Transcontinental Gas Pipe Line Company, LLC

Fourth Revised Volume No. 1

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Effective Date: 11/29/2009, Docket: RP09-558-000, Status: Effective

First Revised Sheet No. 460 First Revised Sheet No. 460

Superseding: Original Sheet No. 460

GENERAL TERMS AND CONDITIONS

(Continued)

42. CAPACITY RELEASE (Continued)

42.11 Seller's Criteria for Best Bid, Award of Remaining Capacity, and Tie-Breaking

Methodology

(a) Seller's standard for selecting the Best Bid shall be the highest present

value of demand charges. In awarding the Best Bid, Seller shall use the tie-

breaking methodology described in Section 42.11(c). After award of the Best

Bid, Seller shall award any remaining capacity according to the criteria in

Section 42.11(b).

(b) If capacity remains after award of the Best Bid, Seller shall award remaining

capacity to the next Best Bid according to the bid evaluation methodology,

and so on, in descending order (subject to the next sentence) until the

capacity offered has been fully awarded, if possible. In that process,

Seller shall not award capacity to a bid that is less than the amount of

capacity sought by that bid unless the bid specifies that an allocation of

capacity that is less than the bid is acceptable.

(c) In the event more than one bid are equal according to the bid evaluation

methodology and all such bids specify that an allocation of capacity is not

acceptable, then a random and blind selection process will be used to select

the winning bid unless otherwise specified by the Releasing Shipper.

42.12 Billing and Payment

(a) The Replacement Shipper shall be billed by Seller and shall make payments to

Seller in accordance with the terms of Seller's applicable Rate Schedule and

the Service Agreement(s), and Seller shall simultaneously credit (on a

contingent basis) all reservation charges billed to the Replacement Shipper

to the Releasing Shipper's bill in that month. If the Replacement Shipper

fails to pay the reservation charges by the due date, Seller shall reverse

the credit and bill the Releasing Shipper in the following month for said

reservation charges, plus interest, and the rights to the capacity shall, at

the election of the Releasing Shipper, revert to the Releasing Shipper for

the remaining term of the release, subject to Seller's nomination and ranking

deadlines, in accordance with Section 28.1.

(b) Seller and a Releasing Shipper may, in connection with their agreement to a

negotiated rate pursuant to the provisions of Section 53 of the General Terms

and Conditions, agree upon payment obligations and credit mechanisms in the

event of a capacity release that vary from or are in addition to those set

forth in this Section 42.12. Nothing in the foregoing provision, however,

shall authorize Seller or a Shipper to violate the Commission's policy with

respect to the negotiation of terms and conditions of service.

42.13 Marketing Fee

Seller shall have the right to negotiate a marketing fee with a Releasing Shipper for

any mutually agreeable marketing services which are provided by Seller.

42.14 Permanent Releases

A Buyer which has a currently effective executed Service Agreement with Seller under

Seller's Rate Schedules FT, FTN, FDLS, ESS, WSS-Open Access, SS-1 Open Access Storage

Service or LNG may release its capacity to a third party ("Replacement Buyer") for

the remaining term of the contract and be relieved of all liability under its Service

Agreement prospective from the effective date of such release, provided that the

following conditions are satisfied: