Transwestern Pipeline Company, LLC

Third Revised Volume No. 1

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Effective Date: 04/05/2010, Docket: RP10-476-000, Status: Effective

Second Revised Sheet No. 180 Second Revised Sheet No. 180

Superseding: First Revised Sheet No. 180

 

GENERAL TERMS AND CONDITIONS

(continued)

 

E. Creditworthiness: Qualification for participation in the capacity release program -

Any potential Replacement Shipper that wishes to acquire released capacity under the

capacity release program must satisfy the creditworthiness requirements contained in

Section 13 of the General Terms and Conditions of this Tariff by pre-qualifying prior

to submitting a bid for capacity. Upon pre-qualification, Transporter shall continue

to review potential Replacement Shipper's financial records and other sources of

public information for creditworthiness. Transporter shall have the right to amend a

potential Replacement Shipper's line of credit from time to time and thereby lower or

increase the quantity and term for which potential Replacement Shipper is qualified to

submit future bids for released capacity. A potential Replacement Shipper cannot bid

for released capacity which exceeds its qualified level of creditworthiness.

Notwithstanding the determination of creditworthiness, Transporter does not guarantee

the payment of any outstanding amounts by a Replacement Shipper.

 

F. Shipper Liability: In the event capacity is temporarily released hereunder, liability

for payment of reservation charges and any surcharges applicable to the reservation

charge will remain with the Releasing Shipper. If the Releasing Shipper permanently

releases capacity hereunder, Transporter will relieve said Releasing Shipper from its

obligations under its Service Agreement, if (1) the release is at or above the rates

provided for under (and for the remaining term of) Releasing Shipper's Service

Agreement or, (2) the release is at less than rates provided for in Releasing

Shipper's Service Agreement and the Releasing Shipper remits as an exit fee, a lump

sum payment for the positive difference between the Releasing Shipper's contract rate

and the bid rate for the full term of the capacity release, and, when the Releasing

Shipper's contract is at maximum tariff rates, the Replacement Shipper and Transporter

reach agreement on a mechanism permitting the periodic adjustment to the bid rate to

reflect subsequent rate adjustments filed for and approved by the FERC. The

Replacement Shipper and any of its subsequent assignees shall be responsible for any

amounts billed to them under Section 30.7(D) of this Tariff, but shall not be

responsible for any other amounts billed to the Releasing Shipper.

 

G. Transporter's Right to Terminate a Temporary Capacity Release: Transporter may elect

to terminate a Replacement Shipper's Service Agreement, upon 30 days written notice to

the Replacement Shipper, under the following conditions:

1. The Releasing Shipper has failed to maintain creditworthiness in accordance with

Section 13 of the General Terms and Conditions of this Tariff;

2. Transporter has terminated the Releasing Shipper's Service Agreement in accordance

with Sections 13 and 16 of the General Terms and Conditions of this Tariff; and

3. The rate stated in the effective Replacement Shipper's Service Agreement is less

than the Releasing Shipper's contract rate.

The Replacement Shipper may avoid termination of the temporary capacity release if,

prior to the end of the 30-day notice period, the Replacement Shipper agrees that,

beginning the first day after the end of the 30-day notice period, it will pay the

lower of (1) the former Releasing Shipper's contract rate, or (2) the maximum

applicable reservation and usage rates as stated in this tariff for the applicable

service for the remainder of the Replacement Shipper's contract term.

 

H. Term Limitation: The term of any agreement providing for the release of capacity

cannot extend beyond the term of the underlying Service Agreement. Released capacity

may be allocated with a future effective date.