Tres Palacios Gas Storage LLC

Original Volume No. 1

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Effective Date: 08/01/2008, Docket: RP08-424-000, Status: Effective

Original Sheet No. 158 Original Sheet No. 158

 

GENERAL TERMS AND CONDITIONS

(Continued)

 

(d) Customer shall prepay for service in an amount

as set forth immediately below, provided that such prepayments

shall be considered collateral held for security and not advance

payments for services and that Customer may deposit its prepayment

funds into an interest-bearing escrow account established by

Customer granting TRES PALACIOS access to the account for payment

of services under Customer's Storage Service Agreement(s).

 

The dollar value of the Financial Assurances set forth above in

this Section 31.10 to be provided by Customer shall be in an

amount equal to Customer's Credit Exposure minus Customer's

Unsecured Collateral Limit. TRES PALACIOS shall re-compute the

dollar value of Financial Assurances Customer is required to

provide on a daily basis. TRES PALACIOS shall notify Customer

when such re-computation indicates that additional credit support

is required to comply with the requirements of this section based

on a 10% increase in the daily computation of the amount of

Financial Assurances over the Financial Assurances previously

provided by Customer. Customer shall have two (2) Business Days

to comply with a notification by TRES PALACIOS of insufficient

credit support.

 

31.11 Customer's obligation to maintain an Acceptable

Credit Rating or to provide Financial Assurances shall continue

for so long as the Parties are bound by the Storage Service

Agreements and all transactions entered into thereunder. This

obligation shall terminate when Customer has performed or

satisfied all of its obligations under the Storage Service

Agreements and, upon such termination, TRES PALACIOS shall return

to Customer, if applicable:

 

(a) the Letter of Credit and funds held by TRES

PALACIOS as security pursuant to Section 31.10(a) then in its

possession but only to the extent it has not then applied such

funds pursuant to this FERC Gas Tariff to the debts, expenses,

costs, assessments and liabilities payable by Customer to TRES

PALACIOS pursuant to the provisions of the Storage Service

Agreement(s);

 

(b) the Guaranty held by TRES PALACIOS pursuant to

Section 31.10(b);

 

(c) any security accepted by TRES PALACIOS pursuant to

Section 31.10(c); or

 

(d) any amount prepaid by Customer pursuant to Section

31.10(d) not required to pay charges for service rendered under

the Storage Service Agreements.

 

32. DISPOSITION OF RETAINED QUANTITIES

 

In the event that TRES PALACIOS holds an auction for Gas

quantities retained pursuant to Section 8 of Rate Schedule FSS,

Section 8 of Rate Schedule FP, Sections 2 or 8 of Rate Schedule

ISS, Sections 2 or 8 of Rate Schedule IHBS, or Sections 2 or 8 of

Rate Schedule IP, TRES PALACIOS shall post such quantities on the

Internet Web Site as soon as reasonably practicable. TRES

PALACIOS shall accept bids only during the time period from 7:00

a.m. until 11:00 a.m. CCT on the second Business Day following

such posting. TRES PALACIOS shall award purchase of the Gas to

the Customer submitting the highest bid, and shall notify