NorAm Gas Transmission Company

Fourth Revised Volume No. 1

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Effective Date: 02/01/1995, Docket: RP94-343-000, Status: Effective

Original Sheet No. 281 Original Sheet No. 281 : Superseded

GENERAL TERMS AND CONDITIONS

(continued)

19.5 Best Bid. Transporter shall evaluate and determine

the best bid among those otherwise consistent with

any terms and conditions specified by the releasing

Shipper as follows:

(a) Transporter shall apply the standard or criteria

for such determination specified by the

releasing Shipper, including the standard to be

used for breaking ties. Any standard or

criteria so specified must be objective,

economic, not unduly discriminatory, not

contrary to applicable provisions of this

Tariff, applicable to all potential replacement

Shippers and require Transporter in applying

such standard to exercise no more than a

ministerial function. The releasing Shipper

shall indemnify and hold Transporter harmless

from and against all demands, losses, claims,

expenses, causes of action and/or damages

suffered or incurred by Transporter arising out

of or related to any determination of a "best

bid" pursuant to a standard specified, supplied,

approved or provided by releasing Shipper.

(b) In default of releasing Shipper specifying a bid

evaluation standard, Transporter shall determine

the bid or bids generating the highest net

present value, using a 10% discount factor,

based on the rate bid (reservation or demand

component), the applicable quantity(ies) and

term or period bid upon. In default of

releasing Shipper specifying a method to break

ties, priority will be given first to the bid

with the shortest term, and next to the bid

submitted first in time.

(c) Bids shall be solicited and submitted only as to

the reservation or demand component (and any

surcharges and other fixed costs applicable

thereto) of the applicable maximum rate.

Shipper cannot release capacity for an effective

price less than or greater than Transporter's

applicable minimum or maximum, respectively,

rates, as on file and in effect from time to

time. If releasing Shipper elects to allow bids