TRANSITION SERVICES AGREEMENT

Exhibit 10.2

EXECUTION COPY

TRANSITION SERVICES AGREEMENT

by and between

DUKE ENERGY CORPORATION

and

SPECTRA ENERGY CORP

Dated as of December 13, 2006

TRANSITION SERVICES AGREEMENT

THIS TRANSITION SERVICES AGREEMENT (this “ Agreement ”) is entered into as of December 13, 2006, by and between Duke Energy Corporation, a Delaware corporation (“ Duke Energy ”), and Spectra Energy Corp (f/k/a Gas SpinCo, Inc.), a Delaware corporation (“ Spectra Energy ”), each a “ Party ” and together, the “ Parties ”.

R E C I T A L S:

WHEREAS, Duke Energy, acting through its direct and indirect subsidiaries, currently conducts a number of businesses, including (i) the Gas Business, and (ii) the Power Business;

WHEREAS, the Board of Directors of Duke Energy has determined that it is appropriate, desirable and in the best interests of Duke Energy and its stockholders to separate Duke Energy into two separate, independent and publicly traded companies: (i) one comprising the Gas Business, which shall be owned and conducted, directly or indirectly, by Spectra Energy, and (ii) one comprising the Power Business which shall continue to be owned and conducted, directly or indirectly, by Duke Energy;

WHEREAS, to effect this separation the Parties entered into that certain Separation and Distribution Agreement dated as of even date hereof (as amended or otherwise modified from time to time, the “ Separation Agreement ”);

WHEREAS, Duke Energy and Spectra Energy desire that if (but only if) the Distribution occurs, Duke Energy will provide to Spectra Energy and its subsidiaries during the relevant Services Term, directly or through Duke Energy’s Affiliates or subcontractors, the Duke Energy Services, all in accordance with the terms and subject to the conditions set forth in this Agreement; and

WHEREAS, Duke Energy and Spectra Energy desire that if (but only if) the Distribution occurs, Spectra Energy will provide to Duke Energy and its subsidiaries during the relevant Services Term, directly or through Spectra Energy’s Affiliates or subcontractors, the Spectra Energy Services, all in accordance with the terms and subject to the conditions set forth in this Agreement.

NOW, THEREFORE, in consideration of the foregoing premises, the mutual promises and covenants hereinafter set forth, and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties, intending to be legally bound, agree as follows:

As used in this Agreement, the following capitalized terms shall have the following meanings:

“ Action ” shall have the meaning set forth in the Separation Agreement.

“ Additional Service ” shall have the meaning set forth in Section 2.8(b).

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“ Affiliate ” shall have the meaning set forth in the Separation Agreement.

“ Agreement ” shall have the meaning set forth in the preamble hereof.

“ Agreement Dispute ” shall have the meaning set forth in Section 12.

“ Ancillary Agreement ” shall have the meaning set forth in the Separation Agreement.

“ Auditing Entity ” shall have the meaning set forth in Section 9.3.

“ Business ” shall mean the Gas Business or the Power Business, as applicable.

“ Business Day ” shall have the meaning set forth in the Separation Agreement.

“ Confidential Information ” shall have the meaning set forth in the Separation Agreement.

“ Contract ” shall have the meaning set forth in the Separation Agreement.

“ Default Interest Rate ” shall have the meaning set forth in Section 3.1(c).

“ Distribution ” shall have the meaning set forth in the Separation Agreement.

“ Distribution Date ” shall have the meaning set forth in the Separation Agreement.

“ Due Date ” shall have the meaning set forth in Section 3.1(b).

“ Duke Energy ” shall have the meaning set forth in the preamble hereof.

“ Duke Energy Group ” shall have the meaning set forth in the Separation Agreement.

“ Duke Energy Project Manager ” shall have the meaning set forth in Section 2.10.

“ Duke Energy Services ” shall mean the limited enumerated services described on Schedule A-1 , Schedule A-2 , Schedule A-3 of the Schedules to Transition Services Agreement document attached hereto and each next consecutive Schedule A through and including Schedule A-46 included therein.

“ Duke Energy Trademarks ” shall have the meaning set forth in Section 13.2(a).

“ Effective Time ” shall have the meaning set forth in the Separation Agreement.

“ FERC ” shall mean the U.S. Federal Energy Regulatory Commission, or its successor agency.

“ Fee ” or “ Fees ” shall have the meaning set forth in Section 3.1(a).

“ Force Majeure ” shall have the meaning set forth in the Separation Agreement.

“ Gas Business ” shall have the meaning set forth in the Separation Agreement.

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“ Governmental Approvals ” shall have the meaning set forth in the Separation Agreement.

“ Governmental Entity ” shall have the meaning set forth in the Separation Agreement.

“ Group ” shall mean either the Duke Energy Group or the Spectra Energy Group, as applicable.

“ Law ” shall have the meaning set forth in the Separation Agreement.

“ Liabilities ” shall have the meaning set forth in the Separation Agreement.

“ New York Courts ” shall have the meaning set forth in Section 15.16.

“ Omitted Service ” shall have the meaning set forth in Section 2.8(a).

“ Party ” shall have the meaning set forth in the preamble hereof.

“ Person ” shall have the meaning set forth in the Separation Agreement.

“ Power Business ” shall have the meaning set forth in the Separation Agreement.

“ Prime Rate ” shall have the meaning set forth in the Separation Agreement.

“ Separation Agreement ” shall have the meaning set forth in the recitals hereto.

“ Service ” shall mean any of the Spectra Energy Services and the Duke Energy Services, as applicable.

“ Service Provider ” shall mean Duke Energy with respect to the Duke Energy Services, and Spectra Energy with respect to the Spectra Energy Services.

“ Service Recipient ” shall mean Spectra Energy with respect to the Duke Energy Services, and Duke Energy with respect to the Spectra Energy Services.

“ Services Group ” shall mean any Services or group of Services identified on one Schedule attached to this Agreement and for which Service or group of Services a single, separate Fee is specified on such Schedule.

“ Services Term ” shall have the meaning set forth in Section 4.1.

“ Spectra Energy ” shall have the meaning set forth in the preamble hereof.

“ Spectra Energy Group ” shall have the meaning set forth in the Separation Agreement.

“ Spectra Energy Project Manager ” shall have the meaning set forth in Section 2.10.

“ Spectra Energy Services ” shall mean the limited enumerated services described on Schedule B-1 , Schedule B-2 , Schedule B-3 of the Schedules to Transition Services Agreement

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document attached hereto and each next consecutive Schedule B through and including Schedule B-14 included therein.

“ Subsidiary ” shall have the meaning set forth in the Separation Agreement.

“ TM License Period ” shall have the meaning set forth in Section 13.2(a).

2.1     Scope of Services .

(a)    Spectra Energy hereby retains Duke Energy to provide, and Duke Energy hereby agrees to provide, the Duke Energy Services to Spectra Energy or any of its subsidiaries, as designated by Spectra Energy, during the relevant Services Term.

(b)    Duke Energy hereby retains Spectra Energy to provide, and Spectra Energy hereby agrees to provide, the Spectra Energy Services to Duke Energy or any of its subsidiaries, as designated by Duke Energy, during the relevant Services Term.

(c)    Notwithstanding anything to the contrary in this Agreement, (i) the Duke Energy Services shall be available to Spectra Energy or any of its subsidiaries only for the purposes of conducting the Gas Business substantially in the same manner and places as it was conducted immediately prior to the Effective Time; and (ii) the Spectra Energy Services shall be available to Duke Energy or any of its subsidiaries only for the purposes of conducting the Power Business substantially in the same manner and places as it was conducted immediately prior to the Effective Time.

2.2     Provision of Services . The Duke Energy Services may be directly provided by Duke Energy or may be provided through any of its Affiliates or subcontractors, and the Spectra Energy Services may be directly provided by Spectra Energy or may be provided through any of its Affiliates or subcontractors.

2.3     No Financing to Services Recipient . In no event shall a Service Provider or its Affiliates be required to (i) lend any funds to a Service Recipient or its Affiliates, (ii) expend funds for any additional equipment or material or property (real or personal) on behalf of Service Recipient, or (iii) make any payments or disbursements on behalf of Service Recipient, except to the extent Service Recipient has previously delivered to Service Provider sufficient funds to make any such expenditures, payment or disbursement.

2.4     No Assumption or Modification of Obligations . Nothing herein shall be deemed to (i) constitute the assumption by Service Provider or any of its Affiliates, or the agreement to assume, any duties, obligations or liabilities of Service Recipient or its Affiliates whatsoever; or (ii) alter, amend or otherwise modify any obligation of Duke Energy or Spectra Energy under the Separation Agreement.

2.5     Application of Resources . Unless otherwise expressly required under the terms of any relevant Schedule hereto or the Separation Agreement, or otherwise agreed to by the Parties in writing, in providing the Services, Service Provider or its Affiliates shall not be obligated to:

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(i) expend funds and other resources beyond levels that would be customary and reasonable for any other nationally recognized service provider to perform services that are similar to the relevant Services; (ii) maintain the employment of any specific employee or subcontractor; (iii) purchase, lease or license any additional (measured as of the even date hereof) equipment or materials (expressly excluding any renewal or extension of any leases or licenses required for Service Provider to perform the relevant Services during the relevant Services Term); or (iv) pay any of Service Recipient’s costs related to its or any of its Affiliates’ receipt of the Services.

2.6     Performance of Services . Subject to the other terms (i) in this Agreement setting forth and circumscribing Service Provider’s performance obligations hereunder (including in Sections 2.1, 2.2, 2.3, 2.5, 2.7, 2.8, 2.9 and 6, and (ii) in the relevant Schedules hereto, each Service Provider shall perform, or cause the applicable members of its Group to perform, the Services required to be provided by it hereunder in a manner specifically described in the relevant Schedules hereto, or, to the extent not so described in such Schedules, in a manner that is substantially the same in nature, accuracy, quality, completeness, timeliness, responsiveness and efficiency with how such relevant Services have been rendered to the Gas Business by Duke Energy (or any of its subsidiaries) prior to the Effective Time, or to the Power Business by Spectra Energy (or any of its subsidiaries) prior to the Effective Time.

2.7     Transitional Nature of Services; Changes . The Parties acknowledge the transitional nature of the Services and agree that notwithstanding anything to the contrary herein, each Service Provider may make changes from time-to-time in the manner of performing the Services if such Service Provider is making similar changes in performing similar services for itself and/or its Affiliates; provided that Service Provider must provide Service Recipient with at least thirty (30) days prior written notice of such changes.

2.8     Omitted Services; Additional Services; Extension of Services Terms .

(a)     Omitted Services . If, after the Distribution Date and prior to December 31, 2007, a Party identifies a service that the other Party (or a member of such other Party’s Group) previously provided to such first Party (or any of its subsidiaries) prior to the Distribution Date, but such service was inadvertently omitted from inclusion in the Services to be received by such first Party under this Agreement (an “ Omitted Service ”), then, upon the prior written consent of the Party that would be Service Provider of such Omitted Service (which consent shall not be unreasonably withheld), such Omitted Service shall be added and considered as part of the Services to be provided by such Service Provider. The Parties shall cooperate and act in good faith to reach agreement on the fees and other specific terms and conditions applicable to such Omitted Service, provided that if such Omitted Service is substantially similar to any other Service provided by Services Provider under this Agreement, such fees and other specific terms and conditions shall be substantially similar to the fees and other specific terms and conditions applicable to such other Services, and provided , further , that a 15% surcharge shall be added to any fees applicable to an Omitted Service. Upon the Parties agreement on the fees and other specific terms and conditions applicable to an Omitted Service, the Parties shall execute an amendment to this Agreement that provides for the substitution of the relevant Schedule, or additions of supplements to the relevant Schedule, in order to describe such Omitted Service and the agreement upon the related fees and other specific terms and conditions applicable thereto.

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(b)     Additional Services; Extension of Services Terms . In the event that the Parties identify and agree upon (i) an additional service to be provided under this Agreement, as well as the related fees and other specific terms and conditions applicable thereto (an “ Additional Service ”), or (ii) an extension of any particular Service Term for any Services Group, as well as the related fees and other specific terms and conditions applicable thereto, the Parties shall execute an amendment to this Agreement that provides for the substitution of the relevant Schedule, or additions of supplements to the relevant Schedule, in order to describe such Additional Service or extension, and the agreed upon related fees and other specific terms and conditions applicable thereto.

2.9     Impracticability . Subject to the provisions of Section 2.11, Service Provider shall not be required to provide any Service to the extent: (A) that the performance of the Services would (i) require Service Provider or any of its Affiliates to violate any applicable Laws (including any applicable codes or standards of conduct established by FERC or any other Governmental Entity with respect to their activities subject to the jurisdiction of FERC or such other Governmental Entity) or any internal policy reasonably adopted in order to comply with any applicable Laws; (ii) result in the breach of any software license, lease, or other Contract; or (iii) require prior approval of a Governmental Entity (except to the extent such approval has already been obtained); or (B) provided under Section 15.20.

2.10     Project Managers . Duke Energy shall designate to Spectra Energy at least one individual to whom all of Spectra Energy’s communications may be addressed with respect to the Duke Energy Services and who has authority to act for and bind Duke Energy in all aspects with respect to the Duke Energy Services (the “ Duke Energy Project Manager ”). Spectra Energy shall designate to Duke Energy at least one individual to whom all of Duke Energy’s communications may be addressed with respect to the Spectra Energy Services and who has authority to act for and bind Spectra Energy in all aspects with respect to the Spectra Energy Services (the “ Spectra Energy Project Manager ”). The initial Duke Energy Project Manager designated by Duke Energy shall be Sean Trauschke and the initial Spectra Energy Project Manager designated by Spectra Energy shall be Greg Harper. Notwithstanding the foregoing in this Section 2.10, the Parties acknowledge and agree that with respect to ordinary course of business communications between the Parties regarding any relevant Service falling within any Services Group, such communications shall take place between each Party’s representative (or his or her designee) identified under the caption “CONTACTS” on the Schedule hereto that includes such Services Group.

2.11     Cooperation . In the event that there is nonperformance of any Service as a result of (i) a Force Majeure event described in Section 15.20, or (ii) impracticability pursuant to Section 2.9, the Parties agree to work together in good faith to arrange for an alternative means by which the applicable Service Recipient may obtain, at its sole cost and expense, the Service so affected. The Parties and the members of their respective Groups shall cooperate with each other in connection with the performance of the Services, including producing on a timely basis all Contracts, documents and other information that is reasonably requested with respect to the performance of Services; provided , however , that such cooperation shall not unreasonably disrupt the normal operations of the Parties and the members of their respective Groups; and provided , further , however the Party requesting cooperation shall pay all reasonable out-of-pocket costs and expenses incurred by the Party or any members of its Group furnishing such

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requested cooperation, unless otherwise expressly provided in this Agreement or the Separation Agreement.

3.1     Fees .

(a)     Fees . In consideration of Service Provider’s performance of the relevant Services, Service Recipient shall pay to Service Provider the fees prescribed on the relevant Schedules hereto (individually a “ Fee ” and collectively the “ Fees ”); provided that , in the event Service Recipient has not caused itself or its Affiliates, as applicable, to obtain such relevant Service from an alternative third party service provider and/or otherwise terminated the provision of such relevant Service by the date that is 180 days after the Distribution Date, then the Fee applicable to such Service shall be increased by 10% for the remainder of the applicable Services Term.

(b)     Invoices; Payment Procedures . Service Provider shall invoice Service Recipient on a monthly basis for all Fees accrued with respect to the prior month. Fees shall be payable by Service Recipient within thirty (30) days after Service Recipient’s receipt of an invoice (the “ Due Date ”). All amounts (i) payable pursuant to the terms of this Agreement shall be paid to Service Provider as directed by Service Provider, and (ii) due and payable hereunder shall be invoiced and paid in U.S. dollars, except as may be expressly provided in any relevant Schedule hereto. A Service Recipient’s obligation to make any required payments under this Agreement shall not be subject to any unilateral right of offset, set-off, deduction or counterclaim, however arising.

(c)     Interest . In the absence of a timely notice of billing dispute in accordance with the provisions of Section 3.2, amounts not paid on or before the Due Date shall be payable with interest, accrued at the then effective Prime Rate plus 2% (the “ Default Interest Rate ”) (or the maximum legal rate whichever is lower), calculated for the actual number of days elapsed, accrued from the Due Date until the date of the actual receipt of payment.

(d)     Taxes . If any Governmental Entity shall impose a tax on the Services rendered to a Service Recipient or its subsidiaries by Service Provider hereunder, Service Recipient agrees to pay, or remit to Service Provider so that Service Provider may pay, the amount of such tax imposed on the Services rendered to Service Recipient or its subsidiaries by Service Provider under this Agreement. Notwithstanding anything to the contrary contained in this Agreement, Service Recipient shall have no liability for, and shall not be obligated to pay for, any property taxes of any kind or type applicable to the property of Service Provider or any of its subsidiaries or any income taxes of any kind or type applicable to the income of Service Provider or any of its subsidiaries, except as may be expressly provided in any relevant Schedule hereto.

3.2     Payment Disputes . In the event that Service Recipient disputes any invoice or portion thereof, Service Recipient shall provide Service Provider prior to the Due Date written notice of the disputed amounts, together with a statement of the particulars of the dispute, including the calculations with respect to any errors or inaccuracies claimed. Should Service Recipient fail to provide timely evidence of the invoice errors claimed on or before the Due

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Date, the disputed amounts shall be owed with interest at the Default Interest Rate from the Due Date until payment is received. Should Service Recipient provide the required information on or before the Due Date, Service Provider shall make a determination on the dispute no later than thirty (30) days from the Due Date. If Service Recipient has (i) underpaid the amount actually due, Service Recipient shall remit any amount due plus interest at the Default Interest Rate from the Due Date until paid within five (5) Business Days after receipt of the determination from Service Provider, or (ii) overpaid the amount actually due, Service Provider shall remit to Service Recipient any refund within five (5) Business Days after determination of such overpayment plus interest at the Default Interest Rate on such refund from the date Service Provider received the overpayment until refunded. Notwithstanding any disputed invoice or portion thereof, Service Recipient shall nevertheless pay when due any undisputed amount of such invoice to Service Provider.

3.3     Expenses . In addition to the payment of all Fees, Service Recipient shall reimburse Service Provider for all reasonable out-of-pocket costs and expenses incurred by Service Provider or its Affiliates in connection with providing the Services (including all travel-related expenses) to the extent that such costs and expenses are not reflected in the Fees for such Services; provided , however , any such expenses exceeding $10,000 per month for any Services Group (other than routine business travel and related expenses) shall require advance approval of Service Recipient. Any travel-related expenses incurred in performing the Services shall be incurred and charged to Service Recipient in accordance with Service Provider’s then applicable business travel policies.

4.1     Services Term . The performance of the Services shall commence on the Distribution Date and, unless earlier terminated pursuant to Section 4.2 or 4.3, shall terminate on the earlier of (i) December 31, 2007, or (ii) such earlier date as may be expressly provided for in the relevant Schedule hereto (the “ Services Term ”).

4.2     Termination . This Agreement or any specific Services Group, as specified below in this Section 4.2, may be terminated prior to the expiration of the relevant Services Term only as follows:

(a)    with respect to all Duke Energy Services in any Services Group, by Spectra Energy by giving a termination notice to Duke Energy, provided that (i) the termination will be effective as of the last day of the calendar month immediately following the calendar month in which Duke Energy receives such termination notice, and (ii) Spectra Energy shall reimburse Duke Energy for any and all costs and expenses incurred by Duke Energy or any of its subsidiaries as a result of such early termination by Spectra Energy, including internal demobilization or incremental, unplanned severance costs, and early termination fees and other costs incurred in order to terminate or reduce the level of services provided by third parties under Contracts with Duke Energy or any of its subsidiaries, which services are affected by such early termination, such reimbursement to be due and payable on the Due Date following Spectra Energy’s receipt of any invoice from Duke Energy with respect to such costs and expenses, or, if there are no more Due Dates, within thirty (30) days of Spectra Energy’s receipt of such invoice;

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(b)    with respect to all Spectra Energy Services in any Services Group, by Duke Energy by giving a termination notice to Spectra Energy, provided that (i) the termination will be effective as of the last day of the calendar month immediately following the calendar month in which Spectra Energy receives such termination notice, and (ii) Duke Energy shall reimburse Spectra Energy for any and all costs and expenses incurred by Spectra Energy or any of its subsidiaries as a result of such early termination by Duke Energy, including internal demobilization or incremental, unplanned severance costs, and early termination fees and other costs incurred in order to terminate or reduce the level of services provided by third parties under Contracts with Spectra Energy or any of its subsidiaries, which services are affected by such early termination, such reimbursement to be due and payable on the Due Date following Duke Energy’s receipt of any invoice from Spectra Energy with respect to such costs and expenses, or, if there are no more Due Dates, within thirty (30) days of Duke Energy’s receipt of such invoice;

(c)    with respect to all Services included in any Services Group that is adversely