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TSP/TSP Name:  8001703-EL PASO NATURAL GAS CO. L.L.C. Critical: N
Notice Type Desc (1):  TSP CAPACITY OFFERING Notice Type Desc (2):  TSP CAP OFFERING
Notice Eff Date/Time:  02/02/2018 3:45:32PM Notice End Date/Time:  02/24/2018 9:00:00am
Post Date/Time:  2/2/2018 3:45:32 PM Notice ID: 601336
Reqrd Rsp:  5 Rsp Date: 
Notice Stat Desc:  INITIATE Prior Notice: 
Subject:  EPNG Line 1600-Waha Open Season
Notice Text:

OPEN SEASON

 

 

EBB Notice – El Paso Natural Gas Company, L.L.C. Open Season

 

DESCRIPTION OF AVAILABLE AND ENHANCEMENT CAPACITY

 

Responding to market interest for firm transportation capacity to serve customers in the Permian Basin, El Paso Natural Gas Company, L.L.C. ("EPNG") is conducting a Binding Open Season for up to 377,000 dekatherms (“Dth”) per day of capacity originating from existing or new receipt points on EPNG's Line No. 1600 east of the Pitbull Receipt Meter to delivery points at or near EPNG's Waha Compressor Station, as further described below.

 

AVAILABLE CAPACITY

 

EPNG has available the following unsubscribed capacity (“Available Capacity”) which requires no system enhancements:
 
Maximum Available Quantity:     21,184 Dth per day
 
Primary Receipt Points:             Existing or new receipt points on Line No. 1600 up to and east of EPNG's Pitbull Receipt Meter.
 
Primary Delivery Points:            Existing or new delivery points at or near EPNG's Waha Compressor Station.
 
Alternate Receipt Points:           All available alternate receipt points on EPNG's Line No. 1600 east of EPNG's Gresham Station at the awarded contract rate as of the date the successful bidder enters into a Firm Transportation Service Agreement ("FTSA") with EPNG (“Eligible Alternate Receipt Points”).
 

Alternate Delivery Points:           Atmos Pipeline at Waha (ILONEWA), OneOk WesTex at Waha (IWESTARW), Mendoza Trails (IMNDZTRL), and EPNG Waha Pool (WAHATRAN) (collectively “Alternate Delivery Point Set 1”).  Deliveries from the Primary Receipt Points and the Eligible Alternate Receipt Points to any point listed in Alternate Delivery Point Set 1 would be at the awarded contract reservation rate.

 

Valero (IVALEROW) and Oasis (IOASISWA) (collectively “Alternate Delivery Point Set 2”).  Deliveries from the Primary Receipt Points and the Eligible Alternate Receipt Points to any point listed in Alternate Delivery Point Set 2 would be assessed an incremental reservation rate of $0.050 per Dth per day (in addition to the awarded contract reservation rate) to be charged only on quantities of gas actually delivered by EPNG to Shipper at these points but not to exceed the maximum tariff rate authorized in EPNG's Federal Energy Regulatory Commission ("FERC") Gas Tariff, Third Revised Volume No. 1A, as the same may be amended from time to time ("EPNG's Tariff").

 

North Baja (INORBAJA), Socal Ehrenberg (DSCALEHR), Topock Socal (DSCALTOP) and Topock (DPG&ETOP).  Deliveries from the Primary Receipt Points to any point listed in the preceding sentence would be assessed an incremental reservation rate of $0.1050 per Dth per day (in addition to the awarded contract reservation rate) to be charged only on quantities of gas actually delivered by EPNG to Shipper at these points but not to exceed the maximum tariff rate authorized in EPNG's Tariff.

 

Deliveries to all other alternate delivery points not listed in the preceding three paragraphs will be at maximum recourse rates under EPNG's Tariff.

 

Applicability of Usage

& Other Charges:                       For purposes of evaluating the capacity offered in this Open Season, successful bidders will not be required to pay Usage Rates under EPNG's Tariff for transportation service from the Receipt Points listed below to the Delivery Points listed below:

 

Receipt Points

Delivery Points

Primary Receipt Points

Primary Delivery Points

Primary Receipt Points

Any point listed in Alternate Delivery Point Set 1

Eligible Alternate Receipt Points

Any point listed in Alternate Delivery Point Set 1

Primary Receipt Points

Any point listed in Alternate Delivery Point Set 2

Eligible Alternate Receipt Points

Any point listed in Alternate Delivery Point Set 2

 

For clarity and avoidance of doubt, maximum Usage Rates under EPNG's Tariff will apply to deliveries made to the following points:

 

·         North Baja (INORBAJA);

 

·         Socal Ehrenberg (DSCALEHR);

 

·         Topock Socal (DSCALTOP);

 

·         Topock (DPG&ETOP); and

 

·         All other Receipt Point and Delivery Point combinations not listed in the matrix above

 

For purposes of evaluating the capacity offered in this Open Season, successful bidders will be required to pay EPNG all other applicable maximum rates, charges and surcharges (other than the exemption from Usage Rates applied to the Receipt Point and Delivery Point combinations listed in the matrix above), including ACA, fuel, lost and unaccounted-for gas, retainage and any other authorized surcharges assessed under Rate Schedule FT-1 of EPNG's Tariff as those amounts may be amended or superseded from time-to-time.  This includes incremental lateral charges and any third party charges resulting from the use of capacity that EPNG may hold on other pipelines.

 

Capacity Start Date:                  The later of (a) the in-service date of the Gulf Coast Express Project previously announced by Kinder Morgan Texas Pipeline LLC (“GCX”) or (b) October 1, 2019 
 
Prospective bidders interested in capacity having receipt and/or delivery locations, or quantities different from those stated above should contact their Business Development representative for additional information.
 

ENHANCEMENT CAPACITY

 

With certain system enhancements and modifications to existing facilities located on EPNG's Line 1600 (the “System Modifications”), EPNG can increase the quantity available from Line No. 1600 to points at or near the Waha Compressor Station up to 355,816 Dth per day (“Enhancement Capacity”):

 

Maximum Available Quantity:     Up to 355,816 Dth per day
 
Primary Receipt Points:             Same as for Available Capacity (see above)
 
Primary Delivery Points:            Same as for Available Capacity (see above)
 
Alternate Rec./Del. Points:         Same as for Available Capacity (see above)
 
Usage & Other Charges:            Same as for Available Capacity (see above)
 
Capacity Start Date:                  The in-service date of the System Modifications.  Subject to EPNG's receipt of sufficient shipper commitments and timely receipt of all necessary regulatory approvals, permits, and other authorizations required for the construction and operation of the System Modifications, in a form and substance satisfactory to EPNG in its sole discretion, EPNG anticipates the ability to achieve an in-service date on the later of (a) in-service date of GCX or (b) October 1, 2019.

 

LENGTH OF OPEN SEASON

 

This Open Season will commence at 4:00 p.m., Mountain Time (“MT”), on February 2, 2018, and will close at 2:00 p.m., MT, on February 23, 2017.  EPNG reserves the right to extend or modify this Open Season by posting a notice on its Electronic Bulletin Board (EBB).

 

Successful bidder(s) will be notified by 4:00 p.m., MT, on March 23, 2018.

 

BID CONDITIONS

 

EPNG will consider bids conditioned upon the receipt of the approval of bidder's management, management committee, and/or board of directors or other appropriate management structure by March 30, 2018Any bidder who conditions its bid as described herein and fails to obtain management approval must provide EPNG written notice no later than 12:00 noon MT on April 4, 2018, or bidder will be deemed to have waived this condition.

 

If a bidder's bid does not qualify for a right-of-first-refusal (“ROFR”) in accordance with Section 4.14(a) of EPNG's Tariff, then EPNG will consider bids conditioned upon EPNG providing bidder a contractual ROFR in accordance with Section 4.14(f) of EPNG's Tariff.

 

EPNG does not anticipate accepting any other conditions for bids submitted during this Open Season.

 

SUBMISSION OF BIDS

 

Parties interested in bidding in this Open Season should submit completed Bid Sheet(s) (in the form attached hereto) to EPNG before the close of the open season via email at the following address:  KMWestBids@KinderMorgan.com.

 

By submitting Bid Sheet(s) to EPNG, the bidding party certifies that (a) all information contained in the request is complete and accurate, (b) it satisfies, or will be able to satisfy, all the requirements of EPNG's Tariff, and (c) the person submitting the bid has full authority to bind the bidding party.

 

The bid rate must be presented as the reservation rate per Dth/month or stated as the maximum tariff rate.  In addition to the bid rate, each bid shall be subject to the applicable maximum usage rate and maximum usage surcharges, all other maximum rates, charges and surcharges, including ACA, fuel, lost and unaccounted-for gas (“L&U”), retainage and any other authorized surcharges assessed under the applicable Rate Schedule of EPNG's Tariff as those amounts maybe amended or superseded from time-to-time. This includes incremental lateral charges and any third party charges resulting from the use of capacity that EPNG may hold on other pipelines.  Subject to the receipt of all required regulatory approvals, EPNG plans to designate the East of Pitbull to Waha path as a no-Fuel segment contingent upon completion of the System Modifications; provided, however, that nothing in this Open Season will in any way obligate EPNG to pursue or continue this no-Fuel designation in the future.  Any shippers using the East of Pitbull to Waha segment will remain subject to EPNG's applicable L&U charges.

 

EPNG reserves the right to reject negotiated rate bids, bids that have rates less than the maximum recourse rate, bids stated as the dollar equivalent of the current maximum recourse rate, bids that are incomplete, contain offers of varying rates within the term, contain additional or modified terms or are inconsistent with the provisions of EPNG's Tariff.  EPNG also reserves the right to reject bids for quantities that are not for the same quantity for the duration of the term.

 

If EPNG does not receive maximum recourse or negotiated rate bids for quantities and terms sufficient to economically justify EPNG's capital investment in the project, then EPNG reserves the right not to move forward with the project described in this Open Season, or to negotiate with bidders to propose a more appropriately sized expansion at a corresponding rate.  Existing shippers with capacity on EPNG's system that could be used in lieu of the System Modifications should notify EPNG if they wish to permanently turnback their capacity through a release to prospective shippers in this Open Season.  Those who wish to so release their capacity should notify EPNG of the amount, the term, and any other conditions that would be necessary to effectuate such a release of their capacity.  Such notices should be submitted to EPNG before the close of the Open Season.

 

Current shippers of EPNG may submit bids which include requests to reform their existing effective FTSAs to utilize the Available Capacity and/or Enhancement Capacity described in this Open Season. For purposes of evaluating bids and awarding capacity, EPNG will consider only the incremental revenue that would be generated by the bid (e.g., the incremental revenue associated with a higher reservation rate, an increase in TCD, or for a term that extends beyond the current FTSA term end date etc.).  Any requests for point redesignations using the Available Capacity and/or Enhancement Capacity will be assigned a present value of zero dollars ($0).

 

EPNG notes that FERC Order No. 894, in some cases, prohibits multiple affiliates of the same entity from bidding in an open season for capacity in which the pipeline may allocate capacity on a pro rata basis. It appears to EPNG that the restrictions imposed by FERC Order No. 894 will be applicable in this Open Season and FERC recommends that potential bidders review and adhere to the requirements of that FERC Order.

 

Although this is a binding open season, EPNG reserves the right, in its sole discretion, to consider requests for Available Capacity and/or Enhancement Capacity received after the close of the Open Season period, including requests to modify a participant's validly submitted bid, but shall be under no obligation to do so.

 

EPNG will review all bids and award capacity based upon the criteria outlined below.

 

EVALUATION CRITERIA

 

If EPNG receives acceptable bids for capacity in excess of the actual amount of Available Capacity and/or Enhancement Capacity, then EPNG will award and/or allocate the capacity in a manner that yields the highest total Present Value (PV) as calculated below.  In determining which bid(s) yield the highest total PV, EPNG reserves the right to combine multiple bids, in whole or in part, in a manner that results in a total PV of the combined bids that exceeds the highest PV achievable by accepting one or more of the disaggregated bids. This process could result in a bidder being awarded less capacity than requested (unless such bidder elects on its bid sheet not to accept a pro rata allocation of capacity).

 

PV will be calculated as the sum of the present values for all of the months beginning with the first month capacity is available through the end date of the bid term.  Bids stating a commencement date upon the in-service date of any to-be-constructed facility will be evaluated using EPNG's estimate of the completion date of the required facilities.

 

The PV for each month will be calculated as follows:

 

PV = (R X Q)/((1+i) to the power of n)

Where:

R = the monthly reservation bid rate

Q = the monthly bid quantity

   i = the monthly discount rate of 0.3542% (which is the annual discount rate of 4.25% divided by 12).

n = the number of months from the earliest date the capacity is available in the Open Season to the month the revenue will be received (the first month capacity is available n = 1, the second month n = 2, and so on).

 

CREDITWORTHINESS REQUIREMENTS

 

The successful bidder(s) must satisfy the creditworthiness requirements of EPNG's Tariff.  A bidder that is unable to satisfy the general creditworthiness provisions set forth in EPNG's Tariff shall provide additional credit support (in the form of a Letter of Credit, a guaranty from a party that satisfies the creditworthiness standards, or such other form that is acceptable to EPNG in its sole discretion).

 

CONTACT INFORMATION

 

Questions concerning this Supplemental Open Season should be directed to Greg Ruben (719-520-4870) or Ken Ulrich (719-520-3712) in the Business Development department.

 

FORM OF BID SHEET

 

Form of Service: FT

 

Email Bid To: KMWestBids@KinderMorgan.com

 

A.    Shipper Information:

 

Legal Name of Bidder:                                                        

 

Name of Requesting Party:                                                             

 

Title of Requesting Party:                                                   

 

DUNS Number:                                                                  

 

Phone:                                                                               

 

B.    Available Capacity Bid:

 

Requested Term Start Date:                                    

 

Requested Term End Date:                                     

 

  If this box is checked and bidder's bid does not qualify for a right-of-first-refusal (“ROFR”) in accordance with Section 4.14(a) of EPNG's Federal Energy Regulatory Commission ("FERC") Gas Tariff, Third Revised Volume No. 1A, as the same may be amended from time to time ("EPNG's Tariff"), then this bid is subject to EPNG providing bidder a contractual ROFR in accordance with Section 4.14(f) of EPNG's Tariff.

 

Transportation Contract Demand:                               Dth/day

 

Will you accept a pro rata allocation of capacity if necessary             Yes                 No

 

Primary Receipt Point(s)

Maximum Daily Receipt Quantity (in Dth/Day)

Primary Delivery Point(s)

Maximum Daily Delivery Quantity (in Dth/Day)

 

 

 

 

 

 

 

 

Total Receipt Quantity

 

Total Delivery Quantity

 

 

Alternate Receipt Points:  All available alternate receipt points on EPNG's Line No. 1600 east of EPNG's Gresham Station at the awarded contract rate as of the date the successful bidder enters into a Firm Transportation Service Agreement with EPNG (“Eligible Alternate Receipt Points”).

 

Alternate Delivery Points:  Atmos Pipeline at Waha (ILONEWA), OneOk WesTex at Waha (IWESTARW), Mendoza Trails (IMNDZTRL), and EPNG Waha Pool (WAHATRAN) (collectively “Alternate Delivery Point Set 1”).  Deliveries from the Primary Receipt Points and the Eligible Alternate Receipt Points to any point listed in Alternate Delivery Point Set 1 would be at the awarded contract reservation rate.

 

Valero (IVALEROW) and Oasis (IOASISWA) (collectively “Alternate Delivery Point Set 2”).  Deliveries from the Primary Receipt Points and the Eligible Alternate Receipt Points to any point listed in Alternate Delivery Point Set 2 will be assessed an incremental reservation rate of $0.050 per Dth per day (in addition to the awarded contract reservation rate) to be charged only on quantities of gas actually delivered by EPNG to Shipper at these points but not to exceed the maximum tariff rate authorized in EPNG's Tariff.

 

North Baja (INORBAJA), Socal Ehrenberg (DSCALEHR), Topock Socal (DSCALTOP) and Topock (DPG&ETOP).  Deliveries from the Primary Receipt Points to any point listed in the preceding sentence will be assessed an incremental reservation rate of $0.1050 per Dth per day (in addition to the awarded contract reservation rate) to be charged only on quantities of gas actually delivered by EPNG to Shipper at these points but not to exceed the maximum tariff rate authorized in EPNG's Tariff.

 

Deliveries to all other alternate delivery points not listed in the preceding three paragraphs will be at maximum recourse rates under EPNG's Tariff.

 

Note:  Any bidder seeking to utilize any to-be-constructed point(s) of receipt and/or delivery may identify an existing alternate point(s) of receipt and/or delivery for use prior to the in-service date of the to-be-constructed point(s).

 

Reservation Rate (select one):

 

  EPNG's maximum recourse rate

 

  Discounted Recourse Rate:  $ ________ per Dth per Month

 

  Negotiated Rate:  $ ________ per Dth per Month

 

Applicability of Usage & Other Charges:

 

For purposes of evaluating the capacity offered in this Open Season, successful bidders will not be required to pay Usage Rates under EPNG's Tariff for transportation service from the Receipt Points listed below to the Delivery Points listed below:

 

Receipt Points

Delivery Points

Primary Receipt Points

Primary Delivery Points

Primary Receipt Points

Any point listed in Alternate Delivery Point Set 1

Eligible Alternate Receipt Points

Any point listed in Alternate Delivery Point Set 1

Primary Receipt Points

Any point listed in Alternate Delivery Point Set 2

Eligible Alternate Receipt Points

Any point listed in Alternate Delivery Point Set 2

 

For clarity and avoidance of doubt, maximum Usage Rates under EPNG's Tariff will apply to deliveries made to the following points:

 

·         North Baja (INORBAJA);

 

·         Socal Ehrenberg (DSCALEHR);

 

·         Topock Socal (DSCALTOP);

 

·         Topock (DPG&ETOP); and

 

·         All other Receipt Point and Delivery Point combinations not listed in the matrix above

 

In addition to the bid rate, successful bidders will be required to pay EPNG all other applicable maximum rates, charges and surcharges (other than the exemption from Usage Rates applied to the receipt and delivery point combinations expressly detailed above), including ACA, fuel, lost and unaccounted-for gas, retainage and any other authorized surcharges assessed under Rate Schedule FT-1 of EPNG's Tariff as those amounts may be amended or superseded from time-to-time.  This includes incremental lateral charges and any third party charges resulting from the use of capacity that EPNG may hold on other pipelines.

 

C.    Enhancement Capacity Bid:

 

Requested Term Start Date:                                    

 

Requested Term End Date:                                     

 

  If this box is checked and bidder's bid does not qualify for a ROFR in accordance with Section 4.14(a) of EPNG's Tariff, then this bid is subject to EPNG providing bidder a contractual ROFR in accordance with Section 4.14(f) of EPNG's Tariff.

 

Transportation Contract Demand:                               Dth/day

 

Will you accept a pro rata allocation of capacity if necessary             Yes                 No

 

Primary Receipt Point(s)

Maximum Daily Receipt Quantity (in Dth/Day)

Primary Delivery Point(s)

Maximum Daily Delivery Quantity (in Dth/Day)

 

 

 

 

 

 

 

 

Total Receipt Quantity

 

Total Delivery Quantity

 

 

Alternate Receipt Points:  Same as for Available Capacity.

 

Alternate Delivery Points:  Same as for Available Capacity.

 

Note:  Any bidder seeking to utilize any to-be-constructed point(s) of receipt and/or delivery may identify an existing alternate point(s) of receipt and/or delivery for use prior to the in-service date of the to-be-constructed point(s).

 

Reservation Rate (select one):

 

  EPNG's maximum recourse rate

 

  Discounted Recourse Rate:  $ ________ per Dth per Month

 

  Negotiated Rate:  $ ________ per Dth per Month

 

Applicability of Usage & Other Charges:  Same as for Available Capacity.

 

D.    Condition to Bid (Check if Applicable):

 

        Prospective shipper's bid will be subject to receipt of the approval of bidder's management, management committee, and/or board of directors or other appropriate management structure by no later than March 30, 2018.  Any bidder electing to cancel such conditioned bid due to failure to obtain management approval must provide EPNG written notice of cancellation by no later than 12:00 noon MT on April 4, 2018 or bidder shall be deemed to have waived this condition.

 

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