Cove Point LNG Limited Partnership

Second Revised Volume No. 1

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Effective Date: 06/01/2003, Docket: CP01- 76-004, Status: Effective

Substitute Second Revised Sheet No. 136 Substitute Second Revised Sheet No. 136 : Effective

Superseding: First Revised Sheet No. 136

 

GENERAL TERMS AND CONDITIONS

(Continued)

 

 

 

15. CAPACITY AND IMBALANCE ALLOCATIONS

 

This Section specifies the procedures for allocating any differences between: (i) Buyers'

aggregate nominations that may exceed the available capacity at Delivery and/or Receipt

Points; (ii) the aggregate of all Buyers' Scheduled Daily Delivery Quantities and actual

deliveries; and (iii) the aggregate of all Buyers' Scheduled Daily Receipt Quantities and

actual receipts ("Difference(s)") at Delivery Points at which gas is being delivered to or

for the account of multiple Buyers or at receipt points from which gas is being received by

Operator for the account of multiple Buyers. Unless otherwise agreed to between Operator

and Confirming Party, physically measured quantities shall be allocated on scheduled daily

quantities and shall be made using Dekatherm units.

 

(a) Capacity. If Operator receives nominations from Buyers for a service other than

discharging LNG from tankers that exceed available capacity Operator shall allocate

capacity among Rate Schedules by first allocating capacity at Delivery Points then

allocating capacity at Receipt Points based on the following priority schedule:

 

(1) First, among Buyers under Rate Schedules LTD-1, FPS-1, FPS-2, FPS-3, and FTS with

total nominations for service within their contractual entitlements at Primary

Delivery and Receipt Points.

 

(2) Second, among Buyers under Rate Schedules LTD-1, FPS-1, FPS-2, FPS-3 and FTS with

total nominations for service within their contractual entitlements at Secondary

Points located between the Primary Receipt and Delivery Points set forth in

Buyers' contracts. When nominations at a Secondary Point exceed available

capacity at that point, Secondary point capacity will be allocated among Buyers

on a pro rata basis, based upon each Buyers' respective level of Secondary

quantities nominated on that Day.

 

(3) Third, among Buyers under Rate Schedules LTD-1, FPS-1, FPS-2, FPS-3 and FTS with

total nominations for service within their contractual entitlements at Secondary

Delivery Points located downstream or Secondary Receipt Points located upstream

of the Primary Points set forth in Buyers' contracts. When nominations at

Secondary Points exceed available capacity at that point, Secondary point

capacity will be allocated among Buyers on a pro rata basis, based upon each

Buyers' respective level of Secondary quantities nominated on that Day.

 

(4) Fourth, among Buyers using Authorized Overrun Service under Rate Schedules LTD-1

and FTS.

 

(5) Fifth, among Buyers under Rate Schedules LTD-2 and ITS with nominations for

service at Delivery and Receipt Points commencing on the first day of the month

starting with those Buyers paying the highest rate. Where nominations for ITS

service by any group of Buyers paying the same rate exceeds the available

capacity at a Delivery or Receipt Point, capacity will be allocated at that

Delivery or Receipt Point based upon the following priority:

 

(i) first, to Buyers that paid the highest rate in the previous month up to

the level of the quantities flowing at that rate on the due date for

monthly nominations at that Delivery or Receipt Point in the month of the

nomination;

 

(ii) next, to Buyers flowing gas at that Delivery or Receipt Point on the due

date for monthly nominations that have requested increased quantities at

that point for the upcoming month, pro rated, if necessary, based upon

Buyers' level of confirmed nominated increase;

 

(iii) then, equally to all remaining Buyers nominating quantities at that point.