DATE: October 23, 2014 TIME: 10:30 A.M.
TO: ALL TENNESSEE GAS PIPELINE COMPANY, L.L.C. CUSTOMERS
RE: AVAILABLE FIRM CAPACITY (OPEN SEASON POSTING #962)
Tennessee Gas Pipeline Company, L.L.C. (“Tennessee”) is holding this open season in accordance with Article XXVI, Sections 5.1, 5.2 and 5.9 of the General Terms and Conditions (“GT&C”) of Tennessee's Effective FERC Gas Tariff (“Tennessee's Tariff”), commencing at 10:30 A.M. CDT, Thursday, October 23, 2014, and ending at 10:30 A.M. CDT, Thursday, October 30, 2014. The capacity offered in this open season is the subject of a pre-arranged deal pursuant to Article XXVI, Section 5.9 of the GT&C of Tennessee's Tariff, the terms and conditions of which are disclosed below. Therefore, the customer under the pre-arranged deal has the right to match the highest net present value (“NPV”) bid received in this open season.
Primary Receipt Points(s): 420999 – Pooling PT – 500 Leg – Zone L
Primary Delivery Point(s): 400459 – Col Gas/TGP Broadrun Cobb
Secondary Delivery Point(s) at
which the Rates
specified below apply: Zone 1 Meter No. 460017 Storage – Bear Creek
Zone 2 Meter No. 420049 COL Gas/TGP North Means KY
Zone 2 Meter No. 420079 COL Gas/TGP Greenup KY
Monthly Reservation Rate: The lower of (i) $4.5625 per Dth; or (ii) Tennessee's maximum applicable monthly reservation rate.
Commodity Rate for all Primary
and Secondary Deliveries: Tennessee's maximum applicable commodity rate per Dth.
In addition to the reservation and commodity rates specified above, for deliveries to the “Dominion/TGP Broad Run Cornwell Kan” meter (#420044), the Pre-Arranged Shipper shall pay an incremental daily reservation rate equal to $0.0605 per Dth/day; provided, however, that the Pre-Arranged Shipper's total obligation for monthly reservation charges and incremental daily reservation charges shall not exceed Tennessee's maximum applicable reservation rate, either on a daily or monthly basis.
Other Conditions
Of the Pre-arranged Deal:
Receipts from and/or deliveries to points other than those listed above shall result in the Pre-Arranged Shipper being assessed Tennessee's maximum reservation rate under Rate Schedule FT-A for the primary path divided by the number of days in the month for the entire gas transportation agreement TQ on the day(s) of such deliveries and Tennessee's maximum daily commodity rates under Rate Schedule FT-A.
Shipper shall also pay ACA, all applicable Fuel and Loss Retention (FL&R), Electric Power Cost Recovery (EPCR), and all other applicable surcharges specified in Tennessee's Tariff.
The total amount of primary receipt point capacity and primary delivery point capacity shall be equal, and the amount of each shall equal the cumulative above-described TQ.
If Shipper attempts to apply the discounted rate described in the Pre-Arranged Deal to any volumes or points not eligible for the discount and thereby fails to pay correctly invoiced and undisputed amounts, then, if such failure is not cured within thirty days of provision of notice by Tennessee to Shipper of such failure, Tennessee shall have the right, in its sole discretion, to immediately terminate the Discounted Rate Agreement with Shipper and/or to assess, from the date of such violation of the terms of the Pre-Arranged Deal, the applicable maximum rate on all transactions occurring under the Service Package for the month(s) in which such limits were exceeded.
The Pre-Arranged Deal and all of its terms and conditions are subject to Tennessee's Tariff, as amended from time to time, and to all valid and applicable laws, orders, directives, rules, and regulations of duly constituted authorities having jurisdiction. In accordance with Article XXVI, Section 5.9 of the GT&C of Tennessee's Tariff, Tennessee is posting the terms of the Pre-Arranged Deal on DART in an open season for competitive bidding as provided, and the Pre-Arranged Shipper shall have a one-time right within 2 business days of notification to match any bids with a higher NPV in order to obtain the capacity.
The above-specified Contract Terms for the Proposal represent the minimum Contract Terms that Tennessee is willing to accept for the capacity underlying the Proposal. Bids for less than the minimum Contract Terms will be rejected; provided, further, bids for less than the Pre-Arranged Deal in its entirety will be rejected.
In the event that bids are received in the open season with a higher cumulative NPV than the Pre-Arranged Deal, the Pre-Arranged Shipper may either match the NPV of the bid(s) or forfeit its rights to all of the capacity included in the Pre-Arranged Deal.
In accordance with GT&C Article XXVI, Section 5.2, all final bids for the Proposal received during the open season will be evaluated on a Net Present Value (NPV) basis using the following factors:
NPV / Dth = En [R*(1 / (1+i)**n)] / TQ
En = Summation of months 1 through n (Sigma)
n = term in months
TQ = Contract TQ
R = Incremental monthly revenue
i = Monthly Discount Factor of 0.8333%
Parties interested in this capacity should submit a binding Firm Transportation request through the DART system or submit a binding bid via facsimile at (713) 369-9305. Customers may also submit a bid via e-mail by e-mailing their bid to TGPBidroom@kindermorgan.com. Confirm Tennessee's receipt of any bid by contacting the Bidroom between 8 am and 5 pm CDT, Monday through Friday. For further information, please contact:
Jason Connelly (713) 420-2446
Kenny Durio (713) 420-5307
Rock Graham (713) 420-4241
Mary Limbaugh (713) 420-4576
Scott Minear (713) 420-5177