Dominion Cove Point LNG, LP

Original Volume No. 1

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Effective Date: 04/01/2009, Docket: RP09-399-001, Status: Effective

Original Sheet No. 205A Original Sheet No. 205A

 

GENERAL TERMS AND CONDITIONS

(Continued)

 

1. DEFINITIONS (Continued)

 

1.42.B.Firm Import Shipper Capped Retainage Percentage

 

In the event that the Retainage percentage applicable to Rate Schedule LTD-1 and

the 2004 Terminal Expansion Service pursuant to Section 30 of these General Terms

and Conditions as calculated in accordance with Section 1.42.A. above, exceeds

three percent (3.0%), the Retainage percentage for Buyers under Rate Schedule LTD-1

and the 2004 Terminal Expansion (Firm Import Shippers), will be capped at three

percent (3.0%) of Buyer's quantities received (Capped 3%). During the period when

the Capped 3% is in effect (Cap Period), the difference between the quantities

retained and the actual quantities required by Operator is the "Cap Period Under or

Over Recovery".

 

For the purposes of this Section 1.42.B., if the cumulative Cap Period Under

Recovery is greater than or equal to 100,000 Dth at the end of any calendar

quarter, then the Cap Period Under Recovery will be reimbursed by the Firm Import

Shippers based upon MDDQ. Notice of such reimbursable share to be tendered by

individual Firm Import Shippers shall be posted on Operator's EBB. Each Firm

Import Shipper will provide its share of Cap Period Under-Recovery quantities to

Operator within 90 days of such notice, via an Operator approved inventory transfer

or via tenders of Natural Gas to Operator at any mutually agreeable location on the

Cove Point Pipeline. Provided, however, that if any Firm Import Shipper wishes to

provide all or any portion of its share of Cap Period Under Recovery quantities via

tenders of Natural Gas to Operator, the Firm Import Shipper shall submit a proposal

to provide such Natural Gas to Operator in uniform quantities over a sixty (60) day

period (or other period acceptable to Operator), specifying the proposed Delivery

Point. Such proposal shall be submitted to Operator within five (5) Business Days

of the posted notice. Operator will review each proposal within five (5) Business

Days. By the end of such five (5) Business Days, Operator shall notify the Firm

Import Shipper either (i) that the proposal is acceptable, or (ii) that operational

conditions make the proposal unacceptable. Operator will not unduly discriminate

among Firm Import Shippers in establishing a schedule for delivery of Natural Gas.

If Operator cannot accommodate Firm Import Shipper's proposal, Operator and the

Firm Import Shipper shall promptly use reasonable efforts to reach agreement on a

mutually acceptable alternative schedule. If, despite the foregoing, Operator and

the Firm Import Shipper are unable to agree on a schedule for delivery of a Firm

Import Shipper's Cap Period Under Recovery Quantities during any calendar quarter,

such Firm Import Shipper shall tender such quantities in the next calendar quarter.

If, after agreeing on a schedule for delivery of Natural Gas by a Firm Import

Shipper in accordance with the provisions of this section, operational conditions

cause Operator to be unable to receive Natural Gas in accordance with such

schedule, Operator shall notify the Firm Import Shipper at least four (4) hours

prior to the Timely Cycle for a particular Gas Day if it is unable to accept said

quantities for such Gas Day. For weekends or holidays, such notice shall be posted

four (4) hours prior to the end of the last Business Day prior to the weekend, or

holiday period, as reported in Gas Daily. In the event Operator notifies a Firm

Import Shipper that it will be unable to receive quantities, the parties will use

good faith reasonable efforts to revise the schedule so that quantities are

transferred or tendered prior to the end of that quarter. Any Firm Import Shipper

who fails to make an approved inventory transfer or to tender Natural Gas in

accordance with an agreed schedule on or before the last day of that quarter,

unless such failure was caused by Operator's actions, shall be subject to a penalty

of $10.00 per Dth not transferred or tendered, which penalty shall be subject to

the provisions of Section 12(e) of the GT&C. This penalty does not relieve the

Firm Import Shipper of the obligation to provide reimbursable quantities to

Operator. Quantities of LNG or Natural Gas received by Operator from Firm Import

Shippers under this section will be treated as quantities retained. If the

cumulative Cap Period Under Recovery at the end of any calendar quarter is less

than 100,000 Dth, then the Cap Period Under Recovery will not be allocated to the

Firm Import Shippers and such balance will be carried forward to the subsequent

period.