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TSP/TSP Name:  6900518-SOUTHERN NATURAL GAS CO. Critical: N
Notice Type Desc (1):  TSP CAP OFFERING Notice Type Desc (2):  TSP CAP OFFERING
Notice Eff Date/Time:  02/16/2017 11:56:31AM Notice End Date/Time:  12/31/2049 9:00:00AM
Post Date:  2/16/2017 11:56:31 AM Notice ID: 700875
Reqrd Rsp:  5 Notice Stat Desc:  INITIATE Prior Notice: 
Subject:  Open Season Announced for Firm Transport
Notice Text:

February 16, 2017

To All Southern Natural Gas Company Shippers

RE: Open Season Announced for Firm Transportation (FT)/Expansion

This is to announce an open season to solicit non-binding bids for firm transportation service ("FT") in Zone 0 and Zone 1 of the Southern Natural Gas Company, L.L.C. (“SNG”) system from SNG's interconnection with Tennessee Gas Pipeline (“TGP”) near Rose Hill. SNG is considering modifying certain facilities to increase its ability to receive gas from TGP by approximately 250,000 dth/day (“Rose Hill expansion facilities”). Incremental firm transportation capacity will be available from Rose Hill to delivery points on SNG's south system upstream of SNG's Enterprise Compressor Station as far upstream as its interconnect with Florida Gas Transmission at Franklinton, its interconnects with ANR, Columbia Gulf, Trunkline, and Gulf South at Shadyside, and its interconnect with Sabine near Henry Hub.  SNG is also soliciting non-binding bids from shippers interested in amending their current primary receipt pins from locations upstream of SNG's Bay Springs Compressor Station to SNG's interconnect with TGP at Rose Hill. The capacity available to be awarded may not be available in the same increments to all locations along SNG's south system and may not be available in particular laterals or at certain receipt or delivery pins. This proposed expansion does not offer any expanded capacity east of SNG's Enterprise Compressor Station.

This open season is being made to solicit non-binding bids from any parties that may wish to participate in this expansion.

The incremental firm transportation capacity is expected to be available by November 1, 2018. All bids for this capacity must have a requested start date no earlier than the in-service date of the proposed Rose Hill expansion facilities. The actual start date shall be subject to receipt of contracts for adequate capacity to support the project, regulatory approvals by SNG and SNG's construction schedule for the Rose Hill expansion facilities.

 

If bid capacity exceeds available capacity, SNG will award the capacity from bids received during the open season on the basis of net present value determined with reference to the rate, volume, term and the date the service is to commence. In calculating the net present value, a discounted cash flow factor of 10.24% will be used. SNG will have the right to aggregate bids in a manner that generates the highest net present value to SNG. Receipt Point Pin shifts will be given an NPV of zero unless a Shipper elects to extend the term of its existing firm transportation packages or elects to increase its discounted or negotiated rate that is less than the maximum rate to the maximum tariff rate or to a discounted or negotiated rate that is more than the existing discounted or negotiated rate.  


The open season will commence as of the date and time this notice is posted and end at 3:00 p.m. CCT on March 24, 2017.

 

SNG will not consider bids with terms of less than ten (10) years.

SNG reserves the right not to accept, in a not unduly discriminatory manner among similarly situated bids, any bid that is uneconomical to SNG; that would require the construction of additional facilities other than the Rose Hill expansion facilities; that would require the construction of facilities which are disproportionate in cost to the quantity bid; that does not meet the requirements of these open season guidelines; that contains unacceptable conditions or contingencies; or that contains a start date outside the in-service date of the Rose Hill expansion facilities as stated above. With the exception of any conditions precedent relating to receipt of regulatory approvals, Shippers must sign a precedent agreement with SNG and have removed all conditions to their bids by a date acceptable to SNG.

SNG reserves the right to not accept bids at less than the maximum tariff rate applicable to this expansion. Seasonal bids for incremental firm capacity will not be considered in this open season. The actual reservation rate to be paid by recourse rate shippers will depend on the ultimate cost and design of the Rose Hill expansion facilities after all the acceptable bids are taken into account. In addition, Shippers shall pay applicable commodity charges, surcharges and fuel, including fuel for deliveries on SNG's system. Only valid requests for service under the terms of SNG's tariff and under the terms of these open season guidelines will be considered. In the precedent agreement Southern will require each shipper to meet certain minimum financial criteria (the “Creditworthiness Test”) in order to proceed with the expansion opportunity. Receipt point shifts for existing packages of capacity will be accepted as part of the open season, even if such packages are seasonal.  
 
Shippers may submit bids to SNG for FT service by completing a standard transportation request form for FT service and faxing it to the attention of Darryl Outlaw at (205) 325-3587 or emailing it to FTServiceRequest@kindermorgan.com.  Please call your account manager if you need an FT Request Form or you can paste the following link in your browser and then click on SNG Service Request. http://pipeportal.kindermorgan.com/PortalUI/CommonForms.aspx?TSP=SNGD

 

On the request form, Shippers should indicate the term (start and end date), quantity (in dth/day), and delivery points on SNG's system, either existing or proposed, with the corresponding volume being bid. The receipt point will be the Rose Hill interconnection with TGP. If a Shipper requests a receipt point shift to the Rose Hill interconnection, it should also note the receipt point it is requesting to shift from.

Shippers should indicate in their bids the minimum volume of capacity they are willing to take in the event the full contract quantity of the bid is not available or if SNG must prorate the bids. If a bid is submitted in excess of the available capacity and the bids must be prorated, the bid in excess of the available capacity will be prorated as though the bidder bid for the maximum available capacity to be awarded.


SNG will take no longer than ten (10) business days to notify Shippers of bid awards. Shippers that have not executed a precedent agreement with SNG by the close of the open season will be required to do so within thirty (30) business days of the award notice.


If you have any questions regarding the Open Season, please contact your Account Manager or Devy Traylor in Business Development at 205-325-3524.

SNG Marketing