DATE: July 13, 2021
TO: ALL TENNESSEE GAS PIPELINE COMPANY, L.L.C. CUSTOMERS
RE: AVAILABLE FIRM CAPACITY (BINDING OPEN SEASON POSTING #1310)
Tennessee Gas Pipeline Company, L.L.C. (“Tennessee” or “TGP”) hereby makes available certain firm capacity in Tennessee's Zone L/1 as outlined below (“Open Season”). This capacity is only made available by the installation of certain facilities at Tennessee's Compressor Station 500 (the “Project” and the capacity made available by the Project is the “Project Capacity”). The expected in-service date of the Project shall be no earlier than December 1, 2021, but the actual in-service date is contingent on the completion of the Project and Tennessee's receipt of all regulatory approvals. Tennessee has entered into a binding agreement with a shipper for the Project Capacity (“Foundational Shipper”). The Foundational Shipper's executed binding agreement represents a qualifying bid in this Open Season. Tennessee is holding this Open Season in accordance with any applicable provisions of its FERC Gas Tariff (as it may be amended from time to time, the “Tariff”), commencing at 11:00 AM on Tuesday, July 13, 2021, and ending at 4:00 PM on Tuesday, July 20, 2021 (the “Open Season Period”). Any capitalized terms that are used but not defined herein shall, unless otherwise indicated, have the meanings ascribed to such terms in the Tariff.
Minor revisions to Open Season #1310 have been made to clarify the location of the Project facilities and the capacity made available by the Project.
Rate Schedule:
FT-A
Transportation Quantity (“TQ”):
Up to 17,000 Dth/d
Term:
The TQ is available the later of (1) December 1, 2021 or (2) the date on which the Project facilities necessary to provide the Project Capacity are placed in-service (“In-service Date”). Tennessee will reject bids for the Project Capacity with a commencement date prior to the In-service Date.
Tennessee reserves the right to reject bids for terms of less than four (4) years. Bids must be made in one (1) year increments.
Primary Receipt Point(s):
420826 - POOLING PT - 100 LEG - ZN0 - NORTH
Bids for this proposal must be identical to receipt point listed above.
Primary Delivery Point(s):
420999 – POOLING PT – 500 LEG – ZONE L
Bids for this proposal must be identical to delivery point listed above.
The capacity path of this transportation agreement will contain an Exception Path as outlined below:
1. Pooling Pt. Zn 0 North going South through TGP's 501 FH segment “KN Line”
2. East from Station 823 through TGP's 509 BH segment “Muskrat Line”
3. North from Sta. 527 through TGP's 527 FH segment to the Primary Delivery Point – 500 Leg - Zone L
EBB Pathing Rules:
https://pipeline2.kindermorgan.com/Documents/TGP/Pathing_Rules-20210713070609.pdf
Secondary Receipt Point(s) at
which the rates
specified below apply:
All Zone 0, L/1 Receipt Points within Transportation Path as defined in TGP's tariff.
Secondary Delivery Point(s) at
All Zone 0, L/1 Delivery Points within Transportation Path as defined in TGP's tariff.
Monthly Reservation Rate:
Tennessee will reject bids for a monthly reservation less than $3.0438 per Dth.
Commodity Rate for Primary
And Secondary
Deliveries:
Tennessee reserves the right to reject bids for less than Tennessee's applicable Base Commodity rate.
Other Charges
Shipper shall also pay ACA, applicable F&LR, EPCR charges, and all other applicable surcharges specified in Tennessee's Tariff, as may be in effect from time to time.
Without limiting or waiving any other rights that Tennessee may have with respect to this Open Season, Tennessee reserves the following rights:
1. To reject bids at less than Tennessee's applicable Base Reservation Rate or applicable Base Commodity Rate per Dth.
2. At any time during this Open Season, upon notice and in its sole discretion, to terminate this Open Season, to extend the Open Season Period, or to modify this Open Season.
3. To clarify and finalize bids containing non-specific and/or ambiguous bid information (including, without limitation, rate, term, and receipt or delivery points) or discrepancies in bid information, provided that Tennessee shall have no obligation to do so.
4. On a not unduly discriminatory basis, to reject any bid or service request that, in Tennessee's sole determination, is incomplete, is inconsistent with the terms of this Open Season, contains additions or modifications to the terms of this Open Season, is otherwise deficient in any respect (including failure to provide credit support as Tennessee deems necessary), or requests service outside the scope of this Open Season.
5. Tennessee will reject any bid that does not specify capacity within the capacity path posted above.
6. To reject any bid that will result in a reduction of reservation charges.
7. To reject bids received after the Open Season Period.
8. To reject negotiated rate bids.
9. To reject contingent bids.
10. Tennessee will reject bids from shippers that cannot meet its creditworthiness and credit assurance requirements, including as outlined below.
11. To reject bids that do not present Tennessee with sufficient economics to construct the Project at Tennessee's Compressor Station 500.
This Open Season is for capacity available only for the receipt/delivery point paths specified above. In order to be considered eligible to be awarded capacity following this Open Season, potential shippers must submit bids that specify terms, volumes, receipt points and delivery points that are consistent with the respective dates, quantities and associated receipt and delivery zones outlined above. All Bids should refer to Open Season #1310.
Available capacity volumes are contingent upon mainline, meter and lateral capacity. Bids cannot exceed the stated maximum volumes.
Because this capacity is made available through the installation of the Project, additional credit requirements may be needed in lieu of the requirements specified in Article XXVI, Section 4 of the General Terms and Conditions of Tennessee's Tariff.
Parties interested in this capacity should submit a binding Firm Transportation request through the DART system. Parties may also submit binding bids via e-mail by e-mailing their bids to TGPBidroom@kindermorgan.com. Any party may confirm Tennessee's receipt of its bid by contacting the Bidroom between 8 A.M. and 5 P.M. CT, Monday through Friday (unless such day is not a working day).
All bids submitted during this Open Season may be replaced with higher Net Present Value (“NPV”) bids during the Open Season Period. Bids cannot be replaced with lower NPV bids. Upon completion of this Open Season, all remaining bids will be considered binding until a successful bid(s) has been awarded.
Tennessee will award the TQ to the shipper(s) submitting qualifying binding bid(s) with the highest NPV. If any potential shipper submits a qualifying binding bid with an equal or higher NPV than the Foundational Shipper's bid, then the Foundational Shipper shall have the right to match or beat such bid within five (5) business days. To the extent the Foundational Shipper elects to beat any qualifying binding bid with a higher NPV bid, the Foundational Shipper shall be awarded one hundred percent (100%) of the TQ. In the event that two or more qualifying binding winning bids have the same total NPV, whether as a result of qualifying binding bids made in this Open Season or the Foundational Shipper exercising its right to match, capacity will be awarded to the shippers with qualifying binding winning bids, including if any such shippers are the Foundational Shipper, on a pro rata basis.
All final bids for each Proposal received during this Open Season will be evaluated on an NPV basis using the following factors:
NPV = En[R*(1/(1+i)**n)]
En = Summation of months 1 through n (Sigma)
n = term in months*
*Term will be capped at 240 months for purposes of NPV evaluation.
R = Incremental monthly revenue
i = Monthly Discount Factor of 0.8333%
Interested bidders may elect to bid the maximum applicable recourse rate or a negotiated rate. Negotiated rate bids will be capped at the applicable recourse rate for NPV evaluation purposes.
Tennessee reserves the right to accept any one bid or combination of bids that will result in the largest aggregate NPV for the aforementioned package(s).
Adam Ledet 713-420-4813 or 504-909-0552 (cell)
Mark Wilson 713-420-7205 (office)
E-mail TGPBidroom@kindermorgan.com