Questar Pipeline Company

First Revised Volume No. 1

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Effective Date: 02/16/2009, Docket: RP09-216-000, Status: Effective

First Revised Sheet No. 69A First Revised Sheet No. 69A

Superseding: Sub. Original Sheet No. 69A

 

PART 1

GENERAL TERMS AND CONDITIONS

(Continued)

 

8. CREDITWORTHINESS.

 

8.1 In evaluating requests for service and for other purposes under

this Tariff, Questar will perform a credit appraisal of shipper.

 

(a) Acceptance of a shipper's request for service and the

continuation of service to a shipper are contingent upon the shipper

complying with creditworthiness requirements of this § 8 on an on-going

basis. To determine creditworthiness, a credit appraisal shall be performed

in accordance with the following criteria:

 

(i) Questar shall apply consistent evaluation practices

to all similarly situated shippers in determining any shipper's financial

ability to perform its obligations to Questar over the term of the requested

or existing Service Agreement.

 

(ii) A shipper will be deemed creditworthy if:

 

(1) its long-term unsecured debt securities are

rated at least BBB- by Standard & Poor's Corporation (S&P) and at least Baa3

by Moody's Investor Service (Moody's) (provided, however, that if the

shipper's rating is at BBB- or Baa3 and the short-term or long-term outlook

is Negative, Questar may require further analysis as discussed below); and

 

(2) the sum of reservation fees, usage fees and any

other associated fees and charges for the contract term, on a net present

value basis, is less than 15% of shipper's tangible net worth. If a shipper

has multiple service agreements with Questar, then the total potential fees

and charges of all such service agreements shall be considered in determining

creditworthiness.

 

(iii) As used in the prior paragraph, the term "tangible

net worth" means the excess of assets over liabilities from an accounting

standpoint, which is also known as "capital." For example, in the case of a

corporation, tangible net worth is represented by the capital stock, paid-in

capital in excess of par or stated value, and other free and clear equity

reserve accounts, if any. Questar defines tangible net worth for a

corporation as the sum of the capital stock, paid-in capital in excess of par

or stated value, and other free and clear equity reserve accounts less

goodwill, patents, unamortized loan costs or restructuring costs, and other

intangible assets. Only actual tangible assets are included in Questar's

assessment of creditworthiness. Tangible net worth is compared with the net

present value of a shipper's obligations to Questar under its contracts in

applying the 15% test in the prior paragraph.