Texas Gas Transmission, LLC

Third Revised Volume No. 1

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Effective Date: 09/15/2008, Docket: RP08-392-000, Status: Effective

Original Sheet No. 2105 Original Sheet No. 2105 GENERAL TERMS AND CONDITIONS Section 9 (Cont'd) 9.4 Discounting 9.4.1 When any of Texas Gas' transportation service maximum rates are to be discounted, the amount of the discount shall be accounted for in the following sequence to the extent any of the following components are included in the maximum rate. The first component discounted shall be the maximum base tariff rates in excess of the minimum rate, followed by any non-transition cost surcharge(s), if applicable. 9.4.2 Types of Discounts: Various rate schedules permit Texas Gas to discount its rates between its maximum and minimum rates on a basis that is not unduly discriminatory. From time to time Customer and Texas Gas may agree in writing on a level of discount of the otherwise applicable rates and charges in addition to a basic discount from the stated maximum rates. For example, Texas Gas may provide a specific discounted rate: (i) to certain specified quantities under the Service Agreement, (ii) if specified quantity levels are actually achieved or with respect to quantities below a specified level, (iii) to production reserves committed by the Shipper, (iv) during specified time periods, (v) to points of receipt, points of delivery, supply areas, transportation paths or defined geographical areas, or (vi) in a specified relationship to the quantities actually transported (i.e., that the rates shall be adjusted in a specified relationship to quantities actually transported), or (vii) based on published index prices for specific receipt or delivery points or other agreed upon pricing reference points for price determination. Such discounted rates may be based upon the published index prices or arrived at by formula. In all circumstances the discounted rate shall be between the maximum rate and the minimum rate applicable to the service provided. Any agreement establishing a discounted rate arrived at by formula will identify what rate component (i.e., reservation charge or commodity charge or both) is discounted and any formula for discounted rates will produce a reservation rate per unit of contract demand. Such forms of discounts shall not be considered a material deviation from Texas Gas' pro forma service agreement as a result of such discount and Texas Gas shall not be required to file such agreement with the Commission as a non-conforming contract solely because of such discount. Texas Gas shall, however, file any required reports related to such discounts pursuant to the Commission's regulations.