North Baja Pipeline, LLC

Original Volume No. 1

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Effective Date: 02/28/2003, Docket: RP02-363-008, Status: Effective

Second Revised Sheet No. 132 Second Revised Sheet No. 132 : Effective

Superseding: First Revised Sheet No. 132

GENERAL TERMS AND CONDITIONS OF SERVICE

(Continued)

 

12. CREDITWORTHINESS (Continued)

 

12.4 Creditworthiness for Interruptible Transportation Service

 

NBP shall not be required to perform or to continue interruptible

transportation service under this FERC Gas Tariff on behalf of any

Shipper who fails to comply with NBP's creditworthiness standards.

If Shipper is found by NBP to be non-creditworthy, NBP will, upon

request, inform Shipper in writing as to the reasons Shipper has

been deemed non-creditworthy.

 

If Shipper's credit standing ceases to meet NBP's credit

requirements during the period of service, Shipper must, within

five (5) business days, pay for one month of service in advance to

continue service. Shipper must, within thirty (30) days, provide

an acceptable guarantee or either a cash security deposit or

letter of credit, consistent with NBP's applicable

creditworthiness standards. If Shipper fails to provide the

required security within this time frame, NBP may suspend service

immediately. Further, NBP may provide simultaneous written notice

to Shipper and the Commission that it will terminate service in

thirty (30) days if Shipper fails to provide security.

Transporter also may exercise any other remedy available to it

hereunder, at law or in equity. Shippers shall provide, initially

and on a continuing basis, financial statements, evidence of debt

and/or credit ratings, and other such information as is reasonably

requested by NBP to establish or confirm Shipper's qualification

for service. Credit limits will be established based on the level

of requested service and Shipper creditworthiness, as established

by the following:

 

(a) Creditworthiness must be evidenced by a rating for

unenhanced senior unsecured debt of at least BB+ by Standard

& Poors, Ba1 by Moody's, or an equivalent rating as

determined by NBP. In the event that a split rating occurs

between rating agencies, NBP will rely upon the lower of the

ratings. This rating must be a "foreign currency" rating if

the Shipper is domiciled outside of the United States.

"Local currency" ratings are unacceptable unless the

Shipper's local currency is US Dollars (e.g. Puerto Rico).

Shipper credit limits for interruptible transportation will

be established by NBP based upon the audited financial

statements for the Shipper's two (2) most recent fiscal

years, all interim reports, and any other relevant

information.

 

(Continued)