
late October, has been rescheduled with FERC Staff for December 14th. This
should be a meeting on a settlement proposal.

Koch, RP00-340:

Koch has circulated revisions to its Order 637 filing, including a settlement
proposal for segmentation. There will be a conference call among Koch and
its customers on December 5th to get comments on the tariff revisions as
discussed at the October 25th technical conference and the new segmentation
proposal. After that call, a follow-up technical conference at FERC should
be scheduled for sometime in January.

[The segmentation proposal would allow customers broader supplemental rights
in the zones in which their primary receipt and primary delivery points are
located. When points are located in different zones, the customer would be
entitled to utilize its full MDQ in each zone (in essence doubling their
MDQ). It's critical to Koch's offer that all segmented transactions will be
scheduled on a supplemental basis, as this is the only protection for the
operational integrity of its system and primary firm services of other
customers. The right to segmentation can be waived by customers and it will
be available on a prospective basis only for new or renegotiated contracts.
Koch is also proposing a "segmentation fee" to be assessed either to those
customers utilizing segmentation or by all Koch customers (undecided in the
proposal). This fee will be used to recover all costs associated with
developing the segmentation program and necessary computer system.]

Colorado Interstate, RP00-325:

CIG will circulate revisions by December 1st to its compliance filing as
discussed at the pipeline's second technical conference on October 26th.
Parties will send comments to CIG by December 10th. The schedule, from that
point, will go into January. CIG may follow Dominion's lead and schedule
settlement meetings with parties before meeting with Staff again.

Tennessee, RP00-477:

Tennessee is circulating revisions based on discussions at the November 14th
technical conference by December 8th. Parties will meet within two weeks of
that date to discuss the revisions (either separately or at a FERC technical
conference).

Kinder Morgan, RP00-343:

Kinder Morgan plans to circulate a revised 637 package by December 15th, with
a conference call scheduled for January 4th to get feedback from customers on
the revisions. The pipeline believes there may not be a need for a second
technical conference and hopes to file a settlement and implementation plan
by the end of January.