Common use of Example 1 Clause in Contracts

Example 1. Remittance based on delivery of gas to the Gas Distributor in a month where the forecasted banked gas account attributed to the Gas Vendor is in a debit and the respective NYMEX ▇▇▇▇ Basis price is less than commodity rate specified by the Gas Vendor. Assume: Consumption = 10,000 m3 Delivery = 8,000 m3 NYMEX = $0.16 per m3 Commodity rate = $0.25 per m3 The Maximum Security Amount is calculated as follows: = banked gas account x NYMEX – (amounts collected – amounts remitted) = [consumption – delivery] x NYMEX – ([consumption x commodity rate] – [delivery x commodity rate]) = [10,000 – 8,000] x 0.16 – ([10,000 x 0.25] – [8,000 x 0.25]) = ‐$180 The calculation would be repeated for each banked gas account attributed to the Gas Vendor for each month of the applicable 12 month period and then summed up by month to determine the month with the maximum cumulative Maximum Security Amount. A negative cumulative Maximum Security Amount would represent no security required from the Gas Vendor.