Texas Eastern Transmission, L P

Seventh Revised Volume No. 1

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Effective Date: 11/16/2009, Docket: RP10-53-000, Status: Effective

Fifth Revised Sheet No. 528 Fifth Revised Sheet No. 528

Superseding: Fourth Revised Sheet No. 528

 

GENERAL TERMS AND CONDITIONS

(Continued)

 

Pipeline may reject all bids which would require Pipeline to discount below a rate and for

discount period agreeable to Pipeline. In the event Pipeline agrees to accept a rate that

is less than the applicable maximum tariff rate, Customer must submit a discount request

online via the LINK® System and Pipeline must approve such request pursuant to the

provisions of Section 28 of these General Terms and Conditions in order for such rate to

become effective.

 

(6) Pipeline shall review all bids from Replacement Customers received pursuant to Section

3.13(B)(4), which have not been rejected by Pipeline, to determine which bid is the "best

bid(s)". For purposes of this Section 3.13, the "best bid(s)" shall be the bid(s) which

yields to Pipeline the highest net present value. Net present value shall be calculated on

the basis of the present value of the Reservation Charge per unit to Pipeline except that

under a Negotiated Rate agreement with a minimum quantity, the net present value evaluation

shall also include the fixed cost component of the usage revenue at the minimum quantity.

In making the determination of net present value Pipeline shall apply the rate, as of the

date of the review, stated in accordance with Section 154.501(d) of the Commission's

regulations, to all bids.

 

(7) Upon receipt from Pipeline of the "best bid(s)", Customer shall have the right for a thirty

(30) day period in which to notify Pipeline in writing whether the Customer is willing to

match the "best bid(s)" for the capacity in whole or in part, made available by (i) the

termination of such service agreement, (ii) expiration of the contract term by its own

terms, or (iii) partial reduction pursuant to contractual right or the reduction of service

level pursuant to a right of first refusal. Commencing January 1, 2006, such notification

must be submitted online via the LINK® System. Failure to notify Pipeline within said

thirty (30) day period constitutes a non-revocable waiver of Customer's right to match the

"best bid(s)" and termination of the right of first refusal for the capacity. In order to

match the "best bid(s)", Customer must agree to a rate up to the maximum rate and contract

term that provide Pipeline with at least the same net present value, for an equivalent

amount of capacity, as the valid "best bid(s)" submitted by the Replacement Customer(s);

provided, however, the maximum rate a Customer must match is the maximum rate the Pipeline

can charge for delivery to the Customer's Point of Delivery under the Agreement which is

subject to the Customer's right to match the "best bid".

 

(8) In the event Pipeline does not receive any bids pursuant to Section 3.13(B)(4) or Pipeline

rejects all bids received due to the fact that such bids were premised on rate discount

levels or rate discount periods unacceptable to Pipeline, Pipeline and Customer may mutually

agree upon the terms and conditions under which Customer shall be entitled to retain its

capacity and continue to receive service. In no event shall Pipeline and Customer agree

upon terms which yield to Pipeline a net present value less than any bid received pursuant

to Section 3.13(B)(4) and rejected by Pipeline and in no event shall Pipeline be obligated

to sell capacity at less than the maximum lawful price for such capacity. In the event

Pipeline and Customer have not reached agreement on the terms and conditions under which

service will be extended, at Customer's election, such election to be exercised prior to the

date which is five Months before the termination date, Pipeline shall tender and Customer

shall execute within 20 days of receipt, a new service agreement reflecting service for all

or part of the contractual quantity, so long as such Customer agrees to pay the maximum

rate; provided, however, if Pipeline and Customer mutually agree to a lower rate which

yields to Pipeline a net present value equal to or greater than any bid received pursuant to

Section 3.13(C) and rejected by Pipeline, the Customer does not have to pay the maximum rate

to retain the capacity.

 

(9) In the event Pipeline and Customer do not execute a new service agreement pursuant to the

provisions of this Section 3.13(B), Pipeline shall have all necessary pregranted abandonment

authorization as to any part of the contractual quantity which is not covered by a new

service agreement. The new service agreement must meet all the requirements of the

definition of ROFR Agreement for Customer to continue to have the right of first refusal

pursuant to Section 3.13(B).