Empire Pipeline, Inc.

Original Volume No. 1

Effective Date: 12/10/2008, Docket: CP06-5-010, Status: Effective

Original Sheet No. 193 Original Sheet No. 193

GENERAL TERMS AND CONDITIONS

14. PROCEDURES FOR ALLOCATING FIRM CAPACITY (Cont'd.)

14.2 Transporter shall evaluate and determine the value of the bid(s)

for the capacity posted by Transporter in accordance with one of

the following two methods, with the specific method identified

in its posting:

(a) Net present value of reservation, demand and capacity

charges per unit of capacity; or

(b) Rate bid, provided such bid meets the minimum term (if any)

stated in Transporter's posting.

In the event Transporter receives two or more bids of equal

value, then under method (a) the best bid shall be the bid with

the shortest term and under method (b) the best bid shall be the

bid with the longest term. Transporter shall base its selection

of method (a) or method (b) upon its assessment of which method

will result in greater revenues for the services associated with

the capacity.

14.3 In processing requests for service received within the posting

period, Transporter shall allocate capacity among shippers

according to the present values (where method (a) is employed)

or rates (where method (b) is employed) of the bids received. A

ratable allocation, based on the quantities requested, shall be

made among shippers that submit bids that are equal with respect

to both value and term.

14.4 Transporter's posting shall also specify the number of days

within which shippers must execute and return service agreements

or precedent agreements once Transporter has allocated available

capacity in accordance with Section 14.3. If a Shipper fails to

execute and return the agreement tendered by Transporter within

such specified period, the capacity allocated to that Shipper

will be reallocated among the remaining shippers requesting the

posted capacity during the posting period, in accordance with

Section 14.3.