Natural Gas Pipeline Company Of America

Seventh Revised Volume No. 1

Effective Date: 04/18/2008, Docket: RP08-319-000, Status: Effective

Original Sheet No. 285 Original Sheet No. 285 : Pending

GENERAL TERMS AND CONDITIONS

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5. PRIORITY OF SERVICE

5.1 ALLOCATION OF FIRM CAPACITY

This Section 5.1 governs the posting, the allocating among

services and among entities requesting firm services, and the awarding

of firm transmission and storage capacity on Natural's system.

(a) If at any time Natural has transmission capacity

and/or storage capacity which would support additional firm services,

Natural shall make such capacity available to perform firm open access

services. The allocation of such capacity among firm services shall be

determined by Natural, applying objective criteria of the relative

engineering suitability and economic value of the various services.

(b) In assigning priority to otherwise valid bids or

requests for any particular firm service, Natural shall allocate firm

capacity to valid bids or requests which generate the highest economic

value for Natural. The criteria for determining the highest economic

value are discussed in Section 5.1(c). In applying such criteria where

a Negotiated Rate or Negotiated Rate Formula is involved, the value

assigned to a request which includes a Negotiated Rate or Negotiated

Rate Formula shall be limited by the Recourse Rate as provided in

Section 49 of these General Terms and Conditions. The procedures to

award firm capacity are described in Section 5.1(c). Certain posting

requirements for firm capacity are set out in Section 5.1(e).

This subsection sets out the procedures to be followed

by Natural in awarding all firm forward haul transmission segment

capacity and firm storage capacity on its system; provided, however,

that these procedures do not apply to the initial allocation of such

firm capacity created by the construction of new facilities (including

both extensions and expansions of Natural's system).

(1) INITIAL OPEN SEASON Natural shall conduct an

Initial Open Season for all Posted Capacity. As used in this Section

5, the term "Posted Capacity" shall mean all firm forward-haul

transmission segment capacity and firm storage capacity currently

available or becoming available in the future which Natural is

obligated to post under Section 5.1(e)(1).