Kinder Morgan Illinois Pipeline LLC

Original Volume No. 1

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Effective Date: 12/01/2007, Docket: RP08- 34-000, Status: Effective

Original Sheet No. 120 Original Sheet No. 120 : Effective

 

 

GENERAL TERMS AND CONDITIONS

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(4) Based on the above listed criteria, the

economic value of a project shall be determined using the

discounted cash flow rate of return methodology with the minimum

acceptable rate of return to be published from time to time on

KMIP's Interactive Website. When the present value of the

incremental revenues from the project is greater than the present

value of the incremental cost of service, KMIP will pay for the

cost of the contemplated facilities. When the present value of the

incremental revenues from the project is less than the present

value of the incremental cost of service, Shipper shall pay for

the cost of the contemplated facilities.

 

5.3 Unless otherwise agreed, Contribution in Aid of

Construction (CIAC) pursuant to this Section 5 shall be increased

by an amount (Tax Reimbursement) to compensate for the corporate

income tax effects thereof, according to the following formula;

 

Tax Reimbursement = [Tax Rate x (CIAC - Present Value

of Tax Depreciation)] x [1 + {Tax Rate/(1 - Tax Rate)}]

 

5.4 KMIP will publish on its Interactive Website the

discount rate(s) and tax rates to be used in calculations under

this Section 5. Subject to its providing at least three (3) days'

prior notice on its Interactive Website, KMIP may change such

factors to reflect changes in circumstances.

 

5.5 When KMIP has previously paid for Receipt or Delivery

Point facilities under this facilities reimbursement policy,

Shipper shall, nevertheless, promptly pay KMIP for KMIP's net book

value of such facilities when either of the following events

occurs: (a) when KMIP's ability to fully recover such costs is

denied in any Section 4 or Section 5 rate proceeding; or (b) when

Shipper ceases operations at the facilities.