Midwestern Gas Transmission Company

Third Revised Volume No. 1

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Effective Date: 03/17/2005, Docket: RP05-186-000, Status: Effective

Original Sheet No. 276 Original Sheet No. 276 : Effective

 

 

GENERAL TERMS AND CONDITIONS

 

 

36. OPERATIONAL BALANCING AGREEMENT POLICY

 

36.1 Purpose

 

The Operational Balancing Agreement (OBA), is intended to govern the treatment

of any differences between the actual quantity of gas received/delivered at a

point of interconnection with Company's system and the quantity of gas that is

scheduled.

 

Company's OBA shall be based upon the NAESB WGQ Model OBA whenever possible.

[6.5.2/v1.4]

 

Company considers an OBA to be a predetermined allocation method.

 

36.2 Policy

 

It is Company's policy to negotiate and execute, if possible, the Company's

applicable form of OBA at all points of interconnection. However, if an OBA

does not exist at a point of interconnection, the imbalance charges, cash-outs,

or penalties incurred at such point shall be the responsibility of Shipper(s)

that are out of balance. Company shall enter into an OBA at all pipeline-to-

pipeline (interstate and intrastate) interconnects. [2.3.29/v1.6]

 

If it is not possible to utilize Company's form of OBA for an interstate

pipeline interconnection, an acceptable OBA for such interconnection must

include the following provisions:

 

(a) The OBA must be in energy terms with stated bases.

 

(b) The OBA parties intend that the quantity actually received/delivered each

day at the interconnection will equal the scheduled nominations.

 

(c) Any differences between the metered quantity and the scheduled nomination

is treated as an OBA imbalance and exists solely between the OBA parties.

 

(d) The OBA parties will take the necessary steps to ensure that the

cumulative daily OBA imbalance is maintained at or tends towards a zero

imbalance. No imbalance penalty shall be imposed when a prior period

adjustment applied to the current period causes or increases a current

month penalty. [2.3.31/v1.1]

 

(e) The OBA parties will regularly reconcile scheduled nominations during a

given Production Month. A mutually agreed upon scheduled nomination summary

must be completed as soon as practical after each Production Month end.

 

(f) The monthly metered flow data for such interconnection will be determined

and communicated by the Measurement Party in writing as soon as possible

to the other OBA party.

 

(g) The OBA parties at such interconnection may temporarily suspend the OBA in

accordance with the terms thereof if either party discovers or anticipates

extraordinary circumstances, such as significant interruption of

transportation service, severe weather, or some other event which affects

the gas supplies available for delivery at the interconnection.

 

(h) A mutually agreeable commencement date, termination date, and cancellation

clause.

 

An operational imbalance at a given point of interconnection is subject

to resolution under Rate Schedule LMS-MA and Rate Schedule LMS-PA, if

applicable, as set forth in the form of OBA.