Caledonia Gas And Storage

First Revised Volume No. 1

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Effective Date: 09/30/2010, Docket: RP10-1032-000, Status: Effective

Original Sheet No. 122 Original Sheet No. 122


25.2 Reimbursement. Upon Customer’s request, Caledonia may agree to

construct facilities to Receive, measure, store or Deliver Gas for

Customer’s account. Except as provided in Section 25.3 herein,

Customer shall reimburse Caledonia: (a) for the costs of any facilities

installed by Caledonia at Customer’s request to Receive, measure,

store or Deliver Gas for Customer’s account; and (b) for any and all

filing costs and approval fees required in connection with Customer’s

Service Agreement that Caledonia is obligated to pay to the Commission

or any other governmental authority having jurisdiction. Any

reimbursement due Caledonia by Customer pursuant to this Section 25.2

shall be due and payable to Caledonia within ten (10) days of receipt

by Customer of Caledonia’s bill(s) for same; provided, however, subject

to Caledonia’s consent, such reimbursement, plus carrying charges

thereon, may be amortized over a mutually agreeable period not to

extend beyond the primary contract term of the Service Agreement

between Caledonia and Customer. Carrying charges shall be computed

utilizing interest factors acceptable to both Caledonia and Customer.

Caledonia reserves the right to request prepayment for new construction

or facilities required at its discretion.

25.3 Waiver. Caledonia may waive from time to time, at its discretion,

all or a portion of the facility cost reimbursement requirement set

forth in Section 25.2 for Rate Schedule FSS, ISS, IPS and ILS if the

Customer provides Caledonia with adequate assurances of storage

quantities to make construction of the facilities economical to

Caledonia. All requests for waiver shall be handled by Caledonia in a

manner which is not unduly discriminatory. For purposes of determining

whether a project is economical, Caledonia will evaluate projects on

the basis of various economic criteria, which will include the

estimated storage quantities, cost of the facilities, operating and

maintenance as well as administrative and general expenses attributable

to the facilities, the revenue Caledonia estimates will be generated as

a result of such construction, and the availability of capital funds on

terms and conditions acceptable to Caledonia. In estimating the

revenues to be generated, Caledonia will evaluate the existence of

capacity limitations downstream of the facilities, the marketability of

the capacity, the Interruptible versus the Firm nature of the service,

and other similar factors which impact whether the available capacity

will actually be utilized.