Texas Eastern Transmission Corporation

Sixth Revised Volume No. 1

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Effective Date: 06/01/1993, Docket: RS92- 11-009, Status: Effective

Original Sheet No. 846 Original Sheet No. 846 : Effective

 

FORM OF SERVICE AGREEMENT

FOR RATE SCHEDULE FTS-2

(Continued)

 

ARTICLE II

 

TERM OF AGREEMENT

 

This Service Agreement shall become effective on and shall

continue in force and effect until and including March 31, 2002 ("Primary Term")

and shall continue thereafter unless terminated by either party at the end of the

Primary Term or the end of any subsequent month by twelve (12) months prior

written notice.

 

Customer hereby expressly acknowledges and agrees that, to the extent not

utilized by Customer for transportation of gas for Customer's account, Pipeline

has the sole right to utilize any pipeline capacity attributable to facilities

constructed by Pipeline to provide service pursuant to this Service Agreement as

part of Pipeline's overall general system capacity. To that end, Customer agrees

not to instigate or cause to be instigated any action designed to alter or

increase Customer's right to utilize the pipeline capacity attributable to

facilities constructed by Pipeline to provide service pursuant to this Service

Agreement. Upon termination of this Service Agreement, all rights of Customer to

the transportation service provided by the facilities constructed and utilized to

provide service hereunder shall terminate and the capacity provided by such

facilities shall be available without limitation for Pipeline's use as Pipeline

in its sole discretion deems desirable. If Customer elects to terminate this

Service Agreement, then notwithstanding such termination Customer shall continue

to pay the monthly charge provided under Section 3.2(A) of Rate Schedule FTS-2

until the earlier of (i) the date Pipeline recovers through said monthly charge

the full original cost of the facilities attributable to the service which has

been terminated, or (ii) the date Pipeline makes effective its next general rate

filing and begins receiving recovery on an alternate basis, which may include

systemwide recovery, of the costs of facilities attributable to the service which

has been terminated. At such time Customer shall cease paying the monthly charge

attributable to the terminated service. In addition, if and to the extent that

Customer terminates this Service Agreement and the Federal Energy Regulatory

Commission or any other Agency having jurisdiction over the premises ever

determines that the facilities attributable to such service are not used or

useful in providing natural gas service on Pipeline's system or otherwise

precludes Pipeline from recovering the full original cost of such facilities then

Customer shall reimburse Pipeline the remaining initial cost of said facilities

not previously recovered by Pipeline through depreciation charges. Such

reimbursement shall not be applicable if and to the extent that Pipeline elects

to terminate this Service Agreement.

 

Any portions of this Service Agreement necessary to correct or cash-out

imbalances under this Service Agreement as required by the General Terms and

Conditions of Pipeline's FERC Gas Tariff, Volume No. 1, shall survive the other

parts of this Service Agreement until such time as such balancing has been

accomplished.