Notice Text:

Subject: Open Season for Gulf Trace Project

Transcontinental Gas Pipe Line Company, LLC (“Transco”) hereby announces a binding open season for its Gulf Trace Project (referred to herein as the “Project”) which will provide incremental, year round firm transportation capacity beginning as early as January 1^st, 2017.  The binding open season will commence on April 16^th, 2014 and end at 3 p.m. C.D.T. on May 8^th, 2014.

Project Path

Transco anticipates the Project will provide up to 1,200,000 dt/day of firm transportation capacity from Transco’s Station 65, Zone 3 Pool in St. Helena Parish, Louisiana to a new interconnect adjacent to the Sabine Pass Liquefaction Terminal in Transco’s Zone 2 in Cameron Parish, Louisiana.

Maps

A map depicting the Project is available here.

Rates

The firm transportation service will be performed under Transco’s Rate Schedule FT and Part 284 (G) of the Federal Energy Regulatory Commission’s (“FERC”) regulations.  At this time, based on the estimated cost of service associated with the Project facilities needed to provide the transportation capacity, Transco anticipates the Project will qualify for rolled in rates.  Accordingly, Transco expects that the recourse reservation rate under the Project will be the Rate Schedule FT – Non-Incremental daily reservation rate for firm transportation service from Zone 3 to Zone 2 (currently $0.13605 per dt, excluding the electric power unit rate).  As further described in the attached Binding Open Season Transportation Request Form, Transco will consider, but will not be obligated to accept, requests for firm transportation service under this binding open season at rates that are lower than such rate. 

In addition, shippers will be responsible for compressor fuel and line loss make-up retention, electric power charges, commodity charges and all applicable surcharges as approved by the FERC for firm transportation service under the Project.  Transco will propose rolled-in treatment of the Project compressor fuel and electric power charges in the FERC application subject to review, approval, and/or modification during the FERC approval process. 

Term

The primary term is 20 years; Transco shall not accept any requests for firm transportation service under the Project with a requested primary term other than 20 years.

Open Season Procedure

As indicated above, this open season will commence on April 16^th, 2014 and end at 3 p.m. C.D.T. on May 8^th, 2014.

Accordingly, any shipper desiring firm transportation service under the Project must complete and submit to Transco the attached Binding Open Season Transportation Request Form on or before 3 p.m. C.D.T. on May 8^th 2014.  In addition, any shipper desiring firm transportation service under the Project must execute and deliver to Transco on or before June 9^th, 2014 (or such later date as may be determined by Transco) a precedent agreement, which shall be substantially similar in form and substance to the form of precedent agreement which shall be provided to prospective shippers upon request.  All requests for the form of precedent agreement should be directed to Ross Conatser by telephone at (713) 215-2958 or at the address provided on the attached Binding Open Season Transportation Request Form. 

The Binding Open Season Transportation Request Form is available here.

Prior to commencement of this binding open season, Transco executed a precedent agreement with a shipper for firm transportation service under the Project.  In consideration of this substantial, early commitment that has enabled Transco to pursue the Project, this shipper is considered an “Anchor Shipper” under the Project. 

Any shipper requesting a Transportation Contract Quantity (TCQ) of at least 750,000 dt/day will qualify as an Anchor Shipper under the Project.  Anchor Shippers will receive priority with regard to allocation of the Project capacity (if necessary, as described below).

Upon receipt of all timely submitted Binding Open Season Transportation Request Forms, Transco will evaluate the total capacity requested and, if necessary, make an initial allocation under the process described below.  This initial allocation, if any, will be reflected in the precedent agreements to be provided by Transco for execution by shippers under this binding open season.

Upon receipt of all executed precedent agreements, Transco will again evaluate the total capacity requested under the executed precedent agreements and, if necessary, make an additional allocation under the process described below.

If the total capacity requested in the binding open season or under the binding precedent agreements exceeds the planned scope of the Project, Transco, in its sole discretion, may revise the scope of the Project (which may include cancelling the Project) and/or allocate the available firm transportation capacity under the Project.

If an allocation of capacity under the Project is performed by Transco, capacity will be allocated first to the shipper(s) bidding the highest daily reservation rate(s) for firm transportation service under the Project, with priority among shippers bidding the same daily reservation rate being given to the Anchor Shippers with (i) any allocation among Anchor Shippers being pro rata based on their requested TCQs and (ii) any allocation among non Anchor Shippers being pro rata based on their requested TCQs.

The TCQs indicated in the Binding Open Season Transportation Request Form and ultimately set forth in each shipper's executed precedent agreement will be subject to such allocation procedures and the other terms and conditions of this binding open season.  In the event that a final allocation occurs, Transco will provide notice to each shipper of its allocated TCQ, if any, by August 8^th, 2014.

Shippers will be responsible for confirming the availability of their requested receipt and delivery points with the point operators.  Please note that the individual receipt and delivery meter capacities in most cases will be less than the firm transportation capacity under the Project.

Transco reserves the right to reject any requests for service under the Project on a not unduly discriminatory basis.

If you have any questions regarding this binding open season, please contact Ross Conatser at (713) 215-2958.