Northern Natural Gas Company
Fifth Revised Volume No. 1
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Effective Date: 07/16/2005, Docket: RP05-376-000, Status: Effective
Eighth Revised Sheet No. 269 Eighth Revised Sheet No. 269 : Effective
Superseding: Seventh Revised Sheet No. 269
GENERAL TERMS AND CONDITIONS
F. Resolution of Imbalances
Each month, subject to mutual agreement by Northern and Shipper on a not unduly
discriminatory basis, Northern and Shipper shall eliminate any Imbalance by using
any combination of the four (4) resolution mechanisms set forth below. Imbalances
will be posted on the 9th Business Day of the month. Shippers will have until the
12th Business Day of the month to access Northern's website to elect which imbalance
resolution mechanism(s) they will use and the volumes associated with each mechanism.
Any volumes not designated to be resolved using either trading (for which final
notification is due to Northern by the 17th business day), imbalance-to-storage or
in-kind resolution will automatically be cashed out. Any residual imbalance volume
remaining after trading, imbalance-to-storage or in-kind resolution methods will also
be automatically cashed-out as further explained herein.
(i) Monthly Imbalance Trading. Each month, Shipper will have the opportunity to
trade monthly imbalances with other eligible Shippers. All imbalance trading
activity shall be in accordance with Subsection L. outlined below.
(ii) Monthly Cash-out/in. Each month, Northern will either invoice the Shipper
pursuant to Section 8 of these General Terms and Conditions or credit the
Shipper the Dollar Valuation amount of the Shipper's monthly imbalance,
determined in accordance with Subsection E. (i) above.
(iii) Monthly Imbalance-to-Storage. Effective April 1, 2005, a Shipper's monthly
imbalance may be resolved as an injection to, or withdrawal from, the Shipper's
deferred delivery account(s), or the deferred delivery account of another
shipper, subject to capacity availability and the terms of the Shipper's deferred
delivery account. If the Shipper is utilizing an account of another Shipper an
executed agreement between the transfer parties must be provided to Northern
identifying the transfer parties and the transfer quantity at the time of the
election.
When Shipper elects the imbalance to storage mechanism, Shipper must identify
the applicable transportation and storage contracts and storage point to be
used for billing purposes. The ability to use the imbalance to storage
mechanism is subject to the storage parameters of the Shipper's or the transfer
party's applicable deferred delivery agreement(s) (either FDD or IDD),
and transportation provisions thereunder. Shippers will be charged all
applicable storage, transportation, and fuel charges. For Shippers and/or
transfer party with unused monthly transportation entitlement, the firm commodity
rate shall apply. To the extent there is not sufficient unused monthly
transportation entitlement, the overrun rate shall apply. For Shippers with
unused monthly storage injection or withdrawal entitlement, the firm injection or
withdrawal rate shall apply. The transportation fee for underdeliveries (storage
injections) will be the applicable out-of-balance transportation rate. Storage
inventories will be adjusted for the imbalance volume on the 14th business day of
the month. Any residual imbalance as a result of the shipper's storage agreement
will be cashed out at the applicable weekly high/low price of the production
month.
(iv) In-kind Resolution. Effective June 1, 2005, in-kind payback may be used to
resolve monthly imbalances after trading, up to the greater of 3% of the
shipper's monthly scheduled volumes, or 1,000 MMBtu. Volumes resolved using
other methods will not count toward the 3% limitation. The in-kind payback
volumes must be scheduled in the calendar month after receipt of notification of
the final imbalance amount that may be resolved through this in-kind process.
The Shipper may nominate any amount of in-kind payback volumes by day. Northern
will attempt to schedule the imbalance payback volumes as requested, subject to
storage or transportation-related allocations. Any residual volume remaining at
the end of the payback month will be cashed out at the high/low weekly price of
the payback month.
Shippers will schedule in-kind payback volumes on the transportation agreement of
their choice. The transportation and storage scheduling priorities for in-kind
resolution will follow the priority of the agreement scheduled. If Northern is
allocating its storage services, in-kind payback volumes will have the same
scheduling priority as Rate Schedules IDD and FDD overrun.