K N Interstate Gas Transmission Co.
First Revised Volume No. 1-D
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Effective Date: 12/02/1994, Docket: RP95- 35-000, Status: Effective
Original Sheet No. 28 Original Sheet No. 28 : Superseded
GENERAL TERMS AND CONDITIONS FOR SERVICES - continued
Multiple bids (defined as different bids made for different
portions of the total capacity) will be permitted.
18.4 BEST OFFER
Transporter will determine which bid constitutes the best offer by
determining the highest economic unit value (per Mcf of capacity)
to Transporter. A calculation based on the formula and interest
rate set forth in Section 23.5 will be used to determine the
highest economic unit value. The comparative economic unit value
of each bid will be determined by calculating the Net Present
Value (NPV) of the reservation charges of each offer over either
the term of the offer or five (5) years, whichever is less, and
then dividing by the quantity of the respective bid. However, if
the bid is at maximum rate and the term is more than five (5)
years, the entire term will be considered in determining the
economic unit value.
In the event equivalent offers are submitted, the capacity will be
made available on a pro rata basis to the equal bidders. Should
any one of the equal bidders veto their pro rata allocation of the
capacity, Transporter will then conduct a lottery to select the
winning bidder, who will then, if the bid is not matched under
Section 18.5 below, be allotted its requested capacity. The
remainder of said capacity, if any, will be available to the other
equal bidder(s) on a pro rata basis, which will again trigger the
veto/lottery selection process.
Transporter will post the name of the winning bidder of the gas
for a period of no less than five (5) work days.