Northern Natural Gas Company

Fifth Revised Volume No. 1

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Effective Date: 11/01/2003, Docket: RP03-398-011, Status: Effective

Original Sheet No. 269C Original Sheet No. 269C : Effective

 

GENERAL TERMS AND CONDITIONS

 

 

(viii) Trade Groups.

 

 

Effective June, 1, 2005 Shippers may form a trading group (Trade Group) to

resolve imbalances. Trading groups must be composed of Shippers having like

imbalances, i.e. Market Area imbalances, Field Area imbalances or Gulf

Coast Area imbalances. Each Shipper must have executed an agreement with

the other members of the Trade Group demonstrating their consent to trade

imbalances. The minimum term of the trading agreement is a minimum of one

year.

 

A Trade Group election form will be posted on the website to notify

Northern of the Trade Group participants. Such notification must be

received by June 1, 2005 for the June production month or by the first of

the month for any production month thereafter.

 

Northern will continue to create imbalance statements for the individual

trading parties in the currently accepted format and pursuant to the

existing pricing provisions in the tariff by the 9th business day following

the production month. Northern will administer the trading among the

parties so that a net imbalance is created for the entire Trade Group each

month.

 

The net imbalance will be priced at the applicable high/low weekly pricing

with tiering and at the average weekly MIP. The amount by which the

high/low weekly pricing with tiering exceeds the amount calculated using

the average weekly MIP is the amount to be allocated to the individual

Trade Group members. The allocation to each member will be based on each

member's amount that would have been different from the average MIP with

tiering had it been cashed-out individually. By the 12th business day

following production month, Northern will provide an imbalance statement

showing the cash-out amount for each individual party in the trading group

at the average MIP less the allocated high/low amount. The net cashout

amount will be settled by the 17th business day, with payment either made

or received by Northern.

 

A shipper participating in a Trade Group cannot use the other imbalance

resolution options provided in Northern's tariff.