Southern LNG Inc.

Original Volume No. 1

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Effective Date: 03/01/2010, Docket: RP10-271-000, Status: Effective

Second Revised Sheet No. 41A Second Revised Sheet No. 41A

Superseding: First Revised Sheet No. 41A

 

(F) If Customer is determined to be non-creditworthy by Southern LNG,

Customer may initiate with Southern LNG a re-evaluation of its credit. As

part of this re-evaluation process Customer should either update or confirm

in writing the prior information provided to Southern LNG related to

Customer's creditworthiness. This update should include any event(s) that

Customer believes could lead to a material change in its creditworthiness

(NAESB 0.3.8);

 

(G) After Southern LNG receives Customer's request for re-evaluation,

including the information in (F) above, Southern LNG will provide Customer

with a written response within five (5) Business Days, which will include

either a determination of Customer's creditworthiness status clearly stating

the reason(s) for Southern LNG's decision, or will provide Customer with an

explanation supporting a future date when a re-evaluation determination will

be made. This re-evaluation process will not exceed twenty (20) Business

Days from the date of the receipt of Customer's request, unless Southern LNG

and Customer mutually agree to some later date (NAESB 0.3.9).

 

In lieu of the above credit requirements such Customer may receive or continue to

receive service if Customer provides (i) where the service is associated with a

permanent release of capacity associated with the original construction of Southern

LNG's facilities or an expansion of Southern LNG's facilities, either (x) the proposed

Acquiring Customer, at the time of such permanent release has a credit rating of not

less than Investment Grade (taking into account for this purpose the lowest published

rating of S&P and Moody's if both such rating agencies have published ratings in

respect of such proposed replacement customer or assignee), or (y) the proposed

Acquiring Customer provides a guarantee from a credit provider that, at the time of

such permanent release or assignment, has a credit rating of not less than Investment

Grade (taking into account for this purpose the lowest published rating of S&P and

Moody's if both such rating agencies have published ratings in respect of such

proposed replacement credit support provider), and in all cases (z) the credit support

is equivalent in amount for the portion of capacity being permanently released, the

duration, and any other material applicable terms as the credit support previously

agreed to in the Releasing Customer's precedent agreement related to such capacity

being released or (ii) where service is not associated with a permanent release, the

greater of the credit support agreed to for its Service Agreement or the following:

 

(x) a security deposit in an amount equal to the cost of performing the

maximum service for Customer for the lesser of the remaining primary

term, or of any extension, of the Service Agreement and a three (3) month

period;

 

(y) good and sufficient surety, as determined by Southern LNG in its

reasonable discretion, in an amount equal to the cost of performing the

maximum service for Customer for the lesser of the remaining primary

term, as may be extended, of the Service Agreement and a three (3) month

period;

 

(z) a guaranty in a form agreed to between Southern LNG and Customer from a

creditworthy party and such creditworthy party will be responsible for

payment of all charges and penalties assessed by Southern LNG but not

paid by Customer.

 

(e) Subject to other provisions of the Rate Schedule and the GT&C, the term of any Service

Agreement may be extended wherein the parties have agreed to an "evergreen" or

"rollover" provision. Also, a Customer having more than one firm Service Agreement

each with a primary term of at least nineteen (19) years, unless Southern LNG agrees

otherwise, shall have the right, to be exercised by written notice to Southern LNG

only once and no later than the tenth (10th) anniversary of the effectiveness of the

earlier Service Agreement, to enter into an amendment to such Service Agreement to

extend the primary term to end no later than the end of the primary term of the later

Service Agreement and to specify the same evergreen extension provisions as the later

Service Agreement, in