W T G Hugoton, LP

Original Volume No. 1

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Effective Date: 08/01/2007, Docket: CP06- 90-002, Status: Effective

Original Sheet No. 258 Original Sheet No. 258 : Effective

 

GENERAL TERMS AND CONDITIONS

 

(iii) a pre-payment in the amount not to exceed a rolling 3 months

of reservation charges under the contract plus an amount equal to

the highest monthly imbalance value owed by the shipper during the

previous 12 months; or

 

(iv) other security acceptable to WTG Hugoton.

 

In the event WTG Hugoton constructs new lateral facilities to

accommodate a Shipper, WTG Hugoton may require Security in an amount up to the

Shipper's proportionate share in the cost of the facilities. In the event a

Shipper defaults and its service is terminated, WTG Hugoton shall mitigate

damages from the default and reduce the Security retained from the defaulting

Shipper through methods such as netting the difference between the highest net

present value of any replacement contract entered into for the terminated

capacity and the net present value of the remaining term of the defaulting

Shipper's contract at the time of termination; or

 

(b) any Interruptible Service Agreement:

 

(i) a written guarantee in a form satisfactory to WTG Hugoton from

a third party which is creditworthy as determined above;

 

(ii) an irrevocable standby letter of credit in an amount not to

exceed 3 months of estimated service charges, including the value

of gas related to gas loaned under deferred delivery rate

schedules, plus an amount equal to the highest monthly imbalance

value owed by the shipper during the previous 12 months;

 

(iii) a pre-payment in an amount not to exceed 3 months of

estimated service charges, including the value of gas related to

gas loaned under deferred delivery rate schedules; plus an amount

equal to the highest monthly imbalance value owed by the shipper

during the previous 12 months; or

 

(iv) other security acceptable to WTG Hugoton.

 

Security, as set forth in (a) and (b) above, is hereinafter referred to

as "Security."

 

For purposes of pre-payments under either (a) (iii) or (b) (iii) above,

Shipper may deposit its prepayment funds into an interest-bearing escrow

account established by the Shipper granting WTG Hugoton access to the account

for payment of the services provided.