Southern Natural Gas Company

Seventh Revised Volume No. 1

 Contents / Previous / Next / Main Tariff Index

 

 

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

Sixth Revised Sheet No. 161 Sixth Revised Sheet No. 161

Superseding: Fifth Revised Sheet No. 161

 

GENERAL TERMS AND CONDITIONS

(Continued)

Article 20 (continued)

 

Notwithstanding the above, unless COMPANY and Shipper expressly agree otherwise in Shipper's Service

Agreement, or package thereto, any Shipper that has entered into an interim-term firm service agreement

or package for reserved capacity pursuant to Section 2.1(b)(vi) of these General Terms and Conditions or

a firm service agreement associated with off-system capacity pursuant to Section 23.1 below or leased

capacity, shall not have the right to extend the term of such capacity under the provisions of this

Article 20 beyond the in-service date of the applicable expansion project or beyond the term of the

service agreement or lease entered into by COMPANY with the third party Service Provider for the off-

system capacity or the leased capacity.

 

In the event COMPANY does not receive any bids for SHIPPER'S capacity or any bids which are acceptable to

COMPANY, SHIPPER shall have fifteen (15) days, or such other period as may be mutually agreed to between

COMPANY and SHIPPER, to notify COMPANY that SHIPPER wishes to retain its rights to its firm capacity at

the maximum rate applicable thereto, or any discount or negotiated rate agreed to by COMPANY, for an

additional term as requested by SHIPPER. In the event SHIPPER matches the best bid at less than the

maximum rate or COMPANY agrees to allow SHIPPER to retain its firm capacity at a discounted or negotiated

rate for an additional term as provided above, then the new or amended Service Agreement shall no longer

be subject to the terms of this Section 20 upon termination of said agreement. If SHIPPER refuses to

renew its firm Service Agreement at the maximum rate, absent an agreement by COMPANY to discount, said

Service Agreement shall be subject to pregranted abandonment on the effective date of termination.

 

If SHIPPER gives notice to terminate its firm Service Agreement pursuant to the

provisions contained therein and does not give COMPANY notice that it wants to exercise its rights

hereunder pursuant to Section 284.221(d)(2)(ii) of the Commission's Regulations, said agreement shall be

subject to pregranted abandonment on the effective date of SHIPPER'S termination notice.

 

20.2 Special Provisions for Expansion Projects

 

In the event that an expansion open season process results in a fully-subscribed construction project as

evidenced by a signed precedent agreement(s) ("PA"), the sizing and design of which could be affected by

an existing firm SHIPPER'S decision regarding continuation of service, COMPANY may issue a separate

notice to proceed with the ROFR process set forth below prior to filing the application with FERC to

construct the expansion. Such ROFR process shall require any affected firm SHIPPER to elect either to

terminate or extend its service agreement, or package(s) thereto or portion thereof, as set forth below.

The affected SHIPPERS shall be considered to be those SHIPPERS with existing firm service agreements, or

packages thereto which will expire within the thirty-six (36) months of the issuance of the ROFR notice

and will, if terminated, impact the design of the proposed expansion.

 

An original capacity holder will have fifteen (15) days from the date of Transporter's notice to elect to

(1) terminate service at the expiration of its service agreement, or applicable package thereto or portion

thereof, or (2) extend its service agreement, or package thereto or portion thereof, by submitting a bid

which matches the NPV of the PA generating the lowest NPV; provided, however, the rate of the matching bid

shall be no more than the maximum tariff rate that applies to the existing SHIPPER's service and no less

than the rate specified in the PA achieving the lowest NPV. If SHIPPER elects not to continue service or

does not submit an election to extend its service agreement within the time specified above, 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 may utilize such capacity for the purposes of completing the expansion project affected thereby.

In any event, SHIPPER may elect to extend its Service Agreement(s), or applicable package(s) thereto or

portion thereof from the respective termination date(s) to the in-service date of the expansion project at

the existing maximum tariff rate or such other rate agreed upon by COMPANY if so requested by SHIPPER at

the conclusion of the fifteen (15) day election process.

 

If construction of such expansion is not authorized by the FERC or the certificate is not accepted by

COMPANY, then the existing firm SHIPPER that elected to extend its contract term during the ROFR process

above may elect to reduce its extended term within fifteen (15) days of the Commission's Order to the

later of the original termination date of the affected service agreement, or package thereto, or one (1)

year beyond the date of the Commission's Order. Furthermore, in said event, the existing firm SHIPPER

that did not elect to extend its contract term during the ROFR process may elect to extend its term

within fifteen (15) days of the Commission's Order to the later of the original termination date of the

affected service agreement, or package thereto, or one (1) year beyond the date of the Commission's

Order.