Northern Natural Gas Company

Fifth Revised Volume No. 1

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Effective Date: 11/01/1993, Docket: RS92- 8-004, Status: Effective

Original Sheet No. 244 Original Sheet No. 244 : Effective

 

GENERAL TERMS AND CONDITIONS

 

Nothing contained herein prevents Northern from buying out an Account No. 858

agreement at any time.

 

23A. UNASSIGNED/UNCONVERTED UPSTREAM CAPACITY

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This Section will apply to any unconverted/unassigned upstream Third Party

Transportation Capacity.

 

Northern's Section 7(c) unassigned firm capacity rights under an upstream third party

transportation contract, which are not eligible for capacity release, shall, to the

extent such use is consistent with Northern's obligations under the related gas

supply contracts, be deemed to be available to Shippers on a firm or interruptible

basis as though such capacity were on Northern's system. TF, TFX or TI Shippers, or

Northern, as merchant, who use unassigned/unconverted upstream capacity will have the

following priorities to the capacity and will pay the following rates:

 

(1) Any Shipper purchasing supply which was or continues to be subject to a firm

purchase obligation on the part of Northern shall have first priority to the

unassigned/unconverted upstream capacity for nomination and scheduling purposes.

The Shipper will pay a rate equal to the upstream pipeline demand and commodity

charges, plus fuel. This priority will also be available to Northern in order

for Northern to fulfill a firm purchase obligation with respect to unassigned

supply behind the unassigned/unconverted upstream capacity. In the event

Northern utilizes the upstream capacity, Northern will credit the below market

cost of the supply to the Account No. 858 Stranded Cost Recovery Mechanism. The

below market cost will be determined as follows: the market price, defined as

the Mid-Continent Index Price in Section 25 of the GENERAL TERMS AND CONDITIONS

of this Tariff, less the cost of the supply.

 

(2) TF Shippers who are assessed an Account No. 858 Stranded Cost surcharge pursuant

to Section 24 of the GENERAL TERMS AND CONDITIONS of this Tariff who use the

unassigned/unconverted upstream capacity will pay a rate equal to the commodity

charge, plus fuel applicable to the upstream capacity. If more capacity is

requested by said TF Shippers than is available, the TF Shipper willing to pay

the highest proportion of the demand charge applicable to the upstream capacity

will have priority to the capacity.

 

(3) TF Shippers who are not assessed an Account No. 858 Stranded Cost surcharge will

have the next priority to the unassigned/unconverted upstream capacity and will

pay the daily demand rate equivalent and commodity charges, plus fuel applicable

to the upstream capacity.

 

(4) TI Shippers will have the lowest priority to the unassigned/unconverted upstream

capacity and will pay the one hundred percent (100%) load factor equivalent of

the demand and commodity charges, plus fuel applicable to the upstream capacity.

 

(5) In (1) through (4) above, if the Shippers are unwilling to pay the maximum rate,

then priority will be granted to the Shipper paying the highest rate.

 

All dollars collected under this section will be credited to the Stranded Account

No. 858 Cost Recovery Mechanism.