Millennium Pipeline Company, L. L. C.

Original Volume No. 1

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Effective Date: 02/18/2010, Docket: RP10-325-000, Status: Effective

Second Revised Sheet No. 71A Second Revised Sheet No. 71A

Superseding: First Revised Sheet No. 71A

 

GENERAL TERMS AND CONDITIONS

(Continued)

 

(d) Notwithstanding the foregoing requirements, if Transporter constructs new

facilities to accommodate a Shipper or agrees to acquire offsystem capacity for a Shipper

pursuant to Section 48 of these General Terms and Conditions, Transporter may require credit

assurance in an amount up to Shipper's proportionate share of the cost of the new facilities or

the net present value of all future payments due to the third party for the acquired offsystem

capacity. This credit assurance may be requested at any time before or after the in-service date

of the facilities or the acquisition of the off-system capacity, to the extent mutually agreed

to as a condition of the construction or acquisition. As Transporter recovers the cost of these

facilities through its rates or makes payment for the offsystem capacity, the credit assurance

required will be reduced accordingly. Specifically, any credit assurance provided by a Shipper

related to new facilities or offsystem capacity will be returned to that Shipper in equal

monthly amounts over the term of its Service Agreement for service related to the new facilities

or offsystem capacity or as otherwise mutually agreed by Transporter and Shipper. This

requirement is in addition to and does not supersede or replace any other rights that

Transporter may have regarding the construction of and reimbursement for facilities. If Shipper

defaults and Transporter terminates service to Shipper, then Transporter may draw upon and

retain such collateral as necessary to reimburse Transporter for the unamortized cost of the

facilities constructed for Shipper or the remaining payments due for the offsystem capacity. The

capacity underlying any terminated Service Agreement will be made available pursuant to Section

4 of these General Terms and Conditions. Within 60 days of the capacity being made available, to

the extent such capacity has been awarded, the credit assurance retained by Transporter from the

original Shipper will be reduced to an amount equal to the difference between net present value

of that portion of the future reservation charge revenues of the original Shipper that would

have been attributed to the cost of the new facilities or offsystem capacity less the net

present value of that portion of the future reservation charge revenues of the newly awarded

Shipper that may be attributed to the cost of the facilities or offsystem capacity.

 

3.10 Loss of Creditworthiness

 

(a) Transporter may at any time re-evaluate the creditworthiness of Shipper and demand

adequate assurance of payment or additional adequate assurances of payment if Transporter

determines that Shipper has in any respect become uncreditworthy. Circumstances under which

Transporter may re-evaluate Shipper's creditworthiness include, but are not limited to, a filing

by Shipper for bankruptcy or a submission to bankruptcy or similar federal or state proceedings,

an adverse change in Shipper's payment practices, a reorganization of Shipper's business

structure, an assignment of Shipper's contracts, or a request by Shipper for increased service.

If Transporter, following such a re-evaluation, makes an adverse preliminary creditworthiness

determination, and Shipper is current in its payments to Transporter and otherwise has a good

credit history with Transporter, Shipper will be given notice of such adverse determination and

be allowed 10 days to submit data demonstrating its continued creditworthiness before

Transporter will make a final determination of creditworthiness and, if adverse, demand adequate

assurance of payment. Transporter may at any time withdraw or revise its demand for adequate

assurance of payment or extend its due date.

 

(b) If the Transporter requests additional information to be used for credit evaluation

after the initiation of service, Transporter, contemporaneous with the request, should provide

its reason(s) for requesting the additional information to Shipper and designate to whom the

response should be sent. Transporter and Shipper may mutually agree to waive the requirements of

this paragraph.

 

(c) Upon receipt of either an initial or follow-up request from Transporter for

information to be used for creditworthiness evaluation, Shipper's authorized representative(s)

should acknowledge receipt of the Transporter's request. Transporter and Shipper may mutually

agree to waive the requirements of this paragraph.

 

(d) Shipper's authorized representative(s) should respond to Transporter's request for

credit information, as allowed by Transporter's tariff, on or before the due date specified in

the request. Shipper should provide all the credit information requested by Transporter or

provide the reason(s) why any of the requested information was not provided.