Egan Hub Storage, LLC

First Revised Volume No. 1

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Effective Date: 03/06/2008, Docket: RP08-188-000, Status: Effective

Third Revised Sheet No. 108 Third Revised Sheet No. 108 : Effective

Superseding: Second Revised Sheet No. 108

 

GENERAL TERMS AND CONDITIONS

(Continued)

 

 

(1) an advance deposit;

 

(2) a standby irrevocable letter of credit, acceptable to Egan Hub,

issued by a financial institution that satisfies Egan Hub's credit

appraisal;

 

(3) security interest in collateral found to be satisfactory to Egan

Hub; or

 

(4) a guarantee, acceptable to Egan Hub, by another person or entity

which satisfies Egan Hub's credit appraisal.

 

Egan Hub shall provide such Customer with a written statement supporting Egan Hub's request for

the security amount requested at the time such security is requested. If Egan Hub rejects the

security provided by Customer in accordance with Section 3.4(b)(2)-(4) above, Egan Hub shall

re-issue its request for the security and include a written explanation for the rejection of

the security previously provided by Customer. For a new Customer, or a Customer requesting a

Billing Amendment, such security shall be calculated as follows:

 

(i) For firm or secondary firm storage service, an amount equal to the

three (3) highest Months during a Contract Year or the duration of

Customer's Service Agreement, whichever is shorter, worth of

Reservation Charges at the rate specified in Customer's Service

Agreement;

(ii) For enhanced park and loan service and Interruptible hub service, an

amount equal to fifteen (15) Days of usage per Month for three (3)

Months or the duration of the Customer's Service Agreement,

whichever is shorter, calculated using the applicable rate(s) agreed

upon by Egan Hub and Customer, as reflected on Exhibit B to

Customer's Hub Services Agreement, plus the market value of any

quantities of Gas loaned to Customer pursuant to Exhibit B of

Customer's executed Hub Services Agreement.

(iii) For Capacity Release Umbrella agreements, Egan Hub will accept any

collateral amount submitted by Customer in relation to the request

for the capacity release umbrella agreement; however, Customer will

be required to comply with all of Egan Hub's credit requirements at

such time as Customer submits a bid to acquire released capacity

pursuant to Section 4 of the General Terms and Conditions of this

FERC Gas Tariff;

 

For an existing Customer, such security shall be equal to the highest three (3) Months of

activity (based on usage of in-kind and loan agreements and the billed amounts for all other

agreements) for all of Customer's active service agreements during the previous twelve (12)

Months. For the purposes of this section, the term "in-kind agreement" does not include Fuel

Reimbursement.

 

With respect to a request for new service or a request resulting in a Billing Amendment, the

security required by Egan Hub pursuant to this Section 3.4(b) must be received by Egan Hub

within ten (10) Business Days of Egan Hub's written notification to Customer, otherwise, such

request will be deemed to be null and void. With respect to an existing service agreement,

Customer must tender (i) an advance payment equal to the highest Month of activity (based on

usage of in-kind and loan agreements and the billed amounts for all other agreements) for all

of Customer's active service agreements during the previous twelve (12) Months within five (5)

Business Days of Egan Hub's notification, and (ii) the security required by this Section 3.4(b)

within thirty (30) days of Egan Hub's notification. If such advance payment or security is not

received within the specified time period, then Egan Hub may immediately suspend service, and

may terminate Customer's service agreement(s) upon thirty (30) days' notice to Customer and the

Commission.