Markwest New Mexico, L. L. C.

Second Revised Volume No. 1

 Contents / Previous / Main Tariff Index

 

 

Effective Date: 08/01/2008, Docket: RP08-409-000, Status: Effective

Original Sheet No. 206 Original Sheet No. 206

 

FERC GAS TARIFF

 

SECOND REVISED VOLUME NO. 1

 

OF

 

MARKWEST NEW MEXICO, L.L.C.

 

FILED WITH THE

 

FEDERAL ENERGY REGULATORY COMMISSION

 

 

 

 

 

 

Communications Concerning This Tariff

Should Be Addressed To:

 

John C. Mollenkopf

Senior Vice President, Southwest Business Unit

MarkWest Energy Partners, L.P.

Telephone: (303) 925-9246

Facsimile: (303) 290-8769

 

 

 

 

MARKWEST NEW MEXICO, L.L.C.

1515 Arapahoe Street

Tower 2, Suite 700

Denver, CO 80202-2126

TABLE OF CONTENTS

 

Second Revised Volume No. 1

 

Description Sheet No.

 

PRELIMINARY STATEMENT 4

 

SYSTEM MAP 5

 

STATEMENT OF RATES AND CHARGES 6

 

RATE SCHEDULE FT FIRM TRANSPORTATION SERVICE 10

 

1. AVAILABILITY 10

 

2. APPLICABILITY AND CHARACTER OF SERVICE 10

 

3. RATES AND CHARGES 11

 

4. DELIVERY POINTS 12

 

5. NOMINATIONS AND SCHEDULING OF RECEIPTS AND

DELIVERIES 12

 

6. OVERRUN QUANTITIES AND IMBALANCES 12

 

7. RESERVATIONS 12

 

8. GOVERNMENTAL AUTHORIZATIONS 12

 

9. GENERAL TERMS AND CONDITIONS 13

 

RATE SCHEDULE IT INTERRUPTIBLE TRANSPORTATION

SERVICE 14

 

1. AVAILABILITY 14

 

2. APPLICABILITY AND CHARACTER OF SERVICE 14

 

3. RATES AND CHARGES 15

 

4. DELIVERY POINTS 15

TABLE OF CONTENTS

 

Second Revised Volume No. 1

 

Description Sheet No.

 

5. NOMINATION AND SCHEDULING OF RECEIPTS AND

DELIVERIES 16

 

6. OVERRUN QUANTITIES AND IMBALANCES 16

 

7. RESERVATIONS 16

 

8. GOVERNMENTAL AUTHORIZATION 16

 

GENERAL TERMS AND CONDITIONS 100

 

1. DEFINITIONS 102

 

2. QUALITY OF GAS 108

 

3. MEASUREMENT 109

 

4. NOMINATIONS 113

 

5. PRIORITY OF SERVICES AND CURTAILMENT 119

 

6. SCHEDULING 119

 

7. ALLOCATION OF DAILY QUANTITIES 120

 

8. OVERRUN QUANTITIES 121

 

9. BILLING AND PAYMENT 122

 

10. CONTROL, OWNERSHIP, AND WARRANTIES 124

 

11. SEGMENTATION OF CAPACITY 126

 

12. OPERATIONAL FLOW ORDERS 126

 

13. NEGOTIATED RATES 128

 

14. FORCE MAJEURE 129

TABLE OF CONTENTS

 

Second Revised Volume No. 1

 

Description Sheet No.

 

15. MARKETING AFFILIATES 131

 

16. NOTICES 132

 

17. NEW FACILITIES POLICY 132

 

18. FERC ANNUAL CHARGE ADJUSTMENT 133

 

19. ORDER OF DISCOUNTING 134

 

20. RELEASE AND ASSIGNMENT OF FIRM TRANSPORTATION

SERVICES 134

 

21. REQUESTS FOR SERVICE 147

 

22. RIGHT OF FIRST REFUSAL 152

 

 

23. CREDITING OF PENALTIES 154

 

24. INCORPORATION IN RATE SCHEDULES AND

TRANSPORTATION AGREEMENTS 154

 

25. NORTH AMERICAN ENERGY STANDARDS BOARD (NAESB)

STANDARDS 155

 

26. DEFAULTS AND REMEDIES 155

 

27. CHANGES IN RATES OR GENERAL TERMS AND

CONDITIONS 158

 

28. ARBITRATION 158

 

29. MISCELLANEOUS 159

PRELIMINARY STATEMENT

 

MarkWest New Mexico, L.L.C. ("MarkWest" or "Transporter") is a corporation

formed under the laws of the State of Texas, with its principal place of

business at Houston, Texas. Transporter is a "natural gas company" as defined

by the Natural Gas Act ("NGA"), 15 U.S.C. Sections 717-717w, and is subject to

the jurisdiction of the Federal Energy Regulatory Commission ("Commission").

Transporter owns and operates a natural gas transmission system located in Lea

County, New Mexico, which is used solely to transport natural gas from

interconnections with interstate pipelines to two electric power plants.

 

Although its facilities are located entirely within the State of New Mexico,

Transporter is engaged in the business of transporting natural gas for

shippers in interstate commerce on a firm and interruptible basis. The

transportation of natural gas in interstate commerce is provided pursuant to a

blanket certificate issued to the Transporter for the activities specified in

Part 284, Subpart G, of the Commission's regulations, as amended from time to

time.

 

MarkWest will undertake the transportation of natural gas only under written

agreement(s) acceptable to MarkWest upon consideration of existing

commitments, operating conditions, and any other factors deemed pertinent by

MarkWest.

 

 

 

 

 

SYSTEM MAP

STATEMENT OF RATES AND CHARGES

 

All rates are stated in U.S. $

 

Rate Schedule FT

 

Recourse Rates:

 

Maximum Minimum

 

Reservation

Charge ($ per

MMBtu per month) $1.2870 $0.0000

 

Commodity Charge

($ per MMBtu) $0.0000 $0.0000

 

Overrun Rate $0.0423 $0.0000

 

ACA Charge $0.0019 $0.0019

 

Negotiated Rates:

 

The effective maximum negotiated reservation charge for any negotiated rate

transportation agreement is the charge agreed to by the parties, as set forth

on Sheet No. 201.

 

Rate Schedule IT

 

Maximum Minimum

 

Commodity Charge

($ per MMBtu) $0.0420 $0.0000

 

ACA Charge $0.0019 $0.0019

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Sheet Nos. 7 through 9 are reserved for future use.

RATE SCHEDULE FT FIRM TRANSPORTATION SERVICE

 

1. AVAILABILITY

 

This FT Rate Schedule is available to any party (hereinafter called

"Shipper") that has requested service under this Rate Schedule, for firm

transportation service under the authority and provisions of Part 284 of

the regulations of the Federal Energy Regulatory Commission, provided

that:

 

1.1 Transporter determines it has available capacity to render the

firm transportation service.

 

1.2 Any construction, acquisition, or expansion of facilities

necessary to commence and provide the firm transportation service

has been completed.

 

1.3 Shipper has executed a Transportation Agreement in the form

contained in this FERC Gas Tariff for service under this Rate

Schedule.

 

1.4 Shipper has made arrangements acceptable to Transporter for

service on upstream transporters.

 

1.5 Shipper has satisfied, and continues to satisfy throughout the

term of its Agreement, the creditworthiness criteria in section 21

of the General Terms and Conditions ("GT&C") of this Tariff.

 

 

2. APPLICABILITY AND CHARACTER OF SERVICE

 

2.1 Transportation service hereunder, through all or any portion of

Transporter's system, will be firm, subject to the availability of

capacity, to the provisions of an effective Transportation

Agreement, and to the GT&C.

 

2.2 On each Day during the term of a Firm Transportation Agreement the

Shipper shall be entitled to request service hereunder subject to

this Rate Schedule and the GT&C. Nominations for service shall be

made pursuant to section 4 of the GT&C. Service hereunder shall

not be subject to the curtailment or interruption except as

provided for herein and in section 5 of the GT&C.

2.3 Transporter may refuse to render service hereunder if and for so

long as Shipper is in default under its Firm Transportation

Agreement or the GT&C.

 

2.4 Transporter will receive at the Receipt Point(s) for Shipper's

account for transportation hereunder daily quantities of Gas up to

Shipper's Transportation Quantity. Such Transportation Quantity

shall be specified in Shipper's Firm Transportation Agreement.

Transporter will deliver for Shipper's account, at the Delivery

Point(s) listed, MMBtus equivalent to the amount of MMBtus

received by Transporter at the Receipt Point(s).

 

2.5 Transporter shall not be obligated to add any facilities or to

expand the capacity of its pipeline system in any manner in order

to provide transportation service to Shipper pursuant to this Rate

Schedule.

 

3. RATES AND CHARGES

 

3.1 The applicable maximum and minimum Recourse Rates for service

hereunder are set forth in the currently effective Statement of

Rates and Charges of this Tariff, and are incorporated herein by

reference.

 

3.2 Unless Transporter and Shipper agree in writing to a discounted

rate or a Negotiated Rate for service provided hereunder, the

rates applicable to Shipper for service hereunder shall be the

maximum Recourse Rates as set forth on the effective Statement of

Rates and Charges. In negotiating rates with a Shipper,

Transporter will negotiate rates in a manner that is not unduly

discriminatory and that treats similarly situated shippers alike.

 

3.3 Effective as of the date of commencement of service, as provided

for in the Firm Transportation Agreement, Transporter shall charge

and Shipper shall pay for Transportation under this Rate Schedule

each Month, or part thereof, if applicable, the sum of the

following:

(a) the applicable Recourse or Negotiated Reservation Charge,

multiplied by Shipper's Transportation Quantity; 

(b) the applicable Negotiated or Recourse Commodity Charge,

multiplied by the total quantity actually delivered at the

Delivery Point(s); and

 

(c) the Annual Charge Adjustment (ACA) set forth in the

Statement of Transportation Rates.

 

4. DELIVERY POINTS

 

4.1 The Delivery Point(s) at which Transporter may deliver Gas for

Shipper's account under this Rate Schedule shall be at either

Shipper's Cunningham Station or Shipper's Maddox Station.

 

5. NOMINATIONS AND SCHEDULING OF RECEIPTS AND DELIVERIES

 

If Shipper desires transportation of Gas on any Day under this Rate

Schedule, Shipper shall submit a nomination in accordance with section 4

of the GT&C.

 

6. OVERRUN QUANTITIES AND IMBALANCES

 

Overrun quantities and imbalances associated with transportation under

this Rate Schedule shall be governed by and resolved pursuant to

sections 4 and 8 of the GT&C.

 

7. RESERVATIONS

 

Transporter reserves the right to take such actions as may be required

to preserve the integrity of its system, including maintenance of

service to other firm customers.

 

8. GOVERNMENTAL AUTHORIZATIONS

 

Transportation service under this Rate Schedule and effective Firm

Transportation Agreements shall be implemented pursuant to any

applicable self-implementing authorizations or program of the FERC for

which Transporter has filed or in which Transporter has agreed to

participate.

9. GENERAL TERMS AND CONDITIONS

 

All of the GT&C of Transporter's Tariff are applicable to this Rate

Schedule and service hereunder, and are made a part hereof, to the

extent that such terms and conditions are not in conflict with any

provision herein. In the event of a conflict between the GT&C and the

provisions of this Rate Schedule, the GT&C shall control. In the event

of a conflict between the GT&C and any Firm Transportation Agreement,

the Firm Transportation Agreement shall control.

RATE SCHEDULE IT

INTERRUPTIBLE TRANSPORTATION SERVICE

 

 

1. AVAILABILITY

 

This IT Rate Schedule is available to any party (hereinafter called

"Shipper") that has requested transportation service under this Rate

Schedule, for interruptible transportation service under the authority

and provisions of Part 284 of the regulations of the Federal Energy

Regulatory Commission, provided that:

 

1.1 Transporter determines it has available capacity to render the

interruptible transportation service.

 

1.2 Shipper has executed a Transportation Agreement in the form

contained in this FERC Gas Tariff for service under this Rate

Schedule.

 

1.3 Shipper has made arrangements acceptable to Transporter for

service on upstream transporters.

 

1.4 Shipper has satisfied, and continues to satisfy throughout the

term of its Agreement, the creditworthiness criteria in section 21

of the General Terms and Conditions ("GT&C") of this Tariff.

 

 

2. APPLICABILITY AND CHARACTER OF SERVICE

 

2.1 Service hereunder will be interruptible, as provided herein, and

pursuant to the Shipper's Transportation Agreement and

Transporter's GT&C, and subject to the availability of capacity

and Transporter's operating conditions and system requirements.

 

2.2 Transporter may refuse to render service hereunder if and for so

long as Shipper is in default under its Interruptible

Transportation Agreement, or under any Transportation Agreement

with Transporter, or under GT&C.

 

2.3 Transporter will receive at the Receipt Point(s) for Shipper's

account for transportation hereunder daily quantities of Gas

nominated by Shipper pursuant to its Interruptible Transportation

Agreement and the GT&C. Transporter will deliver for Shipper's

account, at the Delivery Point(s) nominated by Shipper MMBtus

equivalent to the amount of MMBtus received by Transporter at the

Receipt Point(s).

2.4 Transporter shall not be obligated to add any facilities or to

expand the capacity of its pipeline system in any manner in order

to provide transportation service to Shipper pursuant to this Rate

Schedule. Transporter is free to contract at any time with other

parties for new transportation services (whether firm or

interruptible) without liability to Shipper for any resulting

interruption or reduction of transportation service hereunder.

 

3. RATES AND CHARGES

 

3.1 The applicable maximum and minimum charges for service hereunder

are set forth in the currently effective Statement of Rates and

Charges of this Tariff and are incorporated herein.

 

3.2 Unless Transporter and Shipper agree in writing upon a discounted

rate for service provided hereunder, the rate applicable to

Shipper for service hereunder shall be the applicable maximum

interruptible rate as set forth on the effective Statement of

Rates and Charges.

 

3.3 Effective as of the date of commencement of service, as provided

for in the Interruptible Transportation Agreement, Transporter

shall charge and Shipper shall pay Transporter for transportation

service under this Rate Schedule and Shipper's Transportation

Agreement each Month the applicable rate under the Transportation

Agreement, multiplied by either the total quantity actually

delivered to Shipper at the Delivery Point(s).

 

4. DELIVERY POINTS

 

4.1 The Delivery Point(s) at which Transporter may deliver Gas for

Shipper's account under this Rate equivalent to the amount of

MMBtus received by Transporter at the Receipt Point.

 

5. NOMINATION AND SCHEDULING OF RECEIPTS AND DELIVERIES

 

If Shipper desires transportation of Gas on any Day under this Rate

Schedule, Shipper shall submit a nomination in accordance with section 4

of the GT&C. If nominations exceed the capacity available for

interruptible transportation service, the available capacity shall be

apportioned, by price from highest to lowest, however a pro rata

apportionment (based on the ratio of the quantity nominated by each

individual Shipper and the total quantity nominated by all Shippers

seeking interruptible transportation service) will be used for Shippers

paying the same rate.

 

6. OVERRUN QUANTITIES AND IMBALANCES

 

Overrun quantities and imbalances associated with transportation under

this Rate Schedule shall be governed by and resolved pursuant to

sections 4 and 8 of the GT&C.

 

7. RESERVATIONS

 

Transporter reserves the right to take such actions as may be required

to preserve the integrity of its system, including maintenance of

service to firm customers.

 

8. GOVERNMENTAL AUTHORIZATION

 

Transportation service under this Rate Schedule and Interruptible

Transportation Agreements shall be implemented pursuant to any

applicable self-implementing authorizations or program of the FERC for

which Transporter has filed or in which Transporter has agreed to

participate.

 

9 GENERAL TERMS AND CONDITIONS

 

All of the GT&C of Transporter's Tariff of which this Rate Schedule is a

part are applicable to this Rate Schedule and service hereunder, and are

made a part hereof, to the extent that such terms and conditions are not

contradicted by any provision herein. In the event of a conflict

between the GT&C and the provisions of this Rate Schedule, the GT&C

shall control. In the event of a conflict between the GT&C and any

Interruptible Transportation Agreement, the Interruptible Transportation

Agreement shall control.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Sheet Nos. 17 through 99 are reserved for future use.

GENERAL TERMS AND CONDITIONS

 

TABLE OF CONTENTS

 

General Terms and Conditions Sheet No.

 

1. Definitions 102

 

2. Quality of Gas 108

 

3. Measurement 109

 

4. Nominations 113

 

5. Priority of Services and Curtailment 119

 

6. Scheduling 119

 

7. Allocation of Daily Quantities 120

 

8. Overrun Quantities 121

 

9. Billing and Payment 122

 

10. Control, Ownership, and Warranties 124

 

11. Segmentation of Capacity 126

 

12. Operational Flow Orders 126

 

13. Negotiated Rates 129

 

14. Force Majeure 129

 

15. Marketing Affiliates 131

 

16. Notices 132

 

17. New Facilities Policy 132

 

18. FERC Annual Charge Adjustment 133

GENERAL TERMS AND CONDITIONS

 

TABLE OF CONTENTS

 

General Terms and Conditions Sheet No.

 

19. Order of Discounting 134

 

20. Release and Assignment of Firm Transportation Services 134

 

21. Requests for Service 147

 

22. Right of First Refusal 152

 

23. Crediting of Penalties 154

 

24. Incorporation in Rate Schedules and Transportation

Services 154

 

25. North American Energy Standards Board (NAESB) Standards 155

 

26. Defaults and Remedies 155

 

27. Changes in Rates or General Terms and Conditions 158

 

28. Arbitration 158

 

29. Miscellaneous 159

GENERAL TERMS AND CONDITIONS

 

1. DEFINITIONS

 

Except where the context expressly states another meaning, the following

terms when used in this Tariff and in any Transportation Agreement or

Rate Schedule incorporating this Tariff, shall be construed to have the

following meanings:

 

1. "Affiliate", when used to indicate a relationship with a specific

Person, means another Person that directly, or indirectly through

one or more intermediaries or otherwise, controls, is controlled

by, or is under common control with, such specific Person. A

corporation shall be deemed to be an Affiliate of another

corporation if one of them is directly or indirectly controlled by

the other or if each of them is directly or indirectly controlled

by the same Person.

 

2. "Affiliate Guarantor" means a Shipper's Affiliate that executes a

corporate guarantee satisfactory to Transporter for Shipper's

obligations under a Transportation Agreement.

 

3. "Authorized Overrun" is defined as a nomination made by a Shipper

that exceeds its applicable Transportation Quantity which is

accepted by Transporter. Authorized Overrun quantities are

subject to an Authorized Overrun Charge as provided for in section

8.1(a).

 

4. "Available Capacity" is the capacity in Transporter's system that

is not subscribed or scheduled for service under the terms of

Transporter's Rate Schedules.

 

5. "Btu" shall mean one (1) British Thermal Unit. As set forth in

section 1.16, the reporting basis for Btu shall be 14.73 dry psia

and 60 degrees F.

 

6. "Business Day" is defined as Monday through Friday, excluding

Federal Banking Holidays for transactions in the U.S., and similar

holidays for transactions occurring in Canada and Mexico.

7. "Central Clock Time" or "CCT" means Central Daylight Time when

Daylight Savings Time is in effect and Central Standard Time

otherwise.

 

8. "Commodity Charge" means the rate specified in the Statement of

Rates and Charges.

 

9. "Day" means a twenty-four (24) hour period of time from 9:00 a.m.

to 9:00 a.m. Central Clock Time.

 

10. "Delivering Pipeline" means a pipeline that interconnects with and

delivers Gas into Transporter's pipeline system.

 

11. "Dekatherm" or "Dth" means the quantity of heat energy which is

1,000,000 British thermal units (1 MMBtu).

 

12. "Delivery Point" means either Shipper's Cunningham Station or

Shipper's Maddox Station, where Transporter delivers Gas to

Shipper, or for Shipper's account. The Delivery Point(s) shall be

specified in Shipper's Transportation Agreement.

 

13. "FERC" or "Commission" means the Federal Energy Regulatory

Commission, or any successors thereto.

 

14. "Firm Transportation Agreement" means an agreement pursuant to the

Tariff under which Transporter provides firm transportation to a

Shipper.

 

15. "Force Majeure" has the meaning specified in section 14.1 of these

General Terms and Conditions.

 

16. "Gas" or "Natural Gas" means methane and such other hydrocarbon

constituents, or a mixture of two or more of them which, in any

case, meets the quality specifications of the Tariff.

 

17. "Gross Calorific Heating Value" means the quantity of heat

expressed in Btus produced by the complete combustion at constant

pressure of one anhydrous (dry) cubic foot of Gas with air at a

temperature of sixty degrees (60°) Fahrenheit and at a pressure of

14.73 psia, when the products of the combustion are cooled to the

initial temperature of the Gas and air and the water formed by

combustion is condensed to the liquid state.

18. "Imbalance" has the meaning specified in section 8 of the GT&C.

 

19. "Interruptible Transportation Agreement" means an agreement

pursuant to which Transporter agrees to provide interruptible

transportation service to a Shipper.

 

20. "Intra-day Nomination" is a nomination submitted after the

nomination deadline whose effective time is as stated in section 4

of the GT&C.

 

21. "Marketing Affiliate", when used with respect to Transporter,

means a Person or other entity as defined in Part 161 of the

Commission's regulations.

 

22. "MMBtu", "Dekatherm" or "Dth", means one million (1,000,000) Btu

and shall be the standard unit for purposes of nominations,

scheduling, invoicing, and balancing. Allocated quantities and

imbalances shall be expressed in the same units as nominated

quantities.

 

23. "Month" means the period from 9:00 a.m. CCT on the first Day of

the calendar month and ending at 9:00 a.m. on CCT on the first Day

of the next succeeding calendar month.

 

24. "NAESB" means the North American Energy Standards Board.

 

25. "NAESB Standard" means a standard issued by NAESB and adopted by

the Commission.

 

26. "Negotiated Rate" means a rate or rate formula for service under

any Rate Schedule contained in this Tariff established pursuant to

Section 13 of these General Terms and Conditions.

27. "Operational Balancing Agreement" or "OBA" is a contract between

parties which specifies the procedures to manage operating

balances at an interconnect.

 

28. "Operational Flow Order" or "OFO" is an order issued pursuant to

Section 12 of these General Terms and Conditions.

 

29. "Payment Due Date" means the 25th day of each month. If the

Payment Due Date is not a Business Day, then payment must be

received by Transporter or by the financial institution so

designated by Transporter for payment, on or before the first

Business Day immediately prior to the Payment Due Date.

 

30. "Person" means a natural person, sole proprietorship, firm, trust,

trustee, executor, administrator or other legal personal

representative, partnership, limited partnership, joint venture,

syndicate, company or corporation with or without share capital,

unincorporated association, regulatory body or agency, government

of governmental agency, authority or entity however designated or

constituted.

 

31. "Point Operator" has the meaning set forth in Section 4.7 of these

General Terms and Conditions.

 

32. "Pre-arranged Replacement Shipper" and "PRS" mean the entity

designated by Releasing Shipper prior to the Released Capacity

being posted on the Web Site system in accordance with Section 20.

 

33. "Prepayment", with respect to requests for capacity or service,

means that amount of money that must be submitted by a Shipper

along with a request for service. Such amount will be credited to

Shipper's invoice for services provided by Transporter, or

forfeited by Shipper if it fails to enter into a Transportation

Agreement with Transporter in accordance with the terms of

Transporter's FERC Gas Tariff. With respect to creditworthiness,

prepayment means the advance payment for transportation services

rendered by Transporter.

34. "Psia" means pounds per square inch absolute.

 

35. "Psig" means pounds per square inch gauge.

 

36. "Receipt Point" means a point of interconnection between

Transporter and a Delivering Pipeline.

 

37. "Recourse Rate" means the maximum rate for service under

Transporter's Rate Schedule under which the Negotiated Rate is

otherwise applicable.

 

38. "Released Capacity" means capacity reserved under the terms of an

effective FT Transportation Agreement that a Releasing Shipper

seeks to release, on either a permanent or temporary basis.

 

39. "Releasing Shipper" or "Releasor" means a Shipper who holds or

acquires firm capacity rights and who elects to release all or a

part of such capacity.

 

40. "Replacement Shipper" means a Shipper who acquires all or part of

the rights to capacity held by a Releasing Shipper under the terms

of an effective FT Transportation Agreement, on either a permanent

or temporary basis.

 

41. "Reservation Charge" means the reservation charge component of the

rate applicable to firm transportation service as specified in

Transporter's Tariff and the Firm Transportation Agreement between

such Shipper and Transporter.

 

42. "Scheduled Quantity" is the quantity of Gas a Shipper nominates

for receipt by Transporter at a Receipt Point and for redelivery

by Transporter for Shipper at a Delivery Point, and that

Transporter or Operator schedules for transportation.

43. "Transportation Agreement" means an agreement pursuant to the

Tariff under which Transporter provides transportation or other

contract services to a Shipper.

 

44. "Shipper" means a Person who executes a Transportation Agreement

with Transporter for transportation service under any Rate

Schedule of Transporter's tariff.

 

45. "Tariff" means Transporter's FERC Gas Tariff, as amended and

approved from time to time by the Commission.

 

46. "Transportation" of Gas means the receipt of Gas for Shipper's

account at the Receipt Point(s) and the delivery, for Shipper's

account, of Gas to Transporter at the Delivery Point(s).

 

47. "Transportation Quantity" or "TQ" means for customers receiving

service pursuant to Rate Schedule FT, the daily quantity of Gas

contracted by a Shipper and for which Shipper has agreed to pay a

Reservation Charge in accordance with the terms and conditions of

Shipper's Firm Transportation Agreement. For shippers receiving

service pursuant to Rate Schedule IT, "Transportation Quantity"

shall mean the quantity of Gas Transporter schedules and confirms

for service on any given Day.

 

48. "Transporter" means MarkWest New Mexico, L.L.C.

 

49. "Unauthorized Overrun" means quantities of Gas transported by

Transporter on behalf of a Shipper in excess of Shipper's

Transportation Quantity without Transporter's advance approval.

 

50. "Web Site" means the site on the internet http://www.markwest.com,

through which electronic communication service is accessible to

Transporter.

51. "Year" means a period of 365 consecutive days, except that any

year which contains the date February 29 shall consist of 366

consecutive days.

 

2. QUALITY OF GAS

 

2.1 Gas Quality Specifications: All gas tendered at the Receipt Points

and delivered to the Delivery Points hereunder shall be of

merchantable quality, and shall conform to the quality

specifications and requirements as provided below:

 

(a) The gas shall be commercially free from objectionable odors,

solid matter, dust, gums and gum-forming constituents, or

any other substance which might interfere with the

merchantability of the gas, or cause injury to or

interference with proper operation of the lines, meters,

regulators, or other appliances through which it flows.

 

(b) Oxygen - less than or equal to 0.2% by volume.

 

(c) Hydrogen sulfide - less than or equal to 1/4 grain/Ccf.

 

(d) Total Sulphur - less than or equal to 20 grains/Ccf.

 

(e) Carbon Dioxide - less than or equal to 2.0% by volume.

 

(f) Water - less than or equal to 6 pounds/MMcf.

 

(g) Heating Value - greater than or equal to 950 Btu/Cubic Foot.

 

(h) The temperature shall be less than or equal to 120 degrees

Fahrenheit.

 

If at any time, gas tendered to Transporter at a Receipt Point

fails to conform to the quality specifications, Shipper shall

notify Transporter promptly of such deficiency and follow

notification in writing. If gas delivered to the Delivery

Point(s) fails to conform to the quality specifications, Shipper

shall notify Transporter promptly of such deficiency and follow

notification in writing. In both instances, the deficiency shall

be remedied within a reasonable period of time. Neither

Transporter nor Shipper shall be required to receive gas that

fails to conform to the quality specifications.

 

3. MEASUREMENT

 

3.1 Measurement Facilities

 

Transporter, at its sole cost and expense, shall provide for the

continued operation and maintenance of gas measuring facilities to

be located at the Receipt Points and Delivery Points. Such

facilities shall be constructed and gas volumes shall be measured

by (1) orifice metering tubes at the Delivery Point(s) installed

in compliance with the requirements prescribed in Gas

Measurement/Committee Report No. 3 of the American Gas Association

approved standards measurement, including the appendix thereto,

and any subsequent revision thereof acceptable to Shipper and

Transporter or their designees and (2) ultrasonic meters at the

Receipt Point(s) installed in compliance with the requirements

prescribed in Gas Measurement/Committee Report No. 9 of the

American Gas Association approved standards measurement, including

the appendix thereto, and any subsequent revision thereof

acceptable to Shipper and Transporter or their designees.

 

3.2 Check Metering Equipment - Shipper shall have the right, at its

sole option and expense, to install and operate check metering

equipment downstream of the Receipt Points and the Delivery

Points.

 

3.3 Gas Measurement and Equipment - Reading, calibration and

adjustment of each party's meters and related equipment shall be

performed solely by that party. Each party, however, shall

provide the other with seven (7) Days prior written notice of all

reading, calibration and adjustment, and representatives of the

other party may be present for such events.

3.4 Measurement at the Receipt Points - At the Receipt Points,

Transporter will comply with the provisions for gas measurement

set forth in the General Terms and Conditions of the tariffs of

the Delivering Pipelines. Transporter's measurement equipment,

which is operated by the Delivering Pipelines, will be used as the

primary billing meters at the Receipt Points.

 

3.5 Measurement at the Delivery Points - Each item of equipment shall

be calibrated to provide an accuracy of plus or minus five-tenths

of one percent of full scale.

 

3.6 Resolving Differences at the Delivery Point(s) - If the testing

and calibration performed at the Delivery Point(s) pursuant to

Section 3.3 show that any item of equipment installed by

Transporter does not conform to the accuracy requirements of

Section 3.5, all previous readings of that item of equipment shall

be corrected to zero error for any period which the equipment was

known to be in error. If this period is not known, the correction

shall be made for a period extending back one-half of the time

elapsed since the last testing and calibration performed pursuant

to Section 3.3. During any period when any item of equipment

installed at the Delivery Point(s) by Transporter is inoperable or

known to be in error, the measurements provided by the

corresponding item of equipment installed by Shipper, if any,

shall be used if determined to be accurate in accordance with

Section 3.5. If neither item of equipment is operable or

accurate, or available in the case of Shipper's equipment, the

specification to be measured shall be determined by the parties

hereto on the basis of the best data available using the first of

the following methods which is feasible:

 

(a) By correcting the error if the percentage of error is

ascertainable by calibration, test, or mathematical

calculations; or

(b) By comparing deliveries made during the preceding period

under similar delivery conditions when the equipment was

registering accurately.

 

3.7 Measurement of Moisture

 

Transporter may install on-line at the Delivery Point(s) the most

accurate and reliable technology currently available at reasonable

cost to continuously monitor the moisture content of the gas being

delivered by Transporter. Moisture content monitoring equipment

installed by Transporter, if any, will have the capacity for an

alarm, which may be installed by Shipper, to inform Shipper

whenever the moisture content of the gas being delivered to

Shipper exceeds the maximum designated by the Tariff

specifications referenced in Section 2.1. If Transporter does not

install moisture monitoring equipment as permitted by this

section, Shipper's moisture monitoring equipment located on-line

at the Delivery Point(s) will be used to determine the moisture

content of gas being delivered by Transporter, if that equipment

has been properly installed and maintained and is registering

correctly. Shipper will promptly notify Transporter if the

moisture content of gas being delivered to Shipper exceeds the

maximum designated by the Tariff specifications referenced in

Section 2.1.

 

3.8 Measurement of Gross Calorific Heating Value, Carbon Dioxide,

Oxygen, Nitrogen and Hydrogen Sulfide

 

Transporter's gas chromatograph installed at the Receipt Points

shall be used to measure the gross calorific heating value, carbon

dioxide, oxygen and nitrogen levels in the gas stream. The

standard for calculation of gross calorific heating value,

specific gravity and compressibility of gas mixtures from

compositional analysis shall be Gas Processors Association

Standard No. 2172-84, as amended or supplemented from time to

time. If Shipper accepts delivery of any gas that contains

moisture in excess of the limit for dry gas designated by the

specifications referenced in Section 2.1, as determined in

accordance with Section 3.7, the gross calorific heating value

will be adjusted to reflect the actual water vapor content of the

gas accordingly for billing purposes.

In the event gas is received into Transporter's pipeline system

from an interconnect other than the Receipt Points defined herein,

Shipper may request and, upon such request, Transporter shall be

required to install an automatic sampling device to measure the

hydrogen sulfide levels in the gas. The hydrogen sulfide content

of the gas shall be determined in accordance with the Gas

Processors Association Standard for such determination then in

effect, and if there is no such standard in effect, by a method

generally used and accepted in the industry and agreeable to both

Transporter and Shipper.

 

3.9 Determination of Total Delivered MMBtu - The total number of

MMBtus delivered shall be determined by multiplying the delivered

gross calorific heating value, as determined in Section 3.8, by

the total volume of gas as determined in Section 3.1. If the

total MMBtu results obtained by use of Transporter's equipment, as

specified in Section 3.1 and 3.8, differ by one percent or more

from the results obtained by use of Shipper's check metering

equipment, then Transporter and Shipper shall each be required to

calibrate its measurement equipment. If such calibrations

indicate that Transporter's measurement equipment is within the

tolerance levels set forth in Section 3.5, then Transporter's

measurement equipment shall continue to be used. If such

calibrations indicate that Transporter's measurement equipment is

not within the tolerance levels set forth in Section 3.5 and that

Shipper's measurement equipment is within the tolerance levels set

forth in Section 3.5, then Shipper's measurement equipment shall

be used. If such calibrations indicate that neither parties'

measurement equipment is within the tolerance levels set forth in

Section 3.5, then the provisions of Section 3.6 shall be followed

to resolve any measurement inaccuracies.

3.10 Delivery Pressure - Transporter will operate its pipeline in a

manner that will allow receipt of the deliveries of gas at maximum

daily quantities, at a delivery pressure of 400 Psig to Shipper's

Cunningham Station and a delivery pressure of 548 Psig to

Shipper's Maddox Station (assuming a receipt pressure of 585 Psig

at the Receipt Point). Additionally, Transporter shall be

obligated to deliver quantities of gas at the Delivery Point(s) on

pressure control or flow control. The pressure on the system of

the Delivery Pipeline(s) will dictate the operating pressures on

Transporter's Pipeline facilities, and neither party is obligated

to install compression.

 

3.11 Atmospheric Pressure - The atmospheric pressure shall be assumed

to be 12.84 pounds per square inch absolute at the Receipt

Point(s) and Delivery Point(s), regardless of any variation from

the actual barometric pressure.

 

4. NOMINATIONS

 

4.1 For service required on any Day under each of Shipper's

Transportation Agreements, Shipper shall provide Transporter or

the Delivering Pipeline's dispatch department with a nomination(s)

providing the Shipper's Receipt Point, contract numbers, the

applicable service, the quantity of Gas to be delivered, the

Delivery Point, and such additional information as Transporter

determines to be necessary.

 

4.2 General Rules and Timeline - Pursuant to NAESB Standards 1.3.2

(Version 1.7), 1.3.3 (Version 1.7), 1.3.5 (Version 1.7), 1.3.6

(Version 1.7), 1.3.20 (Version 1.7), 1.3.21 (Version 1.7): The

standard nominations timeline shall be as follows:

 

(a) The Timely Nomination Cycle: 11:30 a.m. for nominations

leaving control of the nominating party; 11:45 a.m. for

receipt of nominations by Transporter; noon to send Quick

Response; 3:30 p.m. for receipt of completed confirmations

by Transporter from upstream and downstream connected

parties; 4:30 p.m. for receipt of scheduled quantities by

Shipper and point operator (Central Clock Time on the day

prior to flow).

 

(b) The Evening Nomination Cycle: 6:00 p.m. for nominations

leaving control of the nominating party; 6:15 p.m. for

receipt of nominations by Transporter; 6:30 p.m. to send

Quick Response; 9:00 p.m. for receipt of completed

confirmations by Transporter from upstream and downstream

connected parties; 10:00 p.m. for Transporter to provide

scheduled quantities to affected Shippers and point

operators, and to provide scheduled quantities to bumped

parties (notice to bumped parties), (Central Clock Time on

the day prior to flow).

 

Scheduled quantities resulting from Evening Nomination that

does not cause another Service Requester on Transporter to

receive notice that it is being bumped should be effective

at 9:00 a.m. on Gas day; and when an Evening Nomination

causes another Service Requester on Transporter to receive

notice that it is being bumped, the scheduled quantities

should be effective at 9:00 a.m. on Gas day. 

(c) The Intraday 1 Nomination Cycle: 10:00 a.m. for nominations

leaving control of the nominating party; 10:15 a.m. for

receipt of nominations by Transporter; 10:30 a.m. to send

Quick Response; 1:00 p.m. for receipt of completed

confirmations by Transporter from upstream and downstream

connected parties; 2:00 p.m. for Transporter to provide

scheduled quantities to affected Shippers and point

operators, and to provide scheduled quantities to bumped

parties (notice to bumped parties), (Central Clock Time on

the Gas day). Scheduled quantities resulting from Intraday

1 Nominations should be effective at 5:00 p.m. on Gas day.

(d) The Intraday 2 Nomination Cycle: 5:00 p.m. for nominations

leaving control of the nominating party; 5:15 p.m. for

receipt of nominations by Transporter; 5:30 p.m. to send

Quick Response; 8:00 p.m. for receipt of completed

confirmations by Transporter from upstream and downstream

connected parties; 9:00 p.m. for Transporter to provide

scheduled quantities to affected Shippers and point

operators (Central Clock Time on the Gas day). Scheduled

quantities resulting from Intraday 2 Nominations should be

effective at 9:00 p.m. on Gas day. Bumping is not allowed

during the Intraday 2 Nomination Cycle.

 

In addition to making scheduled quantities information

available by 4:30 p.m., at the end of each day Transporter

shall make available to Shippers information containing

scheduled quantities, including scheduled intra-day

nominations and any other scheduling changes. All

nominations shall include Shipper defined begin dates and

end dates. All nominations excluding Intraday Nominations

shall have rollover options. Specifically, Shippers shall

have the ability to nominate for several days, months, or

years, provided the nomination begin and end dates are

within the term of Shipper's contract. Nominations received

after the nomination deadline shall be scheduled after

nominations received before the nomination deadline.

Receiver of nomination initiates confirmation with the

caveat that the receiver of the confirmation may relieve the

obligation of sender to send. The sending party shall

adhere to nomination, confirmation, and scheduling

deadlines. The party receiving the request has the right to

waiver the deadline.

 

4.3 Any change in a daily scheduled quantity implemented during the

Day shall only be recognized pro rata to the fraction of the Day

remaining at the time the change is implemented. Changed daily

scheduled quantity shall not exceed an amount equal to

Shipper's Transportation Quantity multiplied by the fraction

of the Day remaining at the time the changes are

implemented, nor less than zero at any point in time.

Transporter shall be under no obligation to accept such

revisions for Shipper nominations made under Transporter's

Interruptible Transportation Service.

 

4.4 Pursuant to NAESB Standards 1.3.9 (Version 1.6), 1.3.11 (Version

1.6), 1.3.13 (Version 1.6): All nominations, including Intraday

Nominations, shall be based on a daily quantity; thus, an intraday

nominator need not submit an hourly nomination. Intraday

Nominations shall include an effective date and time. The

interconnected parties shall agree on the hourly flows of the

Intraday Nomination, if not otherwise addressed in the

Transportation Agreement or Tariff. Intraday Nominations can be

used to request increases or decreases in total flow, changes to

receipt points, or changes to delivery points of scheduled Gas.

Intraday Nominations do not rollover (i.e., Intraday Nominations

span one day only). Intraday Nominations do not replace the

remainder of a standing nomination. There is no need to

renominate if an Intraday Nomination modifies an existing

nomination.

 

4.5 Shipper Prioritization of Nominated Quantities - If Shipper elects

to nominate quantities of Gas to be received by Transporter from

one or more upstream parties at the Receipt Point, Shipper shall

provide the priority, method, and extent to which each nominated

receipt quantity from a particular upstream party should be

reduced in the event that, due to Transporter's allocation of

Available Capacity for Transportation services, all nominated

receipts cannot be scheduled.

 

Shipper prioritization of nominated quantities must be consistent

with the terms of this FERC Gas Tariff and such prioritization

will be honored to the extent that Transporter reasonably

determines such prioritization is operationally feasible.

4.6 Delegation of Nomination Authority to Agent - A Shipper may

delegate to any third party the responsibility for submitting

nominations and receiving confirmations or performing other

administrative duties under any effective agreement, subject to

the following conditions:

 

(a) Any designation of a third party as agent, or any change in

such designation must be provided in writing to Transporter

at least two (2) Business Days prior to the requested

effective date of the designation.

 

(b) The written designation must specify any limits on the

authority of the agent, including any time limit for the

designation. Transporter may reject any Shipper's request

to delegate responsibilities if the limitations on the

designation would impose undue administrative burdens on

Transporter.

 

(c) Transporter will rely on communications from a Shipper's

agent for all nomination purposes, except to the extent the

designation is expressly limited. Communications by

Transporter to such agent will be deemed notice to Shipper.

 

(d) Any third party may administer multiple Transportation

Agreements as the agent for one or more Shippers, but the

agent must make nominations and otherwise administer and

account separately for each Transportation Agreement.

 

4.7 Shipper Designated as Point Operator

 

Transporter's Shipper shall, prior to the effective date of any

Transportation Agreement, be designated and act as Point Operator

for the scheduling and balancing of gas flows at the Receipt

Points to be delivered into the Transporter's pipeline.

Transporter and

Shipper agree that Shipper shall continue to serve as Point

Operator at the Receipt Points for all gas quantities transported

under such Agreement, and that Transporter shall provide all

necessary notices to the Delivering Pipelines to effectuate such

designation. Such designation of Shipper as Point Operator shall

continue in full force and effect throughout the term of such

Agreement, provided that Shipper remains the only Shipper on

Transporter's pipeline. In the event Transporter subsequently

begins transporting gas over the pipeline for other shippers,

subject to any limitations set forth in such Agreement,

Transporter shall take over the responsibilities of Point Operator

at the Receipt Points, but shall coordinate its activities so as

not to impair the nomination and balancing of the existing

Shipper's gas quantities transported under the Agreement with such

Shipper.

 

4.8 Imbalances - The quantities of gas tendered at the Receipt

Point(s) and the quantities of gas delivered at the Delivery

Point(s) shall remain in continuous balance or as near thereto as

practical. In the event the quantity of gas tendered at the

Receipt Point(s) and the quantity of gas taken at the Delivery

Point(s) are not equal, a condition of imbalance shall exist. If

Transporter or Shipper determines that an imbalance exists, both

Transporter and Shipper shall use diligent efforts to correct the

imbalance as soon as practical. Transporter will net Shipper's

imbalances on a monthly basis across all of Shipper's

Transportation Agreements. Shipper may trade any imbalances

incurred under this Section 4 with other Shippers on Transporter's

system, provided the imbalances to be traded are off-setting.

Trades will be deemed completed upon notification to Transporter.

 

4.9 Shipper and Transporter will comply with the nomination provisions

set forth in the tariffs of the Delivering Pipelines, as such

procedures may be reasonably revised from time to time to account

for operational changes.

5. PRIORITY OF SERVICES AND CURTAILMENT

 

5.1 Transporter shall have the right to curtail or discontinue

services, in whole or in part, on all or a portion of its system

at any time for reasons of Force Majeure or when capacity or

operating conditions so require. Transporter shall provide

Shipper such notice of such curtailment as is reasonable under the

circumstances. Routine repair and maintenance is not deemed an

emergency situation or an unexpected loss of capacity and will be

scheduled by Transporter in a manner to avoid, wherever possible,

the disruption of confirmed service.

 

5.2 If due to any cause whatsoever Transporter is unable on any day to

schedule or deliver the quantities of Gas nominated by Shippers,

service shall be curtailed in the following order:

 

(a) first, interruptible service provided pursuant to Rate

Schedule IT, curtailed by price from lowest to highest,

except curtailment will be pro rata on nominated quantities

among Shippers paying the same rate, and recognizing that

Shippers paying the maximum rate will be curtailed last;

 

(b) second, firm service provided pursuant to Rate Schedule FT.

Transporter shall curtail on a pro rata basis on nominated

quantities among all Shippers receiving this service.

 

6. SCHEDULING

 

6.1 Transporter shall schedule all transportation quantities in

accordance with the following priorities:

 

(a) Firm transportation of Natural Gas within Shipper's

Transportation Quantity from a Shipper's primary Receipt

Point(s) and to its primary Delivery Point(s), provided a

Shipper's scheduled quantity shall not exceed its

nomination;

(b) Firm transportation of Natural Gas within the contract path

from a Shipper's Secondary Receipt Point(s) and/or to its

Secondary Delivery Point(s), provided a Shipper's scheduled

quantity shall not exceed its nomination;

 

(c) Firm transportation of Natural Gas outside the contract path

from a Shipper's Secondary Receipt Point(s) and/or to its

Secondary Delivery Point(s).

 

(d) Interruptible service by price from highest to lowest,

except scheduling will be pro rata based on nominated

quantities among Shippers paying the same rate.

 

(e) Transporter shall use service requester provided rankings

when making reductions during the scheduling and curtailment

process when this does not conflict with tariff-based rules.

Pursuant to NAESB Standard 2.3.26 (version 1.7), the time

limitation for disputes of allocations shall be six (6)

months from the date of the initial month-end allocation

with a three (3)-month rebuttal period. This standard shall

not apply in the case of deliberate omission or

misrepresentation or mutual mistake of fact. Parties' other

statutory or contractual rights shall not otherwise be

diminished by this standard.

 

7. ALLOCATION OF DAILY QUANTITIES

 

Receipts and deliveries of Gas under more than one contract and/or Rate

Schedule shall be allocated in accordance with any agreement as may

exist between Transporter and the Delivering Pipeline(s). Absent such

agreement, Shipper(s) shall be deemed to have taken receipt or delivery

of Shipper's scheduled quantities sequentially and in the same priority

order as Transportation is scheduled under section 6 of the GT&C. Any

difference between the allocated and scheduled Gas quantities at a

location will result in the allocation of an imbalance equal to that

difference to the Shipper. Such imbalances shall be resolved in

accordance with Section 4.8 of the General Terms and Conditions.

8. OVERRUN QUANTITIES

 

8.1 Overrun Charge

 

(a) Authorized Overrun Charge

 

If Shipper requests Transporter to deliver quantities of Gas

in excess of Shipper's applicable Transportation Quantity,

and Transporter agrees, Shipper shall be subject to an

Overrun Charge in addition to the applicable reservation and

commodity charges and any balancing charges pursuant to this

section, equal to the 100% load factor maximum rate

applicable to the service Shipper receives as specified in

Shipper's Transportation Agreement per each MMBtu of Gas

taken in excess of Shipper's Transportation Quantity.

 

(b) Unauthorized Overrun Charge

 

If Shipper exceeds its Transportation Quantity without the

approval of the Transporter, Shipper shall be subject to an

Overrun Charge in addition to the applicable reservation and

commodity charges and any balancing charges pursuant to this

section, equal to $10 per MMBtu for each MMBtu of Gas taken

in excess of Shipper's Transportation Quantity.

 

8.2 A Shipper must comply with an OFO issued pursuant to Section 12

within the time period set forth therein, unless the Shipper is

able to demonstrate that such compliance is prevented due to a

Force Majeure event as defined in Section 14.1. In all instances,

including Force Majeure, the Shipper shall make a good faith

effort to comply with any such OFO, including seeking waivers of

any contractual limits with third parties or modifications of

operating conditions on third party systems. Shipper shall notify

Transporter immediately if it believes that it is excused from

compliance with the OFO for any reason, and shall provide

Transporter with documentation sufficient to support its basis for

non-compliance.

8.3 If a shipper fails to comply with an OFO, it shall be subject to

(a) a penalty of $25.00 per MMBtu for any volume of gas by which

it deviated from the requirements of the OFO, and (b) any overrun

or other charges that may be applicable under Section 8. A

Shipper shall not incur any charges or penalties if such charges

or penalties would not have been incurred but for Shipper's

compliance with an OFO. A Shipper shall not incur any penalties

if the OFO was necessitated exclusively by Transporter's

negligence or willful misconduct.

 

8.4 Transporter may waive its right to collect all or any portion of

an OFO penalty assessed against a Shipper, provided that such

waiver is granted in a nondiscriminatory manner.

 

9. BILLING AND PAYMENT

 

9.1 Payment Terms

 

On or before the tenth (10th) Business Day of each Month,

Transporter shall deliver invoices to Shipper for its services in

transporting gas under the applicable Transportation Agreement.

All invoices shall be sent to Shipper by facsimile transmission,

or by other means of transmission acceptable to the Transporter

and Shipper, and all invoices shall be deemed delivered to Shipper

when sent by Transporter in this manner. In addition, Transporter

shall mail to Shipper a confirmation copy of each invoice, but the

date this copy is delivered shall have no effect on the due date

for payment of any invoice for accounting purposes. Invoices

shall be due and payable within fifteen (15) Days of Shipper's

receipt of the original invoice. All past due payments shall bear

interest at one percent above the prime rate per annum announced

by Bank One, Texas N.A. ("Index Bank") as it may vary from time to

time over the period beginning on the Day after the due date in

question and ending on the date payment is sent by Shipper.

Invoices will be supported by adequate backup information to allow

Shipper to review invoice calculations. In the event the

delivered volumes reflected in a Transporter invoice differ from

the volumes indicated by Shipper's check measuring equipment, then

Shipper shall make payment to Transporter using the lower of the

two volume totals, subject to adjustment as described in Section

9.2 below (following calculation of final volumes pursuant to

Section 3.9). All taxes applicable to transportation shall be

shown as a separate line item on each invoice for accounting

purposes. Shipper shall make payment, at Transporter's option,

either by mailing its check via U.S. mail to any address specified

by Transporter, postage prepaid, or by bank transfer of funds to a

bank account to be designated by Transporter.

 

9.2 Disputed Amounts

 

If Shipper disputes the amount of any invoice for any reason,

Shipper shall notify Transporter of the dispute within ten (10)

Business Days after receipt of the invoice. If Shipper fails to

notify Transporter of the dispute within ten (10) Business Days,

the disputed invoice shall be paid in full according to the terms

of the Transportation Agreement, but the payment shall be subject

to adjustment upon final resolution of the dispute, with any

refund to bear interest at one percent over the prime rate

announced by The Index Bank as it may vary from time to time over

the period that Transporter has possession of the money. Any

refund due to Shipper under this section shall be due and payable

fifteen (15) Days after the final resolution of the dispute.

 

If Shipper notifies Transporter of the dispute within ten (10)

Business Days of the receipt of the disputed invoice by Shipper,

and if Shipper and Transporter are unable to resolve the dispute

before the due date of the dispute invoice, Shipper shall pay only

the undisputed portion of the disputed invoice on the due date.

Shipper shall pay the portion of the disputed invoice, if any,

determined to be owing to Transporter within fifteen (15) Days

from the date the dispute is resolved together with interest on

such amount at one percent (1.0%) over the prime rate announced by

the Index Bank as it may vary from time to time, commencing

fifteen (15) Days after the date the invoice is delivered to

Shipper, and continuing until paid.

 

9.2 Failure of Index Bank

 

If the Index Bank (or any substitute Index Bank) no longer

announces a prime rate or ceases to exist, Shipper shall designate

a substitute Index Bank by notifying Transporter of the selection

and the designation shall be effective as of the date the original

Index bank ceased announcing a prime rate or ceased existence, as

the case may be. A substitute Index Bank must be a national

banking association that has capital and undivided profits of at

latest $100,000,000.00 and is located in a metropolitan area of

the United States of America that has a population greater than

500,000.

 

10. CONTROL, OWNERSHIP, AND WARRANTIES

 

10.1 Control and Possession

 

Shipper shall be in control and in possession of the gas prior to

such gas being tendered to Transporter at the Receipt Point(s) and

responsible for any damages, losses or injuries caused thereby

until the same shall have been tendered to Transporter at the

Receipt Point(s), except for injuries and damages which shall be

occasioned solely and proximately by the negligent act or omission

of Transporter or its designee. After the gas has been tendered

by Shipper to Transporter, Transporter shall be deemed in

exclusive control and possession of such gas until delivery

thereof at the Delivery Points, and Transporter shall be

responsible for any injuries or damages caused thereby, except

injuries and damages which shall be occasioned solely and

proximately by the negligent act or omission of Shipper or its

designee. After the gas has been tendered by Transporter to

Shipper at the Delivery Point(s), Shipper shall be deemed in

exclusive control and possession of such gas, and Shipper shall be

responsible for any injuries or damages caused thereby, except

injuries and damages which shall be occasioned solely and

proximately by the negligent act or omission of Transporter or its

designee.

 

10.2 Representation and Warranties Regarding Clear Title

 

Shipper shall represent and warrant that it has title to all gas

it tenders to Transporter at the Receipt Point(s), free and clear

of any liens and/or adverse claims. Transporter shall represent

and warrant that it shall deliver all gas received from Shipper to

Shipper at the Delivery Point(s) free and clear of any liens or

adverse claims.

 

10.3 Indemnification for Claims Affecting Title

 

Shipper and Transporter shall fully indemnify and hold harmless

each other, respective officers, agents, employees and

contractors, from any loss, liability or damages, including costs

and reasonable attorney's fees, suffered as a result of any claim,

action or suit brought by any person arising from any breach by

the indemnifying party of the representations and warranties in a

Transportation Agreement or in Section 10.2 of this Tariff.

 

10.4 Indemnification for Breach of Other Representations and Warranties

 

In addition to the indemnification provisions set forth in Section

10.3 above, Shipper and Transporter shall fully indemnify and hold

harmless each other, its officers, agents, employees and

contractors from any loss, liability or damages, including costs

and reasonable attorney's fees, suffered as a result of any claim,

action or suit brought by any person arising from any breach by

the indemnifying party of any other representations and warranties

in a Transportation Agreement or the GT&C of this Tariff.

11. SEGMENTATION OF CAPACITY

 

Any Shipper receiving firm transportation service may segment, to the

extent operationally feasible, its contract path into two (2) or more

discrete segments for its own use or in connection with a capacity

release pursuant to Section 20 of the GT&C. If Shipper utilizes two (2)

or more discrete pipeline segments, the sum of the quantities of Gas

nominated at all Receipt Points or at all Delivery Points by the Shipper

and, if applicable, the Releasing Shipper may exceed the TQ specified in

the Transportation Agreement so long as the quantities nominated for

transportation in a pipeline segment do not exceed the TQ applicable to

the segment. Shipper may segment its contract path to forwardhaul and

backhaul quantities of Gas to the same Receipt Point or to the same

Delivery Point. In such a segmented transaction, the Shipper may exceed

its TQ at that Receipt Point or Delivery Point and may nominate

quantities of Gas in each segment up to Shipper's TQ assigned to such

segment; provided, however, the quantities nominated to flow in the

opposite direction of the flow of the contract path shall be considered

to be outside the Shipper's contract path. If the Releasing Shipper and

the Replacement Shipper nominate quantities of Gas in segments that

overlap, the quantities shall be scheduled in accordance with the order

set forth in section 6.1 above. If the quantities have equal priority

and the sum of the quantities cannot be scheduled, the quantities shall

be scheduled pro rata unless the Releasing Shipper specifies otherwise

in its release notice.

 

12. OPERATIONAL FLOW ORDERS

 

12.1 General - Transporter may issue OFOs to preserve the integrity of

its Pipeline facilities, to ensure adequate operating pressures,

to have adequate supplies in the Pipeline facilities, to assure

adequate Transporter's Use Gas, to maintain firm services, and to

optimize the operation of the system. Transporter may also issue

OFOs on a not unduly discriminatory basis to respond to other

unforeseen circumstances. To the extent possible, Transporter will

Identify discrete Shipper(s) whose action(s) require Transporter

to issue an OFO(s) and Transporter will limit the applicability of

the OFO(s) to such Shipper(s). Notwithstanding the foregoing, if

Transporter is unable to identify discrete Shipper(s) whose

action(s) require issuance of an OFO, any OFO will be applicable

to all Shippers on the affected Pipeline facilities.

 

12.2 Circumstances Under Which an OFO May be Issued -- Transporter may

issue an OFO in any circumstance which would, in Transporter's

reasonable judgment, impair Transporter's ability to receive or

deliver Quantities of Gas in accordance with its service

obligations including, but not limited to, when:

 

(a) operating pressures are significantly less than or greater

than normal system operating pressures despite Transporter's

efforts to maintain normal pressures, and a further decline

or increase in operating pressures would impair

Transporter's ability to receive or deliver scheduled

Quantities of Gas;

 

(b) a Shipper fails to maintain receipts or deliveries as

required in this Tariff;

 

(c) unscheduled pipeline maintenance and repairs affect

capacity.

 

12.3 Notices

 

If Transporter is required to issue an OFO, Transporter will issue

a notice or email the notice to all affected Shippers, with an

explanation of the necessity of such order, the Shipper(s) to

which the order is directed, and the anticipated duration of such

order. To the extent discrete Shipper(s) are not identified in

any notice of an OFO, such order will be applicable to all

Shippers. Transporter will issue or email any notice of an OFO as

far in advance of the effective date/time of the OFO as is

operationally feasible, subject to Transporter's need to protect

the integrity of the pipeline facilities. Transporter will

provide updated information concerning the need for the OFO and

will issue a notice informing Shipper(s) when any OFO in effect

will be canceled.

 

13. NEGOTIATED RATES

 

13.1 Notwithstanding anything to the contrary contained in this Tariff,

Transporter and Shipper may negotiate a rate for service under any

Rate Schedule contained in this Tariff. Transporter's maximum

Rate Schedule FT rate as shown on Sheet No. 6, Transporter's

Statement of Rates and Charges ("Recourse Rate") is available for

any Shipper that does not desire to negotiate a rate with

Transporter.

 

13.2 A Negotiated Rate shall mean a rate for service, which may be less

than, equal to or greater than Transporter's maximum Reservation

Charge, if applicable, or Commodity Charge, as stated on

Transporter's Statement of Rates and Charges for that service,

shall not be less than the minimum rate, may be based on a rate

design other than Straight Fixed Variable ("SFV"), and may include

a minimum quantity. With respect to a Negotiated Rate which, when

calculated on a 100% load factor basis, exceeds Transporter's

maximum allocation of receipts and deliveries pursuant to Section

7, Shippers who have agreed to pay said Negotiated Rate would be

considered to have paid the maximum Recourse Rate. For purposes

of exercising rights to continue service pursuant to Section 22,

the highest rate that a Shipper must match if it desires to retain

all or a portion of its capacity and continue to receive firm

service under the same Rate Schedule beyond the expiration date of

such Firm Transportation Agreement is the maximum rate applicable

to such service.

 

13.3 On or before the date service commences, Transporter will submit

to the Commission Tariff Sheet No. 201 stating the exact legal

name of the Shipper, the negotiated rate, the rate schedule, the

Receipt Point(s), Delivery Point(s) and TQ. Unless Transporter

executes and files a non-conforming Agreement, such tariff sheet

will contain a statement that the negotiated rate Agreement does

not deviate in any material aspect from the form of Transportation

Agreement in the tariff for the applicable rate schedule.

 

13.4 Nothing in this Section 13 shall authorize Transporter or Shipper

to negotiate terms and conditions of service.

 

14. FORCE MAJEURE

 

14.1 The phrase "Force Majeure", as used in these General Terms and

Conditions, shall mean, without limitation, an act of God,

terrorism, lightening, storm, fire, explosion, accident, unusual

casualty, strike, lockout, labor dispute, civil dispute, civil

disturbance or labor slow down; closure at the time of the Force

Majeure event of all or part of the Shipper electric generating

plant(s) at which gas delivered hereunder was to be utilized

because of imminent danger, industrial disturbance, or labor

trouble; breakdowns or damage to the Shipper electric generating

plant(s) at which gas hereunder was to be utilized because of

imminent danger, industrial disturbance, or labor trouble;

breakdowns or damage to the Shipper electric generating plant(s)

at which gas hereunder was to be utilized at the time of the Force

Majeure event, or breakdown or damage to necessary electrical

transmission equipment (including emergency outages of equipment

or facilities for the purpose of making repairs to avoid breakdown

or damage); freezing of gas lines or gas wells; breakdown or

damage to gas supply facilities or gas transportation facilities;

orders or acts of civil authority which are complied with in good

faith; or any other cause, whether or not of the same class or

kind specifically enumerated above and whether or not foreseen or

foreseeable, which is not reasonably within the control of the

party claiming Force Majeure; provided, however, that an adverse

change to the expected economic benefits or costs associated with

the party's continued performance of its obligations under a

Transportation Agreement shall not constitute an event of Force

Majeure for either Transporter or Shipper. Orders and acts of

civil authority as used herein shall include, without limitation,

used herein shall include, without limitation, any regulation,

direction, order or request (whether valid or invalid) made by any

governmental authority or person acting for a governmental agency,

as well as the act or failure or refusal to act, whether

rightfully or wrongfully done, of any governmental agency,

authority, officer, or court charged with the interpretation,

enforcement, or administration of any applicable law, rule or

regulation, which act or failure or refusal to act effectively

delays issuance of, or denies to either party, any permit,

license, or approval reasonably necessary for the construction,

development, operation, or repair of any facilities necessary or

the performance of the Transportation Agreement.

 

14.2 Suspension of Obligations

 

If either Transporter or Shipper is prevented, or is delayed

wholly or in part, from carrying out any of its obligations under

this Tariff or a Transportation Agreement due to Force Majeure or

its effects, and if that party gives the other party written

notice and full particulars of the Force Majeure event as soon as

reasonably practical, the obligations of the party giving the

notice shall be suspended, except as otherwise stated in the

Agreement and except for Shipper's obligation to make payments for

transportation of gas previously delivered to Shipper, to the

extent made necessary during the continuance of Force Majeure or

its effects. The party claiming Force Majeure shall incur no

liability except as set out in this Tariff or a Transportation

Agreement by reason of its failure to perform the obligation so

suspended; provided, however, that the disabling effects of Force

Majeure shall be eliminated by the affected party as soon as and

to the extent reasonably possible. If Force Majeure prevents

Transporter or Shipper from complying with the terms and

conditions of a Transportation Agreement for a period in excess of

three (3) Months in any twelve-Month period, the party not

claiming Force Majeure may terminate such Agreement upon ten (10)

Days prior written notice to the other party; provided, however,

that such termination in the initial term will require a

termination payment by the party claiming Force Majeure.

The requirement that any Force Majeure be remedied as soon as and

to the extent reasonably possible shall not require the settlement

of strikes, lockout, or other labor difficulty by the party

involved, contrary to its reasonable wishes.

 

15. MARKETING AFFILIATES

 

15.1 Shared Operating Personnel and Facilities

 

Information on facilities and operating personnel that Transporter

shares with its Marketing Affiliates will be available on the Web

Site.

 

15.2 Complaint Resolution

 

Transporter will attempt to resolve any complaints by Shippers or

potential Shippers without the necessity of a written complaint.

To this end, Shippers are encouraged to attempt to resolve

disputes informally with Transporter. A formal complaint

concerning any services offered by Transporter should be directed,

in writing or via facsimile, to:

 

MarkWest New Mexico, L.L.C.

Attn: John C Mollenkopf, Senior Vice President

Southwest Business Unit

MarkWest Energy Partners, L.P.

1515 Arapohoe Street

Tower 2, Suite 700

Denver, CO 80202-2126

Telephone: (713) 965-9151

Facsimile: (713) 965-9156

 

The complaint should state that it constitutes a complaint

pursuant to these tariff provisions, and the complaint should

state with specificity the nature of the complaint, the actions or

procedures of Transporter that gave rise to the complaint, and the

remedy sought by the Shipper. Transporter will respond initially

to the complaint within two (2) Business Days and in writing

within thirty (30) Days.

16. NOTICES

 

Except as otherwise specifically provided in this Tariff, any notice to

be given by Shipper shall be in writing and shall be sufficient if

personally delivered or sent by mail or facsimile transmission (with

confirmation of receipt) to the following address:

 

Transporter: 1515 Arapahoe Street

Tower 2, Suite 700

Denver, CO 80202-2126

Fax: (303) 290-8769

Attn: Mr. John C. Mollenkopf

 

Any notice shall be deemed received on the date delivered if transmitted

via facsimile, telecopied, or personally delivered, or five (5) Days

following deposit in the mail if mailed in the manner set out above.

The designation or address of the party to be notified may be changed at

any time by delivery of written notice of that change to the other

party.

 

17. NEW FACILITIES POLICY

 

Transporter is under no obligation to build, acquire and/or install

service lateral pipelines, taps and metering facilities necessary to

provide transportation service to any new or existing Shipper.

Transporter may construct facilities on a non-discriminatory basis,

provided:

 

17.1 Transporter determines in its sole discretion it has sufficient

unutilized mainline transportation capacity to provide the service

requested by the Shipper without impairing the operational

integrity of its system, or Transporter has obtained certificate

authorizations to expand its mainline capacity by an amount

sufficient to allow Transporter to provide the requested service;

 

17.2 Transporter has or obtains any certificate authorizations

necessary to build. acquire and/or install the service lateral

pipeline(s), tap(s) and/or meter facilities; and

 

17.3 Unless otherwise agreed to by Transporter, Shipper agrees to

reimburse or compensate Transporter, on mutually agreeable terms,

for 100% of Transporter's construction, acquisition and/or

installation costs (including any associated tax effects), as

defined below, for facilities required to effect the service

requested by Shipper. Transporter may waive this requirement at

its discretion, on a not unduly discriminatory basis.

 

For the purposes of this section, Transporter's construction,

acquisition, and/or installation costs shall include, but shall

not be limited to: Transporter's design costs, equipment costs,

labor costs, material costs, supervision costs, construction

financing costs (including a return on equity), taxes (whether

income or otherwise), filing fees, right of way costs and

permitting costs. Nothing in this Section 17 shall require

Transporter to file an application for a certificate of public

convenience and necessity under section 7(c) of the Natural Gas

Act, and nothing in this section shall prevent Transporter from

contesting an application for service filed pursuant to section

7(a) of the Natural Gas Act. Transporter reserves the right to

seek a waiver of the policy set forth herein, for good cause shown

during any proceeding before the Commission instituted under

section 7 of the Natural Gas Act.

 

18. FERC ANNUAL CHARGE ADJUSTMENT

 

Transporter shall adjust the rates charged for services as specified

below from time to time to reflect the annual charge, if any, assessed

Transporter by FERC (Annual Charge Adjustment on "ACA") pursuant to

Order No. 472 or any other superseding or related rule or order.

 

18.1 Services subject to ACA shall include all Transportation services

under Rate Schedules in Transporter's FERC Gas Tariff.

 

18.2 The effective ACA rates shall be shown on Transporter's effective

Statement of Rates and Charges reflecting the current ACA amount

under this section 18.

(a) The effective date of adjustment for each annual charge rate

adjustment filed pursuant to this section 18 shall be

October 1 of each year. The ACA shall become effective on

the effective date of adjustment without suspension or

refund obligation.

 

(b) Filing Procedure: At least thirty days prior to the

effective date of adjustment, Transporter shall file with

FERC and post, as defined in Section 154.402 of the

Commission's Regulations, a revised Tariff Sheet showing the

Statement of Rates and Charges in Second Revised Volume No.

1 of Transporter's FERC Gas Tariff, reflecting the current

Annual Charge Adjustment.

 

18.3 The current Annual Charge Adjustment shall be the unit amount,

adjusted as necessary for heating value and pressure base, which

FERC orders to be effective for the fiscal year commencing on the

effective date of the adjustment.

 

18.4 Transporter shall retain all revenues collected under this Section

18. Except as provided by this section 18, Transporter shall not

have the right to seek to recover in any proceeding under section

4(e) of the Natural Gas Act any annual charges recorded in its

FERC Account No. 928.

 

19. ORDER OF DISCOUNTING

 

To the extent Transporter discounts the rates for service pursuant to

this tariff, the rates for service will be deemed to have been

discounted in the following order: (1) Reservation Charge; (2) Commodity

Charge, but no charges will be discounted below the stated Minimum Rate.

 

20. RELEASE AND ASSIGNMENT OF FIRM TRANSPORTATION SERVICES

 

20.1 Capacity Eligible for Release

 

(a) Shippers under Rate Schedule FT shall be permitted to

release their capacity on a temporary or permanent basis, in

accordance with this Section 20. Capacity which may be

assigned to the Replacement Shipper hereunder shall be

limited to the firm capacity reserved by the Releasing

Shipper, as defined by the Primary Receipt Points and the

Primary Delivery Points contained in the released capacity.

Releases may be made on an interruptible (i.e., subject to

recall) or firm basis and may be billed by Transporter based

on usage.

 

(b) Transporter shall continue to sell its unsubscribed firm

capacity by providing notice of the availability of such

capacity on the Web Site or by using any other marketing

services at its disposal.

 

20.2 Shipper Release Notice

 

(a) A Shipper that desires to release any or all of its firm

capacity under this Section 20 must notify Transporter

electronically on the Web Site of its intent to release

capacity and the terms of the release (hereinafter referred

to as "Shipper Notice"). A Shipper Notice shall be posted

on the Web Site upon receipt by Transporter or such other

time which must comply with the timeline set forth in

Section 20.4(b) herein, as requested by Releasing Shipper.

This Shipper Notice shall include:

 

(1) Releasing Shipper's contract number;

 

(2) The specific quantity of capacity to be released;

 

(3) If the request for release is on a permanent basis;

 

(4) The Receipt Points and Delivery Points at which

Releasing Shipper will release capacity and the

quantity of capacity to be released at each point;

 

(5) The period of time or term of the release;

(6) The conditions of Releasing Shipper's right of recall

as well as methods and rights associated with

returning the previously recalled capacity to the

Replacement Shipper, if applicable;

 

(7) Whether contingent bids will be accepted and when the

contingency must be removed;

 

(8) The identity of a PRS, if applicable;

 

(9) The minimum rate, including the tariff reservation

rate and all demand surcharges as a total number or as

stated separately, expressed in dollars and cents or

percentage of maximum Tariff rate, term, and quantity

of capacity Releasing Shipper shall accept, if any,

and whether bids using a volumetric rate for the

collection of Reservation Charges will be accepted and

whether Releasing Shipper requires a volumetric

commitment. The maximum volumetric rate that may be

bid shall not exceed the one hundred percent (100%)

load factor equivalent of the maximum rate, which

reservation rate equals the Authorized Overrun rate

for the applicable service being released as set forth

on the effective rate tariff sheets. Transporter

shall support volumetric releases with volumetric

commitments by fully accounting for volumetric and

reservation components, consistent with the rules and

regulations enunciated by the Commission. The maximum

reservation rate that may be bid shall not exceed the

maximum rate for the applicable service being released

as set forth on the applicable currently effective

tariff sheets.

(b) Releasing Shipper shall post the Shipper Notice on the Web

Site. Offers should be binding until written or electronic

notice of withdrawal is received by Transporter. The

releasing party has the right to withdraw its offer during

the bid period, where unanticipated circumstances justify

and no minimum bid has been made.

 

(c) When a Releasing Shipper presents a PRS that is on the

approved bidders list, such Replacement Shipper initiates

confirmations of prearranged deals electronically as a

prerequisite to the awarding of the Shipper Notice.

 

(d) The terms Releasing Shipper imposes may not conflict with

any provision of the Transportation Agreement, Rate Schedule

or General Terms and Conditions. In the event of such

conflict, Transporter may withdraw the Shipper Notice from

posting.

 

20.3 Exceptions to Bidding

 

(a) At Shipper's option, a Shipper Notice for a release of

thirty-one (31) days or less with a designated PRS shall not

be subject to the bidding process in accordance with Section

20.4 herein (exempt capacity release). An exempt capacity

release shall not contain an evergreen provision and cannot

be reassigned to the same PRS within twenty-eight (28) Days

from the termination of each release, except in the event

the PRS is bidding the Maximum Rate or is bidding on a

second release under a different Transportation Agreement.

 

(b) In the event Releasing Shipper presents a PRS that is on the

approved bidders list, and such PRS agrees to pay the

applicable Maximum Rate and agrees to all other conditions

of the release prior to the submission of the Shipper Notice

to Transporter, the released capacity will be assigned to

the PRS and such Shipper Notice shall be exempt from the

bidding process in accordance with Section 20.4 herein. The

PRS will be posted as the winning bidder in accordance with

Section 20.4(i) herein.

(c) Timing of Capacity Releases Exempt from Bidding

For non-biddable releases, the posting of the Shipper Notice

for prearranged deals not subject to bid are due (Central

Time):

 

(1) Timely Cycle - by 10:30 a.m. on a Business Day

 

(2) Evening Cycle - by 5:00 p.m. on a Business Day

 

(3) Intra-day 1 Cycle - by 9:00 a.m. on a Business Day

 

(4) Intra-day 2 Cycle - by 4:00 p.m. on a Business Day

 

The capacity release addendum number will be issued within

one hour of the award posting. Nomination is possible

beginning at the next available nomination cycle for the

effective date of the capacity release addendum.

 

20.4 Bidding Process

 

(a) In order to submit a valid bid under this capacity release

program, any party, including a PRS, must be on the approved

bidders list. To be on the approved bidders list, a party

must meet the provisions of Section 21 herein and have

executed a capacity release Transportation Agreement with

Transporter in the form as set forth in this Tariff

(Capacity Release Form of Transportation Agreement). A

party shall remain on the approved bidders list until such

party notifies Transporter to the contrary, no longer meets

the credit qualifications in Section 21 herein, or is

suspended from the approved bidders list in the event and

for such time as such party fails to pay part or all of the

amount of any bill for service.

 

(b) The capacity release timeline in CCT is applicable to all

parties involved in the Capacity Release process; however,

it is only applicable if (1) all information provided by the

parties to the transaction is valid and the acquiring

Shipper has been determined to be creditworthy before the

capacity release bid is tendered; and (2) there are no

special terms or conditions of the release.

(1) For biddable releases (less than one year)

 

On a Business Day

 

12:00 p.m.

 

Time by which Releasing Shipper shall post the Shipper

Notice on the Web Site.

 

1:00 p.m.

 

Bidding period ends and evaluation period begins

during which contingency is eliminated, determination

of best bid is made and ties are broken.

 

2:00 p.m.

 

Evaluation period ends and award posting if no match

required.

 

Communication of match or award is due.

 

2:30 p.m.

 

Match response is due

 

3:00 p.m.

 

Award posting where match is required

 

(2) For biddable releases (one year or more)

 

The timeline is the same as biddable releases for less

than one year except that the Releasing Shipper shall

post the Shipper Notice on the Web Site by 12:00 p.m.

CCT four (4) Business Days before award for long-term

release. Open season ends no later than 1:00 p.m.

Central Clock Time on the Business Day before timely

nominations are due (open season is three Business

Days).

 

(3) Timeline for Releases with Special Conditions

 

If the Releasing Shipper specifies a bid evaluation

methodology other than highest rate, net revenue or

present value, or a permanent release or any other

special conditions, the above timelines shall apply;

provided, however, one additional Business Day will be

added to the evaluation period. Such extended

evaluation period shall cause Gas flow to be at least

one day later than Gas could flow under the timeline

set forth in Section 20.4(b)(1) or Section 20.4(b)(2).

 

(c) All bids must be expressed in dollars and cents or percents

of maximum rate, whichever is stated in the Shipper Notice,

include the required bid information and must be received

and posted electronically through the Web Site. Bids shall

be posted on the Web Site with any contingencies identified

and with the bidder's identity deleted.

 

(d) A bidder may submit only one bid at a time in response to a

Shipper Notice. A bidder may withdraw its bid through the

Web Site at any time prior to the close of the posting

period specified in the Shipper Notice without prejudice to

its submitting another bid with an economic value equal to

or greater than the economic value of the withdrawn bid.

 

(e) Where there is a PRS and an offer which is better than the

bid submitted by the PRS, Transporter will notify the PRS by

2:00 p.m. CCT on the day capacity is awarded and the PRS

will have until 2:30 p.m. to match the better offer and

obtain the right to the released capacity. In the event the

PRS does not match the better bid, Transporter shall award

the capacity to the party who made the best bid.

(f) Bids shall be binding until written or electronic notice of

withdrawal is received by Transporter. Bids cannot be

withdrawn after the bid period ends.

 

(g) In the event that a winning bid has an unacceptable

contingency, and Transporter is not notified through the Web

Site that such contingency has been removed within the time

period specified in the Shipper Notice, such contingent bid

will be rejected by Transporter.

 

(h) The Releasing Shipper may define in the Shipper Notice the

criteria for determining the best bid. If the Releasing

Shipper does not specify the criteria, Transporter shall use

the highest economic value to determine the best bid. If

there are multiple bids meeting the minimum conditions,

Transporter shall award the bids, best bid first, until all

offered capacity is awarded. Transporter will notify,

through the Web Site by 2:00 p.m. CCT following the end of

the posting period, or by 3:00 p.m. CCT if a matching period

is applicable, the PRS or Replacement Shipper that capacity

has been awarded. Transporter shall allow re-releases on

the same terms and basis as the primary release (except as

prohibited by the Commission's regulations).

 

(i) Transporter will post the winning bids and Replacement

Shippers' identity on the Web Site for at least five

Business Days.

 

20.5 Rights and Obligations of Releasing Shipper

 

(a) Regardless of the amount of capacity Releasing Shipper

releases under this Section 20, Releasing Shipper shall

remain liable for the Reservation Charges attributable to

the released capacity unless otherwise agreed to in writing

and in advance by Transporter. In the event of a permanent

release, Transporter may, and will not unreasonably refuse

to, waive liability of Releasing Shipper for the Reservation

Charges.

(b) When capacity is awarded to Replacement Shipper, Releasing

Shipper must adjust or reconfirm its nominations to reflect

the capacity released. Transporter may automatically change

Releasing Shipper's nominations to zero for the

Transportation Agreement under which capacity was released

unless such nominations are adjusted or reconfirmed by the

Releasing Shipper.

 

(c) If Releasing Shipper releases its TQ for a geographic

portion of the capacity reserved under its Transportation

Agreement, Releasing Shipper may use its full TQ for its

unreleased geographic portion of capacity. 

(d) When Releasing Shipper partially releases its capacity under

a Transportation Agreement by releasing capacity between

specific Receipt Points and Delivery Points or by releasing

only a portion of its TQ, Releasing Shipper's Transportation

Agreement shall be deemed to be modified in accordance with

the release and Releasing Shipper may not utilize the

capacity released during the term of the release.

 

(e) Releasing Shipper shall retain all Rights of First Refusal

with respect to the released capacity, unless such release

is a permanent release.

 

(f) Releasing Shippers may, to the extent permitted as a

condition of the capacity release, recall released capacity

(scheduled or unscheduled) at the Timely Nomination cycle

and the Evening Nomination cycle, and recall unscheduled

released capacity at the Intra-Day 1 and Intra-Day 2

Nomination cycles by providing notice to Transporter by the

following times for each cycle: 8:00 a.m. CCT for the Timely

Nomination cycle; 5:00 p.m. CCT for the Evening Nomination

cycle; 8:00 a.m. CCT for the Intra-Day 1 Nomination cycle,

and 3:00 p.m. for the Intra-Day 2 Nomination cycle.

Notification to Replacement Shippers provided by Transporter

within one hour of receipt of recall notification.

20.6 Rights and Obligations of Replacement Shipper

 

(a) Any bid submitted will bind Replacement Shipper or PRS to

the terms of the bid if Transporter selects such bid as the

best bid. If all the information provided by the Releasing

Shipper, the bidder/PRS is valid, the Replacement Shipper is

creditworthy, and there are no special terms and conditions,

Transporter will issue and execute the Addendum to the

Capacity Release Transportation Agreement within one hour of

awarding the winning bid.

 

(b) The capacity release addendum number will be issued within

one hour of the award posting. Nomination is possible

beginning at the next available nomination cycle for the

effective date of the capacity release addendum; however, in

no event will Gas flow on Replacement Shipper's

Transportation Agreement prior to the effective date of the

release as posted in the Shipper Notice.

 

(c) Replacement Shipper is responsible for payment of the

applicable Reservation Charge, and any surcharges thereon,

in the amount of its winning bid. Replacement Shipper is

also responsible for all other billings, e.g., commodity

rate and applicable commodity surcharges. In the event of

payment default, subject to Section 26 herein, Transporter

may elect to terminate that Replacement Shipper's Capacity

Release Transportation Agreement which shall terminate all

service thereunder utilized by the Replacement Shipper.

 

(d) Once Replacement Shipper or PRS is notified of a winning

bid, such Replacement Shipper or PRS shall have all the

rights and obligations specified under the Releasing

Shipper's Rate Schedule, the Releasing Shipper's

Transportation Agreement and the General Terms and

Conditions of this Tariff including the right to release

firm capacity pursuant to this Section unless the conditions

prescribed by the Shipper Notice require otherwise.

Transporter shall allow re-releases on the same terms and

basis as the primary release (except as prohibited by the

Commission's regulations).

 

(e) Replacement Shipper shall have no Right of First Refusal

with respect to the released capacity, unless such release

is permanent.

 

20.7 Rights and Obligations of Transporter

 

(a) Transporter shall determine the best bid based upon the best

bid criteria. Transporter shall have the right, but not the

obligation, to reject, in whole or in part, the terms of any

Shipper Notice or bid which is discriminatory or conflicts

with any order or regulation issued by the FERC, or

provision of the Transportation Agreement, Rate Schedule or

General Terms and Conditions. Such Shipper Notice shall be

rejected in its entirety unless Shipper permits a partial

rejection. Transporter shall provide notification to

Shipper, through the Web Site, of the reason(s) for

rejecting a release notice with the notice of rejection.

 

(b) Transporter shall not have any liability to any Shipper,

Releasing Shipper, Replacement Shipper, bidder or any other

party as a result of Transporter's performance of its

obligations under its capacity release program, and such

Shippers, Releasing Shippers, Replacement Shippers, and

bidders shall indemnify Transporter from and against any and

all losses, damages, expenses, claims, suits, actions and

proceedings whatsoever threatened, incurred or initiated as

a result of Transporter's performance hereunder, except to

the extent such loss, damage, expense, claim, suit, action

or proceeding is the result of Transporter's gross

negligence, undue discrimination or willful misconduct,

provided that Transporter shall be responsible for direct

damages, if any, resulting from Transporter's own

negligence.

20.8 Term

 

(a) Any release under this Section 20 shall be for a minimum

term of at least one Gas Day.

 

(b) Any release under this Section 20 shall be for a maximum

term expiring on the earlier of:

 

(1) The last date this Tariff provision shall be

effective;

 

(2) The expiration date of Releasing Shipper's

Transportation Agreement when the release is for the

full term of such agreement; or

 

(3) The expiration date specified by the Releasing Shipper

in the Shipper Notice.

 

20.9 Billing Adjustments to Releasing Shipper

 

(a) Unless otherwise agreed upon by the Releasing Shipper,

Transporter shall credit Releasing Shipper's monthly bill to

reflect the Reservation Charge (including surcharges, if

any) invoiced to Replacement Shipper, provided however, that

Transporter and Releasing Shipper may, in connection with a

Negotiated Rate based on a rate design other than straight

fixed variable, agree upon a payment obligation and

crediting mechanism that varies from or is in addition to

the provisions of this Section 20.9 in order to establish

the basis of accounting for revenues from a Replacement

Shipper as a means of preserving the economic bases of the

Negotiated Rate. In the event of a release with a

volumetric rate, the volumetric rate shall be no greater

than the 100% load factor equivalent of the maximum rate

currently applicable to the service released and shall be

credited to the Releasing Shipper's monthly bill.

Replacement Shipper's payment of the Commodity Charge will

be retained by Transporter.

 

(b) If Replacement Shipper fails to pay all or any part of the

Reservation Charge so credited within thirty (30) days of

its due date, then such unpaid amount plus interest will be

charged to Releasing Shipper's next monthly bill and will be

due and payable by Releasing Shipper in accordance with

Section 9 herein.

 

20.10 Offers to Purchase Firm Capacity

 

Transporter agrees to post on its Web Site, at a party's request,

offers to purchase firm capacity on a permanent or temporary

basis. Each offer will remain on the Web Site for five (5)

Business Days before it is removed, unless the requesting party

notifies Transporter prior to the expiration of any five (5) Day

period that it wishes to extend the posting for an additional five

(5) Business Days.

 

20.11 Assignment and Delegation.

 

Except as otherwise provided for in this section, Transporter

shall not assign its rights or delegate any of its duties under a

Transportation Agreement as may exist between Transporter and

Shipper without the prior written consent of Shipper, which

consent shall not be unreasonably withheld, and any attempted

assignment or delegation by Transporter without the prior written

consent of Shipper shall be void; provided, however, that

Transporter may, upon reasonable notice to Shipper, assign its

rights or delegate its duties under such Agreement, in whole or in

part, to any Affiliate of Transporter or any subsequent

purchaser(s) of the Pipeline facilities, including a pipeline

expansion, used for the Tariff or any subsequent purchaser of all

or substantially all of Transporter's assets, without the

necessity of obtaining consent from Shipper. Unless a release is

consented to by Shipper, no assignment by Transporter shall

relieve Transporter of its duties and obligations under such

Agreement, and it shall remain principally liable to Shipper for

the performance thereof. Likewise, prior written consent shall

not be required to employ third parties to perform services

incidental to the performance of any Agreement, but no such

employment shall relieve Transporter of its ultimate

responsibility to perform the Agreement.

 

Except as provided herein, Shipper shall not assign its rights or

delegate any of its duties under a Transportation Agreement as may

exist between Transporter and Shipper without prior written

consent of Transporter, which consent shall not be unreasonably

withheld, and any attempted assignment or delegation by Shipper

without the prior written consent of Transporter shall be void;

provided, however, that Shipper may, upon reasonable notice to

Transporter as provided in Section 16 above, assign its rights or

delegate its duties under such Agreement, in whole or in part, to

any affiliate of Shipper or any subsequent purchaser(s) of any

electric generating plants served by an Agreement, without the

necessity of obtaining consent from Transporter. Unless a release

is consented to by Transporter, no assignment by Shipper shall

relieve Shipper of its duties and obligations under such

Agreement, and it shall remain principally liable to Transporter

for the performance thereof. Likewise, prior written consent

shall not be required to employ third parties to perform services

incidental to the performance of any Agreement, but no such

employment shall relieve Shipper of its ultimate responsibility to

perform the Agreement.

 

21. REQUESTS FOR SERVICE

 

Subject to any conditions set forth in the applicable Rate

Schedules, this section shall govern qualifications for receipt of

service under Rate Schedules FT and IT.

21.1 Information Required from All Shippers

 

All Shippers requesting service from Transporter must provide the

following information in writing to Transporter at the following

address:

 

MarkWest New Mexico, L.L.C.

1515 Arapahoe Street

Tower 2, Suite 700

Englewood, CO 80202-2126.

 

(a) Shipper information

 

(1) Shipper's legal name in full and DUNS number.

 

(2) Shipper's mailing address for notices and billing.

 

(3) Shipper's street address if different from above.

 

(4) The name(s), telephone number(s) and fax number(s) of

Shipper employees responsible for nominations and/or

dispatching.

 

(5) The name(s), telephone number(s) and fax number(s) of

Shipper employees responsible for payment of invoices.

 

(6) The name(s), telephone number(s) and fax number(s) of

Shipper employees responsible for other matters.

 

(7) Whether the Shipper is affiliated with Transporter.

 

(b) Type of service requested.

(c) Requested Transportation Quantity, stated in MMBtu per day

(if applicable).

 

(d) Estimated total quantities of Gas to be received and

transported over the delivery period.

 

(e) Requested date of commencement of service (if applicable).

 

(f) Requested term of service (if applicable).

 

(g) Requested Receipt Point(s) and Delivery Point(s), together

with the name of the entity delivering Gas to Transporter

and the name of the entity to receive Gas from Transporter

(if applicable).

 

(h) If applicable, a copy of an executed agreement between

Shipper and third party authorizing Shipper to act on behalf

of the third party to secure the service requested. If

Shipper requests service on behalf of a third party, Shipper

shall provide the name, address, telephone number and

primary business of the third party.

 

(i) No Requests for service will be processed until

Shipper has provided to Transporter a completed

Service Request Form, including information regarding

any specific affiliation with Transporter. All

completed Service Request Forms must be sent by U.S.

Postal Service, by express mail, by courier, or by

facsimile, to:

 

MarkWest New Mexico, L.L.C.

1515 Arapahoe Street

Tower 2, Suite 700

Denver, CO 80202-2126

Phone: (303) 925-9246

Facsimile: (303) 290-8769

 

21.2 Allocation of Capacity

 

To the extent requests for firm service exceed Available Capacity,

capacity will be allocated based on highest bid as established

pursuant to this Section 21, pro rata among equal bids.

21.3 Prepayment

 

If requesting any firm service, Shipper shall make a prepayment by

wire transfer in an amount equal to the lesser of the reservation

charge for two months service or $10,000. The prepayment, plus the

accrued interest from the date payment is received until the date

service commences, shall be applied to the first month's invoice,

and to the invoices of subsequent month(s), as necessary, until

the amount is fully credited. The accrued interest herein shall be

computed in a manner consistent with Section 154.501(d) of the

Commission's Regulations.

 

21.4 Creditworthiness

 

(a) Prior to execution of a Transportation Agreement, providing

for service under any Rate Schedule, a Shipper shall be

required to establish creditworthiness with Transporter.

Transporter shall not be required to: (i) execute a

Transportation Agreement providing for service under the

applicable Rate Schedule on behalf of any Shipper who fails

to meet Transporter's standards for creditworthiness; or

(ii) initiate service to a Shipper who fails to meet

Transporter's standards for creditworthiness; or (iii)

continue transportation service on behalf of any Shipper who

is or has become insolvent or who, at Transporter's request,

fails within a reasonable period to demonstrate

creditworthiness.

 

(b) For purposes herein, the determination of Shipper's

creditworthiness shall be based upon the level of service

requested by Shipper, Shipper's estimated financial strength

as defined by Dun & Bradstreet and a composite credit

appraisal of at least "3", also as defined by Dun &

Bradstreet. If Shipper is not rated by Dun & Bradstreet,

determination of a Shipper's creditworthiness shall be based

upon a credit rating, as evaluated by Transporter, based

upon the level of service requested by Shipper and financial

analysis criteria and which are generally acceptable in the

natural gas industry. If Transporter determines that

Shipper does not have an acceptable rating set forth above,

Shipper may, at its own expense, obtain a private rating

from Dun & Bradstreet, or, as an alternative, request that

an independent certified public accountant, mutually

acceptable to Shipper and Transporter, prepare an equivalent

evaluation based on the financial analysis criteria and

ratios which are generally acceptable in the natural gas

industry.

 

(c) If a Shipper otherwise fails to establish creditworthiness

as provided herein, Shipper may still receive service under

the applicable Rate Schedule provided it furnishes and

maintains for the term of the Transportation Agreement: (i)

a written guarantee in a form satisfactory to Transporter

from a third party which is creditworthy as determined

above, (ii) an irrevocable standby letter of credit in an

amount equal to the contract on a 100% load factor basis,

for contracts with a term of twelve (12) months or longer

the amount of the irrevocable standby letter of credit will

not exceed twelve (12) months valuation, and contracts with

a term less than twelve (12) months the irrevocable standby

letter of credit will be the lesser of three (3) months

valuation or the term of the contracts, (iii) a pre-payment

in the amount equal to the contract on a 100% load factor

basis, for contracts with a term of twelve (12) months

valuation, and for contracts with a term less than twelve

(12) months the pre-payment will be the lesser of three (3)

months valuation or the term of the contracts, or (iv) other

security acceptable to Transporter.

 

(d) To permit Transporter to conduct a creditworthiness review,

a Shipper shall, upon request by Transporter, render to

Transporter: (i) a completed credit application, and (ii)

complete financial statements prepared in accordance with

generally accepted accounting principles or, for non-U.S.-

based Shippers, prepared in accordance with equivalent

principles. Upon requesting transportation service, a

Shipper must submit to Transporter a completed credit

application unless it has previously submitted such to

Transporter within the last twelve (12) months. If a

Shipper elects to provide an irrevocable standby letter of

credit or pre-payment, the completed credit application, and

financial statement requirement is waived by Transporter.

Transporter shall have the right to review a Shipper's

creditworthiness on an ongoing basis and Shipper shall

provide, upon Transporter's request, updated financial

statements periodically in order to determine the continuing

creditworthiness of a Shipper.

 

(e) Transporter shall also consider the Shipper's past payment

record with Transporter. Specifically, if Shipper is

current with its payments to Transporter, and has not been

delinquent in paying bills to Transporter over the past

twelve (12) months (with good faith billing disputes

excepted), the Shipper shall be deemed to have met the

creditworthiness standard with respect to its existing

transportation and storage contracts with Transporter.

Shipper's past payment record with Transporter and other

pipelines shall also be considered in establishing

creditworthiness requirements for new transportation and

storage contracts on Transporter.

 

22. RIGHT OF FIRST REFUSAL

 

22.1 If a Firm Transportation Agreement at the maximum recourse rate

for a term of twelve (12) or more consecutive months of service

contains no automatic extension provision, Shipper shall be

entitled to a right of first refusal ("ROFR") to the renewal of

its Transportation Quantity in accordance with the following

procedures. Transporter shall post the capacity for bidding on

its Web Site no later than 180 days prior to the expiration of

Shipper's Firm Transportation Agreement. The capacity will remain

posted on the Web Site for a minimum of 20 days ("ROFR Bidding

Period"), with such posting containing the following information

with respect to the capacity:

 

(a) Daily Transportation Quantity;

(b) Receipt and Delivery Points;

 

(c) Maximum reservation charge;

 

(d) Any applicable restrictions; and

 

(e) The last day of the ROFR Bidding Period.

 

Transporter may require bidders to insure that offers are bona

fide by providing financial assurances satisfactory to

Transporter.

 

A Shipper's ROFR rights apply only when the Shipper is seeking to

contract for its entire geographic historical Transportation

Quantity, however a Shipper may elect to retain a portion of its

Transportation Quantity subject to ROFR rights, in which case

Transporter's pregranted abandonment authority would apply to the

remainder of the service.

 

22.2 Upon conclusion of the ROFR Bidding Period, Transporter shall

evaluate the bids in accordance with the procedures set forth in

section 20, provided that the term used for purposes of the

formula will be the lesser of the term proposed by the bidder or

five years; and provided further that any bid rate higher than the

maximum applicable recourse rate shall be deemed to be equal to

the maximum applicable recourse rate. Transporter shall not be

required to accept any bid at less than Transporter's maximum

applicable recourse rate.

 

22.3 If Transporter receives no bids, or if Transporter receives no

bids at its maximum applicable recourse rate and Transporter

determines not to accept any bids below the maximum applicable

recourse rate, Transporter shall notify Shipper of the bid having

the highest value to Transporter ("Highest Bid"), or that no bids

were received. If Transporter receives a bid at its maximum

applicable recourse rate, or if it accepts any bid below the

maximum applicable recourse rate, Transporter shall, within

five days of the close of the ROFR Bidding Period, inform

Shipper of the offer to purchase capacity solicited pursuant

to section 20 herein that Transporter intends to accept.

Shipper shall have twenty-five (25) days after receiving

notice to notify Transporter as to whether it will match the

Highest Bid in terms of price, quantity and duration. If

the Shipper elects to match the Highest Bid, it must execute

a new Transportation Agreement that contains the terms of

the Highest Bid; provided, however, that Shipper shall not

be required to pay any rate higher than the maximum

applicable recourse rate. If the Shipper fails to match the

offer presented by Transporter, Transporter shall enter into

a Firm Transportation Agreement with the Person submitting

the competing offer.

 

22.4 If Transporter receives no bids at the maximum applicable recourse

rate and Transporter refuses to accept a lower bid, Transporter

may abandon service to Shipper, unless Shipper agrees to pay the

maximum applicable recourse rate for a period of one year, or if

Transporter and Shipper negotiate the terms and conditions of a

Firm Transportation Agreement extension.

 

23. CREDITING OF PENALTIES

 

Penalties Net of Out-of-Pocket Costs - Transporter will flow through to

its Shippers the amount of all out-of-pocket costs incurred and

collected as a direct result of the Shipper conduct that was penalized

pursuant to sections 8.1(b) and 8.3 of the GT&C. Transporter will net

all revenues received pursuant to those sections against the costs

incurred for such revenues. Transporter will credit the net amount to

those Shippers that were not billed pursuant to those sections during

the applicable Month.

 

24. INCORPORATION IN RATE SCHEDULES AND TRANSPORTATION AGREEMENTS

 

These General Terms and Conditions are incorporated in and are made a

part of Transporter's Rate Schedules and Transportation Agreements. To

the extent there is any inconsistency between terms in these General

Terms and Conditions and terms in Transporter's Rate Schedules or

Transportation Agreements, these General Terms and Conditions shall

govern.

 

 

25. NORTH AMERICAN ENERGY STANDARDS BOARD (NAESB) STANDARDS

 

Transporter hereby incorporates into this Tariff by reference NAESB

Version 1.7 standards as modified by Recommendation R03035A, 2004 Annual

Plan Item 2 FERC Order 2004, and 2005 Annual Plan Item 8 as required by

the Commission in 18 CFR Part 284.12(a), in accordance with Order Nos.

587, et seq.:

 

0.1.z1, 0.3.1 through 0.3.10, 1.1.22, 1.2.1 through 1.2.5, 1.2.8 through

1.2.11, 1.2.13 through 1.2.19, 1.3.2(vi), 1.3.3 through 1.3.9, 1.3.11,

1.3.13 through 1.3.77, 1.3.79, 1.4.1 through 1.4.7, 2.1.6, 2.2.1 through

2.2.5, 2.3.1 through 2.3.6, 2.3.8 through 2.3.13, 2.3.15, 2.3.17 through

2.3.23, 2.3.25, 2.3.27, 2.3.28 through 2.3.35, 2.3.42 through 2.3.44,

2.3.48, 2.3.50 through 2.3.64, 2.4.1 through 2.4.16, 3.3.1 through

3.3.14, 3.3.16 through 3.3.26, 3.4.1 through 3.4.4, 4.1.40, 4.2.1

through 4.2.20, 4.3.1 through 4.3.3, 4.3.5, 4.3.7 through 4.3.18,

4.3.20, 4.3.22 through 4.3.62, 4.3.64 through 4.3.76, 4.3.78 through

4.3.92, 5.1.2 through 5.1.4, 5.2.1, 5.2.2, 5.2.3, 5.3.2, 5.3.3, 5.3.7

through 5.3.10, 5.3.12, 5.3.17, 5.3.18, 5.3.20 through 5.3.60, 5.4.1

through 5.4.22.

 

In addition, Transporter hereby incorporates into this Tariff by

reference the model Operational Balancing Agreement approved by NAESB as

Standards 6.5.2.

 

26. DEFAULTS AND REMEDIES

 

26.1 Events of Default - An "Event of Default" shall mean, with respect

to Shipper or Transporter, the occurrence of any of the following:

 

(a) any representation or warranty made in the Agreement by

Shipper or Transporter that proves to be false or misleading

in any material respect;

 

(b) the failure of Shipper or Transporter to perform any

covenant set forth in a Transportation Agreement, where such

failure is not excused by Force Majeure and is not cured

within thirty (30) Business Days after written notice

thereof to the other party; or

(c) Shipper or Transporter shall be subject to a Bankruptcy

Event (with "Bankruptcy Event" meaning with respect to

either Shipper or Transporter, that such party (i) is

dissolved (other than pursuant to a consolidation,

amalgamation or merger), (ii) makes an assignment or any

general arrangement for the benefit of creditors, (iii)

institutes or has instituted against it a proceeding seeking

a judgment of insolvency or bankruptcy or any other relief

under any bankruptcy or insolvency or other law affecting

creditors' rights and, in the case of any such proceeding or

petition instituted or presented against it, such proceeding

or petition (A) results in a judgment or insolvency or

bankruptcy or the entry of an order for its wind-up or

liquidation or (B) is not withdrawn, dismissed or discharged

within thirty (30) Days after the institution or

presentation thereof, (iv) otherwise becomes bankrupt or

insolvent (however evidenced), (v) has a secured party take

possession of all or substantially all of its assets or has

an action or proceeding taken or levied against all or

substantially all of its assets and such secured party

maintains possession, or any such action or proceeding is

not dismissed, in either case within thirty (30) Days

thereafter, or (vi) is unable to pay its debts or admits in

writing its inability generally to pay its debts as they

fall due.)

 

26.2 Termination by Transporter - Upon the occurrence of an Event of

Default by Shipper under a Transportation Agreement ("Agreement"),

Transporter may terminate the Agreement upon ten (10) additional

Days' prior written notice to Shipper. Except as otherwise

provided in the Agreement, upon termination by Transporter,

Shipper shall pay to Transporter all payments owed to Transporter

for gas that flowed prior to termination. In addition,

Transporter and Shipper may agree to a termination payment to be

paid by Shipper, which shall be equal to the quantity remaining to

be delivered to Shipper under the Transportation Agreement,

multiplied by the Negotiated Rate, if any, under the

Transportation Agreement.

 

26.3 Termination by Shipper - Upon the occurrence of an Event of

Default by Transporter under a Transportation Agreement

("Agreement"), Shipper may terminate the Agreement upon ten (10)

additional Days' prior written notice to Transporter. Except as

otherwise provided in the Agreement, upon termination by Shipper,

Shipper shall pay to Transporter all payments owed to Transporter

for gas that flowed prior to termination. In addition,

Transporter and Shipper may agree to a termination payment to be

paid by Transporter, which shall be equal to the difference

between the Negotiated Rate, if any, and the next highest rate

that Shipper would be required to pay for equivalent capacity and

service from another transportation service provider, multiplied

by the quantity remaining to be delivered to Shipper under the

Transportation Agreement.

 

26.4 Accounting Upon Termination - Any termination of a Transportation

Agreement pursuant to the provisions of Sections 26.2 or 26.3 will

be without prejudice to the right of either Transporter or Shipper

to collect any amounts then due to it, to offset amounts owed to

it by the other party from such amounts due to the other party,

and will be without prejudice to the right of Shipper to receive

any Gas that has been delivered to Transporter at the Receipt

Point(s) but which Transporter has not yet redelivered to the

Delivery Point(s), subject, however, to the payment of the

applicable charge set forth in the terminated Transportation

Agreement for such transportation and resolution of any applicable

Gas imbalances, and without waiver of any remedy to which the

party not in default may be entitled as a result of the defaulting

party's default, breach or violation of the terms of the

terminated Transportation Agreement.

 

26.5 Remedies - In the event of termination by either Transporter or

Shipper under GT&C Sections 26.2 or 26.3, in addition to the

remedies set forth in those Sections, the parties shall have such

other rights and remedies as may exist at law or in equity.

27. CHANGES IN RATES OR GENERAL TERMS AND CONDITIONS

 

Unless otherwise agreed, Transporter may, from time to time propose and

file with FERC, in accordance with Section 4 of the Natural Gas Act,

changes, amendments, revisions, and modifications to (a) Transporter's

rates and rate schedules, and/or (b) the General Terms and Conditions of

Transporter's tariff, provided, however, that unless they have otherwise

agreed, Shippers shall have the right to intervene in and/or protest any

such changes before FERC (or any successor governmental agency) or other

authorities and to exercise any other rights that Shippers may have with

respect thereto.

 

28. ARBITRATION

 

Any controversy arising out of or relating to any Agreement, if not

resolved by the parties, may, by mutual agreement, be submitted to

arbitration under the provisions of the Texas General Arbitration Act,

Tex. Civ. Prac. & Rem. Code Section 171.001, et seq., as it may be

amended from time to time and as modified by any Agreement. When the

parties agree to arbitration, the controversy shall be determined by a

board of three arbitrators to be selected as follows: either party may,

at the time a board of arbitration is desired, notify the other of the

name of any arbitrator of its choosing, and the other party shall,

within ten (10) Days, notify the party desiring arbitration of the name

of its arbitrator. The two arbitrators shall, within ten (10) Days

after the notification of the identity of the second arbitrator, choose

the third arbitrator. If they are unable to agree, the parties shall

make application within two (2) Days to the Senior Judge of the United

States District Court for the Northern District of Texas, who (acting in

an individual and not official capacity) shall appoint the third

arbitrator. All arbitrators appointed pursuant to this Section 28 shall

be third-party individuals qualified by education, knowledge, and

experience to pass on the matters submitted for arbitration and shall

not be employed by nor regularly receive remuneration from either party

other than for arbitration services.

The board so constituted shall meet within ten (10) Days after the

identity of the third arbitrator is determined, at which time the board

shall set a reasonable schedule so that the parties may submit evidence

and argument as they may see fit and be represented by counsel. The

action of a majority of the members of the board shall govern and,

unless otherwise agreed by both parties or otherwise set forth in any

Agreement, their decision shall be rendered within seventy-two (72)

hours from the conclusion of submission of the evidence, shall be in

writing, and shall be final and binding on the parties. Each party

shall pay the expense of the arbitrator selected by it and its own

attorney's fees and costs associated with preparation of its case. All

other costs of the arbitration shall be divided between the parties

according to a method mutually agreed to by them at the outset of the

arbitration proceeding and, failing such agreement, according to the

decision of a majority of the members of the arbitration board, which

shall likewise be final and binding on the parties. Without regard to

any terms of any Agreement which may appear to be in conflict with this

Section 28, neither party shall be entitled to recovery or reimbursement

of costs incurred. Procedures not specified in the Agreement are

established by the provisions of the Texas General Arbitration Act.

 

29. MISCELLANEOUS

 

29.1 Audit - Shipper and Transporter shall maintain books and records

relating to their operation and performance under a Transportation

Agreement in order that the provisions of the Agreement can

adequately be administered. Shipper and Transporter shall have

the right, during the term of such Agreement and within a two-Year

period following its expiration, to enter upon the premises of the

other party at reasonable times for the purposes of examining and

auditing all books and records relating directly to performance

under the Agreement. Audits shall be conducted at the sole

expense of the party conducting the audit. Such party shall

furnish the other party a report stating the results of any audit

and the basis of those results. If any such report discloses that

any error has occurred and that, as a result, an overpayment or an

underpayment has been made, and if the other party disagrees with

the report, both parties shall cooperate in an attempt to resolve

any differences regarding the report. If any difference regarding

an audit report is not resolved within thirty (30) Days following

delivery of that report, Shipper and Transporter may, by mutual

agreement, submit the controversy to arbitration, and failing such

agreement, may use any legal means at their disposal to resolve

the dispute. The amount of the underpayment or overpayment, as

the case may be, shall promptly be paid to the party to whom it is

owed by the other party upon final resolution of any difference.

 

29.2 Governing Laws - Any Transportation Agreement made pursuant to

Transporter's Rates Schedules shall be construed under and in

accordance with the substantive laws of the State of New Mexico,

except any provision of such laws that requires the application of

the laws of another state.

 

29.3 Government Contract Clauses - To the extent applicable,

Transporter shall be bound by any government contract clauses that

are incorporated into a Transportation Agreement, and any other

clauses which Shipper has notified Transporter are required by

governmental statutes, rules or regulations to be included in a

Transportation Agreement. No Transportation Agreement shall be

interpreted to require Transporter to be bound by the provisions

of any law unless that law itself provides for applicability to

Transporter.

 

29.4 Cumulative Remedies - Pursuit, by either Transporter or Shipper,

of any remedy available under this Tariff or any Transportation

Agreement as may exist between Transporter and Shipper, shall not

constitute a waiver of any other remedy that may be available. No

waiver of any event of default or other breach of an Agreement

shall be deemed or construed to constitute a waiver of any

subsequent occurrence of the same event of default or breach of

the same provision of the Agreement.

29.5 Limitation on Damages - In all situations arising out of a

Transportation Agreement, Transporter and Shipper shall attempt to

avoid and minimize the damages resulting from the act or omission

of the other party. Notwithstanding anything to the contrary in

the Agreement, no party shall be liable to any other party for any

lost or prospective profits or any special, punitive, exemplary,

consequential, incidental or indirect losses or damages (in tort,

contract or otherwise) under or in respect of the Agreement or

arising from any failure of performance related hereto howsoever

caused.

 

29.6 Ownership of Pipeline - Unless otherwise agreed, in the event that

Transporter at any time during the term of a Transportation

Agreement desires to sell its pipeline system, Transporter shall

notify Shipper of the full particulars of any bona fide offer

received by Transporter that Transporter is willing to accept.

Shipper shall have an exclusive first option to purchase the

system by providing to Transporter, within thirty (30) Days after

receipt of the notice from Transporter, a written offer to

purchase the system on the same terms or terms more favorable to

Transporter. These rights to purchase shall not extend to the

sale, transfer or other disposition of all or substantially all of

Transporter's assets, or to a sale or disposition to another party

being a wholly-owned subsidiary or entity holding more than fifty-

percent (50%) of the stock of Transporter, or by merger, or by way

of pledge or hypothecation for purposes of obtaining financing.

 

29.7 Calculations - The end results of all calculations under a

Transportation Agreement shall be rounded to three (3) decimal

places.

 

29.8 Entire Agreement - The Transportation Agreement, Rate Schedules,

and the General Terms and Conditions contain the entire agreement

of Transporter and Shipper with respect to the matters contained

therein. No other agreement, statement, or promise made by any

party, or by any employee, officer, or agent of any party, which

is not contained in such materials shall be binding or valid.

Provisions of the Agreement shall be construed as a whole

according to their common meaning, and not strictly for or against

either Transporter or Shipper. No amendment or modification of

the Agreement shall be effective unless in writing and signed by

both Transporter and Shipper.

 

29.9 Modification - No modification of the terms and provisions of a

Transportation Agreement shall be made except by the execution of

written contracts.

 

29.10 Non-waiver and Future Default - No waiver by either Transporter or

Shipper of anyone or more defaults by the other in the performance

of any provisions of any Transportation Agreement shall operate or

be construed as a waiver of any future default or defaults,

whether of a like or of a different character.

 

29.11 Schedules and Contract Subject to Regulation - This Tariff shall

be subject to all present and future applicable laws, orders,

rules and regulations of any duly constituted governmental

authority, whether federal, state, or local, having jurisdiction

over Transporter and Shipper, their facilities, or any provision

of this Tariff including, without limitation, all applicable

Federal Energy Regulatory Commission rules and regulations. The

Transportation Agreement shall be subject to all present and

future applicable laws, orders, rules and regulations of any duly

constituted governmental authority, whether federal, state, or

local, having jurisdiction over the parties to the Agreement,

their facilities, or any provision of the Agreement including,

without limitation, all applicable Federal Energy Regulatory

Commission rules and regulations.

 

29.12 Survival - The provisions of any Transportation Agreement shall

survive the termination of that Transportation Agreement for so

long as is necessary to complete all business transactions

outstanding between the parties related to the Transportation

Agreement, but in no event beyond two (2) Years after its

termination.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Sheet Nos. 163 through 199 are reserved for future use.

SHIPPER INQUIRY FORM

 

Name of inquirer:

 

________________________________________________________________________

 

Identification of contract under question:

 

________________________________________________________________________

 

Designation of time period involved:

 

________________________________________________________________________

 

Nature of inquiry or complaint:

 

________________________________________________________________________

 

________________________________________________________________________

 

Signature:______________________________________________________________

 

Title:__________________________________________________________________

REFERENCE TO CUSTOMERS HAVING NEGOTIATED RATE AGREEMENT OR NON-CONFORMING TRANSPORTATION AGREEMENTS PURSUANT TO

SECTION 154.112(B) OF THE COMMISSION'S REGULATIONS:

 

 

Negotiated TQ Signed

Rate Reservation In Receipt Delivery Effective Docket

Shipper Schedule Rate MMBtu Point(s) Point(s) Date No.

 

Southwestern

Public 276,000 TWPL Maddox

Service MMBtu/ NN Cunningham

Company FT 1/ day EPNG Lea Power 2/ RP08-368

3/

 

 

 

 

 

Notes:

 

1/ The negotiated rate consists of a single demand charge of $100,484.00 per month. Shipper shall reimburse

Transporter for any gross receipts taxes imposed or levied by the state or county and other taxes related to the

transportation of gas. Shipper shall not be liable for any other charges including, but not limited to, the annual

charges assessed Transporter by FERC pursuant to Order No. 472 or any other superseding or related rule or order. Any

tax imposed on Transporter's facilities or accruing to Transporter as a result of the ownership and operation of same

shall be paid by Transporter.

 

2/ The negotiated rate agreement was executed on June 28, 2007, and became effective as of July 1, 2007. The

negotiated rate summarized in note 1 became effective as of June 1, 2008.

 

3/ The agreement is a non-conforming service agreement and was filed at FERC on May 2, 2008.

 

 

[Applicable to the following Rate Schedules: FT, IT, Capacity Release.]

GAS TRANSPORTATION AGREEMENT

 

THIS GAS TRANSPORTATION AGREEMENT (the "Agreement) is effective

_________ ("Effective Date"), and is made and entered into this ________

day of ______________, 20_____, by and between

_________________________________ ("Transporter") and

_________________________________ ("Shipper").

 

WITNESSETH:

 

WHEREAS, Transporter owns and operates a pipeline system;

 

WHEREAS, Shipper desires to purchase _______ transportation

service from Transporter, have Transporter take receipt of Shipper's gas

and delivery Shipper's gas to ____________________________.

 

NOW, THEREFORE, in consideration of the premises and mutual

covenants and agreements herein contained, Transporter and Shipper agree

as follows:

 

ARTICLE I

SERVICE TO BE RENDERED

 

1.1 Transporter shall perform and Shipper shall receive

transportation service in accordance with the provisions of

Transporter's effective Rate Schedule _____________ and the

applicable General Terms and Conditions ("GT&C") of

Transporter's FERC Gas Tariff, Volume No. 1 (Tariff), on

file with the Federal Energy Regulatory Commission (FERC),

as the same may be amended or superseded from time to time

in accordance with the rules and regulations of the FERC.

The maximum obligation of Transporter to deliver gas

hereunder to or for Shipper, and the designation of the

Delivery Point(s) at which Transporter shall deliver or

cause gas to be delivered to or for Shipper, are specified

in Exhibit "A," attached to and made a part hereof by this

reference, as the same may be amended from time to time by

agreement between Shipper and Transporter, or as required by

the rules and regulations of the FERC.

 

ARTICLE II

TERM OF AGREEMENT

 

2.1 Service under this Agreement shall commence as of

______________________ and shall continue in full force and

effect until ________________(the "Primary Term").

Thereafter, this Agreement shall continue on a year to year

basis unless, at least one hundred eighty (180) days prior

to the end of the Primary Term, or of any contract year

thereafter, either party gives written notice to the other

of its intent to terminate this Agreement at the end of the

Primary Term or subsequent contract year. Termination shall

not relieve Shipper of any obligations, including without

limitation payment and indemnity obligations, arising or

accruing hereunder prior to the date of termination.

2.2 Shipper and Transporter agree to avail themselves of the

FERC's pre-granted abandonment authority upon termination of

this Agreement, subject to any right of first refusal

Shipper may have under the FERC's rules and regulations and

Transporter's Tariff.

 

ARTICLE III

RATES AND CHARGES, RATE SCHEDULE AND GENERAL TERMS AND CONDITIONS

 

3.1 Shipper agrees to and will pay Transporter all applicable

maximum rates and charges provided for in Rate Schedule ___

and the GT&C, as effective from time to time, for service

under this Service Agreement, unless service is rendered

hereunder at discounted rates, or negotiated rates under

Section 13 of the GT&C, in which event the rates and charges

that Shipper shall pay Transporter are those agreed to and

set forth in Article VIII of this Agreement.

 

3.2 All of the GT&C and provisions of Rate Schedule _____ shall

be applicable to service hereunder and shall be made a part

hereof.

 

3.3 Unless otherwise agreed, Shipper agrees that Transporter

shall have the unilateral right to file with the appropriate

regulatory authority and make changes effective in: (i) the

rates and charges applicable to Transporter's Rate Schedule

___; (ii) the terms and conditions of service pursuant to

which service hereunder is rendered; and/or (iii) any

provision of the GT&C applicable to service hereunder.

Transporter agrees that Shipper may protest or contest any

such filings or may seek authorization from duly constituted

regulatory authorities for such adjustments of Transporter's

Tariff as may be necessary to ensure that the provisions in

(i), (ii), or (iii) above are consistent with regulatory law

and policy.

 

ARTICLE IV

RESERVATIONS

 

Transporter shall have the right to take actions as may be

required to preserve the integrity of Transporter's pipeline facilities,

including maintenance that may affect Shippers firm transportation.

 

ARTICLE V

GOVERNMENTAL AUTHORIZATIONS

 

It is hereby agreed that transportation service under this

Agreement shall be implemented pursuant to applicable authorizations of

the FERC.

ARTICLE VI

NOTICES

 

Notices shall be provided in accordance with the GT&C, to

Transporter and Shipper, respectively, at the addresses set forth below:

 

(a) Transporter

MarkWest New Mexico, L.L.C.

1515 Arapahoe Street

Tower 2, Suite 700

Denver, CO 80202-2126

Attention:__________________________________________________

 

(b) Shipper

____________________________________________________________

Attention:__________________________________________________

 

ARTICLE VII

INTERPRETATION

 

The parties hereto agree that the interpretation and performance

of this Agreement must be in accordance with the laws of the state of

New Mexico without recourse to the law governing conflict of laws which

would require the application of the laws of another state.

 

ARTICLE VIII

FURTHER AGREEMENT

 

[If none, so state] [Particulars of any agreement pursuant to

Section 13 of the GT&C to be included here]

 

ARTICLE IX

CANCELLATION OF PRIOR CONTRACT(S)

 

This Agreement supersedes and cancels, as of the effective date of

this Agreement, the agreement(s) between the parties hereto as described

below: [If none, so state.]

No modification of the terms and provisions of this Service

Agreement shall be or become effective except by the execution of a

written instrument by Transporter and Shipper.

 

IN WITNESS WHEREOF, the parties hereto have caused this Service

Agreement to be executed by their respective duly authorized officers or

other authorized persons, the day and year first above written.

 

MARKWEST NEW MEXICO, L.L.C.

 

By:______________________________________

 

Printed Name:____________________________

 

Title:___________________________________

 

Executed:___________________, ___________

(Date)

 

 

 

(SHIPPER) [NAME OF SHIPPER]

 

By:______________________________________

 

Printed Name:____________________________

 

Title:___________________________________

 

Executed:___________________, ___________

(Date)

EXHIBIT "A"

 

BY AND BETWEEN

____________________________

AND

MARKWEST NEW MEXICO, L.L.C.

 

EFFECTIVE_____________________________

 

 

Attached to and made a part of Gas Transportation Agreement dated

_____________ by and between MarkWest New Mexico, L.L.C. ("Transporter") and

_____________________ ("Shipper").

 

 

 

Receipt Point(s):_______________________________________________________

 

 

Delivery Point(s): __________________________________________

 

 

Transportation Quantity: ___________________________________MMBtu/d