Williams Natural Gas Company

Second Revised Volume No. 1

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Effective Date: 03/14/1996, Docket: RP95-296-002, Status: Effective

Substitute First Revised Sheet No. 253 Substitute First Revised Sheet No. 253 : Superseded

Superseding: Substitute Original Sheet No. 253

 

 

GENERAL TERMS AND CONDITIONS

 

 

14. TRANSITION COSTS AND EXIT FEES (Cont'd)

 

(2) for contracts where WNG has determined that it can

minimize GSR Costs by continuing to purchase gas under

the contract, the difference between the contract price

and the higher of (a) the price at which WNG resells gas

purchased under the contract(s), or (b) an average of the

spot index prices shown for WNG, Natural Gas Pipeline

Company of America, Northern Natural Gas Company, ANR

Pipeline Company, and Panhandle Eastern Pipe Line

Company, for Texas, Oklahoma, and Kansas, as reported in

the first issue of Inside F.E.R.C.'s Gas Market Report

for the month in which the gas was sold.

 

WNG will post on its EBB an offer to sell the estimated

quantity of gas (PDM Gas) which it expects to be required

to purchase during the following month under the

remaining gas purchase contracts for which WNG has

determined that it can minimize GSR Costs by continuing

to purchase gas under the contract. Such posting will be

made no less than 15 days prior to the beginning of each

month (service month) and will include specific bidding

requirements for any party wishing to purchase such PDM

Gas for such service month. Bids may be submitted to

purchase PDM Gas for periods in excess of one month. If

any PDM Gas is contracted for periods in excess of one

month, only the quantity not covered by a contract will

be included in the monthly posting. Bids must be stated

as a percentage of the average spot index prices as

calculated in the preceding paragraph. In the event of

equal bids, the bid first received will be accepted. WNG

will accept the bid which it determines provides the

greatest economic value to WNG and which meets the

specific bidding requirements as posted on the EBB;

however, WNG retains the right to reject any bid which is

lower than the average of the spot index prices as

calculated in the preceding paragraph.

 

The differential calculated in (c)(2) above shall be reduced

by net revenue received under WNG's below-market contracts.

The net revenue will be the differential between the actual

price WNG pays under its below-market contracts and the higher

of (1) the spot market price, as calculated in paragraph