Re: Clarification of "First of the Month" Termination Date

Cheryl and all -as we discussed- the Contract should terminate at 9am on the
last day of the Month.

Steve Van Hooser
10/03/2000 12:26 PM

To: Cheryl Dudley/HOU/ECT@ECT
cc: Amelia Alland/HOU/ECT@ECT, Dan J Hyvl/HOU/ECT@ECT, Donald P
Reinhardt/HOU/ECT@ECT, Gerald Nemec/HOU/ECT@ECT, Jackie Morgan/HOU/ECT@ECT,
Linda S Bryan/HOU/ECT@ECT, Melissa Graves/HOU/ECT@ECT, Sandi M
Braband/HOU/ECT@ECT, Shawna Flynn/HOU/ECT@ECT, Shonnie Daniel/HOU/ECT@ECT,
Vance Taylor/HOU/ECT@ECT Rebecca Cantrell
Subject: Re: Clarification of "First of the Month" Termination Date

Cheryl,

It is my understanding that HPL made a decision in 1998, for commericial
reasons, to adopt the GISB Gas Day that all interstate pipelines are required
to observe. See definition below. I know that the transportation contract
have been revised to reflect the 9:00 am Central Clock Time convention. As
to the termination letter issue raised in your letter, I'm assuming that you
are working that out with Shawna Flynn.

Steve Van Hooser

Gas Industry Standards Board Business Practice Standards
Standards and Models Relating To Nominations, Flowing Gas, Invoicing,
Electronic
Delivery Mechanisms, Capacity Release Contracts
Interpretations
Book 1 of 2
Containing Principles, Definitions, Standards and Models
Version 1.4
August 31, 1999
Standards:
1.3.1 Standard time for the gas day should be 9 a.m. to 9 a.m. (central clock
time).

Cheryl Dudley
10/02/2000 03:17 PM

To: Shawna Flynn/HOU/ECT@ECT, Sandi M Braband/HOU/ECT@ECT, Shonnie
Daniel/HOU/ECT@ECT, Dan J Hyvl/HOU/ECT@ECT, Gerald Nemec/HOU/ECT@ECT, Steve
Van Hooser/HOU/ECT@ECT, Melissa Graves/HOU/ECT@ECT, Donald P
Reinhardt/HOU/ECT@ECT, Vance L Taylor/HOU/ECT@ECT
cc: Linda S Bryan/HOU/ECT@ECT, Amelia Alland/HOU/ECT@ECT, Jackie
Morgan/HOU/ECT@ECT
Subject: Clarification of "First of the Month" Termination Date

Unless there have been recent changes of which I am unaware, a "gas day" runs
from 8:00 a.m. on one day until 8:00 a.m. on the next day. Based on this
premise, I need to get a clarification of what you actually mean when you do
a termination letter stating that a contract will be terminated on the first
of a particular month.

As the systems currently work, if a termination date is entered as the first
of any month, the deal is rolled over in Sitara for the ENTIRE month.

If Sitara was changed to better read the dates from Global Contracts, it
would still roll the deal over & allow gas to flow through the 1st (which
would actually be until 8:00 a.m. on the 2nd).

When you terminate a contract on the first of any month:

Do you mean that gas should only flow through the end of the previous month
(which would end at 8:00 a.m. on the 1st of the next month)?

or

Do you mean that gas should flow through the end of the 1st day of the month
(which would end at 8:00 a.m. on the 2nd of the month)?

or

Can it be either, based on the individual situation? (If so, please explain.)

Please let me know your views on this issue. I have requested the IT group
to change all of the "1st of a month" termination dates in Global Contracts
to the last day of the previous month in order to prevent Sitara from
assuming that the deal is good for the entire next month. But, before they
act on this request, we want to make sure that we are interpreting the
meaning correctly.

Thanks in advance for your help.