Notice Text. Notice 17238/Previous Notice 17236

Transcription

1 TSP Name: El Paso Natural Gas Company,L.L.C TSP: Notice ID: Critical: N Notice Type Desc: Other Notice Stat Desc: Initiate Subject: Revised Line 1600 to Waha Open Season (17238) Prior Notice: Notice Eff Date: 06/01/2017 Notice Eff Time: 01:56:24 PM Reqrd Rsp Desc: No response required. Post Date: 06/01/2017 Post Time: 03:01:19 PM Notice Text Notice 17238/Previous Notice El Paso Natural Gas Company, L.L.C. ("EPNG") is providing this supplement to EBB Notice 17236, which contains additional links to the Open Season and Bid Sheets that can be downloaded in Microsoft Word and Adobe Acrobat formats. No additional modifications have been made in this supplement to EBB Notice EBB Notice - El Paso Natural Gas Company, L.L.C. Open Season DESCRIPTION OF AVAILABLE AND ENHANCEMENT CAPACITY Responding to market interest for firm transportation capacity to serve customers in the Permian Basin, El Paso Natural Gas Company, L.L.C. ("EPNG") is conducting a Binding Open Season for up to 514,184 dekatherms ("Dth") per day of capacity originating from existing or new receipt points on EPNG's Line No east of Gresham Station to delivery points at or near EPNG's Waha Compressor Station, as further described below. AVAILABLE CAPACITY EPNG has available the following unsubscribed capacity ("Available Capacity") which requires no system enhancements: Maximum Available Quantity: 21,184 Dth per day Primary Receipt Points: Existing or new receipt points on Line No east of EPNG's Gresham Station. Primary Delivery Points: Existing or new delivery points at or near EPNG's Waha Compressor Station. Alternate Receipt Points: All available alternate receipt points on EPNG's Line No east of EPNG's Gresham Station at the awarded contract rate as of the date the successful bidder enters into a Firm Transportation Service Agreement ("FTSA") with EPNG. Alternate Delivery Points: All available alternate delivery rights for all within Permian Basin points (STML PER) at the awarded contract rate as of the date the successful bidder enters into an FTSA with EPNG. Minimum Bid Term: EPNG recommends a minimum bid term of not less than one (1) year (although EPNG reserves the right to reject any bids inconsistent with the terms and conditions of this open season regardless of term). Capacity Start Date: As early as August 1, 2017, but no later than March 1, Prospective bidders interested in capacity having receipt and/or delivery locations, terms or quantities different from those stated above should contact their Business Development representative for additional information.

2 CORNUDAS ENHANCEMENT CAPACITY With certain system enhancements including station yard piping and valve modifications at EPNG's Cornudas Compressor Station (the "Cornudas Modifications"), EPNG can increase the quantity available from Line No to the Waha Compressor Station by to up to 200,000 Dth per day ("Cornudas Enhancement Capacity"): Maximum Available Quantity: Up to 200,000 Dth per day Primary Receipt Points: Same as for Available Capacity (see above) Primary Delivery Points: Same as for Available Capacity (see above) Alternate Rec./Del. Points: Same as for Available Capacity (see above) Minimum Bid Term: EPNG recommends a minimum bid term of five (5) years (although EPNG reserves the right to reject any bids inconsistent with the terms and conditions of this open season regardless of term). Capacity Start Date: The in-service date of the Cornudas Modifications. Subject to EPNG's receipt of sufficient shipper commitments and timely receipt of all necessary regulatory approvals, permits, and other authorizations required for the construction and operation of the Cornudas Modifications, in a form and substance satisfactory to EPNG in its sole discretion, EPNG anticipates the ability to achieve an in-service date as early as March 1, GRESHAM ENHANCEMENT CAPACITY If EPNG receives bids for more than the 200,000 Dth/day of Cornudas Enhancement Capacity, then with certain system enhancements including station yard piping and valve modifications at EPNG's Gresham Compressor Station (the "Gresham Modifications"), EPNG can increase the quantity available from Line No to the Waha Compressor Station by up to 493,000 Dth per day ("Gresham Enhancement Capacity"): Maximum Available Quantity: Up to 493,000 Dth per day Primary Receipt Points: Same as for Available Capacity (see above) Primary Delivery Points: Same as for Available Capacity (see above) Alternate Rec./Del. Points: Same as for Available Capacity (see above) Minimum Bid Term: EPNG recommends a minimum bid term of five (5) years (although EPNG reserves the right to reject any bids inconsistent with the terms and conditions of this open season regardless of term). Capacity Start Date: The in-service date of the Gresham Modifications. Subject to EPNG's receipt of sufficient shipper commitments and timely receipt of all necessary regulatory approvals, permits, and other authorizations required for the construction and operation of the Gresham Modifications, in a form and substance satisfactory to EPNG in its sole discretion, EPNG anticipates the ability to achieve an in-service date as early as March 1, LENGTH OF OPEN SEASON This Open Season will commence at 9:00 a.m., Mountain Time ("MT"), on May 31, 2017, and will close at 1:00 p.m., MT, on July 14, EPNG reserves the right to extend or modify this Open Season by posting a notice on its Electronic Bulletin Board (EBB). Successful bidder(s) will be notified by 4:00 p.m., MT, on July 18, SUBMISSION OF BIDS Parties interested in bidding in this Open Season should submit completed Bid Sheet(s) (in the form attached hereto) to EPNG before the close of the open season via at the following address: KMWestBids@KinderMorgan.com.

3 By submitting Bid Sheet(s) to EPNG, the bidding party certifies that (a) all information contained in the request is complete and accurate, (b) it satisfies, or will be able to satisfy, all the requirements of EPNG's Federal Energy Regulatory Commission ("FERC") Gas Tariff, Third Revised Volume No. 1A, as the same may be amended from time to time ("EPNG's Tariff"), and (c) the person submitting the bid has full authority to bind the bidding party. The bid rate must be presented as the reservation rate per Dth/month or stated as the maximum tariff rate. In addition to the bid rate, each bid shall be subject to the applicable maximum usage rate and maximum usage surcharges, all other maximum rates, charges and surcharges, including ACA, Fuel and lost and unaccounted-for gas ("L&U"), and any other authorized surcharges assessed under the applicable Rate Schedule of EPNG's Tariff as those amounts maybe amended or superseded from time-to-time. This includes incremental lateral charges and any third party charges resulting from the use of capacity that EPNG may hold on other pipelines. Subject to the receipt of all required regulatory approvals, EPNG plans to designate the East of Gresham to Waha path as a no-fuel segment contingent upon completion of the Cornudas Modifications or the Gresham Modifications; provided, however, that nothing in this Open Season will in any way obligate EPNG to pursue or continue this no-fuel designation in the future. Any shippers using the East of Gresham to Waha segment will remain subject to EPNG's applicable L&U charges. EPNG reserves the right to reject negotiated rate bids, bids that have rates less than the maximum recourse rate, bids stated as the dollar equivalent of the current maximum recourse rate, bids that are incomplete, contain offers of varying rates within the term, contain additional or modified terms or are inconsistent with the provisions of EPNG's Tariff. EPNG also reserves the right to reject bids for quantities that are not for the same quantity for the duration of the term. EPNG anticipates that negotiated rate bids of not less than $2.74 per Dth per month (which, for illustrative purposes, is equivalent to $0.09 per Dth on a daily basis) will be required in order to economically justify EPNG's capital investment in the Cornudas Modifications and make available up to 200,000 Dth/day of Cornudas Enhancement Capacity. EPNG anticipates that negotiated rate bids of not less than $2.13 per Dth per month (which, for illustrative purposes, is equivalent to $0.07 per Dth on a daily basis) will be required in order to economically justify EPNG's capital investment in the Gresham Modifications and make available up to 493,000 Dth/day of Gresham Enhancement Capacity. The Bid Sheet accompanying this Open Season provides bidders the opportunity to submit contingent bids which would allow for (i) a higher rate bid in the event EPNG receives bids supporting investment only in the Cornudas Modifications (yielding capacity of up to 200,000 Dth/day) and (ii) a lower rate bid in the event EPNG receives bids supporting investment only in the Gresham Modifications (yielding capacity of up to 493,000 Dth/day). Bidders will also have the ability to bid a single rate for both the Cornudas Enhancement Capacity and the Gresham Enhancement Capacity. If EPNG does not receive maximum recourse or negotiated rate bids for quantities and terms sufficient to economically justify EPNG's capital investment in the project(s), then EPNG reserves the right not to move forward with either of the projects described in this Open Season, or to negotiate with bidders to propose a more appropriately sized expansion at a corresponding rate. Existing shippers with capacity on EPNG's system that could be used in lieu of the Cornudas Modifications or the Gresham Modifications should notify EPNG if they wish to permanently turnback their capacity through a release to prospective shippers in this Open Season. Those who wish to so release their capacity should notify EPNG of the amount, the term, and any other conditions that would be necessary to effectuate such a release of their capacity. Such notices should be submitted to EPNG before the close of the Open Season. EPNG notes that FERC Order No. 894, in some cases, prohibits multiple affiliates of the same entity from bidding in an open season for capacity in which the pipeline may allocate capacity on a pro rata basis. It appears to

4 EPNG that the restrictions imposed by FERC Order No. 894 will be applicable in this Open Season and FERC recommends that potential bidders review and adhere to the requirements of that FERC Order. Although this is a binding open season, EPNG reserves the right, in its sole discretion, to consider requests for Cornudas Enhancement Capacity and/or Gresham Enhancement Capacity received after the close of the Open Season period, including requests to modify a participant's validly submitted bid, but shall be under no obligation to do so. EPNG will review all bids and award capacity based upon the criteria outlined below. EVALUATION CRITERIA If EPNG receives bids for capacity in excess of the actual amount of available capacity, then the capacity will be allocated based on the Present Value (PV) of the bids that generate the highest PV to EPNG. PV will be the sum of the present values for all of the months of service. Bids stating a commencement date upon the in-service date of any to-be-constructed facility will be evaluated using EPNG's estimate of the completion date of the required facilities. The present value for each month will be calculated as follows: PV = (R X Q)/((1+i) to the power of n) Where: R = the monthly reservation bid rate Q = the monthly bid quantity i = the monthly discount rate (the annual discount rate of 3.71% divided by 12). n = the number of months from the earliest date the capacity is available in the open season to the month the revenue will be received (the first month capacity is available n = 1, the second month n = 2, and so on) In accordance with EPNG's Tariff, if there is not sufficient capacity available to meet all acceptable bids, EPNG will award first to the bidder having the highest acceptable PV, followed by the bidder having the second highest acceptable PV, etc., until such time as the capacity is completely awarded (recognizing that bidders with lower PVs may have their bids prorated unless they have expressly elected otherwise in the Open Season Bid Sheet). If two or more acceptable bids are of equivalent PV, then the capacity will be allocated pro rata among those bidders, unless the affected bidders have elected not to have their bids prorated (as indicated on their Open Season Bid Sheet(s)). Each successful bidder shall enter into an FTSA reflecting the terms of its bid as awarded by EPNG. The FTSA will be consistent with the appropriate form of service agreement contained in EPNG's Tariff. CREDITWORTHINESS REQUIREMENTS The successful bidder(s) must satisfy the creditworthiness requirements of EPNG's Tariff. A bidder that is unable to satisfy the general creditworthiness provisions set forth in EPNG's Tariff shall provide additional credit support (in the form of a Letter of Credit, a guaranty from a party that satisfies the creditworthiness standards, or such other form that is acceptable to EPNG in its sole discretion). CONTACT INFORMATION Questions concerning this Supplemental Open Season should be directed to Greg Ruben ( ) or Ken Ulrich ( ) in the Business Development department. FORM OF BID SHEET

5 Form of Service: FT Bid To: A. Shipper Information: Legal Name of Bidder: Name of Requesting Party: Title of Requesting Party: DUNS Number: Phone: B. Available Capacity Bid: Requested Term Start Date: Requested Term End Date: Transportation Contract Demand: Dth/day Will you accept a pro rata allocation of capacity if necessary? Yes No Primary Receipt Point(s) Maximum Daily Receipt Quantity (in Dth/Day) Primary Delivery Point(s) Maximum Daily Delivery Quantity (in Dth/Day) Total Receipt Quantity Total Delivery Quantity Alternate Receipt Point(s): All available alternate receipt points on EPNG's Line No east of EPNG's Gresham Station, at the awarded contract rate, as of the date the successful bidder enters into an FTSA with EPNG. Alternate Delivery Point(s): All available alternate delivery rights for all within Permian Basin points (STML PER), at the awarded contract rate, as of the date the successful bidder enters into an FTSA with EPNG. Note: Any bidder seeking to utilize any to-be-constructed point(s) of receipt and/or delivery may identify an existing alternate point(s) of receipt and/or delivery for use prior to the in-service date of the to-be-constructed point(s). Rate: EPNG's maximum recourse rate Discounted Recourse Rate: $ per Dth per Month Negotiated Rate: $ per Dth per Month In addition to the bid rate, successful bidders will be subject to the applicable maximum usage rate and maximum usage surcharges, all other maximum rates, charges and surcharges, including ACA, Fuel and L&U, and any other authorized surcharges assessed under the applicable Rate Schedule of EPNG's Tariff as those amounts maybe amended or superseded from time-to-time. This includes incremental lateral charges and any third party charges resulting from the use of capacity that EPNG may hold on other pipelines. C. Enhancement Capacity Bid: Requested Term Start Date: Requested Term End Date: Transportation Contract Demand: Dth/day Will you accept a pro rata allocation of capacity if necessary? Yes No

6 Primary Receipt Point(s) Maximum Daily Receipt Quantity (in Dth/Day) Primary Delivery Point(s) Maximum Daily Delivery Quantity (in Dth/Day) Total Receipt Quantity Total Delivery Quantity Alternate Receipt Point(s): All available alternate receipt points on EPNG's Line No east of EPNG's Gresham Station, at the awarded contract rate, as of the date the successful bidder enters into an FTSA with EPNG. Alternate Delivery Point(s): All available alternate delivery rights for all within Permian Basin points (STML PER), at the awarded contract rate, as of the date the successful bidder enters into an FTSA with EPNG. Note: Any bidder seeking to utilize any to-be-constructed point(s) of receipt and/or delivery may identify an existing alternate point(s) of receipt and/or delivery for use prior to the in-service date of the to-be-constructed point(s). Rate: EPNG's maximum recourse rate Discounted Recourse Rate: $ per Dth per Month Negotiated Rate: $ per Dth per Month if EPNG constructs the Cornudas Modifications $ per Dth per Month if EPNG constructs the Gresham Modifications In addition to the bid rate, successful bidders will be subject to the applicable maximum usage rate and maximum usage surcharges, all other maximum rates, charges and surcharges, including ACA, Fuel and L&U, and any other authorized surcharges assessed under the applicable Rate Schedule of EPNG's Tariff as those amounts maybe amended or superseded from time-to-time. This includes incremental lateral charges and any third party charges resulting from the use of capacity that EPNG may hold on other pipelines row(s) retrieved