Columbia Gas Transmission LLC

Third Revised Volume No. 1

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Effective Date: 05/20/2009, Docket: RP09-529-000, Status: Effective

First Revised Sheet No. 404 First Revised Sheet No. 404

Superseding: Original Sheet No. 404

 

GENERAL TERMS AND CONDITIONS (Cont'd)

 

51. Auctions for Storage Service with Market-Based Rates

 

51.1 Request for Service. Shippers who want service under Rate Schedules FSS-M or ISS-M must submit a

request for service pursuant to Section 3(Requests for Service) of the General Terms and Conditions.

 

51.2 Notice. Transporter will auction available FSS-M or ISS-M capacity. Transporter will post on its

EBB either its own intention or a Shipper request to initiate an auction for FSS-M or ISS-M storage

capacity. The reserve price will be determined by Transporter. The price and term for auctions initiated

by a Shipper will be established through negotiation. If Transporter and Shipper are unable to reach

agreement, the reserve price will be established by Transporter in accordance with Section 51.4, with the

term set by the requesting Shipper. Prior to the beginning of the auction, Transporter will post a notice

announcing the date of the auction for FSS-M or ISS-M storage capacity. Transporter will refuse any bid

that would require it to sell capacity at a rate lower than the applicable reserve price. The notice of

the auction will include the auction start time(s) and all steps that will be required to participate and

bid in the auction, as well as the following information:

 

(a) the quantity of capacity available for the auction;

(b) the term for which the capacity is available; and

(c) the reserve price for the capacity;

(d) the criteria that will be applied to determine the winning bidder.

 

51.3 Creditworthiness. Before any Shipper can submit a bid, it must satisfy Transporter's credit

requirements, as set forth in Section 3(Requests for Service) of the General Terms and Conditions.

 

51.4 Calculation of Reserve Price. The reserve price for capacity sold under Rate Schedules FSS-M or ISS-

M will be set at up to: (1) $2.222 per Dth per year; (2) the highest price charged under contracts with

the same term in the twelve (12) month period preceding the auction by a competing storage seller; or (3)

the highest rate paid for service under the applicable rate schedule for the twelve (12) month period

preceding the auction, excluding transactions with companies affiliated with Transporter. For the purpose

of this provision, a "competing storage seller" is defined as a storage provider located in a state in

which Transporter has transportation facilities.

 

51.5 Binding Nature of Bids. All bids will be binding on the potential Shipper. Transporter will notify

the Shipper(s) with the winning bid(s) by telephone following the close of the auction. If a successful

bidder does not accept the capacity, it will forfeit its capacity and Transporter will award the capacity

to the Shipper with the next highest bid. Once Shipper accepts the capacity, it must execute a Service

Agreement within fifteen (15) days after the Service Agreement is tendered by Transporter, unless otherwise

mutually agreed by Transporter and Shipper. If the Shipper fails to execute the Service Agreement by the

established deadline, the capacity will be forfeited, Transporter will re-auction the capacity and the

Shipper will be required to pay any difference between the value of its bid and the next winning bid

received by Transporter.

 

51.6 Posting of Auction Results. No later than twenty-four (24) hours following the close of the auction,

Transporter will post the following information on its EBB:

 

(a) the name of the Shipper(s) with the winning bid(s);

(b) the rate(s) for the capacity;

(c) the term of the contract(s);

(d) the injection and withdrawal points; and

(e) any affiliate relationship between Transporter and Shipper(s).