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Gas allocation agreements

able to reflect his gas buyers nomination rights under the allocation agreement and,
as part of the service under the transportation and processing agreements, the system
operator will be expected (by the system users) to operate the system so as to deliver
in each allocation period the aggregate of users nominations at each gas redelivery
point (in this case, the power station and the national transmission system) with a
high degree of accuracy. System users will not normally nominate redeliveries of
specific quantities of natural gas liquids, but will be obligated to take delivery of and
export from the gas processing plant (usually by pipeline) whatever quantities of
natural gas liquids are allocated and attributed to them, as a result of processing the
required quantity of gas to ensure that the gas nominations are met.
In determining amounts to be attributed to system users in each output stream
in each allocation period, upstream allocation agreements often take into account
additional criteria over and above the system users respective inputs into the system
and their nominations for gas redeliveries from it, for example:
whether the user had booked firm transportation and processing capacity in
respect of such nomination, or whether the user is relying on a reasonable
endeavours (ie operationally interruptible) transportation and/or processing
right; and
whether the users nominations were timely or were given or changed after
an applicable nomination gate closure (typically this would give higher
priority to nominations made on Day D-1).
The attribution rules may incorporate the above concepts into an attribution
hierarchy, which is used to allocate (between the users) any shortfall or excess
amounts of aggregate metered gas redelivery quantity (eg, to the national
transmission system) in an allocation period as compared with users aggregate
nominations. The raison dtre for incorporating concepts such as firmness of
transportation/processing capacity and timeliness of nominations into the
attribution hierarchy is to give value to the higher cost of booking firm capacity and
to incentivise users to nominate (or re-nominate) in a timely fashion.
6.3

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Pipeline stock
Gas pipelines of a significant length are able to store a substantial amount of gas and
can operate safely within a range of pressures and operating conditions. The ability
to store gas in the offshore pipeline system as linepack without immediately
delivering it to the onshore gas processing plant potentially gives the users of such
facilities increased flexibility and gas deliverability.
One question for the transportation and processing agreement and for the
allocation agreement is whether the users of the system should be allowed to use the
pipeline storage capability as part of the service they have paid for, whether they
should pay extra for it, or whether the benefit of such storage capability should be
reserved for the owners and the operator of the pipeline system.
Where the users are not entitled to access the pipelines storage capability, in
each allocation period their inputs into the system need to balance (on an energy
basis) their offtakes from the system in gas and natural gas liquids, except where the

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