Southern Natural Gas Company

Seventh Revised Volume No. 1

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Effective Date: 09/01/2009, Docket: RP09-427-000, Status: Suspended

Third Revised Sheet No. 101B Third Revised Sheet No. 101B

Superseding: Second Revised Sheet No. 101B

GENERAL TERMS AND CONDITIONS

(Continued)

Section 2.1(b)(iii)(continued)

Receipt Point changes requested under Section 6.3 will be awarded according

to this Section 2.1(b)(iii). Company will consider any requests by a SHIPPER

to change primary Receipt Point(s) as part of a bid in an open season for

the available capacity offered in the open season. In evaluating bids

associated with the open season, any request for a change in the primary

Receipt Point(s) will be considered to have a net present value of zero (0)

when comparing requests for service, awarding capacity, and meeting the

reserve price, unless the SHIPPER has agreed in conjunction with its request

to increase its TD or extend the term of its firm contract in which case

COMPANY may consider the terms of such TD increase or contract extension

when evaluating the net present value.

Notwithstanding this Section 2.1(b)(iii), an open season for an amendment of

primary Receipt Point(s) or Delivery Point(s) shall not be required:

(1) when the change is necessitated by the proposed abandonment of

facilities associated with a SHIPPER'S primary Receipt Point(s) or

Delivery Point(s);

(2) upon mutual agreement of COMPANY and SHIPPER when the award of

capacity associated with the proposed change is possible only as the

result of the amendment of SHIPPER's existing primary Receipt

Point(s) or Delivery Point(s); or

(3) when the Receipt Point change is necessitated by the requirement in

Section 6.1 of these General Terms and Conditions.

(iv) COMPANY may enter into a pre-arranged agreement with any shipper for

capacity that is available prior to holding an open season for that

capacity, provided that COMPANY will indicate in the posting announcing the

open season that the open season is subject to a pre-arranged transaction.

For capacity that has not yet become available, COMPANY shall post the

capacity coming available prior to entering into any pre-arranged

transaction for the capacity. Once an open season for capacity has

commenced, COMPANY may not enter into a pre-arranged transaction during the

open season for the capacity included in the open season. Any shipper will

have the right to submit a bid for the capacity in the open season. If a

shipper submits a bid with a higher NPV to COMPANY than the pre-arranged

transaction, the shipper with the pre-arranged transaction will have a one-

time right, within two business days of notification by COMPANY, to match

the NPV of the higher bid in order to obtain award of the capacity. If the

shipper with the pre-arranged transaction elects not to match a higher

competing bid, the capacity will be awarded to the bidder(s) with the

highest NPV to COMPANY. Such NPV shall be determined pursuant to the

procedures set forth in Section 1(b)(i) above and the criteria set forth in

the open season. If the capacity is awarded to a shipper under the terms of

a pre-arranged transaction, COMPANY shall post the following information:

(1) the rate initially offered by COMPANY for the capacity;

(2) the rate agreed upon in the pre-arranged transaction; and

(3) the rate at which the capacity is awarded.