Saltville Gas Storage Company L.L.C.

Original Volume No. 1

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Effective Date: 02/07/2008, Docket: RP08-156-000, Status: Effective

Second Revised Sheet No. 34 Second Revised Sheet No. 34 : Effective

Superseding: First Revised Sheet No. 34

 

FSS RATE SCHEDULE

FIRM STORAGE SERVICE

(Continued)

 

8. RIGHT OF FIRST REFUSAL

 

8.1 Right of First Refusal at End of Contract Term. Saltville may

discontinue service to a Customer at the end of the primary term

or any renewed term of the Customer's Firm Storage Service

Agreement ("FSS Agreement") unless (i) the Customer exercises any

applicable renewal right in the Firm Storage Service Agreement; or

(ii) in the case of a Long Term FSS Agreement, the Customer

exercises its right of first refusal for all or a volumetric

portion of the capacity covered by the FSS Agreement by matching

the terms offered to Saltville during an open season, conducted

pursuant to Section 3 of the General Terms and Conditions of

Saltville's currently effective FERC Gas Tariff, for such capacity

by any qualified prospective successor customer. A "Long Term FSS

Agreement," as that term is used in this Section 8, is an FSS

Agreement that (i) requires the payment of the maximum applicable

tariff rate with a primary term of at least twelve (12) Months of

consecutive service, or (ii) requires the payment of the Maximum

Recourse Rate with a primary term of more than one (1) year for

service which is not available for twelve (12) consecutive Months,

unless otherwise provided for in the Commission's regulations.

Service agreements which include negotiated rates and/or

discounted rates shall not be eligible for the right of first

refusal. A prospective successor customer is "qualified", within

the meaning of this Section 8, if such prospective successor

customer meets the creditworthiness criteria set forth in Section

3 of the General Terms and Conditions of Saltville's currently

effective FERC Gas Tariff.

 

8.2 Exercise of Right of First Refusal.

 

(a) Not less than twelve (12) months prior to the termination or

expiration of a Long Term FSS Agreement, an open season will

be held for the purpose of awarding the capacity that is to

become available upon the Long Term FSS Agreement's

termination or expiration. This open season will be

conducted pursuant to Section 3 of the General Terms and

Conditions of Saltville's currently effective FERC Gas

Tariff.

 

(b) Bids from qualified successor customers who desire, in whole

or in part, the capacity to be made available upon the

expiration or termination of the Long Term FSS Agreement

must be received by Saltville no later than six (6) months

before the effective date of the expiration or termination

of the Long Term FSS Agreement. Upon expiration of the open

season, Saltville will select the highest acceptable bid

received from a qualified successor customer and communicate

the terms of the highest acceptable bid, including, if

applicable, whether the highest bid is for a higher priority

service, to the current capacity holder, who may elect,

within ten (10) Business Days or such greater time as

Saltville may specify, to execute a renewal Firm Storage

Service Agreement upon the same terms for the same or less

volumetric portion of capacity made available in the open

season. In determining which bid for the capacity is the

highest, Saltville will use the present value formula set

forth in Section 3 of the General Terms and Conditions of

Saltville's currently effective FERC Gas Tariff.