PetroLogistics Natural Gas Storage LLC
Original Volume No. 1
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Effective Date: 06/03/2009, Docket: RP09-577-000, Status: Effective
Original Sheet No. 125 Original Sheet No. 125
Umbrella Agreement in the form contained in this FERC Gas Tariff. PetroLogistics will provide a copy of
this Addendum to the Replacement Shipper via facsimile, at which time the Replacement Shipper will have
the same rights and obligations as any other existing Shipper on PetroLogistics' system. Following
implementation of the release, PetroLogistics shall post notice of the winning bidder on the Internet
Web Site.
8.7 Best Bid. When PetroLogistics makes awards of capacity for which there have been multiple
bids meeting minimum conditions, PetroLogistics shall award the bids, best bid first, until all offered
capacity is awarded. The capacity being awarded represents the MDIQ, MDWQ, or MSQ. These quantities
are separate parts of the capacity and are awarded until one of the quantities is fully awarded, at
which point all capacity is deemed to be fully awarded. PetroLogistics shall evaluate and determine the
best bid among those otherwise consistent with any terms and conditions specified by the Releasing Shipper
as follows:
(a) PetroLogistics shall apply the standard or criteria for such determination specified by the
Releasing Shipper, including the standard to be used for breaking ties. Any standard or criteria so
specified must be objective, economic, not unduly discriminatory, not contrary to applicable provisions
of this FERC Gas Tariff, applicable to all potential Replacement Shippers and require PetroLogistics in
applying such standard to exercise no more than a ministerial function. The Releasing Shipper shall
indemnify and hold PetroLogistics harmless from and against all demands, losses, claims, expenses, causes
of action and/or damages suffered or incurred by PetroLogistics arising out of or related to any
determination of a "best bid" pursuant to a standard specified, supplied, approved or provided by
Releasing Shipper.
(b) In default of Releasing Shipper specifying a bid evaluation standard, PetroLogistics shall
determine the bid or bids generating the highest net present value, using a 10% discount factor, based
on the rate bid (reservation or demand component), the applicable quantity(ies) and term or period bid
upon. In default of Releasing Shipper specifying a method to break ties priority will be given first to
the bid with the shortest term, and next to the bid submitted first in time.
8.8 Qualification of Prospective Replacement Shipper. A prospective Replacement Shipper must
be on PetroLogistics' approved bidders list before bids may be posted on the Internet Web Site, must
satisfy all requirements of the applicable Rate Schedule and the General Terms and Conditions of this FERC
Gas Tariff and must have executed a Capacity Release Umbrella Agreement. To be on the approved bidders
list, the prospective Replacement Shipper must satisfy PetroLogistics' credit requirements as outlined
in Section 2.3 of the General Terms and Conditions, and provide PetroLogistics any information required
by Section 2.3 of the General Terms and Conditions. Such credit appraisal shall be reevaluated and
updated every three (3) months. The prospective Replacement Shipper shall remain on the approved bidders
list until such prospective Replacement Shipper (i) notifies PetroLogistics to the contrary, (ii) no
longer meets the credit qualifications established in Section 2.3 of the General Terms and Conditions,
or (iii) is suspended from the approved bidders list in the event, and for such time as, such
Replacement or Prearranged Shipper fails to pay part or all of the amount of any bill for service in
accordance with Section 13 of the General Terms and Conditions. PetroLogistics will apply its
creditworthiness criteria to assess the submission.
On a not unduly discriminatory basis, PetroLogistics will permit Replacement Shippers not satisfying
the creditworthiness requirements to submit bids, if the Releasing Shipper provides PetroLogistics with
a guarantee or other form of credit assurance in form and substance satisfactory to PetroLogistics of
all financial obligations of the Replacement Shipper with respect to the capacity being released by
Releasing Shipper prior to the commencement of service to the Replacement Shipper.
8.9 Nominations. Following its selection, and prior to the flow of gas, the Replacement Shipper
shall be permitted to submit nominations pursuant to the terms and conditions of the applicable Rate
Schedule and the General Terms and Conditions of this FERC Gas Tariff.
8.10 Billing. The Replacement Shipper shall be billed and make payments to PetroLogistics in
accordance with the applicable Rate Schedule, other provisions of this FERC Gas Tariff and of its
service agreement incorporating its bid terms. In accordance with the terms of the release, the
Replacement Shipper shall pay or be liable for the