Northern Natural Gas Company
Fifth Revised Volume No. 1
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Effective Date: 02/21/2009, Docket: RP09-233-000, Status: Effective
Third Revised Sheet No. 284 Third Revised Sheet No. 284
Superseding: Substitute Second Revised Sheet No. 284
GENERAL TERMS AND CONDITIONS
45. WARRANTY
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In the event Northern does not have title to the gas being transported,
Shipper warrants that Shipper at the time of delivery of gas to Northern
will have good title to all such gas pursuant to contractual arrangements
entered into prior to commencement of service, and that it will deliver, or
cause to be delivered, such gas free from all liens, encumbrances and claims
whatsoever; provided, however, that pursuant to Section 44, of these
General Terms and Conditions, Shipper or its designee may elect to retain
the right to process such gas for the removal of liquids and liquifiable
hydrocarbons, but in such instances Shipper warrants that it or its designee
has good right to do so pursuant to contractual arrangements entered into
prior to commencement of service. Shipper will indemnify Northern and save
it harmless from all suits, actions, debts, liabilities, accounts, damages,
costs, losses, and expenses (including attorneys' fees and court costs)
arising out of the adverse claim of any person or persons claiming ownership
of any interest in the gas or for any taxes, licenses, royalties, fees, or
charges which are applicable prior to the time of delivery of such gas to
Northern. In the event any adverse claim of any character whatsoever is
asserted with respect to any of said gas, Northern shall have the right to
suspend service under the Service Agreement until such time as Shipper's
title or right to deliver is free from question.
46. CREDIT WORTHINESS
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Prior to execution of a Service Agreement, providing for service under any
Rate Schedule, a Shipper or a prospective shipper (hereinafter in this
section jointly referred to as "Shipper") shall be required to establish
creditworthiness with Northern. Northern shall not be required to:
(i) execute a Service Agreement providing for service under the applicable
Rate Schedule on behalf of any Shipper who fails to meet Northern's
standards for creditworthiness; or (ii) initiate service to a Shipper who
fails to meet Northern's standards for creditworthiness; or (iii) continue
transportation service on behalf of any Shipper who is or has become
insolvent or who, at Northern's request, fails within a reasonable period to
demonstrate creditworthiness.
For purposes herein, the determination of Shipper's creditworthiness shall
be based upon the level of service requested by Shipper and Shipper's
estimated financial strength as defined by a credit rating of investment
grade, defined as a rating of at least "BBB-" by Standard & Poor's
Rating Group (Standard & Poor's), a rating of at least "Baa3" by Moody's
Investors Service, Inc. (Moody's), a rating of at least "BBB-" by Fitch
Ratings (Fitch) (collectively "Minimum Rating"), and if Shipper is at the
Minimum Rating, the Shipper's Short-Term and Long-Term Outlook or Credit
Watch must be Stable or Positive from Standard & Poor's, Moody's and Fitch;
or for Canadian Shippers not rated by Standard & Poor's, Fitch, or Moody's,
a rating of at least "BBB(low)" by Dominion Bond Rating Service (Dominion)
and the Canadian Shipper's Short-Term and Long-Term Outlook or Credit Watch
is Stable or Positive from Dominion. To the extent Shipper is rated by
multiple agencies, the lower rating applies. If Shipper is not rated by
Standard & Poor's, Moody's, Fitch, or Dominion, a determination of a
Shipper's creditworthiness shall be based upon (at the Shipper's election)
(i) the credit rating assigned to the Shipper's parent company (if the
parent company is creditworthy it must provide a written guarantee in a form
satisfactory to Northern), or (ii) a credit rating, as evaluated by
Northern, based upon the level of service requested by Shipper and financial
analysis criteria and ratios which are generally acceptable in the natural