Transcolorado Gas Transmission Company LLC

Second Revised Volume No. 1

Effective Date: 12/28/2007, Docket: RP08-167-000, Status: Effective

Original Sheet No. 237 Original Sheet No. 237 : Effective

GENERAL TERMS AND CONDITIONS

6. CAPACITY RELEASE BY FIRM SHIPPERS (Continued)

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EXAMPLE (6) The assumptions remain the same as in Example (5), except that we

assume that Bids (c) and (d) were never made.

Winning Qualified Bids: Bid (b) receives 60,000. Bid (e) receives 30,000.

Bid (f) receives 10,000.

Explanation: There are two combinations of Qualified Bids with the Winning

Bid Value:

Combination 1 Combination 2

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Bid (a): 60,000 Bid (b): 60,000

Bid (e): 30,000 Bid (e): 30,000

Bid (f): 10,000 Bid (f): 10,000

(Pro rata allocation pursuant to Section 6.10(d)(2) between Bids (a), (b) and

(e) doesn't work, because only Bid (e) has a low enough Minimum Bid Volume to

accept 100/150 capacity allocation and Bid (e) alone cannot create the Winning

Bid Value). Under Section 6.10(d)(iii)(1), we compare Combinations 1 and 2

for the highest individual Maximum Bid Volumes, and find them all equal.

Under Section 6.10(d)(iii)(2), the tie breaker goes to the Winning Bid Value

combination containing the Qualified Bid having the highest Maximum Bid Volume

and the lowest Minimum Bid Volume. In this case, Bid (b) has the same

(highest) Maximum Bid Volume as Bid (a) but a lower Minimum Bid Volume.

Therefore, Combination 2 wins.

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