RE: SBA Contracts

Michele,
I'm not sure the information is readily available, if available at all. TMS data is only maintained, without extraordinary measures, for 6 months. It is my recollection that there may have been an allocation at a point where SBA gas was scheduled and when that occurred the standard allocation procedures were enforced. I think once we asked the shipper to move the SBA activity to another point, but that was pre GISB. Unfortunately, because of the how the SBA's work, the pack, draft and peak points are negotiated in advance which limits the points to use. Also, the 28-30 hr lead time required for notification means that we have to anticipate what system conditions will become and therein use SBAs to improve system conditions. Sometimes we miss the mark, either cold weather does not materialize or moves in late or shipper activity increases and in hindsight, an SBA was not necessary.

Reyna may have some additional insight in more recent SBA activities.

-----Original Message-----
From: Medeles, Gerry
Sent: Wednesday, November 14, 2001 2:31 PM
To: Winckowski, Michele; Bodnar, Michael; Blair, Lynn
Cc: Cabrera, Reyna
Subject: RE: SBA Contracts

I am not sure I understand the question. Do you mean at anytime we call on SBA volumes, we never/should not allocate the location?

-----Original Message-----
From: Winckowski, Michele
Sent: Wednesday, November 14, 2001 1:32 PM
To: Bodnar, Michael; Blair, Lynn
Cc: Cabrera, Reyna; Medeles, Gerry
Subject: RE: SBA Contracts

I guess the question is - have we ever actually reviewed when we call on the SBA volumes and what the system conditions have been during those periods. We want to verify that we are not allocating a point when we have SBA gas flowing. Theatrically, we argue that we would not call on SBAs if the gas was not needed to meet system requirements. We' want to verify that the theory and the actual match up. I hope this makes sense. Thanks MW

-----Original Message-----
From: Bodnar, Michael
Sent: Wednesday, November 14, 2001 1:15 PM
To: Winckowski, Michele; Blair, Lynn
Cc: Cabrera, Reyna; Medeles, Gerry
Subject: RE: SBA Contracts

Yes, you are correct. The changes in the business requirements for the scheduling priority of SBA contracts will not impact NNG's primary firm shippers. What do you need to verify and support this fact?

-----Original Message-----
From: Winckowski, Michele
Sent: Monday, November 12, 2001 2:53 PM
To: Blair, Lynn; Bodnar, Michael
Subject: SBA Contracts

Contract Shippers Contract Date

107018 Tenaska Marketing Ventures Nov 1 2000
107019 Texaco Gas Marketing Nov 1 2000
107021 OGE Energy Resources Nov 1 2000
107989 Tenaska Marketing Jun 1 2001
108021 Arkla Energy Marketing Co. Jul 1 2001
108284 Tensaka Marketing Ventures Nov 1 2001
108290 Texaco Gas Marketing Nov 1 2001
108281 El Paso Merchant Energy Nov 1 2001
108282 UtiliCorp United, Inc. Nov 1 2001
108283 Engage Energy American Nov 1 2001

These are the SBA contracts that were provided during the due diligence. I'd like to be able to verify and support that the changes in the business requirements for the scheduling priority for these SBA contracts do not result in an impact to NNG's primary firm shippers. Your assistance would be greatly appreciated. Thanks MW