System Operations Overview System Changes Physical Constraints Gas Distribution System 2003/2004 Scheduling Guidelines OFOs and Curtailment System Changes Physical Constraints Gas Distribution System 2003/2004 Scheduling Guidelines OFOs and Curtailment

2 System Changes CG&E/ULHP Peak Day coverage for 2003/2004 is 1,010,000 dth Peak Hr. Coverage for 2003/2004 is 46,855 dth C.G.T. (South) limited to 25,000 dth/hr No Hourly Flexibility on TET or ANR Limited Flexibility on Texas Gas Lost Flexibility on F/L A due to customer growth Peak Day coverage for 2003/2004 is 1,010,000 dth Peak Hr. Coverage for 2003/2004 is 46,855 dth C.G.T. (South) limited to 25,000 dth/hr No Hourly Flexibility on TET or ANR Limited Flexibility on Texas Gas Lost Flexibility on F/L A due to customer growth

Physical Constraints CG&E For RFT and FT Deliveries 55% South 45% North (Dec - Feb) Based on Peak Day Design March - Nov there are currently no restrictions between North and South deliveries ULH&P FT Deliveries must be in the South For RFT and FT Deliveries 55% South 45% North (Dec - Feb) Based on Peak Day Design March - Nov there are currently no restrictions between North and South deliveries ULH&P FT Deliveries must be in the South

INDIANA OHIO TET TGT OHIO RIVER CGT ANR LAWRENCEBURG STATION BROOKVILLE STATION SPRINGBORO STATION DICKS CREEK FERNALD STATION COLD SPRING STATION ALEXANDRIA STATION RED LION LEBANON BUTLER UNION RD. MILLVILLE TRENTON AREA 6 AREA 7 CG&E-ULH&P-LGC PENDLETON COUNTY * * * * * * * * * * COLUMBIA "E" L I N E CENTERVILLE STATION AND. FERRY STATION CALIFORNIA STATION /TET LIBERTY RISING SUN STATION GUILFORD STATION BRIGHT STATION HARRISON VENICE STATION F & ROSE EAST. AVE 3 M I LE T/L "A". T/L "AA". T/L "W". T/L "C148". T/L "CG4". T/L "V". T/L "AM7". ERLANGER T/L "AM 4". T/L "AM". T/L "AM 7". CNG * FOSTER TET - Texas Eastern Transmission CGT - Columbia Gas Transmission TGT - Texas Gas Transmission KO - Kentucky-Ohio Transmission CNG - Consolidated Natural Gas ANR - American Natural Resources CVG Null Gas Flow Null Huntsville Norwood 150 psig 225 psig MAOP 175 psig 120 psig 200 psig 175 psig 355 psig 500 psig F/L SS". F/L WW". Blanchester

5 INDIANA OHIO TET TGT OHIO RIVER CGT ANR LAWRENCEBURG STATION BROOKVILLE STATION SPRINGBORO STATION DICKS CREEK FERNALD STATION COLD SPRING STATION ALEXANDRIA STATION RED LION LEBANON BUTLER UNION RD. MILLVILLE TRENTON AREA 6 AREA 7 CG&E-ULH&P-LGC With C-314 PENDLETON COUNTY * * * * * * * * * * COLUMBIA "E" L I N E CENTERVILLE STATION AND. FERRY STATION CALIFORNIA STATION /TET LIBERTY RISING SUN STATION GUILFORD STATION BRIGHT STATION HARRISON VENICE STATION F & ROSE EAST. AVE 3 M I LE T/L "A". F/L "A". T/L "AA". T/L "W". T/L "C148". T/L "CG4". T/L "V". T/L "AM7". ERLANGER T/L "AM 4". T/L "AM". T/L "AM 7". CNG * FOSTER TET - Texas Eastern Transmission CGT - Columbia Gas Transmission TGT - Texas Gas Transmission KO - Kentucky-Ohio Transmission CNG - Consolidated Natural Gas ANR - American Natural Resources CVG Huntsville Norwood 150 psig 225 psig MAOP 175 psig 120 psig 200 psig 175 psig 355 psig 500 psig Blanchester F/L "A". F/L C-314". 700 psig MAOP F/L WW". F/L SS". 150 psig New Texas Gas Tap New System Station

South Nomination Guidelines Columbia Gulf /C.G.T./Tennessee/KO Transmission Delivery Point Capacity –522,000 dth/day maximum –Dec - Feb RFT & FT marketers will have to deliver 55% of their supply in the South –I.T. customers may have firm capacity on pipelines but not behind city gate - curtailable on peak days or capacity constraints Columbia Gulf /C.G.T./Tennessee/KO Transmission Delivery Point Capacity –522,000 dth/day maximum –Dec - Feb RFT & FT marketers will have to deliver 55% of their supply in the South –I.T. customers may have firm capacity on pipelines but not behind city gate - curtailable on peak days or capacity constraints

North Nomination Guidelines Texas Gas/ Texas Eastern/ANR Delivery Point Capacity –280,000 dth/day maximum total (includes Lebanon Lateral) –Dec - Feb RFT & FT marketers will have to deliver 45% of their supply in the North –CG&E has 100,000 dth/day of station capacity available at Dicks Creek served from Texas Easterns Pipeline –Best delivery point for I.T. customers Texas Gas/ Texas Eastern/ANR Delivery Point Capacity –280,000 dth/day maximum total (includes Lebanon Lateral) –Dec - Feb RFT & FT marketers will have to deliver 45% of their supply in the North –CG&E has 100,000 dth/day of station capacity available at Dicks Creek served from Texas Easterns Pipeline –Best delivery point for I.T. customers

ANR/Texas Eastern (Lebanon Lateral) Scheduling Guidelines FT and RFT Marketers have 50,000 dth/d available Nov-Mar Capacity Request Form must be completed Deliveries for I.T. Customers Nov - Mar is best effort day to day Apr - Oct 20,000 dth/d max FT and RFT Marketers have 50,000 dth/d available Nov-Mar Capacity Request Form must be completed Deliveries for I.T. Customers Nov - Mar is best effort day to day Apr - Oct 20,000 dth/d max

Operational Flow Orders I.T. Customers When warmer than normal weather occurs, especially in Nov and Dec (storage injection limits are at minimum) –Gas nominated must be at or below usage for the day When colder than normal weather occurs, (may be issued when average temperatures are below 20 degrees) –Gas nominated must be at or above usage for the day When warmer than normal weather occurs, especially in Nov and Dec (storage injection limits are at minimum) –Gas nominated must be at or below usage for the day When colder than normal weather occurs, (may be issued when average temperatures are below 20 degrees) –Gas nominated must be at or above usage for the day

Curtailment I.T. Customers Curtailment may start at a low temp of about 0 degrees with 4 levels of curtailment. Other factors to consider –wind speed –day of week –temperature lag –Gulf freeze offs Curtailment in the eastern part of the system may occur at warmer temperatures. Curtailment may start at a low temp of about 0 degrees with 4 levels of curtailment. Other factors to consider –wind speed –day of week –temperature lag –Gulf freeze offs Curtailment in the eastern part of the system may occur at warmer temperatures.