Southern Natural Gas Company

Seventh Revised Volume No. 1

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

Seventh Revised Sheet No. 160 Seventh Revised Sheet No. 160

Superseding: Sixth Revised Sheet No. 160

 

GENERAL TERMS AND CONDITIONS

(Continued)

Section 20 (continued)

 

Except as provided below in Section 20.2, as early as the date on which notice of

termination specified in Exhibit B to SHIPPER'S firm Service Agreement is due, but no later

than forty-five (45) days prior to the effective termination date of SHIPPER'S firm Service

Agreement or any applicable package thereunder, COMPANY shall post on SoNet Premier for

bidding the capacity which will be available upon the termination of SHIPPER'S firm Service

Agreement or any applicable package thereunder. Prior to the expiration of the term of a

Service Agreement(s), or package thereto, COMPANY and SHIPPER may mutually agree to

renegotiate the terms of such Service Agreement(s) to extend the use of at least a portion

of the TD under its existing Service Agreement, or package thereto. Such extension of the

Service Agreement, or package thereto, shall be negotiated on a case-by-case basis in a not

unduly discriminatory manner. If a Service Agreement has pregranted abandonment rights, the

agreement to extend must be reached prior to COMPANY posting the capacity for bidding

pursuant to Section 20 of these General Terms and Conditions. To the extent that COMPANY

and SHIPPER have mutually agreed to such an extension, the requirements of Section 20 of

these General Terms and Conditions shall not apply. Alternatively, if the SHIPPER provides

to COMPANY notice of termination on or prior to the required notice date as defined in

Exhibit B to the Service Agreement, any right of first refusal hereunder will be deemed by

COMPANY as waived unless SHIPPER specifically requests to retain its rights under this

section in its notice of termination.

 

Each bidder for SHIPPER'S firm capacity, or any portion of TD or MDQ being offered under

this section, must submit its bid to COMPANY in writing or through SoNet Premier (with the

appropriate service request form and any required prepayment under COMPANY'S FERC Gas

Tariff applicable to the service, unless already on file with COMPANY) within the time

specified by COMPANY on SoNet Premier. Each bid shall contain the term for which the

capacity is sought and the percentage of the maximum rate in effect during said term which

the bidder is willing to pay for the capacity. If COMPANY receives more than one bid for

SHIPPER'S capacity, and it does not reject all bids as provided below, it will choose the

bid, or combination of bids, which minimizes the impact on the rates for other services

given the terms and conditions of the other services at the time ("best bid"); provided,

however that COMPANY reserves the right to reject any bid which is for less than 100% of

the maximum rate applicable to SHIPPER'S firm service.

 

COMPANY will notify SHIPPER of the best bid received in an arm's length transaction that

COMPANY is willing to accept, and SHIPPER shall have a specified time, but no less than

fifteen (15) days, within which it must match the rate or price percentage and contract

term offered in the best bid in order to retain its firm capacity; provided, however, in

the event the bidder bids a negotiated rate at more than the effective maximum rate,

SHIPPER shall only be required to match the bid at the maximum rate applicable to the

service in order to retain its capacity. SHIPPER shall have the right to bid a volumetric

portion of its capacity, but in no event shall SHIPPER have the right to divide its

capacity in geographic or seasonal portions.

 

Notwithstanding the above, for those Service Agreements referenced under Article III,

Section 7 of the Stipulation and Agreement dated March 10, 2000 in Docket No. RP99-496 or

Article III, Paragraph 1 of the Stipulation and Agreement dated April 29, 2005 in Docket

No. RP04-523("Settlements"), at the end of the extended term or primary term applicable

under the Settlements, respectively, SHIPPER will only be required to match a contract term

not to exceed five (5) years, regardless of the contract term bid. If SHIPPER matches the

best bid, COMPANY and SHIPPER will enter into a new firm Service Agreement or package

reflecting the terms of SHIPPER'S matching bid. If SHIPPER fails to match the best bid

within the time allowed by COMPANY, SHIPPER'S existing firm Service Agreement, or package

thereto or portion thereof, will be subject to pregranted abandonment upon the effective

termination date of SHIPPER'S Service Agreement, or package thereto, and COMPANY will enter

into a new firm Service Agreement with the party or parties offering the best bid.