Natural Gas Pipeline Company Of America

Seventh Revised Volume No. 1

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

Original Sheet No. 301 Original Sheet No. 301 : Pending

GENERAL TERMS AND CONDITIONS

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capacity awards will be based on application of the posted criteria.

Notwithstanding the foregoing, except for conditional capacity awards

in an Early Open Season, Natural shall not be obligated to award firm

capacity based on the following types of bids or requests: (i) any bid

or request for a term of less than one year, under which service is to

commence more than sixty (60) days following the close of the open

season; and (ii) any bid or request for a term which is not continuous

from the commencement of service date to the termination of service

date reflected in the bid.

(5) RESERVE PRICE MATRIX In an Initial Open Season, an Early

Open Season, or a Shipper-Initiated Open Season, Natural shall

establish a reserve price or reserve price matrix. Natural may, but is

not required to, establish a reserve price or reserve price matrix in

an Additional Open Season.

(i) A reserve price defines the minimum price(s) at

which Natural will award the firm capacity covered by the open season,

which price(s) must be equal to or less than the applicable maximum

rate(s). Natural is not obligated to award capacity at less than the

applicable maximum rate unless a lower rate is set out in the reserve

price matrix. In determining whether a reserve price has been met by

any bid, Natural will compare the net present value of the requested

prices in the bid with the net present value of the applicable reserve

price(s). If the reserve price is met, Natural will award firm

capacity to valid bids consistent with the posted bid evaluation

criteria and this Section 5.1(d).

(ii) Reserve prices in a reserve price matrix may vary

by relevant elements, including but not limited to term, service type,

Receipt Points, Delivery Points and markets. Differences in "markets",

as that term is used in the prior sentence, shall refer to differences

relating to any of the following: (A) geographical areas (zones,

segments, points, etc.), where the value of Natural's services may vary

among such geographical areas due to current or projected differences

in competitive alternatives, regulation, or operational, supply or

capacity factors; (B) customers, where the value of Natural's services

may vary by customer due to current or projected differences in

competitive alternatives available to them or demand their

characteristics (including access to alternative fuels; (C) contract

time periods, where the value of Natural's services may vary due to

current or projected differences in competitive alternatives or market

demand at or over different contract time periods (for example, winter

season versus multi-year); (D) products and services, where the value

of Natural's product and service offerings may vary due to current or

projected differences in competitive alternatives or market