Millennium Pipeline Company, L. L. C.

Original Volume No. 1

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Effective Date: 11/01/2009, Docket: RP10-17-000, Status: Effective

First Revised Sheet No. 79 First Revised Sheet No. 79

Superseding: Original Sheet No. 79

 

GENERAL TERMS AND CONDITIONS

(Continued)

 

(c) Termination of Long-Term Service Agreements; Exercise of Right of

First Refusal.

 

(1)(a) If Shipper's long-term Service Agreement is at the

applicable Recourse Rate for that service and does not extend according

to its terms or otherwise continue as described at Section 4.1(b) above,

or Shipper declines to extend the contract under the provisions

described at Section 4.1(b) above, Shipper may continue service upon

termination of that Service Agreement by (i) agreeing to match the

highest acceptable value bid, rate and term, offered to Transporter for

Shipper's firm service, or any portion (volume but not geographic

portion) thereof, through the bidding process described at Section 4.2

below, and (ii) executing a new Service Agreement incorporating the new

rate and term. This right of first refusal will apply only to a long

term Service Agreement at the applicable Recourse Rate for that service.

A Shipper with a firm Service Agreement having multiple primary Receipt

and Delivery Points subject to a right of first refusal may exercise its

right of first refusal with respect to the Service Agreement's

Transportation Demand at only certain primary Receipt and Delivery Point

combinations in such Service Agreement and in the same rate zone,

subject to satisfaction of Transporter's operational considerations

based on pipeline configuration and design. Section 12 (Maximum Daily

Delivery Obligation at Delivery Points and Maximum Daily Quantity at

Receipt Points) of the General Terms and Conditions addresses the

adjustment to maximum daily delivery obligations (MDDOs) when a Shipper

reduces its Service Agreement's Transportation Demand through the

exercise of a right of first refusal. The highest rate that Shipper

must match through the bidding process at Section 4.2 below if it wishes

to continue such service is the Recourse Rate. This right of first

refusal shall be deemed to be assigned where both (i) a Shipper holding

such a right releases and assigns all or a portion (volume but not

geographic portion) of the capacity for the remainder of the term under

that Service Agreement, regardless of the duration of that permanent

release, and (ii) Transporter and the Releasing Shipper agree to

terminate the Releasing Shipper's contract, so that the Releasing

Shipper no longer has any liability to the pipeline to pay for the

capacity.

 

(1)(b) Notwithstanding the provisions of Section 4.1(c)(1)(a),

Transporter and Shipper may mutually agree, on a not unduly

discriminatory basis, to include in discount rate or negotiated rate

firm Service Agreements that bear a term of 12 or more consecutive

months of service, a contractual right of first refusal equivalent to

the regulatory right of first refusal set forth in this Section 4.