Common use of Staged Contract Clause in Contracts

Staged Contract. FRS Zone 1 and FRS Zone 2 shippers who contract for fifty-nine months or more for capacity averaging 2,8001,400 103m3/d (10050 mmcf/d) or more for the term of the Transportation Agreement at one or more receipt points may stage their contracted capacity in annualizedperiodic tranche capacity commitments, provided that: (i) the Shipper commits to the staged capacity profile ("Staged Capacity Profile") at the commencement of the term of the Precedent Agreement which provides the volumetric commitments for each tranche for the term and the time at which each such tranche will begin and end during the term, and (ii) the first tranche of the Staged Capacity Profile shall commence December 1, 20152015, and each subsequent tranches in the Staged Capacity Profile shall commence on November 1 of each subsequent gas year for the term of the staged contractand/or on one other date during each gas year for the term as specified by ▇▇▇▇▇▇▇ in the Staged Capacity Profile. Notwithstanding the Shipper's average capacity over the term of the Transportation Agreement, each year Transporter shall only be required to transport for Shipper the volume committed by shipper in its Staged Capacity Profile for that year. The FRS Zone 1 or FRS Zone 2 toll for Staged Contracts will be the volume weighted average price for all tranches over the term of the contract. For example a shipper with the following production profile (volumes in 103m3/d): YearStart Date End Date # Months Volume Dec 1/2015 Oct 31/2020 59 2,1001,000 2Nov. 1/2016 Oct. 31/2020 48 3,500500 3May 1/2017 Oct 31/2020 42 4,100300 4Nov 1/2017 Oct 31/2018 12 4,100200 Annual Average 3,4601,634 would be deemed to have a 34-stage contract: a fifty-nine (59) month tranche for 2,1001,000 103m3/d, a forty-eight (48) month tranche for 1,400500 103m3/d, a forty-two (42) month tranche for 300 103m3/d and a twenty-four (24twelve (12) month tranche for 600200 103m3/d. The toll for the staged contract would be the volume weighted average for the three stages as per the formula below: SCT = (5yrVol x 5YrToll) + (3yrVol x 3YrToll) + (1yrVol x 1YrToll) (5yrVol+3YrVol +1yrVol) Where:

Staged Contract. FRS Zone 1 and FRS Zone 2 shippers who contract for fifty-fifty- nine months or more for capacity averaging 2,8001,400 1,400 103m3/d (10050 50 mmcf/d) or more for the term of the Transportation Agreement at one or more receipt points may stage their contracted capacity in annualizedperiodic periodic tranche capacity commitments, provided that: (i) the Shipper commits to the staged capacity profile ("Staged Capacity Profile") at the commencement of the term of the Precedent Agreement which provides the volumetric commitments for each tranche for the term and the time at which each such tranche will begin and end during the term, and (ii) the first tranche of the Staged Capacity Profile shall commence December 1, 201520152015, and each subsequent tranches in the Staged Capacity Profile shall commence on November 1 of each subsequent gas year for the term of the staged contractand/or and/or on one other date during each gas year for the term as specified by ▇▇▇▇▇▇▇ Shipper in the Staged Capacity Profile. Notwithstanding the Shipper's average capacity over the term of the Transportation Agreement, each year Transporter shall only be required to transport for Shipper the volume committed by shipper in its Staged Capacity Profile for that year. The FRS Zone 1 or FRS Zone 2 toll for Staged Contracts will be the volume weighted average price for all tranches over the term of the contract. For example a shipper with the following production profile (volumes in 103m3/d): YearStart Date End Date # Months Volume Dec 1/2015 Oct 31/2020 59 2,1001,000 2Nov. 1/2016 Oct. 31/2020 48 3,500500 3May 1/2017 Oct 31/2020 42 4,100300 4Nov 1/2017 Oct 31/2018 12 4,100200 Annual Average 3,4601,634 would be deemed to have a 344-stage contract: a fifty-nine (59) month tranche for 2,1001,000 1,000 103m3/d, a forty-eight (48) month tranche for 1,400500 500 103m3/d, a forty-two (42) month tranche for 300 103m3/d and a twenty-four (24twelve twelve (12) month tranche for 600200 200 103m3/d. The toll for the staged contract would be the volume weighted average for the three stages as per the formula below: SCT = (5yrVol x 5YrToll) + (3yrVol x 3YrToll) + (1yrVol x 1YrToll) (5yrVol+3YrVol +1yrVol) Where: