Stingray Pipeline Company, L. L. C.

Third Revised Volume No. 1

Effective Date: 11/01/2008, Docket: RP08-436-000, Status: Effective

First Revised Sheet No. 168 First Revised Sheet No. 168

Superseding: Original Revised Sheet No. 168

GENERAL TERMS AND CONDITIONS

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EXAMPLE (5) Assume:

Capacity Release Request = 100,000/Day for 5 Years

Qualified Bids:

Maximum Bid Unit Bid Minimum

Volume Term Value Bid Volume

----------- -------- -------- ----------

Bid (a) 60,000/Day 5 Years $.18 60,000

Bid (b) 60,000/Day 5 Years $.18 50,000

Bid (c) 70,000/Day 5 Years $.18 65,000

Bid (d) 50,000/Day 5 Years $.18 15,000

Bid (e) 30,000/Day 5 Years $.18 10,000

Bid (f) 40,000/Day 5 Years $.17 0

Winning Qualified Bids: Bid (c) receives 70,000. Bid (d) receives

30,000.

Explanation: Again, there are many combinations of Bids (a), (b), (c),

(d) and (e) with the same Winning Bid Value. Pro rata allocation won't

work, because each Bid would receive 100/270 of the capacity; only Bids

(d) and (e) have low enough Minimum Bid Volumes for a pro rata

allocation, and the sum of Bid (d)'s and Bid (e)'s Maximum Bid Volumes

is less than 100,000. Under Section 16.10(d)(3)(A), we then look to the

combinations of Bid(s) (a), (b), (c), (d) and (e) to identify the Bid

with the highest Maximum Bid Volume. This is Bid (c). We allocate the

highest volume to Bid (c) consistent with creating the Winning Bid

Value, so 70,000 is allocated to (c). This leaves 30,000 to be

allocated. Bids (a) and (b) have the next highest Maximum Bid Volume

(60,000), but the Minimum Bid Volumes of Bids (a) and (b) are each too

high to receive the remaining capacity. The next highest available

Maximum Bid Volume is in Bid (d), which is allocated the remaining

capacity of 30,000.

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