East Tennessee Natural Gas, LLC

Third Revised Volume No. 1

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Effective Date: 04/20/2008, Docket: RP08-277-000, Status: Effective

First Revised Sheet No. 316A First Revised Sheet No. 316A : Effective

Superseding: Second Sub Original Sheet No. 316A

 

 

GENERAL TERMS AND CONDITIONS (Continued)

 

6.2 Upon notification by Transporter that a Shipper has failed to satisfy

the credit criteria or subsequently during the term of the service

agreement no longer satisfies the credit criteria, such Shipper may

still obtain credit approval by Transporter if it pays any outstanding

balances due Transporter for service rendered or has complied with

Section 16 of the General Terms and Conditions with regard to such

balances and elects to provide one of the following forms of security:

 

(a) an advance deposit;

 

(b) a standby irrevocable letter of credit, acceptable to

Transporter, issued by a financial institution that satisfies

Transporter's credit appraisal;

 

(c) security interest in collateral found to be satisfactory to

Transporter; or

 

(d) a guarantee, acceptable to Transporter, by another person or

entity which satisfies Transporter's credit appraisal.

 

Transporter shall provide such Shipper with a written statement

supporting Transporter's request for the security amount requested at

the time such security is requested. If Transporter rejects the

security provided by Shipper in accordance with Section 6.2(b)-(d)

above, Transporter shall re-issue its request for the security and

include a written explanation for the rejection of the security

previously provided by Shipper. For a new Shipper or a Shipper

requesting a Billing Amendment, such security shall be calculated as

follows:

(1) For firm transportation or storage service, an amount equal to

the three (3) highest Months' worth of reservation charges at

the applicable maximum recourse rate during a contract Year;

(2) For interruptible transportation or storage service, an amount

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

Months multiplied by the arithmetic average of the applicable

commodity rate(s), multiplied by Shipper's Maximum Interruptible

Quantity;

(3) For Park and Loan service, the applicable maximum Park and Loan

Daily Charge multiplied by Shipper's Maximum Park Quantity or

Maximum Loan Quantity, as applicable, plus the value of any

quantity to be loaned to Shipper;

(4) For Capacity Release Umbrella agreements, Transporter will

accept any collateral amount submitted by Shipper in relation to

the request for the capacity release umbrella agreement;

however, Shipper will be required to comply with all of

Transporter's credit requirements at such time as Shipper

submits a bid to acquire released capacity pursuant to Section

3.14 of the General Terms and Conditions of this FERC Gas

Tariff;

(5) For other agreements (e.g., Operational Balancing Agreement), an

estimated imbalance quantity of 5,000 Dth per Month for three

(3) Months multiplied by the average of Transporter's cashout

prices for the latest three (3) Months.

 

For an existing Shipper, 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, including cashout amounts, for all

other agreements) for all of Shipper'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.