Spreadsheet: phillip_m_love__30662__SyntheticProc-WK
Sheet: SYNTHETIC STORAGE (2A)

DESK (SYNTHETIC/PHYSICAL STORAGE BOOK) - w/ [NAME]
3rd Party (or Pipeline w/o Transport)
 |  | 1999-10-31 00:00:00
 | General [NAME]: | If the transaction is completed any time during the month prior to bidweek, and one of
 |  | or all of the leg(s) occurs in a future month;
2A.1 | TRADER
[NAME]: |  | Input the entire transaction as Exchange Buy(s) or Sell(s) with the ECT counterparty being the
 |  | ECT - Synthetic business unit for your region with risk assignment at mid to the cash desk.
 |  | Input the commodity fee as 0 to reflect actual cash flow (excluding fees).
 | Fee: | If fee is paid in volumes, net against appropriate position (Buy/Sell).
 |  | If the fee is monetary and payable or receivable, input into the Exchange Buy/Sell as an
 |  | Exchange Fee in the External Fee column on the deal in which payment is due/received.
 |  | Input the fee as follows on the applicable exchange deal:
 |  | ECT Paying Fee        Receiving Gas   ([NAME])   -   Fee is POSITIVE
 |  | Delivering Gas   (Exchange Sell)   -   Fee is NEGATIVE
 |  | [NAME][NAME])   -   Fee is NEGATIVE
 |  | Delivering Gas   (Exchange Sell)   -   Fee is POSITIVE
 |  | NOTE:   For downstream accounting, the fee must be in Sitara.  On Sitara Exchange Buy/
 |  | Sell deals with physical risk assignment, the exchange fee bridges only to CPR's
 |  | backscreen and is not included in intramonth economics.)
 |  | If fee is to be paid/received with no volume flowing, input fee as a deal level fee (on Terms tab).
 | Other: | Input terms in Sitara comment field (note "SYNTHETIC," dates, fee, volumes, special instructions).
 |  | and corresponding leg Sitara #.
 |  | Attach the Synthetic user tag on the Exchange deals.
 |  | Complete term sheet.  (Remember to include the Sitara deal numbers on the term sheet.)
 |  | Complete term sheet and place in the deal ticket basket.
 | Confirmation: | If confirmation is not received from the counterparty:
 |  | * Work with Confirmations group to draft individualized confirmation for deal.
 |  | * Review and approve confirmation (within 24 hours) when provided by Confirmations group.
 |  | If confirmation is received from counterparty, provide copy to Confirmations group.
If deal is modified: |  | If deal is modified, update [NAME] deal to reflect anticipated future flow dates and volumes.
 |  | * Prepare revised term sheet and place in the deal basket.
2A.2 | Risk Management
Trade Capture:
TAGG Input: |  | Input all legs as Buys & Sells and price as: .0001 (price), -.0001 (basis) & .0001 (phys. [NAME].)
 |  | in the appropriate book for your region.
 | Fee: | If fee is paid in $, input as separate leg as purchase physical annuity using 3rd party name.
 |  | If fee is paid in $, input as separate leg as sales physical annuity using 3rd party name.
 | Modification: | If volumes do not flow as scheduled or deal terms are modified, unwind applicable leg(s) and
 |  | rebook as separate leg(s).
Sitara: |  | Verify trader input per deal number(s) provided on term sheet.
Other: |  | Input TAGG# on Sitara deal in SCI.
 |  | Write TAGG and remaining Sitara deal numbers on term sheet.
Economics: |  | Include current month position(s) in daily P&L as Buy(s)/Sell(s) at Index plus mid-market
 |  | adjustment.  Make sure Mid-Market Index is correctly related to the TAGG deal.  If not, correct
 |  | the physical risk assignment on the Sitara deal to get the correct mid market index into CPR.
 |  | Include future month position(s) in daily P&L at Index + mid-market adjustment during bid
 |  | week when they become prompt month positions.
 | Fee: | If fee paid in $, it is a physical annuity in TAGG.  For downstream accounting, the fee must be
 |  | in Sitara.  NOTE:  On Sitara Exchange Buy and Sell deals with physical risk assignment , the
 |  | exchange fee bridges only to CPR's backscreen and is not included in intramonth economics.)
 | Manual: | Before bid week & at month-end, review deal volumes in Sitara to determine if any changes.
 |  | Discuss any issues with trader and/or Logistics.  Verify revisions to term sheets as needed.
 | [NAME]: | No special procedures necessary.
2A.3 | CONFIRMATIONS
Draft Confirmation: |  | If confirmation is not received from counterparty, work with trader to draft individualized
 |  | confirmation for deal.
 |  | Forward completed confirmation to trader for review.
 |  | Send confirmation to counterparty (24 hour turnaround).
 |  | If confirmation is received from the counterparty, obtain copy from trader.
If deal is modified: |  | An amended term sheet will be forwarded by Risk Management.
 |  | Work with trader to determine if deal should be reconfirmed.
2A.4 | CONTRACT ADMINISTRATION
Unify Desks
Contract: |  | Create a new Global exchange contract for each agreement with the counterparty.
 |  | The contract will link the Exchange Buy and Sell.
If deal is modified: |  | An amended term sheet will be forwarded by Risk Management.
 |  | If the deal is modified so that the end date is extended beyond the original "TO DATE", update
 |  | the contract expiration date in GLOBAL CONTRACTS.
Non-Unify Desks |  | Attach Exchange contract to [NAME] transaction (Exchange Buy and Exchange Sell).
 |  | Create a new Global exchange contract for each agreement with the counterparty.
 |  | The contract will link the Exchange Buy and Sell.
 |  | Set up S3/S4 contract for counterparty (new contract for each transaction) in Synergi
 |  | Global Contracts.
 |  | Notify scheduler of contract number when contract set-up is complete.
 |  | Set up sale contract for counterparty in Synergi and Global Contacts.
2A.5 | [NAME]
Unify Desks |  | Path transaction as [NAME] and Sell on the exchange contract.
 | Manual: | When scheduling 2nd half of deal, review volumes to make sure contracted volumes are flowing.
 |  | (i.e., Buy(s) & Sell(s)) volumes should equal unless the contracted receipt and delivery volumes
 |  | differ  -  information should be obtained from trader and/or pipeline.
 |  | Notify Economics if gas does not flow as scheduled.
Non-Unify Desks
Contract: |  | Obtain S3/S4 contract number from Contract Administration or Synthetic Storage Coordinator.
[NAME]: |  | Schedule transaction as Buy(s) and Sell(s) using designated S3/S4 contract.
 |  | Change deal type to "Interconnect" to prevent download to Synergi.
 |  | When scheduling 2nd half of deal, review volumes to make sure contracted volumes are flowing.
 |  | (i.e., Buy(s) & Sell(s)) volumes should equal unless the contracted receipt and delivery volumes
 |  | differ  -  information should be obtained from trader and/or pipeline.
 |  | Notify Economics if gas doesn't flow as scheduled.
[NAME]: |  | Manually input transaction into Synergi as transport using designated S3/S4 contract number.
 | Fee: | If fee is paid in volumes, volumes should be netted against receipts/deliveries.
 |  | If fee is paid in $, no input necessary.
Balancing: |  | Ensure volumes in Sitara/CPR equal those in Autonoms and Synergi.
 |  | Deals will appear on the CPR/Synergi/Autonoms Compare Report (because Buys and Sells
 |  | were changed to transport/storage).
Manual: |  | Before bid week and on last day of month, review deal volumes and work with Economics to
 |  | ensure volumes are properly accounted for (i.e., volumes for all legs should be equal).
2A.6 | DEAL VALIDATION
 |  | Attach Exchange contract to [NAME] transaction (Exchange Buy and Exchange Sell).
2A.7 | CASH MANAGEMENT
OA Variance: |  | No OA I variance will be created between Unify and Sitara.
Invoicing: |  | No invoice will be created because the commodity price is 0 unless ECT is billing the 3rd party
 |  | for the Exchange fee.
 |  | No payment will be accrued because the commodity price is 0 unless ECT is paying the 3rd
 |  | party for the Exchange fee.
 |  | Note: Watch for NEGATIVE fees on deals.  Some special handling may be required to get the
 |  | payment to the customer on these transactions.
2A.8 | CONTROLS GROUP
 |  | No procedures necessary.
2A.9 | VOLUME MANAGEMENT
OA Variance: |  | No OA I variance will be created between Unify and Sitara.
Invoicing: |  | If fee is paid in volumes no action necessary.
 |  | If fee is monetary $, Cash Management to handle.
2A.10 | GAS ACCOUNTING
Valuation: |  | No imbalance created because transactions pathed as buys and sells.
2A.11 | SHORT-TERM REPORTING
Valuation: |  | No imbalance created because transactions pathed as buys and sells.
Liquidations: |  | Treat all liquidations related to the TAGG # on the term sheet like a regular physical liquidation.