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Cardinal States Gathering, LLC, (“CSG”), a subsidiary of CNX Resources Corporation, hereby announces the commencement of a Non-Binding Open Season (“Open Season”) to solicit interest in new firm transportation service to be made available through reconfigurations and modifications to its existing pipeline system and the conversion of its CSG2 gathering line to interstate transmission service (the “Project”). The CSG2 line will be spun off into a new corporate entity, CNX Transmission LLC, which will file a certificate application to become an interstate pipeline subject to Federal Energy Regulatory Commission (“FERC”) jurisdiction.

Project Description

The CSG2 line is a 20-inch diameter, 30-mile long pipeline that extends from CSG’s existing Huff Creek Interconnect with Columbia Gas Transmission, LLC’s KA-20 pipeline in Wyoming County, West Virginia, to CSG’s existing interconnect with East Tennessee Natural Gas, LLC’s (“ETNG”) Jewell Ridge Lateral pipeline in Tazewell County, Virginia, as shown on the map below. After facility modifications, the CSG2 line will have a design capacity of up to 285,000 Dth/day.

The Project provides a transportation path for low cost local production as well as supply from the Marcellus and Utica producing areas to the high demand areas of ETNG and Transco Zone 5. CSG anticipates that the Project could be placed in-service as early as December 2018, subject to approval of the FERC.

CNX Transmission Map

CSG has entered into a Precedent Agreement with one Foundation Shipper, which has agreed to a primary term of 15 years at the maximum recourse rate. CSG considers the Foundation Shipper’s Precedent Agreement to be a prearranged conforming bid that is not subject to prorationing in the Open Season. The Foundation Shipper volumes will initially be 150,000 Dth/day, ramping down after each five year anniversary of service, for a total reduction of forty (40) percent over the course of the 15-year primary term. In this Open Season, CSG is offering interested shippers the opportunity to submit non-binding bids for the remaining approximately 135,000 Dth/day of firm transportation capacity from the Huff Creek Interconnect to the Jewell Ridge Interconnect.

Project Rates

Firm transportation service for the Project will be provided pursuant to the interstate pipeline’s FT Rate Schedule and Part 284(G) of the FERC regulations, as will be established in a new FERC Gas Tariff as part of this Project. The maximum recourse transportation rate for the Project will be based on the level of market participation and final design capacity of the Project's facilities. The estimated initial maximum recourse rate is approximately $0.11 per Dth per Day of Maximum Daily Transportation Quantity (“MDTQ”), calculated on a 100% load factor basis. In addition to the indicative reservation rate, shippers will be required to pay all applicable surcharges, usage charges, and fuel retention charges per the interstate pipeline’s FERC Gas Tariff.

Interested shippers may submit maximum recourse rate bids or negotiated rate bids for service over the Project as part of the Open Season.

Open Season Information

This Open Season shall commence on February 19, 2018 and end at 5:00 p.m. ECT on March 2, 2018. During the Open Season, interested parties must submit to CSG a fully executed copy of the attached Non-Binding Open Season Request Form, which must be signed by a duly authorized representative of the requesting shipper, specifying:

a) Maximum Daily Transportation Quantity (MDTQ). Shippers requesting a 15-year contract term have the option to reduce volumes after the first five years of service, subject to a maximum capacity reduction of 40% over the contract term.

b) Contract Term (15-year preferred contract term). CSG reserves the right to reject any request for transportation service with a primary term of less than ten (10) years commencing on the in-service date of the Project.

c) Receipt and Delivery Points with related volume(s).

d) Negotiated or Maximum Recourse Reservation Rate. If a negotiated rate is selected, then the shipper must propose a negotiated rate to be effective for the Contract Term. All negotiated rate shippers will be required to pay all applicable surcharges, usage charges, and fuel retention charges per the interstate pipeline’s FERC Gas Tariff.

The completed Non-Binding Open Season Request Form must be delivered to CSG by email or fax by 5:00 p.m. ECT on March 2, 2018, to either:

Chad Griffith, Fax: 724-485-4705;

Yemi Akinkugbe, Fax: 724-485-4705;

Bids shall not become binding until incorporated into mutually agreed-on definitive agreements. Bids will be treated as confidential and shall not be disclosed, except as authorized by the bidder or as required by applicable law or regulation.

Open Season Process

After the close of the Open Season, CSG will determine whether to hold a subsequent binding open season, or whether to proceed based on the bids received during the Open Season. If CSG decides to hold a subsequent binding open season, the bids received in this Open Season shall be deemed null and void.

If CSG decides to proceed with the bids received from this Open Season, CSG will evaluate the bids received during the Open Season on a net present value per unit of capacity basis. If the total amount of capacity requested during the Open Season totals more than 135,000 Dth/day of capacity such that allocation of capacity is required, CSG will allocate capacity to those prospective shippers that submitted the highest bids on a net present value per unit of capacity basis.

If CSG decides to proceed with the bids received from this Open Season, CSG will send each successful bidder a confidentiality agreement. Upon receipt of the executed confidentiality agreement, CSG will send the successful bidder a pro forma precedent agreement and credit application. Participating shippers will be asked to sign a binding Precedent Agreement within thirty days after they are notified of the award of capacity, which Precedent Agreement will include a credit agreement and, to the extent applicable, a negotiated rate agreement.

To the extent that capacity remains available in the Project following the completion of negotiations with all qualifying bidders in the Open Season, CSG reserves the right to negotiate mutually acceptable precedent agreements with any potential shippers for the remaining capacity upon request.

More information regarding the Project is available at:

If you have any questions regarding this Open Season, please contact:

Chad Griffith, Fax: 724-485-4705; Phone: 724-485-3117; Email:

Yemi Akinkugbe, Fax: 724-485-4705; Phone: 724-485-4079; Email:




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