05/2007. 3 Working Smart For You Access to multiple Midwest markets Access to multiple supply sources Access to Michigan & Ontario storage fields Flexible.

05/2007

3

Working Smart For You

• Access to multiple Midwest markets

• Access to multiple supply sources

• Access to Michigan & Ontario storage fields

• Flexible services

• Flexible pricing

4

Great Lakes Gas Transmission

• Interstate natural gas transmission system

transporting gas for others

• Headquartered in Troy, MI. near Detroit

• $1.2 billion in assets

• $272 million in revenue in 2006

5

Great Lakes Gas Transmission & the Midwest/Northeast Pipeline Grid

6

Great Lakes Gas TransmissionTypical Peak Receipt/Deliveries

ANR PipelineCMS EnergyNorthern NaturalTransCanada PipeLinesUnion GasViking Gas

Carlton400 MMcf/d

Fortune Lake900 MMcf/d

Farwell650 MMcf/d (R)

Chippewa (CE)225 MMcf/d

Belle River (MC)

225 MMcf/d (R)

St. Clair1.6 Bcf/d

N

Emerson2.3 Bcf/d (R)

7

Facilities

• 2,000-mile, 36” diameter pipeline system

traverses Minnesota, Wisconsin, and Michigan

– MAOP 974 psi

• 14 compressor stations with combined 450,000

hp

• Over 60 receipt and/or delivery points

8

Forwardhaul or Backhaul

• Forwardhaul: bringing Western Canada

Sedimentary Basin gas to the Midwest and

Ontario

• Backhaul: supplying Manitoba, Minnesota,

Wisconsin, and Michigan markets from Dawn or

Chicago hubs

– Currently no fuel charges

9

Interconnects

Interconnects directly with TransCanada, Northern Natural, ANR, as well as:

In Minnesota

• Minnesota Energy Resources

• City of Duluth, MN

• Otter Tail Power

In Wisconsin

• NSP/Xcel

• Superior WL&P

In Michigan

• Bluewater Gas Storage

• Consumers Energy

• Detroit Edison (via SEMCO)

• MCV

• MichCon

• SEMCO

• WEPCo

10

Supply Options

• Western Canadian Sedimentary Basin

– via TCPL at Emerson

• Chicago hub supply

– via ANR at Fortune Lake and Farwell

• Dawn hub supply

– via TCPL at St. Clair

11

Storage Access

• Northern MI– 130 Bcf working gas

• Central MI– 289 Bcf working gas

• Southeast MI– 219 Bcf working gas

• Dawn, Ontario– 240 Bcf working gas

12

Eastern Zone Storage Access

Great Lakes Delivery/

Receipt Point

Storage Company

# of

Fields

Working Gas (Bcf)

Max. Field Deliverability

(MMcf/ d)

Deward ANR Storage 4 56 810

Farwell ANR Pipeline 10 193 4,300

Farwell MichCon 1 40 500

Chippewa Consumers Energy 15 130 2,800

Rattle Run Bluewater Gas Storage 1 3 100

Rattle Run Bluewater Gas Storage 1 27 700

Belle River Mills MichCon 4 124 2,550

Belle River Mills DTE/Washington 10 2 65 920

Total Michigan Access 638 Bcf 12.7 Bcf/ d

13

Michigan Production

• Production region

• Goose Creek & Jordan Valley

– 100 MMcf/d metering capability

– 105 Bcf production in 2006*

• Hudson

• Richfield

*Michigan Public Service Commission. Annual gas production summary.

14

Services

• Great Lakes offers a full menu of transportation services

– Standard FT Service (long-term, short-term, daily, intra-day)

– Limited Firm

– Interruptible

– Seamless service (off system capacity)

– Market Center services

15

FT & LFT Service

• Firm service

– Provided every day, without interruption

– Short term service for as little as one day

– Secondary point flexibility

– Intra-day available

• Full MDQ over less than 24 hours

16

FT & LFT Service

• Limited Firm service

– Available for a pre-determined number of

days within a pre-determined time period

(i.e., available 120 out of 151 days)

– May be lower cost alternative firm service

17

Short Term Services

• Firm services offered daily

– Daily and intra-day longhaul

– Daily shorthaul

• Short-term FT customers treated equal to long-

term FT customers

• Subject to auction process

18

Auction Procedures

• Auctions take place in GLConnect

– Requires username and password

• Bidders should have credit coverage for the

term they are bidding

– Or subject to pre-pay

• All posted bids are binding

19

Auction Procedures

• Nearly all auctions are blind (closed)

• Bidders can enter multiple bids under the same

entity name

– Total MDQ can’t exceed offered MDQ

• Unsold auction capacity will be sold on a first-

come, first-served basis at the highest awarded

bid rate

– Until 2:00 p.m. CCT

20

Auction Timing

• Term services (monthly, seasonal, annual)– Posted for 25-49 hours, ending at 9:00 a.m. CCT

• Next-day offerings– Posted 8:00 a.m. – 9:00 a.m. CCT

• Intra-day offerings– Posted 9:00 a.m. – 9:30 a.m. CCT on weekdays– Posted 9:30 a.m. – 10:00 a.m. CCT on weekends

and holidays

21

Segmentation

• Firm transporters can segment capacity within

path to serve multiple markets

• Forwardhaul and backhaul gas to a common

delivery point or from a common receipt point

– Increase receipt & delivery volumes with no

reservation cost increase to maximum rate

contracts

22

Segmentation Flexibility

Emerson

St. Clair

FortuneLake

Farwell

100

100

100

EXAMPLE:100 Mdth/d Emerson to St. Clair contract

Total Emerson Receipt: 100 Mdth/dTotal Farwell Receipt: 200 Mdth/dTotal Fortune Lake Deliv: 200 Mdth/dTotal St. Clair Delivery: 100 Mdth/d

23

Capacity Release

• Firm shippers have the right to release capacity

to qualified third parties

– Full or partial MDQ

– Segmented releases

24

Interruptible Service

• Less expensive than FT

• Typically used for shorter paths and/or

backhauls on a short-term basis

• Not subject to the auction process

25

Seamless Service

• Contract with Great Lakes to/from points on

other pipelines

– Example: Chicago to Dawn service

• Great Lakes acquires transportation on

interconnecting pipeline

• One rate, one nomination – Great Lakes does

the rest

26

Market Center Services

• Parks and loans available (as system conditions

permit) at all receipt and delivery points

• Title transfers available at all receipt and

delivery points

– Currently no charge

• Interruptible in nature

27

Cost Based Rates

• Three zone system

– $0.12/dth to Carlton (Northern Natural)

• Approximately 1.2% fuel

– $0.20/dth to Fortune Lake (ANRPL)

• Approximately 2.0% fuel

– $0.35/dth to St. Clair (TransCanada)

• Approximately 3.5% fuel

28

Transporter’s Use

• 13 fuel segments

• Determined by the 15th of each month

Number of segments

12-month average*

8 2.20%

9 2.47%

10 2.73%

11 2.99%

12 3.25%

13 3.47%

* As of May. Actual fuel percentages posted on www.glgt.com.

Number of segments

12-month average*

1 0.30%

2 0.58%

3 0.85%

4 1.12%

5 1.39%

6 1.66%

7 1.93%

29

Progressive Pricing Policies

• Negotiated rate authority

• Market sensitive rates on short term services

– Posted daily as available

– Discounts may apply to secondary points

30

Progressive Pricing Policies

• Rate ranges

– Floor and ceiling capped rates

• Pricing certainty

– Locking in price for longer term

• Seasonal firm service

– Variable MDQ for seasonal needs

31

Working Smart For You

• Access to multiple Midwest markets

• Access to multiple supply sources

• Access to Michigan & Ontario storage fields

• Flexible services

• Flexible pricing