EXHIBIT 10.h

CONFORMED COPY

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EL PASO NATURAL GAS COMPANY

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$400,000,000
REVOLVING CREDIT AND COMPETITIVE
ADVANCE FACILITY AGREEMENT

DATED AS OF MAY 31, 1996

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CHEMICAL BANK,
AS ADMINISTRATIVE AGENT
AND CAF ADVANCE AGENT

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M-i

TABLE OF CONTENTS

Page
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ARTICLE I

DEFINITIONS AND ACCOUNTING TERMS . . . . . . . . . . . . . . . . 1
SECTION 1.1 Certain Defined Terms . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
SECTION 1.2 Computation of Time Periods . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
SECTION 1.3 Accounting Terms . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
SECTION 1.4 References . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16

ARTICLE II

AMOUNTS AND TERMS OF THE ADVANCES . . . . . . . . . . . . . . . . 16
SECTION 2.1 The Revolving Credit Advances . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
SECTION 2.2 Revolving Credit Notes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
SECTION 2.3 Making the Revolving Credit Advances . . . . . . . . . . . . . . . . . . . . . . . 17
SECTION 2.4 CAF Advances . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
SECTION 2.5 Procedure for CAF Advance Borrowings . . . . . . . . . . . . . . . . . . . . . . . 19
SECTION 2.6 CAF Advance Payments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
SECTION 2.7 CAF Advance Notes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
SECTION 2.8 Fees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
SECTION 2.9 Reduction of the Commitments . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
SECTION 2.10 Repayment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
SECTION 2.11 Interest on Revolving Credit Advances . . . . . . . . . . . . . . . . . . . . . . . 24
SECTION 2.12 Additional Interest on Eurodollar Rate Advances . . . . . . . . . . . . . . . . . . 25
SECTION 2.13 Interest Rate Determination . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
SECTION 2.14 Voluntary Conversion of Advances . . . . . . . . . . . . . . . . . . . . . . . . . 27
SECTION 2.15 Prepayments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
SECTION 2.16 Increased Costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
SECTION 2.17 Increased Capital . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
SECTION 2.18 Illegality . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
SECTION 2.19 Payments and Computations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
SECTION 2.20 Taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
SECTION 2.21 Sharing of Payments, Etc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
SECTION 2.22 Use of Proceeds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35

ARTICLE III

CONDITIONS OF EFFECTIVENESS AND LENDING . . . . . . . . . . . . . . . 35
SECTION 3.1 Conditions Precedent to Effectiveness of this Agreement . . . . . . . . . . . . . . 35
SECTION 3.2 Conditions Precedent to Initial Advances
to Any Borrowing Subsidiary or Holding . . . . . . . . . . . . . . . . . . . . . 36
SECTION 3.3 Conditions Precedent to Each Borrowing . . . . . . . . . . . . . . . . . . . . . . 37

ARTICLE IV

REPRESENTATIONS AND WARRANTIES . . . . . . . . . . . . . . . . . 38
SECTION 4.1 Representations and Warranties of the Borrowers . . . . . . . . . . . . . . . . . . 38

ARTICLE V

COVENANTS OF THE BORROWERS . . . . . . . . . . . . . . . . . . 41
SECTION 5.1 Affirmative Covenants . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
SECTION 5.2 Negative Covenants . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43
SECTION 5.3 Reporting Requirements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46
SECTION 5.4 Restrictions on Material Subsidiaries . . . . . . . . . . . . . . . . . . . . . . . 49

ARTICLE VI

GUARANTEE . . . . . . . . . . . . . . . . . . . . . . 49
SECTION 6.1 Guarantees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
SECTION 6.2 No Subrogation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50
SECTION 6.3 Amendments, etc. with respect to the Obligations; Waiver of Rights . . . . . . . . 51
SECTION 6.4 Guarantee Absolute and Unconditional . . . . . . . . . . . . . . . . . . . . . . . 51
SECTION 6.5 Reinstatement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 52

ARTICLE VII

EVENTS OF DEFAULT . . . . . . . . . . . . . . . . . . . . 53
SECTION 7.1 Event of Default . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 53

ARTICLE VIII

THE ADMINISTRATIVE AGENT AND THE CAF ADVANCE AGENT . . . . . . . . . . . . 56
SECTION 8.1 Authorization and Action . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 56
SECTION 8.2 Administrative Agent's and CAF Advance Agent's Reliance, Etc. . . . . . . . . . . . 57
SECTION 8.3 Chemical and Affiliates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 57
SECTION 8.4 Lender Credit Decision . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 58
SECTION 8.5 Indemnification . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 58
SECTION 8.6 Successor Administrative Agent and CAF Advance Agent . . . . . . . . . . . . . . . 58

ARTICLE IX

MISCELLANEOUS . . . . . . . . . . . . . . . . . . . . . 59
SECTION 9.1 Amendments, Etc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 59
SECTION 9.2 Notices, Etc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 60
SECTION 9.3 No Waiver; Remedies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 60
SECTION 9.4 Costs and Expenses; Indemnity . . . . . . . . . . . . . . . . . . . . . . . . . . . 60
SECTION 9.5 Right of Set-Off . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 62
SECTION 9.6 Binding Effect . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 62
SECTION 9.7 Assignments and Participations . . . . . . . . . . . . . . . . . . . . . . . . . . 62
SECTION 9.8 Confidentiality . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 65
SECTION 9.9 Consent to Jurisdiction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 66
SECTION 9.10 GOVERNING LAW . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 67
SECTION 9.11 Rate of Interest . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 67
SECTION 9.12 Effect on Outstanding CAF Advances . . . . . . . . . . . . . . . . . . . . . . . . 67
SECTION 9.13 Execution in Counterparts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 68

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SCHEDULE

Schedule I Commitments, Addresses, Etc.

EXHIBITS

Exhibit A Form of Revolving Credit Note
Exhibit B Form of Notice of Borrowing
Exhibit C Form of CAF Advance Note
Exhibit D Form of CAF Advance Request
Exhibit E Form of CAF Advance Offer
Exhibit F Form of CAF Advance Confirmation
Exhibit G Form of Assignment and Acceptance
Exhibit H Form of Opinion of [Associate] General Counsel
of the Company
Exhibit I Form of Opinion of New York Counsel to the Company
Exhibit J Form of Process Agent Letter
Exhibit K Form of Joinder Agreement
Exhibit L Form of Opinion of [Associate] General Counsel of
the Company
Exhibit M Form of Opinion of New York Counsel to the Company

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$400,000,000 REVOLVING CREDIT AND COMPETITIVE ADVANCE FACILITY
AGREEMENT, dated as of May 31, 1996, among EL PASO NATURAL GAS COMPANY, a
Delaware corporation ("EPNGC"), the several banks and other financial
institutions from time to time parties to this Agreement (the "Lenders"),
CHEMICAL BANK, a New York banking corporation, as administrative agent (in such
capacity, the "Administrative Agent") and as CAF Advance Agent (in such
capacity, the "CAF Advance Agent") for the Lenders hereunder.

The parties hereto hereby agree as follows:

ARTICLE I

DEFINITIONS AND ACCOUNTING TERMS

SECTION 1.1 Certain Defined Terms. As used in this
Agreement, the following terms shall have the following meanings (such meanings
to be equally applicable to both the singular and plural forms of the terms
defined):

"Administrative Agent" shall have the meaning assigned to such
term in the preamble hereof.

"Advance" means an advance by a Lender to any Borrower
pursuant to Article II, and refers to a Base Rate Advance, a
Eurodollar Rate Advance or a CAF Advance.

"Affiliate" means as to any Person, any other Person that,
directly or indirectly, controls, is controlled by or is under common
control with such Person or is a director or officer of such Person.
The term "control" (including the terms "controlled by" or "under
common control with") means, with respect to any Person, the
possession, direct or indirect, of the power to vote 20% or more of
the securities having ordinary voting power for the election of
directors of such Person or to direct or cause the direction of the
management and policies of such Person, whether through ownership of
voting securities or by contract or otherwise.

"Agreement" means this $400,000,000 Revolving Credit and
Competitive Advance Facility, as amended, supplemented or otherwise
modified from time to time.

"Alternate Program" means any other program providing for the
sale or other disposition of trade or other receivables entered into
by the Company or a Principal Subsidiary (or for purposes of Section
5.2(a) only, any Restricted Affiliate) which is in addition to or in
replacement of the program evidenced by the Receivables Purchase and
Sale Agreement, provided that such program is on terms (a)
substantially similar to the Receivables Purchase and Sale Agreement
or (b) customary for similar
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transactions as reasonably determined by the Administrative Agent.

"Applicable LIBO Rate" means in respect of any CAF Advance
requested pursuant to a LIBO Rate CAF Advance Request, the London
interbank offered rate for deposits in Dollars for the period
commencing on the date of such CAF Advance and ending on the maturity
date thereof which appears on Telerate Page 3750 as of 11:00 A.M.,
London time, two Business Days prior to the beginning of such period.

"Assignment and Acceptance" means an assignment and acceptance
entered into by a Lender and an Eligible Assignee, and accepted by the
Administrative Agent, in substantially the form of Exhibit G hereto.

"Base CD Rate" means the sum of (a) the product of (i) the
Three-Month Secondary CD Rate and (ii) a fraction, the numerator of
which is one and the denominator of which is one minus the C/D Reserve
Percentage and (b) the C/D Assessment Rate.

"Base Rate" means for any day, a rate per annum (adjusted to
the nearest 1/16 of 1% or, if there is no nearest 1/16 of 1%, rounded
upwards to the next highest 1/16 of 1%) equal to the greatest of (a)
the Prime Rate in effect on such day, (b) the Base CD Rate in effect
on such day plus 1/2 of 1% and (c) the Effective Federal Funds Rate in
effect on such day plus 1/2 of 1%. Any change in the Base Rate due to
a change in the Prime Rate, the Three-Month Secondary CD Rate or the
Effective Federal Funds Rate shall be effective as of the opening of
business on the effective day of such change in the Prime Rate, the
Three-Month Secondary CD Rate or the Effective Federal Funds Rate,
respectively.

"Base Rate Advance" means an Advance which bears interest as
provided in Section 2.11(a)(i).

"Borrowers" means the collective reference to EPNGC, each
Borrowing Subsidiary and Holding once Holding executes and delivers a
Joinder Agreement; each, a "Borrower".

"Borrowing" means a borrowing consisting of Advances of the
same Type made on the same day by the Lenders, it being understood
that there may be more than one Borrowing on a particular day.

"Borrowing Subsidiary" means each domestic Principal
Subsidiary of the Company which has been designated by the Company as
a "Borrowing Subsidiary" by written notice to the Administrative
Agent; collectively, the "Borrowing Subsidiaries".

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3

"Burlington" means Burlington Resources Inc., a Delaware
corporation.

"Business Day" means a day of the year on which banks are not
required or authorized to close in New York, New York and, if the
applicable Business Day relates to any Eurodollar Rate Advances or
LIBO Rate CAF Advances, on which dealings are carried on in the London
interbank market.

"CAF Advance" means an Advance made pursuant to Sections 2.4
and 2.5.

"CAF Advance Agent" shall have the meaning assigned to such
term in the preamble hereof.

"CAF Advance Availability Period" means the period from and
including the Closing Date until the earlier of (a) the date which is
14 days prior to the Stated Termination Date and (b) the Termination
Date.

"CAF Advance Confirmation" means each confirmation by the
applicable Borrower of its acceptance of CAF Advance Offers, which CAF
Advance Confirmation shall be substantially in the form of Exhibit F
and shall be delivered to the CAF Advance Agent by telecopy.

"CAF Advance Interest Payment Date" means as to each CAF
Advance, each interest payment date specified by the applicable
Borrower for such CAF Advance in the related CAF Advance Request.

"CAF Advance Lenders" means Lenders from time to time
designated by the Company, in consultation with the CAF Advance Agent,
as CAF Advance Lenders as provided in Section 2.4.

"CAF Advance Maturity Date" means as to any CAF Advance, the
date specified by the applicable Borrower pursuant to Section
2.5(d)(ii) in its acceptance of the related CAF Advance Offer.

"CAF Advance Note" shall have the meaning assigned to such
term in Section 2.7 (collectively, the "CAF Advance Notes").

"CAF Advance Offer" means each offer by a CAF Advance Lender
to make CAF Advances pursuant to a CAF Advance Request, which CAF
Advance Offer shall contain the information specified in Exhibit E and
shall be delivered to the CAF Advance Agent by telephone, immediately
confirmed by telecopy.

"CAF Advance Request" means each request by the applicable
Borrower for CAF Advance Lenders to submit bids

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to make CAF Advances, which request shall contain the information in
respect of such requested CAF Advances specified in Exhibit D and
shall be delivered to the CAF Advance Agent in writing, by telecopy,
or by telephone, immediately confirmed by telecopy.

"Capitalization" of any Person means the sum (without
duplication) of (a) consolidated Debt of such Person and its
consolidated Subsidiaries, plus (b) the aggregate amount of Guaranties
entered into by such Person and its consolidated Subsidiaries, plus
(c) the consolidated common and preferred stockholders' equity of such
Person and its consolidated Subsidiaries.

"C/D Assessment Rate" means for any day as applied to any Base
Rate Advance, the annual assessment rate determined by Chemical to be
payable on such day to the Federal Deposit Insurance Corporation (the
"FDIC") for the FDIC's (or any successor's) insuring time deposits at
offices of Chemical in the United States.

"C/D Reserve Percentage" means for any day as applied to any
Base Rate Advance, that percentage (expressed as a decimal) which is
in effect on such day, as prescribed by the Board of Governors of the
Federal Reserve System (or any successor) (the "Board"), for
determining the then current reserve requirement for the
Administrative Agent in respect of new non-personal time deposits in
Dollars having a maturity of 30 days or more.

"Chemical" means Chemical Bank.

"Closing Date" means the date on which the conditions
precedent set forth in Section 3.1 have been satisfied (or compliance
therewith shall have been waived by the Lenders).

"Commitment" means as to any Lender, the obligation of such
Lender to make Revolving Credit Advances to the Borrowers hereunder in
an aggregate principal amount at any one time outstanding not to
exceed the amount set forth opposite such Lender's name on Schedule I
(as such Schedule I is amended from time to time pursuant to Section
9.7(c)), as such amount may be reduced from time to time in accordance
with the provisions of this Agreement.

"Commitment Percentage" means as to any Lender at any time,
the percentage which such Lender's Commitment then constitutes of the
aggregate Commitments (or, at any time after the Commitments shall
have expired or terminated, the percentage which the aggregate
principal amount of such Lender's Advances then outstanding
constitutes of the aggregate principal amount of the Advances then
outstanding).

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"Company" means (a) at all times prior to Holding becoming a
Borrower, EPNGC, and (b) thereafter, Holding.

"Contingent Guaranty" shall have the meaning assigned to such
term in the definition of the term "Guaranty" contained in this
Section 1.1.

"Convert", "Conversion" and "Converted" each refers to a
conversion of Advances of one Type into Advances of another Type
pursuant to Section 2.13, 2.14 or 2.18.

"Debt" means, as to any Person, all Indebtedness of such
Person other than (a) any Project Financing of such Person and (b) in
the case of the Company or a Principal Subsidiary, any liabilities of
the Company or such Principal Subsidiary, as the case may be, under
any Alternate Program, or any document executed by the Company or such
Principal Subsidiary, as the case may be, in connection therewith;
provided, however, that for purposes of Article V hereof "Debt" shall
not include up to an aggregate amount of $100,000,000 of (i) the
amount of optional payments in lieu of asset repurchase or other
payments to similar effect, including extension or renewal payments,
on off balance sheet leases and (ii) the amount of the purchase price
for optional acquisition of such asset (in either case, calculated at
the lower amount payable in respect of such asset under clause (i) or
(ii) above.

"Dollars" and "$" means dollars in lawful currency of the
United States of America.

"Effective Federal Funds Rate" means, for any day, the
weighted average of the rates on overnight Federal funds transactions
with members of the Federal Reserve System arranged by Federal funds
brokers, as published for such day (or, if such day is not a Business
Day, for the next preceding Business Day) by the Federal Reserve Bank
of New York, or, if such rate is not so published for any day which is
a Business Day, the average of the quotations for such day on such
transactions received by the Administrative Agent from three Federal
funds brokers of recognized standing selected by it.

"Eligible Assignee" means, with respect to any particular
assignment under Section 9.7, any bank or other financial institution
approved in writing by the Company expressly with respect to such
assignment and, except as to such an assignment by Chemical so long as
Chemical is the Administrative Agent hereunder, the Administrative
Agent as an Eligible Assignee for purposes of this Agreement, provided
that neither the Administrative Agent's nor the Company's approval
shall be unreasonably withheld.

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"EPNGC" shall have the meaning assigned to such term in the
preamble hereof.

"ERISA" means the Employee Retirement Income Security Act of
1974, as amended from time to time, and the regulations promulgated
and rulings issued from time to time thereunder.

"ERISA Affiliate" means any Person who is a member of the
Company's controlled group within the meaning of Section
4001(a)(14)(A) of ERISA.

"Eurocurrency Liabilities" has the meaning assigned to that
term in Regulation D of the Board of Governors of the Federal Reserve
System, as in effect from time to time.

"Eurodollar Rate" means, for any Interest Period for each
Eurodollar Rate Advance comprising part of the same Borrowing, an
interest rate per annum equal to the average (rounded upward to the
nearest whole multiple of 1/16 of 1% per annum, if such average is not
such a multiple) of the rate per annum at which deposits in Dollars
are offered by the principal office of each of the Reference Lenders
in London, England, to prime banks in the London interbank market at
11:00 A.M. (London, England time) two Business Days before the first
day of such Interest Period (if applicable or appropriate, in an
amount comparable to the amount of such Borrowing) and for a period
equal to such Interest Period. The Eurodollar Rate for the Interest
Period for each Eurodollar Rate Advance comprising part of the same
Borrowing shall be determined by the Administrative Agent on the basis
of applicable rates furnished to and received by the Administrative
Agent from the Reference Lenders two Business Days before the first
day of such Interest Period, subject, however, to the provisions of
Section 2.13.

"Eurodollar Rate Advance" means an Advance which bears
interest determined by reference to the Eurodollar Rate, as provided
in Section 2.11(a)(ii).

"Eurodollar Rate Margin" means for each day and each
Eurodollar Rate Advance, the rate per annum set forth below opposite
the applicable S&P Bond Rating and Moody's Bond Rating:

Bond Rating Eurodollar
(S&P/Moody's) Level Rate Margin
--------------------- ----- -----------

A-/A3 or higher I .200%
BBB+/Baa1 II .205%
BBB/Baa2 III .250%
BBB-/Baa3 or lower IV .300%;

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provided that if the ratings of such rating agencies do not fall
within the same Level, the Eurodollar Rate Margin applicable to such
day will be the lower Eurodollar Rate Margin and provided, further,
that in the event a rating is not available from either rating agency,
such rating agency will be deemed to have assigned its lowest rating.

"Eurodollar Reserve Percentage" for any Lender for
any Interest Period for any Eurodollar Rate Advance means the reserve
percentage applicable during such Interest Period under regulations
issued from time to time by the Board of Governors of the Federal
Reserve System (or if more than one such percentage shall be so
applicable, the daily average of such percentages for those days in
such Interest Period during which any such percentage shall be so
applicable) for determining the maximum reserve requirement
(including, but not limited to, any emergency, supplemental or other
marginal reserve requirement) for such Lender with respect to
liabilities or assets consisting of or including Eurocurrency
Liabilities having a term equal to such Interest Period.

"Events of Default" shall have the meaning assigned to such
term in Section 7.1.

"Excluded Acquisition Debt" means (a) Debt, Guaranties or
reimbursement obligations of any corporation acquired by the Company
or any of its Subsidiaries and which Debt, Guaranties or reimbursement
obligations exist immediately prior to such acquisition (provided that
(i) such Debt, Guaranties or reimbursement obligations are not
incurred solely in anticipation of such acquisition and (ii)
immediately prior to such acquisition such corporation is not a
Subsidiary of the Company) or (b) Debt, Guaranties or reimbursement
obligations in respect of any asset acquired by the Company or its
Subsidiaries and which Debt, Guaranties or reimbursement obligations
exists immediately prior to such acquisition (provided that (i) such
Debt, Guaranties or reimbursement obligations are not incurred solely
in anticipation of such acquisition and (ii) immediately prior to such
acquisition such asset is not an asset of the Company or any of its
Subsidiaries).

"Existing Facility" shall have the meaning assigned to such
term in Section 3.1(g).

"FERC" means the Federal Energy Regulatory Commission, or any
agency or authority of the United States from time to time succeeding
to its function.

"Fixed Rate CAF Advance" means any CAF Advance made pursuant
to a Fixed Rate CAF Advance Request.

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"Fixed Rate CAF Advance Request" means any CAF Advance Request
requesting the CAF Advance Lenders to offer to make CAF Advances at a
fixed rate (as opposed to a rate composed of the Applicable LIBO Rate
plus (or minus) a margin).

"Guaranty", "Guaranteed" and "Guaranteeing" each means any act
by which any Person assumes, guarantees, endorses or otherwise incurs
direct or contingent liability in connection with, or agrees to
purchase or otherwise acquire or otherwise assures a creditor against
loss in respect of, any Debt or Project Financing of any Person other
than the Company or any of its consolidated Subsidiaries (excluding
(a) any liability by endorsement of negotiable instruments for deposit
or collection or similar transactions in the ordinary course of
business, (b) any liability in connection with obligations of the
Company, any of its consolidated Subsidiaries or any Restricted
Affiliate, including, without limitation, obligations under any
conditional sales agreement, equipment trust financing or equipment
lease and any liability of any Restricted Affiliate in respect of
obligations of EPNGC or its consolidated Subsidiaries and (c) any such
act in connection with a Project Financing that either (i) guarantees
performance of the completion of the project which is financed by such
Project Financing, until such time, if any, that such guaranty becomes
a guaranty of payment of such Project Financing (other than a guaranty
of payment of the type referred to in subclause (ii) below) or (ii) is
contingent upon, or the obligation to pay or perform under which is
contingent upon, the occurrence of any event other than or in addition
to the passage of time or any Project Financing becoming due (any such
act referred to in this clause (c) being a "Contingent Guaranty");
provided, however, that for purposes of this definition the liability
of the Company or any of its Subsidiaries with respect to any
obligation as to which a third party or parties are jointly, or
jointly and severally, liable as a guarantor or otherwise as
contemplated hereby and have not defaulted on its or their portions
thereof, shall be only its pro rata portion of such obligation.

"Holding" means any domestic parent holding company of EPNGC
which directly or indirectly owns 100% of EPNGC's common stock;
provided, however, that immediately after Holding becomes EPNGC's
parent holding company, not less than 80% of the shareholders of
common stock of Holding are the same shareholders of common stock of
EPNGC immediately prior to Holding becoming EPNGC's parent holding
company.

"Holding Guaranty" shall have the meaning assigned to such
term in Section 5.1(g).

"Indebtedness" of any Person means, without duplication (a)
indebtedness of such Person for borrowed money, (b) obligations of
such Person (other than any portion of any

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trade payable obligation of such Person which shall not have remained
unpaid for 91 days or more from the original due date of such portion)
to pay the deferred purchase price of property or services, and (c)
obligations of such Person as lessee under leases which shall have
been or should be, in accordance with generally accepted accounting
principles, recorded as capital leases, except that where such
indebtedness or obligation of such Person is made jointly, or jointly
and severally, with any third party or parties other than any
consolidated Subsidiary of such Person, the amount thereof for the
purposes of this definition only shall be the pro rata portion thereof
payable by such Person, so long as such third party or parties have
not defaulted on its or their joint and several portions thereof.

"Indemnified Party" means any or all of the Lenders, the
Administrative Agent and the CAF Advance Agent.

"Interest Period" means, for each Eurodollar Rate Advance
comprising part of the same Borrowing, the period beginning on the
date of such Advance or the date of the Conversion of any Advance into
such an Advance and ending on the last day of the period selected by
the applicable Borrower pursuant to the provisions below and,
thereafter, each subsequent period commencing on the last day of the
immediately preceding Interest Period and ending on the last day of
the period selected by the applicable Borrower pursuant to the
provisions below. The duration of each such Interest Period shall be
one, two, three or six months, or, subject to availability to each
Lender, nine or twelve months, in each case as the applicable Borrower
may, upon notice received by the Administrative Agent not later than
12:00 noon (New York City time) on the third Business Day prior to the
first day of such Interest Period with respect to Eurodollar Rate
Advances, select; provided, however, that:

(a) the duration of any Interest Period which
commences before the Termination Date and would otherwise end
after the Termination Date shall end on the Termination Date;

(b) if the last day of such Interest Period
would otherwise occur on a day which is not a Business Day,
such last day shall be extended to the next succeeding
Business Day, except if such extension would cause such last
day to occur in a new calendar month, then such last day shall
occur on the next preceding Business Day; and

(c) Interest Periods commencing on the same date
for Advances comprising the same Borrowing shall be of the
same duration.

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"Joinder Agreement" means a Joinder Agreement, substantially
in the form of Exhibit K hereto, duly executed and delivered by the
Company and the Borrowing Subsidiary party thereto or Holding, as the
case may be.

"Lenders" shall have the meaning assigned to such term in the
preamble hereof.

"LIBO Rate CAF Advance" means any CAF Advance made pursuant to
a LIBO Rate CAF Advance Request.

"LIBO Rate CAF Advance Request" means any CAF Advance Request
requesting the CAF Advance Lenders to offer to make CAF Advances at an
interest rate equal to the Applicable LIBO Rate plus (or minus) a
margin.

"Lien" means any lien, security interest or other charge or
encumbrance, or any assignment of the right to receive income, or any
other type of preferential arrangement, in each case to secure any
Indebtedness or any Guaranty of any Person.

"Majority Lenders" means Lenders the Commitment Percentages of
which aggregate at least 51%.

"Margin Stock" means "margin stock" as defined in Regulation U
of the Board of Governors of the Federal Reserve System, as in effect
from time to time.

"Material Adverse Effect" means a material adverse effect on
the financial condition or operations of the Company and its
consolidated Subsidiaries on a consolidated basis.

"Material Subsidiary" means any Subsidiary of Holding (other
than a Project Financing Subsidiary) that itself (on an
unconsolidated, stand-alone basis) owns in excess of 10% of the
consolidated net property, plant and equipment of Holding and its
consolidated Subsidiaries.

"Mojave" means Mojave Pipeline Company.

"Moody's Bond Rating" means for any day, the rating of EPNGC's
(so long as it is the Company) or Holding's (so long as it is the
Company), as the case may be, senior long-term unsecured debt by
Moody's Investors Service, Inc. in effect at 11:00 A.M., New York City
time, on such day.

"Multiemployer Plan" means a "multiemployer plan" as defined
in Section 4001(a)(3) of ERISA to which the Company or any ERISA
Affiliate is making or accruing an obligation to make contributions,
or has within any of the preceding five plan years made or accrued an
obligation to make contributions and in respect of which the Company
or an

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11

ERISA Affiliate has any liability (contingent or otherwise), such plan
being maintained pursuant to one or more collective bargaining
agreements.

"Multiple Employer Plan" means a single employer plan, as
defined in Section 4001(a)(15) of ERISA, which (a) is maintained for
employees of the Company or an ERISA Affiliate and at least one Person
other than the Company and its ERISA Affiliates or (b) was so
maintained and in respect of which the Company or an ERISA Affiliate
could have liability under Section 4064 or 4069 of ERISA in the event
such plan has been or were to be terminated.

"Net Worth" means with respect to the Company, as of any date
of determination, the sum of the preferred stock and stockholders'
equity of the Company as shown on the most recent consolidated balance
sheet of the Company delivered pursuant to Section 5.3.

"Note" means any Revolving Credit Note or CAF Advance Note
(collectively, the "Notes").

"Notice of Borrowing" has the meaning specified in Section
2.3(a).

"Obligations" means the collective reference to the unpaid
principal of and interest on the Notes and all other financial
liabilities of the Borrowers to the Administrative Agent, the CAF
Advance Agent and the Lenders (including, without limitation, interest
accruing at the then applicable rate provided in this Agreement after
the maturity of the Advances and interest accruing at the then
applicable rate provided in this Agreement after the filing of any
petition in bankruptcy, or the commencement of any insolvency,
reorganization or like proceeding, relating to any Borrower whether or
not a claim for post-filing or post-petition interest is allowed in
such proceeding), whether direct or indirect, absolute or contingent,
due or to become due, or now existing or hereafter incurred, which may
arise under, out of, or in connection with, this Agreement or the
Notes, in each case whether on account of principal, interest,
reimbursement obligations, fees, indemnities, costs, expenses or
otherwise (including, without limitation, all fees and disbursements
of counsel to the Administrative Agent, the CAF Advance Agent or to
the Lenders that are required to be paid by any Borrower pursuant to
this Agreement).

"Other Taxes" shall have the meaning assigned to such term in
Section 2.20(b).

"Party" shall have the meaning assigned to such term in
Section 9.8.

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12

"PBGC" means the Pension Benefit Guaranty Corporation (or any
successor).

"Permitted Claims" shall have the meaning assigned to such
term in Section 9.9(a).

"Person" means an individual, partnership, corporation
(including a business trust), joint stock company, trust,
unincorporated association, joint venture or other entity, or a
country or any political subdivision thereof or any agency or
instrumentality of such country or subdivision.

"Plan" means a Single Employer Plan or a Multiple Employer
Plan.

"Prime Rate" means the rate of interest per annum publicly
announced from time to time by Chemical as its prime rate in effect at
its principal office in New York City. The Prime Rate is not intended
to be the lowest rate of interest charged by Chemical in connection
with extensions of credit to debtors.

"Principal Subsidiary" means, at any time, any Subsidiary of
the Company (other than a Project Financing Subsidiary) having assets
at such time greater than or equal to 5% of the consolidated assets of
the Company and its consolidated Subsidiaries at such time.

"Process Agent" has the meaning specified in Section 9.9(a).

"Project Financing" means any Indebtedness incurred to finance
a project, other than any portion of such Indebtedness permitting or
providing for recourse against the Company or any of its Subsidiaries
(or for purposes of Section 5.2(a) only, any Restricted Affiliate)
other than (a) recourse to the stock or assets of the Project
Financing Subsidiary, if any, incurring or Guaranteeing such
Indebtedness, and (b) such recourse as exists under any Contingent
Guaranty.

"Project Financing Subsidiary" means any Subsidiary of the
Company (or for purposes of Section 5.2(a) only, any Restricted
Affiliate) whose principal purpose is to incur Project Financing, or
to become a partner in a partnership so created, and substantially all
the assets of which Subsidiary or partnership are limited to those
assets being financed (or to be financed) in whole or in part by a
Project Financing.

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corporation and Citicorp North America, Inc., as agent, as such
Agreement may be amended, supplemented, restated or otherwise modified
from time to time which amendment, supplement, restatement or
modification will not extend the purchase of receivables and other
assets thereunder to receivables and assets other than present and
future gas purchase contract take-or-pay buyout and buydown
receivables, the collateral and other support therefor and the
collections therefrom.

"Reference Lenders" means Chemical, Morgan Guaranty Trust
Company of New York and Union Bank of Switzerland.

"Register" has the meaning specified in Section 9.7(c).

"Restricted Affiliate" means any Affiliate of EPNGC (other
than a Subsidiary of EPNGC) designated by EPNGC as a "Restricted
Affiliate" by written notice to the Administrative Agent; provided
that such Affiliate shall not become a Restricted Affiliate until such
time that (a) such Affiliate executes and delivers a guaranty (in form
and substance reasonably satisfactory to the Administrative Agent)
(each a "Restricted Affiliate Guaranty") in favor of the
Administrative Agent, for the ratable benefit of the Lenders,
guaranteeing the prompt and complete payment by each Borrower when due
(whether at the stated maturity, by acceleration or otherwise) of the
Obligations owing by such Borrower and (b) the Administrative Agent
receives legal opinions from the General Counsel or Associate General
Counsel of Holding and from New York counsel to Holding reasonably
acceptable to the Administrative Agent, which legal opinions shall be
in form and substance satisfactory to the Administrative Agent;
provided, further, that after such time as such Affiliate becomes a
Restricted Affiliate, EPNGC may terminate the designation of such
Affiliate as a Restricted Affiliate by written notice to the
Administrative Agent at which time the aforementioned guaranty of such
Affiliate shall also terminate.

"Restricted Affiliate Guaranty" shall have the meaning
assigned to such term in the definition of Restricted Affiliate.

"Revolving Credit Advances" shall have the meaning assigned to
such term in Section 2.1.

"Revolving Credit Note" shall have the meaning assigned to
such term in Section 2.3 (collectively, the "Revolving Credit Notes").

"S&P Bond Rating" means for any day, the rating of EPNGC's (so
long as it is the Company) or Holding's (so long as it is the
Company), as the case may be, senior long-term

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unsecured debt by Standard & Poor's Ratings Group in effect at 11:00
A.M., New York City time, on such day.

"Single Employer Plan" means a single employer plan, as
defined in Section 4001(a)(15) of ERISA, that (a) is maintained for
employees of the Company or an ERISA Affiliate and no Person other
than the Company and its ERISA Affiliates or (b) was so maintained and
in respect of which the Company or an ERISA Affiliate could have
liability under Section 4069 of ERISA in the event such plan has been
or were to be terminated.

"Stated Termination Date" means May 30, 2001.

"Subsidiary" means, as to any Person, any corporation of which
at least a majority of the outstanding stock having by the terms
thereof ordinary voting power to elect a majority of the board of
directors of such corporation (irrespective of whether or not at the
time stock of any other class or classes of such corporation shall or
might have voting power by reason of the happening of any contingency)
is at the time directly or indirectly beneficially owned or controlled
by such Person or one or more of its Subsidiaries or such Person and
one or more of the Subsidiaries of such Person.

"Taxes" shall have the meaning assigned to such term in
Section 2.20(a).

"Termination Date" means the earlier of (a) the Stated
Termination Date and (b) the date of termination in whole of the
Commitments pursuant to Section 2.9 or 7.1.

"Termination Event" means (a) a "reportable event," as such
term is described in Section 4043 of ERISA (other than a "reportable
event" not subject to the provision for 30-day notice to the PBGC
under subsections .11, .12, .13, .14, .16, .18, .19 or .20 of PBGC
Reg. Section 2615), or an event described in Section 4062(e) of
ERISA, or (b) the withdrawal of the Company or any ERISA Affiliate
from a Multiple Employer Plan during a plan year in which it was a
"substantial employer," as such term is defined in Section 4001(a)(2)
of ERISA or the incurrence of liability by the Company or any ERISA
Affiliate under Section 4064 of ERISA upon the termination of a
Multiple Employer Plan, or (c) the filing of a notice of intent to
terminate a Plan or the treatment of a Plan amendment as a termination
under Section 4041 of ERISA, or (d) the institution of proceedings to
terminate a Plan by the PBGC under Section 4042 of ERISA, or (e) the
conditions set forth in Section 302(f)(1)(A) and (B) of ERISA to the
creation of a lien upon property or rights to property of the Company
or any ERISA Affiliate for failure to make a required payment to a
Plan are satisfied, or (f) the adoption of an amendment to a Plan
requiring the

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provision of security to such Plan, pursuant to Section 307 of ERISA,
or (g) the occurrence of any other event or the existence of any other
condition which would reasonably be expected to result in the
termination of, or the appointment of a trustee to administer, any
Plan under Section 4042 of ERISA.

"Three-Month Secondary CD Rate" means, for any day, the
secondary market rate (adjusted to the basis of a year of 365 or 366
days, as the case may be) for three-month certificates of deposit
reported as being in effect on such day (or, if such day shall not be
a Business Day, the next preceding Business Day) by the Board of
Governors of the Federal Reserve System (the "Board") through the
public information telephone line of the Federal Reserve Bank of New
York (which rate will, under the current practices of the Board, be
published in Federal Reserve Statistical Release H.15(519) during the
week following such day), or, if such rate shall not be so reported on
such day or such next preceding Business Day, the average of the
secondary market quotations for three-month certificates of deposit of
major money center banks in New York City received at approximately
10:00 A.M., New York City time, on such day (or, if such day shall not
be a Business Day, on the next preceding Business Day) by the
Administrative Agent from three New York City negotiable certificate
of deposit dealers of recognized standing selected by it.

"Type" means (a) as to any Revolving Credit Advance, its
nature as a Base Rate Advance or a Eurodollar Rate Advance and (b) as
to any CAF Advance, its nature as a Fixed Rate CAF Advance or a LIBO
Rate CAF Advance.

"Withdrawal Liability" shall have the meaning given such term
under Part 1 of Subtitle E of Title IV of ERISA.

SECTION 1.2 Computation of Time Periods. Unless otherwise
stated in this Agreement, in the computation of a period of time from a
specified date to a later specified date, the word "from" means "from and
including" and the words "to" and "until" each means "to but excluding."

SECTION 1.3 Accounting Terms. All accounting terms not
specifically defined herein shall be construed in accordance with generally
accepted accounting principles either (a) consistent with those principles
applied in the preparation of the financial statements referred to in Section
4.1(e) or (b) not materially inconsistent with such principles (so that no
covenant contained in Section 5.1 or 5.2 would be calculated or construed in a
materially different manner or with materially different results than if such
covenant were calculated or construed in accordance with clause (a) of this
Section 1.3).

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SECTION 1.4 References. The words "hereof", "herein" and
"hereunder" and words of similar import when used in this Agreement shall refer
to this Agreement as a whole and not to any particular provision of this
Agreement, and Article, Section, Schedule and Exhibit references are to this
Agreement unless otherwise specified.

ARTICLE II

AMOUNTS AND TERMS OF THE ADVANCES

SECTION 2.1 The Revolving Credit Advances. Each Lender
severally agrees, on the terms and conditions hereinafter set forth, to make
revolving credit advances ("Revolving Credit Advances") to the Borrowers or any
one or more of them from time to time on any Business Day during the period
from the date hereof to and including the Termination Date in an aggregate
amount not to exceed at any time outstanding the amount of such Lender's
Commitment; provided that the aggregate amount of the Advances outstanding
shall not at any time exceed the aggregate amount of the Commitments. Each
Borrowing shall be in an aggregate amount of $5,000,000 in the case of a
Borrowing comprised of Base Rate Advances and $20,000,000 in the case of a
Borrowing comprised of Eurodollar Rate Advances, or, in each case, an integral
multiple of $1,000,000 in excess thereof (or, in the case of a Borrowing of
Base Rate Advances, the aggregate unused Commitments, if less) and shall
consist of Revolving Credit Advances of the same Type made on the same day by
the Lenders ratably according to their respective Commitments. Within the
limits of each Lender's Commitment, any Borrower may make more than one
Borrowing on any Business Day and may borrow, repay pursuant to Section 2.10 or
prepay pursuant to Section 2.15, and reborrow under this Section 2.1.

SECTION 2.2 Revolving Credit Notes. The Revolving Credit
Advances to each Borrower made by each Lender shall be evidenced by a
promissory note of such Borrower, substantially in the form of Exhibit A, with
appropriate insertions as to maker, payee, date and principal amount (a
"Revolving Credit Note"), payable to the order of such Lender and in a
principal amount equal to the lesser of (a) the amount of the initial
Commitment of such Lender and (b) the aggregate unpaid principal amount of all
Revolving Credit Advances made to such Borrower by such Lender. Each Lender is
hereby authorized to, and prior to any transfer thereof shall, record the date,
Type and amount of each Revolving Credit Advance made by such Lender, each
continuation thereof, each conversion of all or a portion thereof to another
Type, the date and amount of each payment or prepayment of principal thereof
and, in the case of Eurodollar Rate Advances, the length of each Interest
Period with respect thereto, on the schedule annexed to and constituting a part
of its Revolving Credit Note, and any such recordation shall constitute prima
facie evidence of the accuracy of the information so recorded;

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provided, however, that the failure to make any such recordation shall not
affect the obligations of such Borrower hereunder or any Revolving Credit Note.
Each Revolving Credit Note shall (i) be dated (A) in the case of EPNGC, the
Closing Date or (B) in each other case, the date the applicable Subsidiary
Borrower or Holding, as the case may be, became a Borrower hereunder, (ii) be
stated to mature on the Termination Date and (iii) provide for the payment of
interest in accordance with this Agreement.

SECTION 2.3 Making the Revolving Credit Advances. (a) Each
Borrowing of Revolving Credit Advances shall be made on notice by the Company
to the Administrative Agent (a "Notice of Borrowing") received by the
Administrative Agent, (i) in the case of a proposed Borrowing comprised of Base
Rate Advances, not later than 10:00 A.M. (New York City time) on the Business
Day of such proposed Borrowing and (ii) in the case of a proposed Borrowing
comprised of Eurodollar Rate Advances, not later than 12:00 noon (New York City
time) on the third Business Day prior to the date of such proposed Borrowing.
Each Notice of Borrowing shall be by telecopy or telephone (and if by
telephone, confirmed promptly by telecopier), in substantially the form of
Exhibit B, specifying therein the requested (A) Borrower, (B) date of such
Borrowing, (C) Type of Revolving Credit Advances comprising such Borrowing, (D)
aggregate amount of such Borrowing, and (E) in the case of a Borrowing
comprised of Eurodollar Rate Advances, the initial Interest Period for each
such Advance. Each Lender shall, before 1:00 P.M. (New York City time) on the
date of such Borrowing, make available to the Administrative Agent at its
address at 270 Park Avenue, New York, New York, 10017, Reference: El Paso
Natural Gas Company, or at such other address designated by notice from the
Administrative Agent to the Lenders pursuant to Section 9.2, in same day funds,
such Lender's ratable portion of such Borrowing. Immediately after the
Administrative Agent's receipt of such funds and upon fulfillment of the
applicable conditions set forth in Article III, the Administrative Agent will
make such funds available to the applicable Borrower at Chemical, 270 Park
Avenue, New York, New York, 10017, Account No. 323291503, Reference: El Paso
Natural Gas Company, or at such other account of the applicable Borrower
maintained by the Administrative Agent (or any successor Administrative Agent)
designated by the applicable Borrower and agreed to by the Administrative Agent
(or such successor Administrative Agent), in same day funds.

(b) Each Notice of Borrowing shall be irrevocable and binding
on the applicable Borrower. In the case of any Borrowing which the related
Notice of Borrowing specified is to be comprised of Eurodollar Rate Advances,
if such Advances are not made as a result of any failure to fulfill on or
before the date specified for such Borrowing the applicable conditions set
forth in Article III, the applicable Borrower shall indemnify each Lender
against any loss, cost or expense incurred by such Lender as a result of such
failure, including, without limitation, any loss, cost or expense incurred by
reason of the liquidation or

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reemployment of deposits or other funds acquired by such Lender to fund the
Advance to be made by such Lender as part of such Borrowing.

(c) Unless the Administrative Agent shall have received
notice from a Lender prior to the date of any Borrowing that such Lender will
not make available to the Administrative Agent such Lender's ratable portion of
such Borrowing, the Administrative Agent may assume that such Lender has made
such portion available to the Administrative Agent on the date of such
Borrowing in accordance with subsection (a) of this Section 2.3 and the
Administrative Agent may, in reliance upon such assumption, make available to
the applicable Borrower on such date a corresponding amount. If and to the
extent such Lender shall not have so made such ratable portion available to the
Administrative Agent, such Lender and the applicable Borrower severally agree
to repay to the Administrative Agent forthwith on demand such corresponding
amount together with interest thereon, for each day from the date such amount
is made available to the applicable Borrower until the date such amount is
repaid to the Administrative Agent, at the Effective Federal Funds Rate for
such day. If such Lender shall repay to the Administrative Agent such
corresponding amount, such amount so repaid shall constitute such Lender's
Advance to the applicable Borrower as part of such Borrowing for purposes of
this Agreement.

(d) The failure of any Lender to make the Advance to be made
by it as part of any Borrowing shall not relieve any other Lender of its
obligation, if any, hereunder to make its Advance on the date of such
Borrowing, but no Lender shall be responsible for the failure of any other
Lender to make the Advance to be made by such other Lender on the date of any
Borrowing.

SECTION 2.4 CAF Advances. Subject to the terms and
conditions of this Agreement, the Borrowers or any one or more of them may
borrow CAF Advances from time to time during the CAF Advance Availability
Period on any Business Day. The Company shall, in consultation with the CAF
Advance Agent, designate Lenders from time to time as CAF Advance Lenders by
written notice to the CAF Advance Agent. The CAF Advance Agent shall transmit
each such notice of designation promptly to each designated CAF Advance Lender.
CAF Advances shall be borrowed in amounts such that the aggregate amount of
Advances outstanding at any time shall not exceed the aggregate amount of the
Commitments at such time. Any CAF Advance Lender may make CAF Advances in
amounts which, individually and together with the aggregate amount of other
Advances of such CAF Advance Lender, exceed such CAF Advance Lender's
Commitment, and such CAF Advance Lender's CAF Advances shall not be deemed to
utilize such CAF Advance Lender's Commitment. Within the limits and on the
conditions hereinafter set forth with respect to CAF Advances, the Borrowers
from time to time may borrow, repay and reborrow CAF Advances.

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SECTION 2.5 Procedure for CAF Advance Borrowings. (a) A
Borrower, or the Company on behalf of a Borrower, shall request CAF Advances by
delivering a CAF Advance Request to the CAF Advance Agent, not later than 12:00
Noon (New York City time) four Business Days prior to the date of the proposed
Borrowing (in the case of a LIBO Rate CAF Advance Request), and not later than
10:00 A.M. (New York City time) one Business Day prior to the date of the
proposed Borrowing (in the case of a Fixed Rate CAF Advance Request). Each CAF
Advance Request may solicit bids for CAF Advances in an aggregate principal
amount of $10,000,000 or an integral multiple of $1,000,000 in excess thereof
and having not more than three alternative maturity dates. The maturity date
for each CAF Advance shall be not less than 14 days nor more than 180 days
after the date of the Borrowing therefor (and in any event shall be not later
than the Stated Termination Date); provided that each LIBO Rate CAF Advance
shall mature one, two, three or six months after the date of the Borrowing
therefor. The CAF Advance Agent shall notify each CAF Advance Lender promptly
by telecopy of the contents of each CAF Advance Request received by the CAF
Advance Agent.

(b) In the case of a LIBO Rate CAF Advance Request, upon
receipt of notice from the CAF Advance Agent of the contents of such CAF
Advance Request, each CAF Advance Lender may elect, in its sole discretion, to
offer irrevocably to make one or more CAF Advances at the Applicable LIBO Rate
plus (or minus) a margin determined by such CAF Advance Lender in its sole
discretion for each such CAF Advance. Any such irrevocable offer shall be made
by delivering a CAF Advance Offer to the CAF Advance Agent, before 10:30 A.M.
(New York City time) on the day that is three Business Days before the date of
the proposed Borrowing, setting forth:

(i) the maximum amount of CAF Advances for each maturity date
and the aggregate maximum amount of CAF Advances for all maturity dates
which such CAF Advance Lender would be willing to make (which amounts
may, subject to Section 2.4, exceed such CAF Advance Lender's
Commitment); and

(ii) the margin above or below the Applicable LIBO Rate at
which such CAF Advance Lender is willing to make each such CAF Advance.

The CAF Advance Agent shall advise the Company and the applicable Borrower
before 11:00 A.M. (New York City time) on the date which is three Business Days
before the proposed date of the Borrowing of the contents of each such CAF
Advance Offer received by it. If the CAF Advance Agent, in its capacity as a
CAF Advance Lender, shall elect, in its sole discretion, to make any such CAF
Advance Offer, it shall advise the Company and the applicable Borrower of the
contents of its CAF Advance Offer before 10:15 A.M. (New York City time) on the
date which is three Business Days before the proposed date of the Borrowing.

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(c) In the case of a Fixed Rate CAF Advance Request, upon
receipt of notice from the CAF Advance Agent of the contents of such CAF
Advance Request, each CAF Advance Lender may elect, in its sole discretion, to
offer irrevocably to make one or more CAF Advances at a rate of interest
determined by such CAF Advance Lender in its sole discretion for each such CAF
Advance. Any such irrevocable offer shall be made by delivering a CAF Advance
Offer to the CAF Advance Agent before 9:30 A.M. (New York City time) on the
proposed date of the Borrowing, setting forth:

(i) the maximum amount of CAF Advances for each maturity
date, and the aggregate maximum amount for all maturity dates, which
such CAF Advance Lender would be willing to make (which amounts may,
subject to Section 2.4, exceed such CAF Advance Lender's Commitment);
and

(ii) the rate of interest at which such CAF Advance Lender is
willing to make each such CAF Advance.

The CAF Advance Agent shall advise the Company and the applicable Borrower
before 10:00 A.M. (New York City time) on the proposed date of the Borrowing of
the contents of each such CAF Advance Offer received by it. If the CAF Advance
Agent, in its capacity as a CAF Advance Lender, shall elect, in its sole
discretion, to make any such CAF Advance Offer, it shall advise the Company and
the applicable Borrower of the contents of its CAF Advance Offer before 9:15
A.M. (New York City time) on the proposed date of the Borrowing.

(d) Before 11:30 A.M. (New York City time) three Business
Days before the proposed date of the Borrowing (in the case of CAF Advances
requested by a LIBO Rate CAF Advance Request) and before 10:30 A.M. (New York
City time) on the proposed date of the Borrowing (in the case of CAF Advances
requested by a Fixed Rate CAF Advance Request), the Company, in its absolute
discretion, shall:

(i) cancel such CAF Advance Request by giving the CAF Advance
Agent telephone notice to that effect, or

(ii) by giving telephone notice to the CAF Advance Agent
(immediately confirmed by delivery to the CAF Advance Agent of a CAF
Advance Confirmation in writing or by telecopy) (A) subject to the
provisions of Section 2.5(e), accept one or more of the offers made by
any CAF Advance Lender or CAF Advance Lenders pursuant to Section
2.5(b) or Section 2.5(c), as the case may be, of the amount of CAF
Advances for each relevant maturity date and (B) reject any remaining
offers made by CAF Advance Lenders pursuant to Section 2.5(b) or
Section 2.5(c), as the case may be.

(e) The Company's acceptance of CAF Advances in response to
any CAF Advance Request shall be subject to the following limitations:

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(i) the amount of CAF Advances accepted for each maturity
date specified by any CAF Advance Lender in its CAF Advance Offer shall
not exceed the maximum amount for such maturity date specified in such
CAF Advance Offer;

(ii) the aggregate amount of CAF Advances accepted for all
maturity dates specified by any CAF Advance Lender in its CAF Advance
Offer shall not exceed the aggregate maximum amount specified in such
CAF Advance Offer for all such maturity dates;

(iii) the Company may not accept offers for CAF Advances for
any maturity date in an aggregate principal amount in excess of the
maximum principal amount requested in the related CAF Advance Request;
and

(iv) if the Company accepts any of such offers, it must
accept offers based solely upon pricing for such relevant maturity date
and upon no other criteria whatsoever and if two or more CAF Advance
Lenders submit offers for any maturity date at identical pricing and
the Company accepts any of such offers but does not wish to (or by
reason of the limitations set forth in Section 2.4 or in Section
2.5(e)(iii), cannot) borrow the total amount offered by such CAF
Advance Lenders with such identical pricing, the Company shall accept
offers from all of such CAF Advance Lenders in amounts allocated among
them pro rata according to the amounts offered by such CAF Advance
Lenders (or as nearly pro rata as shall be practicable after giving
effect to the requirement that CAF Advances made by a CAF Advance
Lender on a date of the Borrowing for each relevant maturity date shall
be in a principal amount of $5,000,000 or an integral multiple of
$1,000,000 in excess thereof; provided that if the number of CAF
Advance Lenders that submit offers for any maturity date at identical
pricing is such that, after the Company accepts such offers pro rata in
accordance with the foregoing, the CAF Advance to be made by such CAF
Advance Lenders would be less than $5,000,000 principal amount, the
number of such CAF Advance Lenders shall be reduced by the CAF Advance
Agent by lot until the CAF Advances to be made by such remaining CAF
Advance Lenders would be in a principal amount of $5,000,000 or an
integral multiple of $1,000,000 in excess thereof).

(f) If the Company notifies the CAF Advance Agent that a CAF
Advance Request is cancelled pursuant to Section 2.5(d)(i), the CAF Advance
Agent shall give prompt telephone notice thereof to the CAF Advance Lenders.

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be made on such Borrowing Date for each maturity date and (ii) the acceptance
or rejection of any offers to make such CAF Advances made by such CAF Advance
Lender. Before 1:00 P.M. (New York City time) on the date of the Borrowing
specified in the applicable CAF Advance Request, each CAF Advance Lender whose
CAF Advance Offer has been accepted shall make available to the Administrative
Agent at its office set forth in Section 9.2 the amount of CAF Advances to be
made by such CAF Advance Lender, in same day funds. The Administrative Agent
will make such funds available to the applicable Borrower as soon as
practicable on such date at the Administrative Agent's aforesaid address. As
soon as practicable after each Borrowing Date, the CAF Advance Agent shall
notify each Lender of the aggregate amount of CAF Advances advanced on such
Borrowing Date and the respective maturity dates thereof.

(h) The failure of any CAF Advance Lender to make the CAF
Advance to be made by it as part of any Borrowing shall not relieve any other
Lender of its obligation, if any, hereunder to make its CAF Advance on the date
of such Borrowing, but no CAF Lender shall be responsible for the failure of
any other CAF Advance Lender to make the CAF Advance to be made by such CAF
Advance Lender on the date of any Borrowing.

SECTION 2.6 CAF Advance Payments. (a) The applicable
Borrower shall repay to the Administrative Agent, for the account of each CAF
Advance Lender which has made a CAF Advance to it, on the applicable CAF
Advance Maturity Date the then unpaid principal amount of such CAF Advance.
The Borrowers shall not have the right to prepay any principal amount of any
CAF Advance.

(b) The applicable Borrower shall pay interest on the unpaid
principal amount of each CAF Advance to it from the date of the Borrowing to
the applicable CAF Advance Maturity Date at the rate of interest specified in
the CAF Advance Offer accepted by the applicable Borrower in connection with
such CAF Advance (calculated on the basis of a 360-day year for actual days
elapsed), payable on each applicable CAF Advance Interest Payment Date.

(c) If all or a portion of the principal amount of any CAF
Advance shall not be paid when due (whether at the stated maturity, by
acceleration or otherwise), such overdue principal amount shall, without
limiting any rights of any Lender under this Agreement, bear interest from the
date on which such payment was due at a rate per annum which is 1% above the
rate which would otherwise be applicable pursuant to the CAF Advance Note
evidencing such CAF Advance until the stated maturity date of such CAF Advance,
and for each day thereafter at a rate per annum which is 2% above the Base
Rate, in each case until paid in full (as well after as before judgment).
Interest accruing pursuant to this paragraph (c) shall be payable from time to
time on demand.

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SECTION 2.7 CAF Advance Notes. The CAF Advances made by each
CAF Advance Lender to each Borrower shall be evidenced by a promissory note of
such Borrower, substantially in the form of Exhibit C with appropriate
insertions (a "CAF Advance Note"), payable to the order of such CAF Advance
Lender and representing the obligation of such Borrower to pay the unpaid
principal amount of all CAF Advances made to it by such CAF Advance Lender,
with interest on the unpaid principal amount from time to time outstanding of
each CAF Advance evidenced thereby as prescribed in Section 2.6(b). Each CAF
Advance Lender is hereby authorized to, and prior to any transfer thereof
shall, record the date and amount of each CAF Advance made to it by such CAF
Advance Lender, the maturity date thereof, the date and amount of each payment
of principal thereof and the interest rate with respect thereto on the schedule
attached to and constituting part of its CAF Advance Note, and any such
recordation shall constitute prima facie evidence of the accuracy of the
information so recorded; provided, however, that the failure to make any such
recordation shall not affect the obligations of such Borrower hereunder or
under any CAF Advance Note. Each CAF Advance Note shall be dated (a) in the
case of EPNGC, the Closing Date or (b) in each other case, the date the
applicable Subsidiary Borrower or Holding, as the case may be, became a
Borrower hereunder, and each CAF Advance evidenced thereby shall bear interest
for the period from and including the Borrowing Date of such CAF Advance on the
unpaid principal amount thereof from time to time outstanding at the applicable
rate per annum determined as provided in, and such interest shall be payable as
specified in, Section 2.6(b).

SECTION 2.8 Fees. (a) The Company agrees to pay to the
Administrative Agent for the account of each Lender a facility fee for the
period from and including the date hereof to the Termination Date, computed at
a variable rate per annum on the average daily amount of the Commitment of such
Lender during the period for which payment is made, which rate will vary
according to the S&P Bond Rating of the Company and the Moody's Bond Rating of
the Company as follows:

Bond Rating Facility
(S&P/Moody's) Level Fee Rate
--------------------- ----- --------

A-/A3 or higher I .100%
BBB+/Baa1 II .120%
BBB/Baa2 III .150%
BBB-/Baa3 or lower IV .200%;

provided that if the ratings of such rating agencies do not fall within the
same Level, the rate applicable to such day will be the lower facility fee rate
and provided, further, that in the event a rating is not available from either
rating agency, such rating agency will be deemed to have assigned its lowest
rating. Such facility fees shall be payable quarterly in arrears on the last
day of each March, June, September and December on the Termination Date or such
earlier date on which the Commitments

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shall terminate as provided herein, commencing on the first of such dates to
occur after the date hereof.

(b) The Company agrees to pay to Chase Securities Inc.,
the Administrative Agent and the CAF Advance Agent the fees set forth in the
letter, dated May 7, 1996, from Chase Securities Inc. and Chemical to EPNGC.

SECTION 2.9 Reduction of the Commitments. The Company shall
have the right, upon at least three Business Days' notice to the Administrative
Agent, to terminate in whole or reduce ratably in part the unused portions of
the respective Commitments of the Lenders, provided that each partial reduction
shall be in the aggregate amount of $10,000,000 or any whole multiple of
$1,000,000 in excess thereof.

SECTION 2.10 Repayment. The Borrowers shall repay to each
Lender on the Termination Date the aggregate principal amount of the Advances
then owing to such Lender.

SECTION 2.11 Interest on Revolving Credit Advances. (a)
Ordinary Interest. The Borrowers shall pay interest on the unpaid principal
amount of each Revolving Credit Advance owing to each Lender from the date of
such Advance until such principal amount is due (whether at stated maturity, by
acceleration or otherwise), at the following rates:

(i) Base Rate Advances. During such periods as such
Advance is a Base Rate Advance, a rate per annum equal at all times to
the Base Rate in effect from time to time, payable quarterly in arrears
on the last day of each March, June, September and December during such
periods and on the date such Base Rate Advance shall be Converted or
due (whether at stated maturity, by acceleration or otherwise).

(ii) Eurodollar Rate Advances. During such periods as
such Advance is a Eurodollar Rate Advance, at a rate per annum equal at
all times during each Interest Period for such Advance to the sum of
the Eurodollar Rate for such Interest Period plus the Eurodollar Rate
Margin (in the case of Eurodollar Rate Advances to EPNGC and its
Subsidiaries, based on the Moody's Bond Rating and S&P Bond Rating of
EPNGC, and, in the case of all other Borrowers, based on the Moody's
Bond Rating and S&P Bond Rating of Holding) in effect from time to
time, payable on the last day of each such Interest Period and, if any
such Interest Period has a duration of more than three months, on each
day which occurs during such Interest Period every three months from
the first day of such Interest Period.

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such amount is due until such amount is paid in full, payable on demand, at a
rate per annum equal at all times (i) from such due date to the last day of the
then existing Interest Period in the case of each Eurodollar Rate Advance, to
1% per annum above the interest rate per annum required to be paid on such
Advance immediately prior to the date on which such amount became due, and (ii)
from and after the last day of the then existing Interest Period, and at all
times in the case of any Base Rate Advance, to 1% per annum above the Base Rate
in effect from time to time.

SECTION 2.12 Additional Interest on Eurodollar Rate Advances.
If any Lender shall determine in good faith that reserves under regulations of
the Board of Governors of the Federal Reserve System are required to be
maintained by it in respect of, or a portion of its costs of maintaining
reserves under such regulations is properly attributable to, one or more of its
Eurodollar Rate Advances, the applicable Borrower shall pay to such Lender
additional interest on the unpaid principal amount of each such Eurodollar Rate
Advance to it (other than any such additional interest accruing to a particular
Lender in respect of periods prior to the 30th day preceding the date notice of
such interest is given by such Lender as provided in this Section 2.12),
payable on the same day or days on which interest is payable on such Advance,
at an interest rate per annum equal at all times during each Interest Period
for such Advance to the excess of (i) the rate obtained by dividing the
Eurodollar Rate for such Interest Period by a percentage equal to 100% minus
the Eurodollar Reserve Percentage, if any, for such Lender for such Interest
Period over (ii) the Eurodollar Rate for such Interest Period. The amount of
such additional interest (if any) shall be determined by each Lender, and such
Lender shall furnish written notice of the amount of such additional interest
to the Company and the Administrative Agent, which notice shall be conclusive
and binding for all purposes, absent manifest error.

SECTION 2.13 Interest Rate Determination. (a) Each
Reference Lender agrees to furnish to the Administrative Agent timely
information for the purpose of determining the Eurodollar Rate. If any one or
more of the Reference Lenders shall not furnish such timely information to the
Administrative Agent for the purpose of determining any such interest rate, the
Administrative Agent shall determine such interest rate on the basis of timely
information furnished by the remaining Reference Lenders.

(b) The Administrative Agent shall give prompt notice to the
Company and the Lenders of the applicable interest rate determined by the
Administrative Agent for purposes of Section 2.11(a)(i) or (ii), and the
applicable rate, if any, furnished by each Reference Lender for the purpose of
determining the applicable interest rate under Section 2.11(a)(ii).

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(c) If fewer than two Reference Lenders furnish timely
information to the Administrative Agent for determining the Eurodollar Rate for
any Eurodollar Rate Advances,

(i) the Administrative Agent shall give the Company and
each Lender prompt notice thereof by telephone (confirmed in writing)
that the interest rate cannot be determined for such Eurodollar Rate
Advances,

(ii) each such Advance will automatically, on the last
day of the then existing Interest Period therefor, Convert into a Base
Rate Advance (or if such Advance is then a Base Rate Advance, will
continue as a Base Rate Advance), and

(iii) the obligations of the Lenders to make, or to
Convert Advances into, Eurodollar Rate Advances shall be suspended
until the Administrative Agent shall notify the Company and the Lenders
that the circumstances causing such suspension no longer exist.

(d) If, with respect to any Eurodollar Rate Advances, the
Majority Lenders determine and give notice to the Administrative Agent that, as
a result of conditions in or generally affecting the London interbank
eurodollar market, the rates of interest determined on the basis of the
Eurodollar Rate for any Interest Period for such Advances will not adequately
reflect the cost to such Majority Lenders of making, funding or maintaining
their respective Eurodollar Rate Advances for such Interest Period, the
Administrative Agent shall forthwith so notify the Company and the Lenders,
whereupon,

(i) each such Advance will automatically, on the last
day of the then existing Interest Period therefor, Convert into a Base
Rate Advance, and

(ii) the obligation of the Lenders to make, or to Convert
Advances into, Eurodollar Rate Advances shall be suspended until the
Administrative Agent shall notify the Company and the Lenders that the
circumstances causing such suspension no longer exist.

(e) If the applicable Borrower shall fail to select the
duration of any Interest Period for any Eurodollar Rate Advances in accordance
with the provisions contained in the definition of "Interest Period" in Section
1.1, the Administrative Agent will forthwith so notify the applicable Borrower
and the Lenders and such Advances will automatically, on the last day of the
then existing Interest Period therefor, Convert into Base Rate Advances.

(f) On the date on which the aggregate unpaid principal
amount of Eurodollar Rate Advances comprising any Borrowing shall be reduced,
by payment or prepayment or

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otherwise, to less than $10,000,000, such Eurodollar Rate Advances shall
automatically Convert into Base Rate Advances, and on and after such date the
right of the applicable Borrower to Convert such Advances into Eurodollar Rate
Advances shall terminate; provided, however, that if and so long as each such
Eurodollar Rate Advance shall have the same Interest Period as Eurodollar Rate
Advances comprising another Borrowing or other Borrowings, and the aggregate
unpaid principal amount of all such Eurodollar Rate Advances shall equal or
exceed $20,000,000, the applicable Borrower shall have the right to continue
all such Advances as, or to Convert all such Advances into Eurodollar Rate
Advances having the same Interest Period.

(g) If any Reference Lender shall for any reason no longer
have a Commitment or any Revolving Credit Advances, such Reference Lender shall
thereupon cease to be a Reference Lender, and if, as a result, there shall only
be one Reference Lender remaining, the Administrative Agent (after consultation
with the Company and the Lenders) shall, by notice to the Company and the
Lenders, designate another Lender as a Reference Lender so that there shall at
all times be at least two Reference Lenders.

SECTION 2.14 Voluntary Conversion of Advances. Any Borrower
may on any Business Day, upon notice given to the Administrative Agent, not
later than 10:00 A.M. (New York City time) on the Business Day of the proposed
Conversion of Eurodollar Rate Advances to Base Rate Advances and not later than
12:00 noon (New York City time) on the third Business Day prior to the date of
the proposed Conversion in the case of a Conversion of Base Rate Advances to
Eurodollar Rate Advances, and subject to the provisions of Sections 2.13, 2.16
and 2.18, Convert all Advances of one Type comprising the same Borrowing into
Advances of another Type; provided, however, that any Conversion of any
Eurodollar Rate Advances into Base Rate Advances made on any day other than the
last day of an Interest Period for such Eurodollar Rate Advances shall be
subject to the provisions of Section 9.4(b). Each such notice of a Conversion
shall, within the restrictions specified above, specify (a) the date of such
Conversion, (b) the Advances to be Converted, and (c) if such Conversion is
into Eurodollar Rate Advances, the duration of the Interest Period for each
such Advance.

SECTION 2.15 Prepayments. Any Borrower may upon (a) in the
case of Eurodollar Rate Advances, at least two Business Days' notice and (b) in
the case of Base Rate Advances, telephonic notice not later than 12:00 noon
(New York City time) on the date of prepayment, to the Administrative Agent
which specifies the proposed date and aggregate principal amount of the
prepayment and the Type of Advances to be prepaid, and if such notice is given
such Borrower shall, prepay the outstanding principal amounts of the Advances
comprising the same Borrowing in whole or ratably in part, together with
accrued interest to the date of such prepayment on the amount prepaid;
provided, however, that (i) each partial prepayment shall be in an

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aggregate principal amount not less than $10,000,000 or an integral multiple of
$1,000,000 in excess thereof and (ii) in the event of any such prepayment of
Eurodollar Rate Advances on any day other than the last day of an Interest
Period for such Eurodollar Rate Advances, such Borrower shall be obligated to
reimburse the Lenders in respect thereof pursuant to, and to the extent
required by, Section 9.4(b); provided, further, however, that such Borrower
will use its best efforts to give notice to the Administrative Agent of the
proposed prepayment of Base Rate Advances on the Business Day prior to the date
of such proposed prepayment.

SECTION 2.16 Increased Costs. (a) If, due to either (i) the
introduction after the date of this Agreement of or any change after the date
of this Agreement (including any change by way of imposition or increase of
reserve requirements or assessments other than those referred to in the
definition of "Eurodollar Reserve Percentage," "C/D Reserve Percentage" or "C/D
Assessment Rate" contained in Section 1.1) in or in the interpretation of any
law or regulation or (ii) the compliance with any guideline or request issued
or made after the date of this Agreement from or by any central bank or other
governmental authority (whether or not having the force of law), in each case
above other than those referred to in Section 2.17, there shall be any increase
in the cost to any Lender of agreeing to make, fund or maintain, or of making,
funding or maintaining, Eurodollar Rate Advances funded in the interbank
Eurodollar market, then the Borrowers shall from time to time, upon demand by
such Lender (with a copy of such demand to the Administrative Agent), pay to
the Administrative Agent for the account of such Lender additional amounts
sufficient to reimburse such Lender for all such increased costs (except those
costs incurred more than 60 days prior to the date of such demand; for the
purposes hereof any cost or expense allocable to a period prior to the
publication or effective date of such an introduction, change, guideline or
request shall be deemed to be incurred on the later of such publication or
effective date). Each Lender agrees to use its best efforts promptly to notify
the Company of any event referred to in clause (i) or (ii) above, provided that
the failure to give such notice shall not affect the rights of any Lender under
this Section 2.16(a) (except as otherwise expressly provided above in this
Section 2.16(a)). A certificate as to the amount of such increased cost,
submitted to the Company and the Administrative Agent by such Lender, shall be
conclusive and binding for all purposes, absent manifest error. After one or
more Lenders have notified the Company of any increased costs pursuant to this
Section 2.16, the Company may specify by notice to the Administrative Agent and
the affected Lenders that, after the date of such notice whenever the election
of Eurodollar Rate Advances by the applicable Borrower for an Interest Period
or portion thereof would give rise to such increased costs, such election shall
not apply to the Revolving Credit Advances of such Lenders during such Interest
Period or portion thereof, and, in lieu thereof, such Revolving Credit Advances
shall during such

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Interest Period or portion thereof be Base Rate Advances. Each Lender agrees
to use its best efforts (including, without limitation, a reasonable effort to
change its lending office or to transfer its affected Advances to an affiliate
of such Lender) to avoid, or minimize the amount of, any demand for payment
from the Borrowers under this Section 2.16.

(b) In the event that any Lender shall change its lending
office and such change results (at the time of such change) in increased costs
to such Lender, the Borrowers shall not be liable to such Lender for such
increased costs incurred by such Lender to the extent, but only to the extent,
that such increased costs shall exceed the increased costs which such Lender
would have incurred if the lending office of such Lender had not been so
changed, but, subject to subsection (a) above and to Section 2.18, nothing
herein shall require any Lender to change its lending office for any reason.

SECTION 2.17 Increased Capital. If either (a) the
introduction of or any change in or in the interpretation of any law or
regulation or (b) compliance by any Lender with any guideline or request from
any central bank or other governmental authority (whether or not having the
force of law) affects or would affect the amount of capital required or
expected to be maintained by such Lender or any corporation controlling such
Lender and such Lender determines that the amount of such capital is increased
by or based upon the existence of such Lender's commitment to lend hereunder
and other commitments of this type, then, within ten days after demand, and
delivery to the Company of the certificate referred to in the last sentence of
this Section 2.17 by such Lender (with a copy of such demand to the
Administrative Agent), the applicable Borrowers shall pay to the Administrative
Agent for the account of such Lender, from time to time as specified by such
Lender, additional amounts sufficient to compensate such Lender or such
corporation in the light of such circumstances, to the extent that such Lender
reasonably determines such increase in capital to be allocable to the existence
of such Lender's commitment to lend hereunder (except any such increase in
capital incurred more than, or compensation attributable to the period before,
90 days prior to the date of such demand; for the purposes hereof any increase
in capital allocable to, or compensation attributable to, a period prior to the
publication or effective date of such an introduction, change, guideline or
request shall be deemed to be incurred on the later of such publication or
effective date). Each Lender agrees to use its best efforts promptly to notify
the Company of any event referred to in clause (a) or (b) above, provided that
the failure to give such notice shall not affect the rights of any Lender under
this Section 2.17 (except as otherwise expressly provided above in this Section
2.17). A certificate in reasonable detail as to the basis for, and the amount
of, such compensation submitted to the Company by such Lender shall, in the
absence of manifest error, be conclusive and binding for all purposes.

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SECTION 2.18 Illegality. Notwithstanding any other provision
of this Agreement, if the introduction of or any change in or in the
interpretation of any law or regulation shall make it unlawful, or any central
bank or other governmental authority shall assert that it is unlawful, for any
Lender or its lending office to perform its obligations hereunder to make
Eurodollar Rate Advances or to continue to fund or maintain such Advances
hereunder, such Lender may, by notice to the Company and the Administrative
Agent, suspend the right of the Borrowers to elect Eurodollar Rate Advances
from such Lender and, if necessary in the reasonable opinion of such Lender to
comply with such law or regulation, Convert all such Eurodollar Rate Advances
of such Lender to Base Rate Advances at the latest time permitted by the
applicable law or regulation, and such suspension and, if applicable, such
Conversion shall continue until such Lender notifies the Company and the
Administrative Agent that the circumstances making it unlawful for such Lender
to perform such obligations no longer exist (which such Lender shall promptly
do when such circumstances no longer exist). So long as the obligation of any
Lender to make Eurodollar Rate Advances has been suspended under this Section
2.18, all Notices of Borrowing specifying Advances of such Type shall be
deemed, as to such Lender, to be requests for Base Rate Advances. Each Lender
agrees to use its best efforts (including, without limitation, a reasonable
effort to change its lending office or to transfer its affected Advances to an
affiliate) to avoid any such illegality.

SECTION 2.19 Payments and Computations. (a) The Borrowers
shall make each payment hereunder (including, without limitation, under Section
2.8, 2.10 or 2.11) and under the Notes, whether the amount so paid is owing to
any or all of the Lenders or to the Administrative Agent, not later than 12:00
noon (New York City time) without setoff, counterclaim, or any other deduction
whatsoever, on the day when due in Dollars to the Administrative Agent at its
address at 270 Park Avenue, New York, New York 10017, Reference: El Paso
Natural Gas Company, or at such other location designated by notice to the
Company from the Administrative Agent and agreed to by the Company, in same day
funds. The Administrative Agent will promptly thereafter cause to be
distributed like funds relating to the payment of principal or interest or
facility fees ratably (other than amounts payable pursuant to Section 2.12,
2.16, 2.17, 2.18 or 2.20) according to the respective amounts of such
principal, interest or facility fees then due and owing to the Lenders, and
like funds relating to the payment of any other amount payable to any Lender to
such Lender, in each case to be applied in accordance with the terms of this
Agreement. Upon its acceptance of an Assignment and Acceptance and recording
of the information contained therein in the Register pursuant to Section
9.7(d), from and after the effective date specified in such Assignment and
Acceptance, the Administrative Agent shall make all payments hereunder and
under the Notes in respect of the interest assigned thereby to the Lender
assignee thereunder, and the parties to such Assignment and Acceptance shall
make all appropriate adjustments in such

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payments for periods prior to such effective date directly between themselves.

(b) All computations of interest based on the Base Rate and
of facility fees shall be made by the Administrative Agent on the basis of a
year of 365 or 366 days, as the case may be, and all computations of interest
based on the Eurodollar Rate or the Effective Federal Funds Rate shall be made
by the Administrative Agent, and all computations of interest pursuant to
Section 2.12 shall be made by each Lender with respect to its own Advances, on
the basis of a year of 360 days, in each case for the actual number of days
(including the first day but excluding the last day) occurring in the period
for which such interest or fees are payable. Each determination by the
Administrative Agent (or, in the case of Section 2.12, 2.16, 2.17, 2.18 or
2.20, by each Lender with respect to its own Advances) of an interest rate or
an increased cost or increased capital or of illegality hereunder shall be
conclusive and binding for all purposes if made reasonably and in good faith.

(c) Whenever any payment hereunder or under the Notes shall
be stated to be due on a day other than a Business Day, such payment shall be
made on the next succeeding Business Day, and such extension of time shall in
such case be included in the computation of payment of interest; provided,
however, if such extension would cause payment of interest on or principal of
Eurodollar Rate Advances to be made in the next following calendar month, such
payment shall be made on the next preceding Business Day.

(d) Unless the Administrative Agent shall have received
notice from the Company or any other applicable Borrower prior to the date on
which any payment is due to the Lenders hereunder that the applicable Borrower
will not make such payment in full, the Administrative Agent may assume that
the applicable Borrower has made such payment in full to the Administrative
Agent on such date and the Administrative Agent may, in reliance upon such
assumption, cause to be distributed to each Lender on such due date an amount
equal to the amount then due such Lender. If and to the extent the applicable
Borrower shall not have so made such payment in full to the Administrative
Agent, each Lender shall repay to the Administrative Agent forthwith on demand
such amount distributed to such Lender together with interest thereon, for each
day from the date such amount is distributed to such Lender until the date such
Lender repays such amount to the Administrative Agent, at a rate equal to the
Effective Federal Funds Rate for such day.

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excluding, all taxes, levies, imposts, deductions, charges or withholdings, and
all liabilities with respect thereto, imposed by the jurisdiction under the
laws of which such Indemnified Party is organized, domiciled, resident or doing
business, or any political subdivision thereof or by any jurisdiction in which
such Indemnified Party holds any interest in connection with this Agreement or
any Note (including, without limitation, in the case of each Lender, the
jurisdiction of such Lender's lending office) or any political subdivision
thereof, other than by any jurisdiction with which the Indemnified Party's
connection arises solely from having executed, delivered or performed
obligations or received a payment under, or enforced, this Agreement or any
Note (all such non-excluded taxes, levies, imposts, deductions, charges,
withholdings and liabilities being hereinafter referred to as "Taxes"). If any
Borrower shall be required by law to deduct any Taxes from or in respect of any
sum payable hereunder or under any Note to any Indemnified Party, (i) the sum
payable shall be increased as may be necessary so that after making all
required deductions (including deductions applicable to additional sums payable
under this Section 2.20) such Indemnified Party receives an amount equal to the
sum it would have received had no such deductions been made, (ii) such Borrower
shall make or cause to be made such deductions and (iii) such Borrower shall
pay or cause to be paid the full amount deducted to the relevant taxation
authority or other authority in accordance with applicable law, provided that
the Borrowers shall not be required to pay any additional amount (and shall be
relieved of any liability with respect thereto) pursuant to this subsection (a)
to any Indemnified Party that either (A) on the date such Lender became an
Indemnified Party hereunder, (y) was not entitled to submit a U.S. Internal
Revenue Service form 1001 (relating to such Indemnified Party, and entitling it
to a complete exemption from United States withholding taxes on all amounts to
be received by such Indemnified Party pursuant to this Agreement) and a U.S.
Internal Revenue Service form 4224 (relating to all amounts to be received by
such Indemnified Party pursuant to this Agreement) and (z) was not a United
States person (as such term is defined in Section 7701(a)(30) of the Internal
Revenue Code) or (B) has failed to submit any form or certificate that it was
required to file or provide pursuant to subsection (d) of this Section 2.20 and
is entitled to file or give, as applicable, under applicable law, provided,
further, that should an Indemnified Party become subject to Taxes because of
its failure to deliver a form required hereunder, the Borrowers shall take such
steps as such Indemnified Party shall reasonably request to assist such
Indemnified Party to recover such Taxes, and provided further that each
Indemnified Party, with respect to itself, agrees to indemnify and hold
harmless the Borrowers from any taxes, penalties, interest and other expenses,
costs and losses incurred or payable by the Borrowers as a result of the
failure of any of the Borrowers to comply with its obligations under clause
(ii) or (iii) above in reliance on any form or certificate provided to it by
such Indemnified Party pursuant to this Section 2.20. If any Indemnified Party
receives a net credit or refund

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in respect of such Taxes or amounts so paid by the Borrowers, it shall promptly
notify the Company of such net credit or refund and shall promptly pay such net
credit or refund to the applicable Borrower, provided that the applicable
Borrower agrees to return such net credit or refund if the Indemnified Party to
which such net credit or refund is applicable is required to repay it.

(b) In addition, each Borrower agrees to pay any present or
future stamp or documentary taxes or any other excise or property taxes,
charges or similar levies which arise from any payment made by such Borrower
hereunder or under the Notes or from the execution, delivery or performance of,
or otherwise with respect to, this Agreement or the Notes (hereinafter referred
to as "Other Taxes").

(c) Each Borrower will indemnify each Indemnified Party and
the Administrative Agent for the full amount of Taxes or Other Taxes
(including, without limitation, any Taxes or Other Taxes imposed by any
jurisdiction on amounts payable under this Section 2.20) paid by such
Indemnified Party and any liability (including penalties, interest and
expenses) arising therefrom or with respect thereto except as a result of the
gross negligence (which shall in any event include the failure of such
Indemnified Party to provide to the Borrowers any form or certificate that it
was required to provide pursuant to subsection (d) below) or willful misconduct
of such Indemnified Party, whether or not such Taxes or Other Taxes were
correctly or legally asserted. This indemnification shall be made within 30
days from the date such Indemnified Party makes written demand therefor.

(d) On or prior to the date on which each Indemnified Party
organized under the laws of a jurisdiction outside the United States becomes an
Indemnified Party hereunder, such Indemnified Party shall provide the Company
with U.S. Internal Revenue Service form 1001 or 4224, as appropriate, or any
successor form prescribed by the U.S. Internal Revenue Service, certifying that
such Indemnified Party is fully exempt from United States withholding taxes with
respect to all payments to be made to such Indemnified Party hereunder, or other
documents satisfactory to the Company indicating that all payments to be made to
such Indemnified Party hereunder are fully exempt from such taxes. Thereafter
and from time to time (but only so long as such Indemnified Party remains
lawfully able to do so), each such Indemnified Party shall submit to the Company
such additional duly completed and signed copies of one or the other of such
Forms (or such successor Forms as shall be adopted from time to time by the
relevant United States taxing authorities) as may be (i) notified by any
Borrower to such Indemnified Party and (ii) required under then-current United
States law or regulations to avoid United States withholding taxes on payments
in respect of all amounts to be received by such Indemnified Party pursuant to
this Agreement or the Notes. Upon the request of any Borrower from time to time,
each Indemnified Party that is a United States

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person (as such term is defined in Section 7701(a)(30) of the Internal Revenue
Code) shall submit to the Company a certificate to the effect that it is such a
United States person. If any Indemnified Party determines, as a result of any
change in applicable law, regulation or treaty, or in any official application
or interpretation thereof, that it is unable to submit to the Company any form
or certificate that such Indemnified Party is obligated to submit pursuant to
this subsection (d), or that such Indemnified Party is required to withdraw or
cancel any such form or certificate previously submitted, such Indemnified
Party shall promptly notify the Company of such fact.

(e) Any Indemnified Party claiming any additional amounts
payable pursuant to this Section 2.20 shall use its best efforts (consistent
with its internal policy and legal and regulatory restrictions) to change the
jurisdiction of its lending office if the making of such a change would avoid
the need for, or reduce the amount of, any such additional amounts which may
thereafter accrue and would not, in the reasonable judgment of such Indemnified
Party, be otherwise disadvantageous to such Indemnified Party.

(f) Without prejudice to the survival of any other
agreement of the Borrowers hereunder, the agreements and obligations of the
Borrowers and each Indemnified Party contained in this Section 2.20 shall
survive the payment in full of principal and interest hereunder and under the
Notes.

(g) Any other provision of this Agreement to the contrary
notwithstanding, any amounts which are payable by any Borrower under this
Section 2.20 shall not be payable under Section 2.16.

SECTION 2.21 Sharing of Payments, Etc. If any Lender shall
obtain any payment (whether voluntary, involuntary, through the exercise of any
right of set-off, or otherwise) on account of the Advances made by it (other
than pursuant to Section 2.12, 2.16, 2.17, 2.18 or 2.20) in excess of its
ratable share of payments on account of the Advances obtained by all the
Lenders, such Lender shall forthwith purchase from the other Lenders such
participations in the Advances made by them as shall be necessary to cause such
purchasing Lender to share the excess payment ratably with each of them,
provided, however, that if all or any portion of such excess payment is
thereafter recovered from such purchasing Lender, such purchase from each
Lender shall be rescinded and each Lender shall repay to the purchasing Lender
the purchase price to the extent of such recovery together with an amount equal
to such Lender's ratable share (according to the proportion of (a) the amount
of such Lender's required repayment to (b) the total amount so recovered from
the purchasing Lender) of any interest or other amount paid or payable by the
purchasing Lender in respect of the total amount so recovered. Each Borrower
agrees that any Lender so purchasing a participation

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from another Lender pursuant to this Section may, to the fullest extent
permitted by law, exercise all its rights of payment (including the right of
set-off) with respect to such participation as fully as if such Lender were the
direct creditor of such Borrower in the amount of such participation.

SECTION 2.22 Use of Proceeds. Proceeds of the Advances may
be used for general corporate purposes of the Company and its Subsidiaries,
including, without limitation, for acquisitions and for payment of commercial
paper issued by the Company and to refinance the loans under EPNGC's Revolving
Credit and Competitive Advance Facility Agreement, dated as of August 10, 1994.

ARTICLE III

CONDITIONS OF EFFECTIVENESS AND LENDING

SECTION 3.1 Conditions Precedent to Effectiveness of this
Agreement. This Agreement shall become effective when (i) it shall have been
executed by EPNGC, the Administrative Agent and the CAF Advance Agent, (ii) the
Administrative Agent and EPNGC either shall have been notified by each Lender
that such Lender has executed it or shall have received a counterpart of this
Agreement executed by such Lender, and (iii) the Administrative Agent shall, on
or before June 30, 1996, have received the following, each (except in the case
of the letter referred to in Section 3.1(f)) dated the Closing Date, in form
and substance satisfactory to the Administrative Agent and (except for the
Notes) in sufficient copies for each Lender:

(a) The Notes made by EPNGC, to the order of the Lenders,
respectively.

(b) Certified copies of the resolutions of the Board of
Directors of EPNGC approving the borrowings contemplated hereby and
authorizing the execution of this Agreement and the Notes, and of all
documents evidencing other necessary corporate action of EPNGC and
governmental approvals to EPNGC, if any, with respect to this Agreement
and the Notes.

(c) A certificate of the Secretary or an Assistant Secretary
of EPNGC certifying the names and true signatures of the officers of
EPNGC authorized to sign this Agreement and the other documents to be
delivered by it hereunder.

(d) A favorable opinion of the General Counsel of EPNGC,
or the Associate General Counsel of EPNGC, in substantially the form of
Exhibit H hereto, and as to such other matters as any Lender through
the Administrative Agent may reasonably request.

(e) A favorable opinion of Jones, Day, Reavis & Pogue, New
York counsel to EPNGC, in substantially the form of

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36

Exhibit I hereto, and as to such other matters as any Lender through
the Administrative Agent may reasonably request.

(f) A letter from the Process Agent, in substantially the
form of Exhibit J hereto, agreeing to act as Process Agent for EPNGC
and to forward forthwith all process received by it to EPNGC.

(g) Evidence satisfactory to the Administrative Agent that
all advances, accrued interest and other fees and any other amounts
owing to the lenders and the agents under the Revolving Credit and
Competitive Advance Facility Agreement, dated as of August 10, 1994
(the "Existing Facility"), among EPNGC, the several financial
institutions from time to time parties thereto, and Chemical, as
Administrative Agent and CAF Advance Agent, shall have been paid in
full, and the commitments to make advances thereunder shall have been
cancelled.

Anything in this Agreement to the contrary notwithstanding, if all of the
conditions to effectiveness of this Agreement specified in this Section 3.1
shall not have been fulfilled on or before June 30, 1996, this Agreement, and
all of the obligations of EPNGC, the Lenders, the Administrative Agent and the
CAF Advance Agent hereunder, shall be terminated on and as of 5:00 P.M. (New
York City time) on June 30, 1996; provided, however, that as soon as the
Administrative Agent determines that all of the conditions to effectiveness of
this Agreement specified in this Section 3.1 shall have been fulfilled on or
before June 30, 1996, the Administrative Agent shall furnish written notice to
EPNGC and the Lenders to the effect that it has so determined, and such notice
by the Administrative Agent shall constitute conclusive evidence that this
Agreement shall have become effective for all purposes.

SECTION 3.2 Conditions Precedent to Initial Advances to Any
Borrowing Subsidiary or Holding. The agreement of each Lender to make the
initial Advances to be made by it to any Borrowing Subsidiary or Holding is
subject to the Administrative Agent receiving the following, in form and
substance satisfactory to the Administrative Agent and (except for the Notes)
in sufficient copies for each Lender (provided that no Subsidiary of Holding
which is not a Subsidiary of EPNGC may become a Borrower hereunder unless
Holding is a Borrower hereunder):

(a) A Joinder Agreement executed and delivered by such
Borrowing Subsidiary or Holding, as the case may be, conforming to the
requirements hereof.

(b) The Notes, dated the date such Borrowing Subsidiary or
Holding, as the case may be, executes and delivers its Joinder
Agreement, made by such Borrowing Subsidiary or Holding, as the case
may be, to the order of the Lenders, respectively.

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(c) A certificate of the Secretary or an Assistant
Secretary of such Borrowing Subsidiary or Holding, as the case may be,
certifying the names and true signature of the officers of such
Borrowing Subsidiary or Holding, as the case may be, authorized to sign
the Joinder Agreement and the other documents to be delivered by it
hereunder.

(d) A favorable opinion of the General Counsel or
Associate General Counsel of the Company, given upon the express
instructions of the Company, in substantially the form of Exhibit L
hereto, and as to such other matters as any Lender through the
Administrative Agent may reasonably request, with such assumptions,
qualifications and exceptions as the Administrative Agent may approve.

(e) A favorable opinion of Jones, Day, Reavis & Pogue or
other New York counsel to the Company reasonably satisfactory to the
Administrative Agent, in substantially the form of Exhibit M hereto,
and as to such other matters as any Lender through the Administrative
Agent may reasonably request, with such assumptions, qualifications and
exceptions as the Administrative Agent may approve.

(f) A letter from the Process Agent, in substantially the
form of Exhibit J hereto, agreeing to act as Process Agent for such
Borrowing Subsidiary or Holding, as the case may be, and to forward
forthwith all process received by it to such Borrowing Subsidiary or
Holding, as the case may be.

SECTION 3.3 Conditions Precedent to Each Borrowing. The
obligation of each Lender to make an Advance (including the initial Advance) on
the occasion of any Borrowing shall be subject to the conditions precedent that
on the date of such Borrowing this Agreement shall have become effective
pursuant to Section 3.1 and, before and immediately after giving effect to such
Borrowing and to the application of the proceeds therefrom, the following
statements shall be true and correct, and the giving by the applicable Borrower
or the Company on such Borrower's behalf of the applicable Notice of Borrowing
and the acceptance by the applicable Borrower of the proceeds of such Borrowing
shall constitute its representation and warranty that on and as of the date of
such Borrowing, before and immediately after giving effect thereto and to the
application of the proceeds therefrom, the following statements are true and
correct:
(i) Each representation and warranty contained in Section
4.1 is correct in all material respects as though made on and as of
such date; and

(ii) No event has occurred and is continuing, or would
result from such Borrowing, which constitutes an Event of Default or
would constitute an Event of Default but for the requirement that
notice be given or time elapse or both.

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ARTICLE IV

REPRESENTATIONS AND WARRANTIES

SECTION 4.1 Representations and Warranties of the Borrowers.
Each Borrower represents and warrants as follows:

(a) The Company is a corporation duly incorporated,
validly existing and in good standing under the laws of the State of
Delaware. Each Principal Subsidiary and each Restricted Affiliate is
duly incorporated, validly existing and in good standing in the
jurisdiction of its incorporation. The Company, each Principal
Subsidiary and each Restricted Affiliate possess all corporate powers
and all other authorizations and licenses necessary to engage in its
business and operations as now conducted, the failure to obtain or
maintain which would have a Material Adverse Effect.

(b) The execution, delivery and performance by (i) each
Borrower of this Agreement, each Joinder Agreement, if any, to which it
is a party and its Notes (as applicable) and (ii) each Restricted
Affiliate of its Restricted Affiliate Guaranty are within such
Borrower's or Restricted Affiliate's, as the case may be, corporate
powers, have been duly authorized by all necessary corporate action,
and do not contravene (A) such Borrower's or Restricted Affiliate's, as
the case may be, charter or by-laws or (B) law or any contractual
restriction binding on or affecting such Borrower or Restricted
Affiliate, as the case may be.

(c) No authorization or approval or other action by, and
no notice to or filing with, any governmental authority or regulatory
body is required for the due execution, delivery and performance by (i)
such Borrower of this Agreement, each Joinder Agreement, if any, to
which it is a party or its Notes (as applicable) or (ii) any Restricted
Affiliate of its Restricted Affiliate Guaranty, except filings
necessary to comply with laws, rules, regulations and orders required
in the ordinary course to comply with ongoing obligations of such
Borrower under Section 5.1(a) and (b).

(d) This Agreement constitutes, its Notes and each Joinder
Agreement, if any, to which it is a party (as applicable) when
delivered hereunder shall constitute and its Restricted Affiliate
Guaranty when delivered hereunder shall constitute, the legal, valid
and binding obligations of each Borrower or Restricted Affiliate, as
the case may be, enforceable against such Borrower or Restricted
Affiliate, as the case may be, in accordance with their respective
terms, except as may be limited by any applicable bankruptcy,
insolvency, reorganization, moratorium or

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similar laws affecting creditors' rights generally or by general
principles of equity.

(e) The consolidated balance sheet of EPNGC and its
consolidated Subsidiaries as at December 31, 1995, and the related
consolidated statements of income and cash flows of EPNGC and its
consolidated Subsidiaries for the fiscal year then ended, reported on
by Coopers & Lybrand LLP, independent public accountants, copies of
which have been furnished to the Administrative Agent and the Lenders
prior to the date hereof, fairly present the consolidated financial
condition of EPNGC and its consolidated Subsidiaries as at such date
and the consolidated results of the operations of EPNGC and its
consolidated Subsidiaries for the period ended on such date, all in
accordance with generally accepted accounting principles consistently
applied, and since December 31, 1995, there has been no material
adverse change in such condition or operations. The unaudited
consolidated balance sheet of EPNGC and its consolidated Subsidiaries
as of March 31, 1996, and the related consolidated statements of income
and cash flows of EPNGC and its consolidated Subsidiaries for the three
months then ended, certified by the chief financial officer of EPNGC,
copies of which have been furnished to the Administrative Agent and the
Lenders prior to the date hereof, fairly present the consolidated
results of operations of EPNGC and its consolidated Subsidiaries for
the three months then ended, all in accordance with generally accepted
accounting principles consistently applied (except as approved by the
chief financial officer of EPNGC and as disclosed therein) and subject
to normal year-end audit adjustments.

(f) There is no action, suit or proceeding pending, or to
the knowledge of any Borrower threatened, against or involving the
Company, any Principal Subsidiary or any Restricted Affiliate in any
court, or before any arbitrator of any kind, or before or by any
governmental body, which in the reasonable judgment of the Company
(taking into account the exhaustion of all appeals) would have a
Material Adverse Effect, or which purports to affect the legality,
validity, binding effect or enforcement of this Agreement or the Notes.

(g) The Company, each Principal Subsidiary and each
Restricted Affiliate have duly filed all tax returns required to be
filed, and have duly paid and discharged all taxes, assessments and
governmental charges upon it or against its properties now due and
payable, the failure to pay which would have a Material Adverse Effect,
unless and to the extent only that the same are being contested in good
faith and by appropriate proceedings by the Company, the appropriate
Subsidiary or the appropriate Restricted Affiliate.

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(h) The Company, each Principal Subsidiary and each
Restricted Affiliate have good title to their respective properties and
assets, free and clear of all mortgages, liens and encumbrances, except
for mortgages, liens and encumbrances (including covenants,
restrictions, rights, easements and minor irregularities in title)
which do not materially interfere with the business or operations of
the Company, such Subsidiary or such Restricted Affiliate as presently
conducted or which are permitted by Section 5.2(a), and except that no
representation or warranty is being made with respect to Margin Stock.

(i) No Termination Event has occurred or is reasonably
expected to occur with respect to any Plan which, with the giving of
notice or lapse of time, or both, would constitute an Event of Default
under Section 7.1(g).

(j) Each Plan has complied with the applicable provisions
of ERISA and the Code where the failure to so comply would reasonably
be expected to result in an aggregate liability that would exceed 10%
of the Net Worth of the Company.

(k) The statement of assets and liabilities of each Plan
and the statements of changes in fund balance and in financial
position, or the statement of changes in net assets available for plan
benefits, for the most recent plan year for which an accountant's
report with respect to such Plan has been prepared, copies of which
report have been furnished to the Administrative Agent, fairly present
the financial condition of such Plan as at such date and the results of
operations of such Plan for the plan year ended on such date.

(l) Neither the Company nor any ERISA Affiliate has
incurred, or is reasonably expected to incur, any Withdrawal Liability
to any Multiemployer Plan which, when aggregated with all other amounts
required to be paid to Multiemployer Plans in connection with
Withdrawal Liability (as of the date of determination), would exceed
10% of the Net Worth of the Company.

(m) Neither the Company nor any ERISA Affiliate has
received any notification that any Multiemployer Plan is in
reorganization, insolvent or has been terminated, within the meaning of
Title IV of ERISA, and no Multiemployer Plan is reasonably expected to
be in reorganization, insolvent or to be terminated within the meaning
of Title IV of ERISA the effect of which reorganization, insolvency or
termination would be the occurrence of an Event of Default under
Section 7.1(i).

(n) The Borrowers are not engaged in the business of
extending credit for the purpose of purchasing or carrying

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Margin Stock, and no proceeds of any Advance will be used to extend
credit to others (other than to any Subsidiary of the Company) for the
purpose of purchasing or carrying Margin Stock.

(o) No Borrower is an "investment company" or a "company"
controlled by an "investment company" within the meaning of the
Investment Company Act of 1940, as amended.

(p) No Borrower is a "holding company" or a "subsidiary
company" of a "holding company" within the meaning of the Public
Utility Holding Company Act of 1935, as amended.

All representations and warranties made by the Borrowers herein or made in any
certificate delivered pursuant hereto shall survive the making of the Advances
and the execution and delivery to the Lenders of this Agreement and the Notes.

ARTICLE V

COVENANTS OF THE BORROWERS

SECTION 5.1 Affirmative Covenants. So long as any of the
Notes or other amount payable by any Borrower hereunder shall remain unpaid or
any Lender shall have any Commitment hereunder, each Borrower will, unless the
Majority Lenders shall otherwise consent in writing:

(a) Preservation of Corporate Existence, Etc. Preserve
and maintain, and, in the case of the Company, cause each Principal
Subsidiary and each Restricted Affiliate to preserve and maintain, its
corporate existence, rights (charter and statutory) and material
franchises, except as otherwise permitted by Section 5.2(d) or 5.2(e).

(b) Compliance with Laws, Etc. Comply, and, in the case
of the Company, cause each Principal Subsidiary and each Restricted
Affiliate to comply, in all material respects with all applicable laws,
rules, regulations and orders (including, without limitation, all
environmental laws and laws requiring payment of all taxes, assessments
and governmental charges imposed upon it or upon its property except to
the extent contested in good faith by appropriate proceedings) the
failure to comply with which would have a Material Adverse Effect.

(c) Visitation Rights. At any reasonable time and from
time to time, permit the Administrative Agent or any of the Lenders or
any agents or representatives thereof, to examine and make copies of
and abstracts from the records and books of account of, and visit the
properties of, the Company, any of its Subsidiaries and any Restricted
Affiliate, and to discuss the affairs, finances and accounts of the
Company and any of its Subsidiaries and any Restricted

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Affiliate with any of their officers and with their independent
certified public accountants.

(d) Books and Records. Keep, and, in the case of the
Company, cause each of its Subsidiaries and each Restricted Affiliate
to keep, proper books of record and account, in which full and correct
entries shall be made of all its respective financial transactions and
the assets and business of the Company, each of its Subsidiaries and
each Restricted Affiliate, as applicable, in accordance with generally
accepted accounting principles either (i) consistently applied or (ii)
applied in a changed manner provided such change shall have been
disclosed to the Administrative Agent and shall have been consented to
by the accountants which (as required by Section 5.3(b)) report on the
financial statements of the Company and its consolidated Subsidiaries
for the fiscal year in which such change shall have occurred.

(e) Maintenance of Properties, Etc. Maintain and
preserve, and, in the case of the Company, cause each Principal
Subsidiary and each Restricted Affiliate to maintain and preserve, all
of its properties which are used in the conduct of its business in good
working order and condition, ordinary wear and tear excepted, to the
extent that any failure to do so would have a Material Adverse Effect.

(f) Maintenance of Insurance. Maintain, and, in the case
of the Company, cause each Principal Subsidiary and each Restricted
Affiliate to maintain, insurance with responsible and reputable
insurance companies or associations in such amounts and covering such
risks as is usually carried by companies engaged in similar businesses
and owning similar properties in the same general areas in which the
Company, such Subsidiary or such Restricted Affiliate operates.

(g) Holding Guaranty. Once Holding is formed, cause (i)
Holding to execute and deliver a guaranty (in form and substance
reasonably satisfactory to the Administrative Agent) (the "Holding
Guaranty") in favor of the Administrative Agent, for the ratable
benefit of the Lenders, guaranteeing the prompt and complete payment by
each Borrower when due (whether at the stated maturity, by acceleration
or otherwise) of the Obligations owing by such Borrower and (ii) the
delivery to the Administrative Agent of legal opinions from the General
Counsel or the Associate General Counsel of Holding and from New York
counsel to Holding reasonably acceptable to the Administrative Agent,
which legal opinions shall be in form and substance reasonably
satisfactory to the Administrative Agent.

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SECTION 5.2 Negative Covenants. So long as any of the Notes
or other amount payable by the Borrowers hereunder shall remain unpaid or any
Lender shall have any Commitment hereunder, each Borrower will not, unless the
Majority Lenders shall otherwise consent in writing:

(a) Liens, Etc. (i) Create, assume or suffer to exist,
or, in the case of the Company, permit any Principal Subsidiary to
create, assume or suffer to exist, any Liens upon or with respect to
any of the capital stock of any Principal Subsidiary, whether now owned
or hereafter acquired, or (ii) create or assume, or, in the case of the
Company, permit any Principal Subsidiary or any Restricted Affiliate to
create or assume, any Liens upon or with respect to any other assets
material to the consolidated operations of the Company and its
consolidated Subsidiaries taken as a whole securing the payment of
Indebtedness and Guaranties in an aggregate amount (determined without
duplication of amount (so that the amount of a Guarantee will be
excluded to the extent the Indebtedness Guaranteed thereby is included
in computing such aggregate amount)) exceeding $100,000,000; provided,
however, that this subsection (a) shall not apply to:

(A) Liens on the stock or assets of any Project
Financing Subsidiary or any Restricted Affiliate (or any
partnership interest in or assets of any partnership of which
the Project Financing Subsidiary is a partner) securing the
payment of a Project Financing and related obligations;

(B) Liens on assets acquired by the Company, any
of its Subsidiaries or any Restricted Affiliate after February
11, 1992 to the extent that such Liens existed at the time of
such acquisition and were not placed thereon by or with the
consent of the Company in contemplation of such acquisition;

(C) Liens created by any Alternate Program or any
document executed by any Borrower or any Restricted Affiliate
in connection therewith;

(D) Liens on Margin Stock; and

(E) Liens for taxes, assessments or governmental
charges or levies not yet overdue.

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consolidated Guaranties of EPNGC and its consolidated Subsidiaries and
all Restricted Affiliates and their consolidated Subsidiaries (without
duplication and determined as to all of the foregoing entities on a
consolidated basis) to (B) Capitalization of EPNGC and all Restricted
Affiliates (without duplication and determined as to all of the
foregoing entities on a consolidated basis) to exceed .7 to 1; and (ii)
from and after the date that Holding becomes a Borrower hereunder,
permit the ratio of (A) the sum of (1) the aggregate amount of
consolidated Debt of Holding and its consolidated Subsidiaries plus (2)
the aggregate amount of consolidated Guaranties of Holding and its
consolidated Subsidiaries to (B) Capitalization of Holding to exceed .7
to 1.

(c) Debt, Etc. In the case of the Company, permit any of
its consolidated Subsidiaries to create or suffer to exist any Debt,
any Guaranty or any reimbursement obligation with respect to any letter
of credit (other than any Project Financing), if, immediately after
giving effect to such Debt, Guaranty or reimbursement obligation and
the receipt and application of any proceeds thereof or value received
in connection therewith, the aggregate amount (determined without
duplication of amount) of Debt, Guaranties and letter of credit
reimbursement obligations of the Company's consolidated Subsidiaries
(other than any Project Financing) determined on a consolidated basis
would exceed $75,000,000; provided, however, that the following Debt,
Guaranties or reimbursement obligations shall be excluded from the
application of, and calculation set forth in, this paragraph (c): (A)
Debt, Guaranties or reimbursement obligations incurred by (x) Mojave or
(y) so long as it is a Borrower, EPNGC, (B) Debt, Guaranties or
reimbursement obligations arising under this Agreement, (C) Debt,
Guaranties or reimbursement obligations incurred by El Paso Field
Services Company up to an amount not to exceed at any time outstanding
the tangible net worth of El Paso Field Services Company, provided that
such Debt may be guaranteed by the Company, (D) Excluded Acquisition
Debt and (E) successive extensions, refinancings or replacements of
Debt, Guaranties or reimbursement obligations referred to in clauses
(A) and (D) above and in an amount not in excess of the amounts so
extended, refinanced or replaced.

(d) Sale, Etc. of Assets. Sell, lease or otherwise
transfer, or, in the case of the Company, permit any Principal
Subsidiary to sell, lease or otherwise transfer, (in either case,
whether in one transaction or in a series of transactions) assets
constituting a material portion of the consolidated assets of the
Company and its Principal Subsidiaries taken as a whole, provided that
provisions of this subsection (d) shall not apply to:

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(i) any sale of the San Juan Basin Gathering
System and related facilities in accordance with the
procedures set forth in the Master Separation Agreement dated
as of January 15, 1992 between EPNGC, Meridian Oil Holding
Inc., a Delaware corporation, and Burlington;

(ii) any sale of receivables and related rights
pursuant to any Alternate Program;

(iii) any Project Financing Subsidiary and the
assets thereof;

(iv) sales, leases or other transfers of assets
or capital stock of any Subsidiary of the Company other than
any Principal Subsidiary;

(v) any sale of Margin Stock;

(vi) any sale of up to 20% of the equity of El
Paso Field Services Company in an initial public offering of
such corporation's equity securities;

(vii) any sale, lease or other transfer to the
Company or any Principal Subsidiary, or to any corporation
which after giving effect to such transfer will become and be
either (A) a Principal Subsidiary in which the Company's
direct or indirect equity interest will be at least as great
as its direct or indirect equity interest in the transferor
immediately prior thereto or (B) a directly or indirectly
wholly-owned Principal Subsidiary;

(viii) any transfer permitted by Section 5.2(e);
and

(ix) any transfer to Holding or any of its
Subsidiaries of any stock or assets other than FERC regulated
assets (or stock or any other equity interest in an entity
owning FERC regulated assets) used in the mainline gas
transmission business; provided that (A) no Default or Event
of Default shall have occurred and be continuing before and
after giving effect to such transfer and (B) no Borrower may
be so transferred unless Holding is also a Borrower.

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into) the Company, provided that (A) if such Principal Subsidiary
merges or consolidates with (or liquidates into) the Company, the
Company shall be the continuing or surviving corporation and (B) if any
such Principal Subsidiary merges or consolidates with (or liquidates
into) any other Subsidiary of the Company, one of such Subsidiaries is
the surviving corporation and, if either such Subsidiary is not
wholly-owned by the Company, such merger or consolidation is on an
arm's length basis, and (ii) the Company or any Principal Subsidiary
may merge or consolidate with any other corporation (that is, in
addition to the Company or any Principal Subsidiary of the Company),
provided that (A) if the Company merges or consolidates with any such
other corporation, the Company is the surviving corporation, (B) if any
Principal Subsidiary merges or consolidates with any such other
corporation, the surviving corporation is a wholly-owned Principal
Subsidiary of the Company, and (C) if either the Company or any
Principal Subsidiary merges or consolidates with any such other
corporation, after giving effect to such merger or consolidation no
Event of Default, and no event which with lapse of time or the giving
of notice, or both, would constitute an Event of Default, shall have
occurred and be continuing.

SECTION 5.3 Reporting Requirements. So long as any Note
shall remain unpaid or any Lender shall have any Commitment hereunder, the
Company will furnish to each Lender in such reasonable quantities as shall from
time to time be requested by such Lender:

(a) as soon as publicly available and in any event within
60 days after the end of each of the first three fiscal quarters of
each fiscal year of each of EPNGC and, following its formation,
Holding, a consolidated balance sheet of each of EPNGC and, following
its formation, Holding and its respective consolidated subsidiaries as
of the end of such quarter, and consolidated statements of income and
cash flows of each of EPNGC and, following its formation, Holding and
its respective consolidated subsidiaries each for the period commencing
at the end of the previous fiscal year and ending with the end of such
quarter, certified (subject to normal year-end adjustments) as being
fairly stated in all material respects by the chief financial officer,
controller or treasurer of the Company and accompanied by a certificate
of such officer stating (i) whether or not such officer has knowledge
of the occurrence of any Event of Default which is continuing hereunder
or of any event not theretofore remedied which with notice or lapse of
time or both would constitute such an Event of Default and, if so,
stating in reasonable detail the facts with respect thereto, (ii) all
relevant facts in reasonable detail to evidence, and the computations
as to, whether or not the Company is in compliance with the
requirements set

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forth in subsections (b) and (c) of Section 5.2, and (iii) a listing of
all Principal Subsidiaries and consolidated Subsidiaries of the Company
showing the extent of its direct and indirect holdings of their stocks;

(b) as soon as publicly available and in any event within
120 days after the end of each fiscal year of each of EPNGC and,
following its formation, Holding, a copy of the annual report for such
year for each of EPNGC and, following its formation, Holding and its
respective consolidated Subsidiaries containing financial statements
for such year reported by nationally recognized independent public
accountants acceptable to the Lenders, accompanied by (i) a report
signed by said accountants stating that such financial statements have
been prepared in accordance with generally accepted accounting
principles and (ii) a letter from such accountants stating that in
making the investigations necessary for such report they obtained no
knowledge, except as specifically stated therein, of any Event of
Default which is continuing hereunder or of any event not theretofore
remedied which with notice or lapse of time or both would constitute
such an Event of Default;

(c) within 120 days after the close of each of the
Company's fiscal years, a certificate of the chief financial officer,
controller or treasurer of the Company stating (i) whether or not he
has knowledge of the occurrence of any Event of Default which is
continuing hereunder or of any event not theretofore remedied which
with notice or lapse of time or both would constitute such an Event of
Default and, if so, stating in reasonable detail the facts with respect
thereto, (ii) all relevant facts in reasonable detail to evidence, and
the computations as to, whether or not the Company is in compliance
with the requirements set forth in subsections (b) and (c) of Section
5.2 and (iii) a listing of all Principal Subsidiaries and consolidated
Subsidiaries of the Company showing the extent of its direct and
indirect holdings of their stocks;

(d) promptly after the sending or filing thereof, copies
of all publicly available reports which the Company, any Principal
Subsidiary or any Restricted Affiliate sends to any of its security
holders and copies of all publicly available reports and registration
statements which the Company, any Principal Subsidiary or any
Restricted Affiliate files with the Securities and Exchange Commission
or any national securities exchange other than registration statements
relating to employee benefit plans and to registrations of securities
for selling security holders;

(e) within 10 days after sending or filing thereof, a copy
of FERC Form No. 2: Annual Report of Major Natural Gas Companies, sent
or filed by the Company to or with the FERC with respect to each fiscal
year of the Company;

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(f) promptly in writing, notice of all litigation and of
all proceedings before any governmental or regulatory agencies against
or involving the Company, any Principal Subsidiary or any Restricted
Affiliate, except any litigation or proceeding which in the reasonable
judgment of the Company (taking into account the exhaustion of all
appeals) is not likely to have a material adverse effect on the
consolidated financial condition of the Company and its consolidated
Subsidiaries taken as a whole;

(g) within three Business Days after an executive officer
of the Company obtains knowledge of the occurrence of any Event of
Default which is continuing or of any event not theretofore remedied
which with notice or lapse of time, or both, would constitute an Event
of Default, notice of such occurrence together with a detailed
statement by a responsible officer of the Company of the steps being
taken by the Company or the appropriate Subsidiary to cure the effect
of such event;

(h) as soon as practicable and in any event (i) within 30
days after the Company or any ERISA Affiliate knows or has reason to
know that any Termination Event described in clause (a) of the
definition of Termination Event with respect to any Plan has occurred
and (ii) within 10 days after the Company or any ERISA Affiliate knows
or has reason to know that any other Termination Event has occurred, a
statement of the chief financial officer or treasurer of the Company
describing such Termination Event and the action, if any, which the
Company or such ERISA Affiliate proposes to take with respect thereto;

(i) promptly and in any event within two Business Days
after receipt thereof by the Company or any ERISA Affiliate, copies of
each notice received by the Company or any ERISA Affiliate from the
PBGC stating its intention to terminate any Plan or to have a trustee
appointed to administer any Plan;

(j) promptly and in any event within 30 days after the
filing thereof with the Internal Revenue Service, copies of each
Schedule B (Actuarial Information) to the annual report (Form 5500
Series) with respect to each Single Employer Plan;

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within the meaning of Title IV of ERISA, or (iv) the amount of
liability incurred, or expected to be incurred, by the Company or any
ERISA Affiliate in connection with any event described in clause (i),
(ii) or (iii) above; and

(l) as soon as practicable but in any event within 60 days
of any notice of request therefor, such other information respecting
the financial condition and results of operations of the Company or any
Subsidiary of the Company as any Lender through the Administrative
Agent may from time to time reasonably request.

Each balance sheet and other financial statement furnished
pursuant to subsections (a) and (b) of this Section 5.3 shall contain
comparative financial information which conforms to the presentation required
in Form 10-Q and 10-K, as appropriate, under the Securities Exchange Act of
1934, as amended.

SECTION 5.4 Restrictions on Material Subsidiaries. Upon
Holding becoming a Borrower hereunder, Holding will not, and will not permit
any Material Subsidiary, to enter into any agreement or understanding pursuant
to which (a) any claim Holding may have against any Material Subsidiary would
be subordinate in any manner to the payment of any other obligation of such
Material Subsidiary or (b) by its terms limits or restricts the ability of such
Material Subsidiary to make funds available to Holding (whether by dividend or
other distribution, by replacement of any inter-company advance or otherwise)
if, in any such case referred to in this clause (b), there is, at the time any
such agreement is entered into, a reasonable likelihood that all such
agreements and understandings, considered together, would materially and
adversely affect the ability of Holding to meet its obligations as they become
due.

ARTICLE VI

GUARANTEES

SECTION 6.1 Guarantees. (a) Subject to the provisions of
Section 6.1(b), each Borrower hereby unconditionally and irrevocably guarantees
to the Administrative Agent, for the ratable benefit of the Lenders and their
respective successors, indorsees, transferees and assigns, the prompt and
complete payment by each other Borrower when due (whether at the stated
maturity, by acceleration or otherwise) of the Obligations owing by such other
Borrower.

(b) Anything in this Article VI to the contrary
notwithstanding, the maximum liability of each Borrower (other than a Borrower
which is guaranteeing the Obligations of its Subsidiaries) under this Article
VI shall in no event exceed the amount which can be guaranteed by such
Borrowing Subsidiary under

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applicable federal and state laws relating to the insolvency of debtors.

(c) Each Borrower agrees that the Obligations owing by any
other Borrower may at any time and from time to time exceed the amount of the
liability of such other Borrower under this Article VI without impairing the
guarantee of such Borrower under this Article VI or affecting the rights and
remedies of the Administrative Agent or any Lender under this Article VI.

(d) No payment or payments made by any Borrower or any
other Person or received or collected by the Administrative Agent or any Lender
from any Borrower or any other Person by virtue of any action or proceeding or
any set-off or appropriation or application, at any time or from time to time,
in reduction of or in payment of the Obligations shall be deemed to modify,
reduce, release or otherwise affect the liability of the Borrowers under this
Article VI which shall, notwithstanding any such payment or payments, continue
until the Obligations are paid in full and the Commitments are terminated.

(e) Each Borrower agrees that whenever, at any time, or
from time to time, it shall make any payment to the Administrative Agent or any
Lender on account of its liability under this Article VI, it will notify the
Administrative Agent in writing that such payment is made under this Article VI
for such purpose.

SECTION 6.2 No Subrogation. Notwithstanding any payment or
payments made by any Borrower under this Article VI or any set-off or
application of funds of such Borrower by the Administrative Agent or any
Lender, such Borrower shall not be entitled to be subrogated to any of the
rights of the Administrative Agent or any Lender against any other Borrower or
against any collateral security or guarantee or right of offset held by the
Administrative Agent or any Lender for the payment of the Obligations, nor
shall such Borrower seek or be entitled to seek any contribution or
reimbursement from any other Borrower in respect of payments made by such
Borrower hereunder, until all amounts owing to the Administrative Agent and the
Lenders by the other Borrowers on account of the Obligations are paid in full
and the Commitments are terminated. If any amount shall be paid to any
Borrower on account of such subrogation rights at any time when all of the
Obligations shall not have been paid in full, such amount shall be held by such
Borrower in trust for the Administrative Agent and the Lenders, segregated from
other funds of such Borrower, and shall, forthwith upon receipt by such
Borrower, be turned over to the Administrative Agent in the exact form received
by such Borrower (duly indorsed by such Borrower to the Administrative Agent,
if required), to be applied against the Obligations, whether matured or
unmatured, in such order as the Administrative Agent may determine.

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SECTION 6.3 Amendments, etc. with respect to the Obligations;
Waiver of Rights. Each Borrower shall remain obligated under this Article VI
notwithstanding that, without any reservation of rights against such Borrower,
and without notice to or further assent by such Borrower, any demand for
payment of any of the Obligations made by the Administrative Agent or any
Lender may be rescinded by the Administrative Agent or such Lender, and any of
the Obligations continued, and the Obligations, or the liability of any other
party upon or for any part thereof, or any collateral security or guarantee
therefor or right of offset with respect thereto, may, from time to time, in
whole or in part, be renewed, extended, amended, modified, accelerated,
compromised, waived, surrendered or released by the Administrative Agent or any
Lender, and this Agreement, any Notes and any other documents executed and
delivered in connection herewith may be amended, modified, supplemented or
terminated, in whole or in part, as the Administrative Agent (or the Majority
Lenders, as the case may be) may deem advisable from time to time, and any
collateral security, guarantee or right of offset at any time held by the
Administrative Agent or any Lender for the payment of the Obligations may be
sold, exchanged, waived, surrendered or released. Neither the Administrative
Agent nor any Lender shall have any obligation to protect, secure, perfect or
insure any Lien at any time held by it as security for the Obligations or for
this Agreement or any property subject thereto. When making any demand
hereunder against any Borrower, the Administrative Agent or any Lender may, but
shall be under no obligation to, make a similar demand on the applicable
Borrowing Subsidiaries or any other guarantor, and any failure by the
Administrative Agent or any Lender to make any such demand or to collect any
payments from the other Borrowers or any such other guarantor or any release of
the other Borrowers or such other guarantor shall not relieve such Borrower of
its obligations or liabilities hereunder, and shall not impair or affect the
rights and remedies, express or implied, or as a matter of law, of the
Administrative Agent or any Lender against such Borrower for the purposes
hereof "demand" shall include the commencement and continuance of any legal
proceedings.

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continuing, absolute and unconditional guarantee of payment without regard to
(a) the validity, regularity or enforceability of this Agreement, any Note, any
of the Obligations or any other collateral security therefor or guarantee or
right of offset with respect thereto at any time or from time to time held by
the Administrative Agent or any Lender, (b) any defense, set-off or
counterclaim (other than a defense of payment or performance) which may at any
time be available to or be asserted by any Borrower against the Administrative
Agent or any Lender, or (c) any other circumstance whatsoever (with or without
notice to or knowledge of any Borrower) which constitutes, or might be
construed to constitute, an equitable or legal discharge of any Borrower for
the Obligations, or of the Borrowers under this Agreement, in bankruptcy or in
any other instance. When pursuing its rights and remedies hereunder against
any Borrower, the Administrative Agent and any Lender may, but shall be under
no obligation to, pursue such rights and remedies as it may have against any
other Borrower or any other Person or against any collateral security or
guarantee for the Obligations or any right of offset with respect thereto, and
any failure by the Administrative Agent or any Lender to pursue such other
rights or remedies or to collect any payments from other Borrowers or any such
other Person or to realize upon any such collateral security or guarantee or to
exercise any such right of offset, or any release of any other Borrower or any
such other Person or of any such collateral security, guarantee or right of
offset, shall not relieve any Borrower of any liability hereunder, and shall
not impair or affect the rights and remedies, whether express, implied or
available as a matter of law, of the Administrative Agent or any Lender against
such Borrower. The guarantees contained in this Article VI shall remain in
full force and effect and be binding in accordance with and to the extent of
its terms upon each Borrower and its successors and assigns thereof, and shall
inure to the benefit of the Administrative Agent and the Lenders, and their
respective successors, indorsees, transferees and assigns, until all the
Obligations and the obligations of the Borrowers under this Agreement shall
have been satisfied by payment in full and the Commitments shall be terminated,
notwithstanding that from time to time during the term of this Agreement the
Borrowers may be free from any Obligations.

SECTION 6.5 Reinstatement. The provisions of this Article VI
shall continue to be effective, or be reinstated, as the case may be, if at any
time payment, or any part thereof, of any of the Obligations is rescinded or
must otherwise be restored or returned by the Administrative Agent or any
Lender upon the insolvency, bankruptcy, dissolution, liquidation or
reorganization of any Borrower or upon or as a result of the appointment of a
receiver, intervenor or conservator of, or trustee or similar officer for, any
Borrower or any substantial part of its property, or otherwise, all as though
such payments had not been made.

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ARTICLE VII

EVENTS OF DEFAULT

SECTION 7.1 Event of Default. If any of the following events
("Events of Default") shall occur and be continuing:

(a) Any Borrower shall fail to pay any installment of
principal of any of its Notes when due, or any interest on any of its
Notes or any other amount payable by it hereunder within five Business
Days after the same shall be due; or

(b) Any representation or warranty made or deemed made by
any Borrower herein or by any Borrower (or any of its officers) in
connection with this Agreement shall prove to have been incorrect in
any material respect when made or deemed made; or

(c) Any Borrower shall fail to perform or observe any
other term, covenant or agreement contained in this Agreement on its
part to be performed or observed and any such failure shall remain
unremedied for 30 days after written notice thereof shall have been
given to such Borrower by the Administrative Agent or by any Lender
with a copy to the Administrative Agent; or

(d) The Company, any Principal Subsidiary or any
Restricted Affiliate shall fail to pay any Debt or Guaranty (excluding
Debt incurred pursuant hereto) of the Company, such Subsidiary or such
Restricted Affiliate (as the case may be) in an aggregate principal
amount of $25,000,000 or more, or any installment of principal thereof
or interest or premium thereon, when due (whether by scheduled
maturity, required prepayment, acceleration, demand or otherwise) and
such failure shall continue after the applicable grace period, if any,
specified in the agreement or instrument relating to such Debt or
Guaranty; or any other default under any agreement or instrument
relating to any such Debt, or any other event, shall occur and shall
continue after the applicable grace period, if any, specified in such
agreement or instrument, if the effect of such default or event is to
accelerate, or to permit the acceleration of, the maturity of such
Debt; or any such Debt shall be required to be prepaid (other than by a
regularly scheduled required prepayment), prior to the stated maturity
thereof, as a result of either (i) any default under any agreement or
instrument relating to any such Debt or (ii) the occurrence of any
other event the effect of which would otherwise accelerate or to permit
the acceleration of the maturity of such Debt; provided that,
notwithstanding any provision contained in this subsection (d) to the
contrary, to the extent that pursuant to the terms of any agreement or
instrument relating to any Debt or Guaranty referred to in this
subsection (d) (or in the case of any such Guaranty,

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relating to any obligations Guaranteed thereby), any sale, pledge or
disposal of Margin Stock, or utilization of the proceeds of such sale,
pledge or disposal, would result in a breach of any covenant contained
therein or otherwise give rise to a default or event of default
thereunder and/or acceleration of the maturity of the Debt or
obligations extended pursuant thereto, or payment pursuant to any
Guaranty, and as a result of such terms or of such sale, pledge,
disposal, utilization, breach, default, event of default or
acceleration or nonpayment under such Guaranty, or the provisions
thereof relating thereto, this Agreement or any Advance hereunder would
otherwise be subject to the margin requirements or any other
restriction under Regulation U issued by the Board of Governors of the
Federal Reserve System, then such breach, default, event of default or
acceleration, or nonpayment under any Guaranty, shall not constitute a
default or Event of Default under this subsection (d); or

(e)(i) The Company, any Principal Subsidiary or any
Restricted Affiliate shall (A) generally not pay its debts as such
debts become due; or (B) admit in writing its inability to pay its
debts generally; or (C) make a general assignment for the benefit of
creditors; or (ii) any proceeding shall be instituted or consented to
by the Company, any such Subsidiary or any such Restricted Affiliate
seeking to adjudicate it a bankrupt or insolvent, or seeking
liquidation, winding up, reorganization, arrangement, adjustment,
protection, relief, or composition of it or its debts under any law
relating to bankruptcy, insolvency or reorganization or relief of
debtors, or seeking the entry of an order for relief or the appointment
of a receiver, trustee, or other similar official for it or for any
substantial part of its property; or (iii) any such proceeding shall
have been instituted against the Company, any such Subsidiary or any
such Restricted Affiliate and either such proceeding shall not be
stayed or dismissed for 60 consecutive days or any of the actions
sought in such proceeding (including, without limitation, the entry of
an order for relief against it or the appointment of a receiver,
trustee, custodian or other similar official for it or any substantial
part of its property) shall occur; or (iv) the Company, any such
Subsidiary or any such Restricted Affiliate shall take any corporate
action to authorize any of the actions set forth above in this
subsection (e); or

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levy or similar process in respect of such lien, or payment over in
respect of such garnishment or similar order, has commenced) or (ii)
there shall be any period of 30 consecutive days during which a stay of
execution or of enforcement proceedings (other than those referred to
in the parenthesis in clause (i) above) in respect of such judgment or
order, by reason of a pending appeal, bonding or otherwise, shall not
be in effect; or

(g) (i) Any Termination Event with respect to a Plan shall
have occurred and, 30 days after notice thereof shall have been given
to the Company by the Administrative Agent, such Termination Event
shall still exist; or (ii) the Company or any ERISA Affiliate shall
have been notified by the sponsor of a Multiemployer Plan that it has
incurred Withdrawal Liability to such Multiemployer Plan; or (iii) the
Company or any ERISA Affiliate shall have been notified by the sponsor
of a Multiemployer Plan that such Multiemployer Plan is in
reorganization, or is insolvent or is being terminated, within the
meaning of Title IV of ERISA; or (iv) any Person shall engage in a
"prohibited transaction" (as defined in Section 406 of ERISA or Section
4975 of the Code) involving any Plan; and in each case in clauses (i)
through (iv) above, such event or condition, together with all other
such events or conditions, if any, would result in an aggregate
liability of the Company or any ERISA Affiliate that would exceed 10%
of the Net Worth of the Company.

(h) Upon completion of, and pursuant to, a transaction, or
a series of transactions (which may include prior acquisitions of
capital stock of EPNGC or Holding in the open market or otherwise),
involving a tender offer (i) a "person" (within the meaning of Section
13(d) of the Securities Exchange Act of 1934) other than Burlington,
EPNGC or Holding, a Subsidiary of EPNGC or Holding or any employee
benefit plan maintained for employees of EPNGC or Holding and/or any of
their respective Subsidiaries or the trustee therefor, shall have
acquired direct or indirect ownership of and paid for in excess of 50%
of the outstanding capital stock of EPNGC or Holding entitled to vote
in elections for directors of EPNGC or Holding and (ii) at any time
before the later of (A) six months after the completion of such tender
offer and (B) the next annual meeting of the shareholders of EPNGC or
Holding following the completion of such tender offer more than half of
the directors of EPNGC or Holding consists of individuals who (1) were
not directors before the completion of such tender offer and (2) were
not appointed, elected or nominated by the Board of Directors in office
prior to the completion of such tender offer (other than any such
appointment, election or nomination required or agreed to in connection
with, or as a result of, the completion of such tender offer); or

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(i) Any event of default shall occur under any agreement
or instrument relating to or evidencing any Debt now or hereafter
existing of the Company or any Principal Subsidiary or Restricted
Affiliate as the result of any change of control of the Company; or

(j) Any of (i) the guarantees contained in Article VI,
(ii) the Restricted Affiliate Guarantees or (iii) the Holding Guaranty
shall cease, for any reason, to be in full force and effect or any
Borrower, any Restricted Affiliate or Holding shall so assert;

then, and in any such event, the Administrative Agent shall at the request, or
may with the consent, of the Majority Lenders, by notice to the Company, (i)
declare the obligation of each Lender to make Advances to be terminated,
whereupon the same shall forthwith terminate, and (ii) declare the Notes, all
interest thereon and all other amounts payable under this Agreement to be
forthwith due and payable, whereupon the Notes, all such interest and all such
amounts shall become and be forthwith due and payable, without presentment,
demand, protest or further notice of any kind, all of which are hereby
expressly waived by the Borrowers; provided, however, that if an Event of
Default under subsection (e) of this Section 7.1 (except under clause (i)(A)
thereof) shall occur, (A) the obligation of each Lender to make Advances shall
automatically be terminated and (B) the Notes, all interest thereon and all
other amounts payable under this Agreement shall automatically become and be
forthwith due and payable, without presentment, demand, protest or any notice
of any kind, all of which are hereby expressly waived by the Borrowers.

ARTICLE VIII

THE ADMINISTRATIVE AGENT AND THE CAF ADVANCE AGENT

SECTION 8.1 Authorization and Action. Each Lender hereby
appoints and authorizes the Administrative Agent and the CAF Advance Agent to
take such action as agent on its behalf and to exercise such powers under this
Agreement as are delegated to the Administrative Agent and the CAF Advance
Agent by the terms hereof, together with such powers as are reasonably
incidental thereto. As to any matters not expressly provided for by this
Agreement (including, without limitation, enforcement of this Agreement or
collection of the Notes), the Administrative Agent and the CAF Advance Agent
shall not be required to exercise any discretion or take any action, but shall
be required to act or to refrain from acting (and shall be fully protected in
so acting or refraining from acting) upon the instructions of the Majority
Lenders, and such instructions shall be binding upon all Lenders and all
holders of Notes; provided, however, that the Administrative Agent and the CAF
Advance Agent shall not be required to take any action which exposes the
Administrative

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Agent or the CAF Advance Agent to personal liability or which is contrary to
this Agreement or applicable law. The Administrative Agent and the CAF Advance
Agent agree to give to each Lender prompt notice of each notice given to it by
any Borrower pursuant to the terms of this Agreement.

SECTION 8.2 Administrative Agent's and CAF Advance Agent's
Reliance, Etc. None of the Administrative Agent, the CAF Advance Agent or any
of its respective directors, officers, agents or employees shall be liable for
any action taken or omitted to be taken by it or them under or in connection
with this Agreement, except for its or their own gross negligence or willful
misconduct. Without limitation of the generality of the foregoing, the
Administrative Agent and the CAF Advance Agent: (i) may treat the payee of any
Note as the holder thereof until the Administrative Agent receives and accepts
an Assignment and Acceptance entered into by the Lender which is the payee of
such Note, as assignor, and an Eligible Assignee, as assignee, as provided in
Section 9.7; (ii) may consult with legal counsel (including counsel for the
Company), independent public accountants and other experts selected by it and
shall not be liable for any action taken or omitted to be taken in good faith
by it in accordance with the advice of such counsel, accountants or experts;
(iii) makes no warranty or representation to any Lender and shall not be
responsible to any Lender for any statements, warranties or representations
(whether written or oral) made in or in connection with this Agreement; (iv)
shall not have any duty to ascertain or to inquire as to the performance or
observance of any of the terms, covenants or conditions of this Agreement on
the part of the Borrowers or to inspect the property (including the books and
records) of the Borrowers; (v) shall not be responsible to any Lender for the
due execution, legality, validity, enforceability, genuineness, sufficiency or
value of this Agreement or any other instrument or document furnished pursuant
hereto; and (vi) shall incur no liability under or in respect of this Agreement
by acting upon any notice, consent, certificate or other instrument or writing
(which may be by telegram, telecopier, cable or telex) believed by it to be
genuine and signed or sent by the proper party or parties.

SECTION 8.3 Chemical and Affiliates. With respect to its
Commitment, the Advances made by it and the Note issued to it, Chemical shall
have the same rights and powers under this Agreement as any other Lender and
may exercise the same as though it were not the Administrative Agent or the CAF
Advance Agent; and the term "Lender" or "Lenders" shall, unless otherwise
expressly indicated, include Chemical in its individual capacity. Chemical and
its affiliates may accept deposits from, lend money to, act as trustee under
indentures of, and generally engage in any kind of business with, the Company,
any of its Subsidiaries and any Person who may do business with or own
securities of the Company or any of its Subsidiaries, all as if Chemical were
not

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the Administrative Agent or the CAF Advance Agent and without any duty to
account therefor to the other Lenders.

SECTION 8.4 Lender Credit Decision. Each Lender acknowledges
that it has, independently and without reliance upon the Administrative Agent,
the CAF Advance Agent or any other Lender and based on the financial statements
referred to in Section 4.1 and such other documents and information as it has
deemed appropriate, made its own credit analysis and decision to enter into
this Agreement. Each Lender also acknowledges that it will, independently and
without reliance upon the Administrative Agent, the CAF Advance Agent or any
other Lender and based on such documents and information as it shall deem
appropriate at the time, continue to make its own credit decisions in taking or
not taking action under this Agreement.

SECTION 8.5 Indemnification. The Lenders agree to indemnify
the Administrative Agent and the CAF Advance Agent (to the extent not
reimbursed by the Borrowers), ratably according to the respective principal
amounts of the Notes then held by each of them (or if no Notes are at the time
outstanding or if any Notes are held by Persons which are not Lenders, ratably
according to the respective amounts of their aggregate Commitments), from and
against any and all liabilities, obligations, losses, damages, penalties,
actions, judgments, suits, costs, expenses or disbursements of any kind or
nature whatsoever which may be imposed on, incurred by, or asserted against the
Administrative Agent or the CAF Advance Agent in any way relating to or arising
out of this Agreement or any action taken or omitted by the Administrative
Agent or the CAF Advance Agent under this Agreement, provided that no Lender
shall be liable for any portion of such liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, costs, expenses or disbursements
resulting from the Administrative Agent's or the CAF Advance Agent's gross
negligence or willful misconduct. Without limitation of the foregoing, each
Lender agrees to reimburse the Administrative Agent and the CAF Advance Agent
promptly upon demand for its ratable share of any out-of-pocket expenses
(including reasonable counsel fees) incurred by the Administrative Agent or the
CAF Advance Agent in connection with the preparation, execution, delivery,
administration, modification, amendment or enforcement (whether through
negotiations, legal proceedings, in bankruptcy or insolvency proceedings, or
otherwise) of, or legal advice in respect of rights or responsibilities under,
this Agreement, to the extent that the Administrative Agent or the CAF Advance
Agent is not reimbursed for such expenses by the Borrowers.

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to appoint a successor Administrative Agent or the CAF Advance Agent. If no
successor Administrative Agent or CAF Advance Agent shall have been so
appointed by the Majority Lenders, and shall have accepted such appointment,
within 30 days after the retiring Administrative Agent's or the CAF Advance
Agent giving of notice of resignation or the Majority Lenders' removal of the
retiring Administrative Agent or CAF Advance Agent, then such retiring
Administrative Agent or CAF Advance Agent may, on behalf of the Lenders,
appoint a successor Administrative Agent or CAF Advance Agent, which shall be a
Lender and a commercial bank organized, or authorized to conduct a banking
business, under the laws of the United States of America or of any State
thereof and having a combined capital and surplus of at least $500,000,000.
Upon the acceptance of any appointment as Administrative Agent or CAF Advance
Agent hereunder by a successor Administrative Agent or CAF Advance Agent, such
successor Administrative Agent or CAF Advance Agent shall thereupon succeed to
and become vested with all the rights, powers, privileges and duties of the
retiring Administrative Agent or CAF Advance Agent, and the retiring
Administrative Agent or CAF Advance Agent shall be discharged from its duties
and obligations under this Agreement. After any retiring Administrative
Agent's or CAF Advance Agent's resignation or removal hereunder as
Administrative Agent or CAF Advance Agent, the provisions of this Article VII
shall inure to its benefit as to any actions taken or omitted to be taken by it
while it was Administrative Agent or CAF Advance Agent under this Agreement.

ARTICLE IX

MISCELLANEOUS

SECTION 9.1 Amendments, Etc. An amendment or waiver of any
provision of this Agreement or the Notes, or a consent to any departure by any
Borrower therefrom, shall be effective against the Lenders and all holders of
the Notes if, but only if, it shall be in writing and signed by the Majority
Lenders, and then such a waiver or consent shall be effective only in the
specific instance and for the specific purpose for which given; provided,
however, that no such amendment, waiver or consent shall, unless in writing and
signed by all the Lenders, be effective to: (a) waive any of the conditions
specified in Article III, (b) increase the Commitments of the Lenders or
subject the Lenders to any additional obligations, (c) reduce the principal of,
or interest on, the Notes or any facility fees hereunder, (d) postpone any date
fixed for any payment of principal of, or interest on, the Notes or any
facility fees hereunder, (e) change the percentage of the Commitments or of the
aggregate unpaid principal amount of the Notes, or the number of Lenders, which
shall be required for the Lenders or any of them to take any action under this
Agreement, (f) amend this Section 9.1 or (g) amend, waive or consent to any
departure of any provision in Article VI; provided, further, that no amendment,

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waiver or consent shall, unless in writing and signed by the Administrative
Agent and the CAF Advance Agent in addition to the Lenders required hereinabove
to take such action, affect the rights or duties of the Administrative Agent or
the CAF Advance Agent under this Agreement or any Note.

SECTION 9.2 Notices, Etc. Except as otherwise provided in
Section 2.3(a), 2.5(d) or 2.15(b), all notices and other communications
provided for hereunder shall be in writing (including telecopier and other
readable communication) and mailed by certified mail, return receipt requested,
telecopied or otherwise transmitted or delivered, if to any Borrower, c/o the
Company at 1 Paul Kayser Center, 100 North Stanton Street, El Paso, Texas
79901, Attention: Executive Vice President and Chief Financial Officer,
Telecopier: (915) 541-5008; if to any Lender, at its address set forth under
its name on Schedule I; if to the Administrative Agent, at 270 Park Avenue, New
York, New York 10017, Attention: John Gehebe, Telecopier: (212) 270-4892;
and if to the CAF Advance Agent, at 140 East 45th Street, New York, New York
10017, Attention: Terri Reilly, Telecopier: (212) 622-0003, Telephone: (212)
622-8779; or, as to each party and each Borrowing Subsidiary, at such other
address as shall be designated by such party in a written notice to the other
parties. All such notices and communications shall, if so mailed, telecopied
or otherwise transmitted, be effective when received, if mailed, or when the
appropriate answerback or other evidence of receipt is given, if telecopied or
otherwise transmitted, respectively. A notice received by the Administrative
Agent, the CAF Advance Agent or a Lender by telephone pursuant to Section
2.3(a), 2.5(d) or 2.15(b) shall be effective if the Administrative Agent or
Lender believes in good faith that it was given by an authorized representative
of the applicable Borrower and acts pursuant thereto, notwithstanding the
absence of written confirmation or any contradictory provision thereof.

SECTION 9.3 No Waiver; Remedies. No failure on the part of
any Lender, the Administrative Agent or the CAF Advance Agent to exercise, and
no delay in exercising, any right hereunder or under any Note shall operate as
a waiver thereof; nor shall any single or partial exercise of any right
hereunder or under any Note preclude any other or further exercise thereof or
the exercise of any other right. The remedies herein provided are cumulative
and not exclusive of any remedies provided by law.

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all or any portion of the Commitments hereunder, including, without limitation,
the related reasonable fees and out-of-pocket expenses of counsel for the
Administrative Agent or its Affiliates, travel expenses, duplication and
printing costs and courier and postage fees, and excluding any syndication fees
paid to other parties joining the syndicate and (iii) all out-of-pocket costs
and expenses, if any, incurred by the Administrative Agent, the CAF Advance
Agent and the Lenders in connection with the enforcement (whether through
negotiations, legal proceedings in bankruptcy or insolvency proceedings, or
otherwise) of this Agreement, the Notes and the other documents to be delivered
hereunder and thereunder, including the reasonable fees and out-of-pocket
expenses of counsel.

(b) If any payment of principal of, or Conversion of, any
Eurodollar Rate Advance or CAF Advance is made by any Borrower to or for the
account of a Lender on any day other than the last day of the Interest Period
for such Advance, as a result of a prepayment pursuant to Section 2.15 or a
Conversion pursuant to Section 2.13(f) or Section 2.14 or due to acceleration
of the maturity of the Notes pursuant to Section 7.1 or due to any other reason
attributable to such Borrower, such Borrower shall, upon demand by such Lender
(with a copy of such demand to the Administrative Agent), pay to the
Administrative Agent for the account of such Lender any amounts required to
compensate such Lender for any additional losses, costs or expenses which it
may reasonably incur as a result of such payment or Conversion, including,
without limitation, any loss (excluding loss of anticipated profits), cost or
expense incurred by reason of the liquidation or reemployment of deposits or
other funds acquired by any Lender to fund or maintain such Advance.

(c) Each Borrower agrees to indemnify and hold harmless
the Administrative Agent, the CAF Advance Agent and each Lender (to the extent
not reimbursed by any other Borrower) from and against any and all claims,
damages, liabilities and expenses (including, without limitation, fees and
disbursements of counsel) which may be incurred by or asserted against the
Administrative Agent, the CAF Advance Agent or such Lender in connection with
or arising out of any investigation, litigation, or proceeding (whether or not
the Administrative Agent, the CAF Advance Agent or such Lender is party
thereto) related to any acquisition or proposed acquisition by the Company, or
by any Subsidiary of the Company, of all or any portion of the stock or
substantially all the assets of any Person or any use or proposed use of the
Advances by any Borrower (excluding any claims, damages, liabilities or
expenses incurred by reason of the gross negligence or willful misconduct of
the party to be indemnified or its employees or agents, or by reason of any use
or disclosure of information relating to any such acquisition or use or
proposed use of the proceeds by the party to be indemnified or its employees or
agents).

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SECTION 9.5 Right of Set-Off. Upon the declaration of the
Notes as due and payable pursuant to the provisions of Section 7.1, each Lender
is hereby authorized at any time and from time to time, to the fullest extent
permitted by law, to set off and apply any and all deposits (general or
special, time or demand, provisional or final) at any time held and other
indebtedness at any time owing by such Lender to or for the credit or the
account of the applicable Borrower against any and all of the obligations of
such Borrower now or hereafter existing under this Agreement and the Notes of
such Borrower held by such Lender, irrespective of whether or not such Lender
shall have made any demand under this Agreement or such Notes and although such
obligations may be unmatured. Each Lender agrees promptly to notify the
Company after any such set-off and application made by such Lender, provided
that the failure to give such notice shall not affect the validity of such
set-off and application. The rights of each Lender under this Section 9.5 are
in addition to other rights and remedies (including, without limitation, other
rights of set-off) which such Lender may have.

SECTION 9.6 Binding Effect. This Agreement shall become
effective in accordance with the provisions of Section 3.1, and thereafter
shall be binding upon and inure to the benefit of the Borrowers, the
Administrative Agent, the CAF Advance Agent and each Lender and their
respective successors and assigns, except that no Borrower shall have the right
to assign its rights hereunder or any interest herein without the prior written
consent of all of the Lenders.

SECTION 9.7 Assignments and Participations. (a) Each Lender
may assign to one or more banks or other financial institutions all or a
portion of its rights and obligations under this Agreement (including, without
limitation, all or a portion of its Commitment, the Advances owing to it and
the Notes held by it); provided, however, that (i) each such assignment shall
be of a constant, and not a varying, percentage of all rights and obligations
under this Agreement, (ii) the amount of the Commitment of the assigning Lender
being assigned pursuant to each such assignment (determined as of the date of
the Assignment and Acceptance with respect to such assignment) shall in no
event be less than $15,000,000 (or, if less, the entire Commitment of the
assigning Lender) and shall be an integral multiple of $1,000,000, (iii) each
such assignment shall be to an Eligible Assignee, and (iv) the parties to each
such assignment shall execute and deliver to the Administrative Agent, for its
acceptance and recording in the Register, an Assignment and Acceptance,
together with any Notes subject to such assignment and a processing and
recordation fee of $2,500, and shall send to the Company an executed
counterpart of such Assignment and Acceptance. Upon such execution, delivery,
acceptance and recording, from and after the effective date specified in each
Assignment and Acceptance, (A) the assignee thereunder shall be a party hereto
and, to the extent that rights and obligations hereunder have been assigned to
it pursuant to such Assignment

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and Acceptance, have the rights and obligations of a Lender hereunder and (B)
the assigning Lender thereunder shall, to the extent that rights and
obligations hereunder have been assigned by it pursuant to such Assignment and
Acceptance, relinquish its rights and be released from its obligations under
this Agreement (and, in the case of an Assignment and Acceptance covering all
or the remaining portion of an assigning Lender's rights and obligations under
this Agreement, such Lender shall cease to be a party hereto).

(b) By executing and delivering an Assignment and
Acceptance, each Lender assignor thereunder and the assignee thereunder confirm
to and agree with each other and the other parties hereto as follows: (i)
other than as provided in such Assignment and Acceptance, such assigning Lender
makes no representation or warranty and assumes no responsibility with respect
to any statements, warranties or representations made in or in connection with
this Agreement or the execution, legality, validity, enforceability,
genuineness, sufficiency or value of this Agreement or any other instrument or
document furnished pursuant hereto; (ii) such assigning Lender makes no
representation or warranty and assumes no responsibility with respect to the
financial condition of each Borrower or the performance or observance by each
Borrower of any of its obligations under this Agreement or any other instrument
or document furnished pursuant hereto; (iii) such assignee confirms that it has
received a copy of this Agreement, together with copies of the financial
statements referred to in Section 4.1 and such other documents and information
as it has deemed appropriate to make its own credit analysis and decision to
enter into such Assignment and Acceptance; (iv) such assignee will,
independently and without reliance upon the Administrative Agent, the CAF
Advance Agent, such assigning Lender or any other Lender and based on such
documents and information as it shall deem appropriate at the time, continue to
make its own credit decisions in taking or not taking action under this
Agreement; (v) such assignee confirms that it is an Eligible Assignee; (vi)
such assignee appoints and authorizes the Administrative Agent and the CAF
Advance Agent to take such action as agent on its behalf and to exercise such
powers under this Agreement as are delegated to the Administrative Agent and
the CAF Advance Agent by the terms hereof, together with such powers as are
reasonably incidental thereto; and (vii) such assignee agrees that it will
perform in accordance with their terms all of the obligations which by the
terms of this Agreement are required to be performed by it as a Lender.

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absent manifest error, and each Borrower, the Administrative Agent, the CAF
Advance Agent and the Lenders may treat each Person whose name is recorded in
the Register as a Lender hereunder for all purposes of this Agreement. The
Register shall be available for inspection by any Borrower or any Lender at any
reasonable time and from time to time upon reasonable prior notice. Upon the
acceptance of any Assignment and Acceptance for recordation in the Register,
Schedule I hereto shall be deemed to be amended to reflect the revised
Commitments of the Lenders parties to such Assignment and Acceptance as well as
administrative information with respect to any new Lender as such information
is recorded in the Register.

(d) Upon its receipt of an Assignment and Acceptance
executed by an assigning Lender and as assignee representing that it is an
Eligible Assignee, together with any Notes subject to such assignment, the
Administrative Agent shall, if such Assignment and Acceptance has been
completed and is in substantially the form of Exhibit G hereto, (i) accept such
Assignment and Acceptance, (ii) record the information contained therein in the
Register and (iii) give prompt notice thereof to the Company; within five
Business Days after its receipt of such notice and its receipt of an executed
counterpart of such Assignment and Acceptance, the Borrowers, at their own
expense, shall execute and deliver to the Administrative Agent in exchange for
the surrendered Notes new Notes to the order of such Eligible Assignee in an
amount equal to the Commitment assumed by it pursuant to such Assignment and
Acceptance and, if the assigning Lender has retained a Commitment hereunder,
new Notes to the order of the assigning Lender in an amount equal to the
Commitment retained by it hereunder. Such new Notes shall be in an aggregate
principal amount equal to the aggregate principal amount of such surrendered
Notes, shall be dated (A) in the case of Notes made by EPNGC, the Closing Date
and (B) in the case of Notes made by any other Borrower, the date such other
Borrower executes and delivers its Joinder Agreement, and shall otherwise be in
substantially the form of Exhibits A and C.

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Agreement or any waiver hereunder without the consent, approval or vote of any
such participant or group of participants, other than modifications, amendments
and waivers which (A) postpone any date fixed for any payment of, or reduce any
payment of, principal of or interest on such Lender's Notes or any facility
fees payable under this Agreement, or (B) increase the amount of such Lender's
Commitment in a manner which would have the effect of increasing the amount of
a participant's participation, or (C) reduce the interest rate payable under
this Agreement and such Lender's Notes, or (D) consent to the assignment or the
transfer by any Borrower of any of its rights and obligations under the
Agreement, and (vi) except as contemplated by the immediately preceding clause
(v), no participant shall be deemed to be or to have any of the rights or
obligations of a "Lender" hereunder.

(f) Any Lender may, in connection with any assignment or
participation or proposed assignment or participation pursuant to this Section
9.7, disclose to the assignee or participant or proposed assignee or
participant, any information relating to the Borrowers furnished to such Lender
by or on behalf of the Borrowers; provided that, prior to any such disclosure,
the assignee or participant or proposed assignee or participant shall agree in
writing for the benefit of the Borrowers to preserve the confidentiality of any
confidential information relating to the Borrowers received by it from such
Lender in a manner consistent with Section 9.8.

(g) Anything in this Agreement to the contrary
notwithstanding, any Lender may at any time create a security interest in all
or any portion of its rights under this Agreement (including, without
limitation, the Advances owing to it) and the Notes issued to it hereunder in
favor of any Federal Reserve Bank in accordance with Regulation A of the Board
of Governors of the Federal Reserve System (or any successor regulation) and
the applicable operating circular of such Federal Reserve Bank.

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in order to comply with any law, order, regulation or ruling applicable to such
party, or (v) to any prospective assignee or participant in connection with any
contemplated assignment of any rights or obligations hereunder, or any sale of
any participation therein, by such Party pursuant to Section 9.7, if such
prospective assignee or participant, as the case may be, executes an agreement
with the Company containing provisions substantially similar to those contained
in this Section 9.8; provided, however, that the Company acknowledges that the
Administrative Agent has disclosed and may continue to disclose such
information as the Administrative Agent in its sole discretion determines is
appropriate to the Lenders from time to time.

SECTION 9.9 Consent to Jurisdiction. (a) Each Borrower
hereby irrevocably submits to the jurisdiction of any New York State or Federal
court sitting in New York City and any appellate court from any thereof in any
action or proceeding by the Administrative Agent, the CAF Advance Agent, any
Lender or the holder of any Note in respect of, but only in respect of, any
claims or causes of action arising out of or relating to this Agreement or the
Notes (such claims and causes of action, collectively, being "Permitted
Claims"), and each Borrower hereby irrevocably agrees that all Permitted Claims
may be heard and determined in such New York State court or in such Federal
court. Each Borrower hereby irrevocably waives, to the fullest extent it may
effectively do so, the defense of an inconvenient forum to the maintenance of
such action or proceeding in any aforementioned court in respect of Permitted
Claims. Each Borrower hereby irrevocably appoints CT Corporation System (the
"Process Agent"), with an office on the date hereof at 1633 Broadway, New York,
New York 10019, as its agent to receive on behalf of such Borrower and its
property service of copies of the summons and complaint and any other process
which may be served by the Administrative Agent, any Lender or the holder of
any Note in any such action or proceeding in any aforementioned court in
respect of Permitted Claims. Such service may be made by delivering a copy of
such process to the Company by courier and by certified mail (return receipt
requested), fees and postage prepaid, both (i) in care of the Process Agent at
the Process Agent's above address and (ii) at the Company's address specified
pursuant to Section 9.2, and each Borrower hereby irrevocably authorizes and
directs the Process Agent to accept such service on its behalf. Each Borrower
agrees that a final judgment in any such action or proceeding shall be
conclusive and may be enforced in other jurisdictions by suit on the judgment
or in any other manner provided by law.

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of other jurisdictions or (ii) shall be deemed to be a general consent to
jurisdiction in any particular court or a general waiver of any defense or a
consent to jurisdiction of the courts expressly referred to in subsection (a)
above in any action or proceeding in respect of any claim or cause of action
other than Permitted Claims.

SECTION 9.10 GOVERNING LAW. THIS AGREEMENT AND THE NOTES
SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE
OF NEW YORK.

SECTION 9.11 Rate of Interest. It is the intention of the
parties hereto that each Lender shall each conform strictly to usury laws
applicable to it. Accordingly, if the transactions contemplated hereby would
be usurious as to any Lender under laws applicable to it, then, in that event,
notwithstanding anything to the contrary in this Agreement or in the Notes to
the order of such Lender, it is agreed as follows: (a) the aggregate of all
consideration which constitutes interest under law applicable to such Lender
that is contracted for, taken, reserved, charged or received by such Lender
hereunder, or under such Notes or otherwise, shall under no circumstances
exceed the maximum amount allowed by such applicable law, and any excess shall
be credited by such Lender on the principal amount of the sums owed to such
Lender (or, if all amounts owing to such Lender shall have been paid in full,
refunded by such Lender to the applicable Borrower); or (b) in the event that a
prepayment of any Advances owed to any Lender is required, then such
consideration that constitutes interest under law applicable to such Lender may
never include more than the maximum amount allowed by such applicable law, and
excess interest, if any, provided for shall be cancelled automatically by such
Lender as of the date of such prepayment and, if theretofore paid, shall be
credited by such Lender on the principal amount of such prepayment obligation
(or, if the principal amount of such prepayment obligation shall have been paid
in full, refunded by such Lender to the applicable Borrower). To the extent
that Article 5069-1.04 of the Texas Revised Civil Statutes is relevant to any
Lender for the purpose of determining the maximum amount of interest allowed by
applicable law, such Lender hereby elects to determine the applicable rate
ceiling under such Article by the indicated (weekly) rate ceiling from time to
time in effect, subject to such Lender's right subsequently to change such
method in accordance with applicable law. In no event, however, shall Article
5069, Chapter 15, of the Texas Revised Civil Statutes apply to this Agreement
or the Notes or the transactions contemplated hereby.

SECTION 9.12 Effect on Outstanding CAF Advances. The parties
hereto acknowledge and agree that upon the effectiveness of this Agreement all
"CAF Advances" under the Existing Facility immediately before the effectiveness
of this Agreement will be converted to CAF Advances hereunder on terms and
conditions set forth in this Agreement.

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SECTION 9.13 Execution in Counterparts. This Agreement may
be executed in any number of counterparts and by different parties hereto in
separate counterparts, each of which when so executed shall be deemed to be an
original and all of which taken together shall constitute one and the same
agreement. Delivery to the Administrative Agent of a counterpart executed by a
Lender shall constitute delivery of such counterpart to all of the Lenders.
This Agreement may be delivered by facsimile transmission of the relevant
signature pages hereof.

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IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be executed by their respective officers thereunto duly
authorized, as of the date first above written.

EL PASO NATURAL GAS COMPANY

By /s/ H. Brent Austin
----------------------------
Title: Executive Vice President

CHEMICAL BANK, as Administrative
Agent, CAF Advance Agent and a
Lender

By /s/ Peter Ling
----------------------------
Title: Vice President

THE BANK OF NEW YORK

By /s/ Raymond J. Palmer
----------------------------
Title: Vice President

CITIBANK, N.A.

By /s/ Areezo Jafari
----------------------------
Title: Assistant Vice President

CREDIT LYONNAIS NEW YORK BRANCH

By /s/ Pascal Poupelle
----------------------------
Title: Senior Vice President

THE INDUSTRIAL BANK OF JAPAN,
LIMITED, NEW YORK BRANCH

By /s/ A. Yoshino
----------------------------
Title: Executive Vice President
Houston Office

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KREDIETBANK N.V.,
GRAND CAYMAN BRANCH

By /s/ Robert Snauffer
----------------------------
Title: Vice President

By /s/ Raymond F. Murray
----------------------------
Title: Vice President

MELLON BANK, N.A.

By /s/ E. Marc Cuenod, Jr.
----------------------------
Title: First Vice President

MORGAN GUARANTY TRUST COMPANY
OF NEW YORK

By /s/ John Kowalczuk
----------------------------
Title: Vice President

NATIONSBANK OF TEXAS, N.A.

By /s/ Dale T. Wilson
----------------------------
Title: Vice President

ROYAL BANK OF CANADA

By /s/ J.D. Frost
----------------------------
Title: Senior Manager

SOCIETE GENERALE

By /s/ Richard A. Gould
----------------------------
Title: Vice President

THE SUMITOMO BANK, LIMITED

By /s/ Harumitsu Seki
----------------------------
Title: General Manager

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TORONTO DOMINION (TEXAS), INC.

By /s/ Linda A. Lavin
----------------------------
Title: Director

UNION BANK OF SWITZERLAND

By /s/ Evans Swann
----------------------------
Title: Managing Director

By /s/ Kelly Boots
----------------------------
Title: Assistant Treasurer

SCHEDULE I

COMMITMENTS, ADDRESSES, ETC.

Name and Address of Lender Amount of Commitment
- -------------------------- --------------------

CHEMICAL BANK $40,000,000
270 Park Avenue
New York, NY 10017
Attention: John Gehebe
Telecopier: 212-270-4892

THE BANK OF NEW YORK $34,400,000
One Wall Street, 19th Floor
New York, NY 10288
Attention: Raymond Palmer
Telecopier: 212-835-7923

CITIBANK, N.A. $34,400,000
One Court Square - 7th Floor
Long Island City, NY 11102
Attention: Leena Caligiure
Telecopier: 718-248-4844

CREDIT LYONNAIS $34,400,000
NEW YORK BRANCH
1000 Louisiana, Suite 5360
Houston, TX 77002
Attention: Bernadette Archie
Telecopier: 713-751-0307

THE INDUSTRIAL BANK OF JAPAN, $16,000,000
LIMITED, NEW YORK BRANCH
245 Park Avenue, 23rd Floor
New York, NY 10167
Attention: Atsushi Kawai
Agnes Aberin
Telecopier: 212-557-3581/949-0134

with a copy to:
Three Allen Center
Suite 4850
333 Clay Street
Houston, TX 77002
Attention: Lynn Williford
Telecopier: 713-651-9209

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Name and Address of Lender Amount of Commitment
-------------------------- --------------------

KREDIETBANK N.V., $16,000,000
GRAND CAYMAN BRANCH
c/o Kredietbank N.V.,
New York Branch
125 West 55th Street
New York, NY 100109
Attention: Lynda Resuma
Mayra Ramirez
Telecopier: 212-956-5580

MELLON BANK, N.A. $26,400,000
Three Mellon Bank Center
Room 2302
Pittsburgh, PA 15258
Attention: Andrew Plonsky
Telecopier: 412-234-5049

with a copy to:
1100 Louisiana, Suite 3600
Houston, TX 77002
Attention: Janet O'N Jenkins
Telecopier: 713-650-3409

MORGAN GUARANTY TRUST COMPANY $34,400,000
OF NEW YORK
60 Wall Street
New York, NY 10260-0060
Attention: Vernon M. Ford, Jr.
Telecopier: 212-648-5023

NATIONSBANK OF TEXAS, N.A. $34,400,000
303 West Wall Street
P.O. Box 1599
Midland, TX 79702-1599
Attention: Dale T. Wilson
Telecopier: 915-685-2009

ROYAL BANK OF CANADA $26,400,000
600 Wilshire Boulevard, Suite 800
Los Angeles, CA 90017
Attention: J.D. Frost
Telecopier: 213-955-5350

78
3

Name and Address of Lender Amount of Commitment
-------------------------- --------------------

SOCIETE GENERALE $16,000,000
2001 Ross Avenue, Suite 4800
Dallas, TX 75201
Attention: Tequlla English
Telecopier: 214-754-0171

with a copy to:
1111 Bagby, Suite 2020
Houston, TX 77002
Attention: Richard A. Gould
Telecopier: 713-650-0824

THE SUMITOMO BANK, LIMITED $26,400,000
700 Louisiana Street, Suite 1750
Houston, TX 77002
Attention: William R. McKown
Telecopier: 713-759-0020

TORONTO DOMINION (TEXAS), INC. $26,400,000
909 Fannin Street, 17th Floor
Houston, TX 77010
Attention: Lisa Allison
Telecopier: 713-951-9921

UNION BANK OF SWITZERLAND $34,400,000
1100 Louisana, Suite 4500
Houston, TX 77005
Attention: Evans Swann
Telecopier: 713-655-6555

with a copy to:
299 Park Avenue
New York, NY 10171-0026
Attention: James Broadus
Telecopier: 212-821-3259

CONFORMED COPY

================================================================================

EL PASO NATURAL GAS COMPANY

_____________________________________

$100,000,000
REVOLVING CREDIT AND COMPETITIVE
ADVANCE FACILITY AGREEMENT

DATED AS OF MAY 31, 1996

_____________________________________

CHEMICAL BANK,
AS ADMINISTRATIVE AGENT
AND CAF ADVANCE AGENT

================================================================================
80
N-i

TABLE OF CONTENTS

Page
----

ARTICLE I

DEFINITIONS AND ACCOUNTING TERMS . . . . . . . . . . . . . . . . 1
SECTION 1.1 Certain Defined Terms . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
SECTION 1.2 Computation of Time Periods . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
SECTION 1.3 Accounting Terms . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
SECTION 1.4 References . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16

ARTICLE II

AMOUNTS AND TERMS OF THE ADVANCES . . . . . . . . . . . . . . . . 16
SECTION 2.1 The Revolving Credit Advances . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
SECTION 2.2 Revolving Credit Notes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
SECTION 2.3 Making the Revolving Credit Advances . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
SECTION 2.4 CAF Advances . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
SECTION 2.5 Procedure for CAF Advance Borrowings . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
SECTION 2.6 CAF Advance Payments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
SECTION 2.7 CAF Advance Notes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
SECTION 2.8 Fees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
SECTION 2.9 Reduction of the Commitments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
SECTION 2.10 Repayment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
SECTION 2.11 Interest on Revolving Credit Advances . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
SECTION 2.12 Additional Interest on Eurodollar Rate
Advances . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
SECTION 2.13 Interest Rate Determination . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
SECTION 2.14 Voluntary Conversion of Advances . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
SECTION 2.15 Prepayments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
SECTION 2.16 Increased Costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
SECTION 2.17 Increased Capital . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
SECTION 2.18 Illegality . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
SECTION 2.19 Payments and Computations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
SECTION 2.20 Taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
SECTION 2.21 Sharing of Payments, Etc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
SECTION 2.22 Use of Proceeds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
SECTION 2.23 Extension of Stated Termination Date . . . . . . . . . . . . . . . . . . . . . . . . . . . 35

ARTICLE III

CONDITIONS OF EFFECTIVENESS AND LENDING . . . . . . . . . . . . . . . 36
SECTION 3.1 Conditions Precedent to Effectiveness of
this Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
SECTION 3.2 Conditions Precedent to Initial Advances
to Any Borrowing Subsidiary or Holding . . . . . . . . . . . . . . . . . . . . . . 37
SECTION 3.3 Conditions Precedent to Each Borrowing . . . . . . . . . . . . . . . . . . . . . . . . . . . 38

ARTICLE IV

REPRESENTATIONS AND WARRANTIES . . . . . . . . . . . . . . . . . 39
SECTION 4.1 Representations and Warranties of the
Borrowers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39

ARTICLE V

COVENANTS OF THE BORROWERS . . . . . . . . . . . . . . . . . . 42
SECTION 5.1 Affirmative Covenants . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
SECTION 5.2 Negative Covenants . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44
SECTION 5.3 Reporting Requirements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47
SECTION 5.4 Restrictions on Material Subsidiaries . . . . . . . . . . . . . . . . . . . . . . . . . . . 50

ARTICLE VI

GUARANTEE . . . . . . . . . . . . . . . . . . . . . . 51
SECTION 6.1 Guarantees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51
SECTION 6.2 No Subrogation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51
SECTION 6.3 Amendments, etc. with respect to the
Obligations; Waiver of Rights . . . . . . . . . . . . . . . . . . . . . . . . . . . 52
SECTION 6.4 Guarantee Absolute and Unconditional . . . . . . . . . . . . . . . . . . . . . . . . . . . . 53
SECTION 6.5 Reinstatement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 54

ARTICLE VII

EVENTS OF DEFAULT . . . . . . . . . . . . . . . . . . . . 54
SECTION 7.1 Event of Default . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 54

ARTICLE VIII

THE ADMINISTRATIVE AGENT AND THE CAF ADVANCE AGENT . . . . . . . . . . . . 58
SECTION 8.1 Authorization and Action . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 58
SECTION 8.2 Administrative Agent's and CAF Advance
Agent's Reliance, Etc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 58
SECTION 8.3 Chemical and Affiliates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 59
SECTION 8.4 Lender Credit Decision . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 59
SECTION 8.5 Indemnification . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 59
SECTION 8.6 Successor Administrative Agent and CAF
Advance Agent . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 60

ARTICLE IX

MISCELLANEOUS . . . . . . . . . . . . . . . . . . . . . 61
SECTION 9.1 Amendments, Etc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 61
SECTION 9.2 Notices, Etc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 61
SECTION 9.3 No Waiver; Remedies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 62
SECTION 9.4 Costs and Expenses; Indemnity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 62
SECTION 9.5 Right of Set-Off . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 63
SECTION 9.6 Binding Effect . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 63
SECTION 9.7 Assignments and Participations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 64
SECTION 9.8 Confidentiality . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 67
SECTION 9.9 Consent to Jurisdiction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 67
SECTION 9.10 GOVERNING LAW . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 68
SECTION 9.11 Rate of Interest . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 68
SECTION 9.12 Execution in Counterparts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 69

-ii-
82
SCHEDULE

Schedule I Commitments, Addresses, Etc.

EXHIBITS

Exhibit A Form of Revolving Credit Note
Exhibit B Form of Notice of Borrowing
Exhibit C Form of CAF Advance Note
Exhibit D Form of CAF Advance Request
Exhibit E Form of CAF Advance Offer
Exhibit F Form of CAF Advance Confirmation
Exhibit G Form of Assignment and Acceptance
Exhibit H Form of Opinion of [Associate] General Counsel
of the Company
Exhibit I Form of Opinion of New York Counsel to the
Company
Exhibit J Form of Process Agent Letter
Exhibit K Form of Joinder Agreement
Exhibit L Form of Opinion of [Associate] General Counsel of
the Company
Exhibit M Form of Opinion of New York Counsel to the Company
Exhibit N Form of Extension Request

-iii-
83

$100,000,000 REVOLVING CREDIT AND COMPETITIVE ADVANCE FACILITY
AGREEMENT, dated as of May 31, 1996, among EL PASO NATURAL GAS COMPANY, a
Delaware corporation ("EPNGC"), the several banks and other financial
institutions from time to time parties to this Agreement (the "Lenders"),
CHEMICAL BANK, a New York banking corporation, as administrative agent (in such
capacity, the "Administrative Agent") and as CAF Advance Agent (in such
capacity, the "CAF Advance Agent") for the Lenders hereunder.

The parties hereto hereby agree as follows:

ARTICLE I

DEFINITIONS AND ACCOUNTING TERMS

"Administrative Agent" shall have the meaning assigned to such
term in the preamble hereof.

"Advance" means an advance by a Lender to any Borrower
pursuant to Article II, and refers to a Base Rate Advance, a
Eurodollar Rate Advance or a CAF Advance.

"Agreement" means this $100,000,000 Revolving Credit and
Competitive Advance Facility, as amended, supplemented or otherwise
modified from time to time.