Caledonia Gas And Storage

Original Volume No. 1

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Effective Date: 12/05/2007, Docket: RP08- 57-000, Status: Effective

First Revised Sheet No. 30 First Revised Sheet No. 30 : Effective

Superseding: Superseding Original Sheet No. 30

(a) Notice of open season. If Caledonia elects to conduct an open season

pursuant to Section 3.1, above, or if an open season is required pursuant to

Section 8 of Rate Schedule FSS, Caledonia shall post notice of the open season

on its Internet Web Site, at least ten (10) Days prior to commencement of the

open season. Such notice shall set forth when the open season begins and

ends, where interested parties may submit requests for firm storage services,

any minimum rates or length of term, if any, Caledonia will accept for the

available capacity, and how interested parties may obtain forms for requesting

service and additional details about the open season.

 

(b) Duration. The open season shall commence at the time and Day

specified and for the term indicated in the notice of open season. During

this time, Caledonia will accept requests for the firm storage services to be

available in its Facility.

 

(c) During an open season, Caledonia will accept requests for firm storage

service(s) from Potential Customers. Capacity will be allocated to those

Customers offering to pay the highest negotiated rates. More specifically,

capacity will be allocated to those Customers offering to pay the highest

present value to Caledonia over the term of each Service Agreement. Caledonia

reserves the right to give first priority to bids where: (i) the reservation

charges meet or exceed a threshold value; and (ii) the length of term meets or

exceeds a threshold value. If, upon allocation of capacity to those Customers

meeting these criteria, capacity remains, Caledonia may, in its reasonable

judgment, allocate capacity to Customers offering bids meeting other criteria.

Present value of the reservation charges shall be calculated in accordance

with the following formula:

 

PV = 1 - (1 + i)-n x (R) x (V)

i

Where: i = The prime rate as published by the Wall Street Journal on

the first Day of the open season plus five percent (5%) (or 500 basis points),

the sum of which is then divided by twelve (12).

 

n = The term of the Service Agreement, in Months.

R = the reservation charge(s) bid

V = MSC (Volume stated in Dth)

(d) During the allocation process of an open season, should requests for

firm storage service exceed available capacity, capacity will first be

allocated to the highest present value bids received for firm storage service.

When remaining unallocated capacity is not sufficient to meet the next highest

present value bidder’s capacity requirements for firm storage service, that

next highest bidder has the option of declining the remaining capacity.

Caledonia will then offer the remaining capacity to the next highest bidder,

until all the remaining capacity is allocated or until such time that the next

highest bidder’s terms did not meet the minimum requirements set forth in the

Open Season.

 

(e) Should the next highest present value bid in Section 3.2(c) above be

submitted by two or more Customers (e.g., tied bids) and there is insufficient

remaining capacity available to serve such Customers, then capacity will be

allocated to the Customers on a pro rata basis.