Enbridge Offshore Pipelines (Utos) LLC

FIFTH REVISED VOLUME NO. 1

 Contents / Previous / Next / Main Tariff Index

Effective Date: 05/06/2005, Docket: RP05-331-000, Status: Effective

First Revised Sheet No. 163 First Revised Sheet No. 163 : Effective

Superseding: Original Sheet No. 163

GENERAL TERMS AND CONDITIONS

(Continued)

21. NEW FACILITIES COSTS

UTOS shall be entitled to submit filings under Section 4 of the Natural Gas Act

and the Commission's Regulations and to recover capital costs of new facilities

incurred as a result of the restructuring of UTOS' services pursuant to the

provisions of Order Nos. 636 et seq. Such costs shall include, but not be

limited to, electronic measurement and communication facilities; flow control

equipment; other facility costs (including pre-tax rate of return times net

rate base; depreciation; and an allowance for ad valorem taxes).

22. DISCOUNT POLICY

(a) In the event that UTOS agrees to discount its rate to Shipper below UTOS’

maximum rate under UTOS’ Rate Schedules, the following discount terms may be

reflected on the applicable Transportation Agreements and will apply without

the discount constituting a material deviation from UTOS’ applicable pro forma

Transportation Agreements; provided, however, that any such discounted rates

set forth below shall be between the minimum and maximum rates applicable to

the service provided under the applicable Rate Schedule. UTOS and Shipper may

agree that a specified discounted rate will apply under the following

conditions:

(i) to specified quantities under Shipper's Transportation Agreement(s);

(ii) to specified quantities above or below a certain level or all quantities if

quantities exceed a certain level;

(iii) in a specified relationship to quantities actually transported (i.e., that

the Reservation Charge will be adjusted in a specified relationship to

quantities actually transported);

(iv) to specified quantities during specified periods of time or during

specified periods of the year;

(v) to specified quantities at specific Point(s) of Receipt or Point(s) of

Delivery;

(vi) to production reserves committed or dedicated by Shipper; and/or

(vii) that a specific discounted rate is based on published index prices for

specific Point(s) of Receipt and/or Point(s) of Delivery or other agreed-

upon published pricing reference points (such discounted rate may be based

upon the differential between published prices or arrived at by formula).

Any agreement containing such discounted rate shall specify the rate

component(s) to be discounted (i.e., Demand Rate or Commodity Rate or

both), and any formula will provide a reservation rate per unit of contract

demand (Maximum Daily Quantity). To the extent the firm Reservation Rate

is discounted, the index price differential rate formula shall be

calculated to state a rate per Dth. Furthermore, such discount shall not

change the underlying rate design of the service being provided or include

any minimum bill or maximum take provision that would have the effect of

guaranteeing revenue.

In addition, the discount agreement may include a provision that if one

rate component which was at or below the applicable maximum rate at the

time the discount agreement was executed subsequently exceeds the

applicable maximum rate or is less than the applicable minimum rate due to

a change in UTOS’ maximum (minimum) rates so that such rate component must

be adjusted downward (upward) to equal the new applicable maximum (minimum)

rate, the other rate components may be adjusted upward (downward) to

achieve the agreed overall rate, so long as none of the resulting rate

components exceed the maximum rate or are less than the minimum rate

applicable to that rate component. Such changes to rate components shall

be applied prospectively, commencing with the date a Commission order

accepts revised tariff sheets. Nothing contained herein shall be construed

to alter a refund obligation under applicable law for any period during