Northern Natural Gas Company

Fifth Revised Volume No. 1

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Effective Date: 12/30/2004, Docket: RP03-398-015, Status: Effective

Substitute Sixth Revised Sheet No. 297 Substitute Sixth Revised Sheet No. 297 : Effective

Superseding: Sixth Revised Sheet No. 297

GENERAL TERMS AND CONDITIONS

 

 

52. RIGHT OF FIRST REFUSAL

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Shippers holding firm Agreements at maximum rates with a term of

twelve (12) or more consecutive months of service or for a term of

more than one (1) year for service not available for twelve

consecutive months may exercise the Right of First Refusal. Such

agreements are not subject to pregranted abandonment provided

notice is given as described herein. A Shipper may agree to waive

its Right of First Refusal at any time. Firm Service Agreements

at discounted rates entered into prior to March 27, 2000, with a

term equal to or greater than one (1) year, retain the Right of

First Refusal; however, any such grandfathered service agreement

must extend at maximum rates for twelve (12) or more consecutive

months of service or for a term of more than one (1) year for

service not available for twelve consecutive months in order to

retain its Right of First Refusal beyond the extended term.

Any Shipper with a contract having Right of First Refusal who

wishes to extend their contract at maximum rates for a term of at

least five (5) years, can be extended without exercising the Right

of First Refusal process or posting. A firm Shipper may elect to

retain a portion of its capacity, subject to the Right of First

Refusal process and have Northern's pregranted abandonment

authority apply to the remainder of the capacity.

 

The Right of First Refusal will not be applicable to interim

service agreements for entitlement associated with (1) expansion

projects as set forth in Section 26 of this Tariff, and

(2) capacity that is already under contract for a future period

subject to the following conditions:

 

a) The future capacity must have been sold through an open

season bidding process permitting bids for capacity for

service to start immediately or anytime in the future;

b) the bids must have been evaluated on a net present value

basis; and

c) the future capacity must have been awarded to the Shipper

providing the highest net present value bid.

 

 

The process for exercising the Right of First Refusal is as

follows:

 

1) Notice

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Northern will provide no more than nine (9) months, and no

less than eight (8) months advance written notice of pending

contract expiration to firm Shippers with contract terms of

one (1) year or more. Shippers must give written notice to

Northern within sixty (60) days of the date of Northern's

notification to Shipper that it wishes Northern to post its

capacity to begin the Right of First Refusal process.