 Mod 380 is the long term solution for AQ  Consider options for an interim solution  Investigating 3 options  Analysis will tell us which are feasible  Analysis still being undertaken on these options  Use of extended AQ Appeal Process  New managed AQ Appeal Process  AQ appeal mid year (Apr) Options for mid-year AQ Change

Enhanced AQ Appeals Process Extend appeals process to SSPs Use results of AQ trial Calc as a guide to largest AQ movers Use existing AQ mechanisms including re- confirmation process Need to ration numbers otherwise this would cause system constraints Potential for gaming exists

AQ Correction Process Once again results of Trial calc could be trigger Will apply to SSPs New process to automatically update AQ values rather than reconfirmation. Shippers to specify MPRNs that they wish to amend Xoserve to manage workflow to protect system Potential for gaming exists

Bi-annual AQ Review Undertake additional AQ Review April for LSPs and SSPs Extension of trial Calc May not include an AQ amendment facility therefore could lack control Analysis will take time to complete. Impacts on system capacity Issues with change effort and costs for a timebound solution May compromise delivery of full Mod 380 solution There may be gaming opportunities Value of the change (How much additional benefit from AQ correction process and at what cost?) Stability of SOQ.

What Next? What do Project Nexus stakeholders value? Xoserve will continue to analyse the options BUT – Don’t lose focus on the ‘End game’ We want to deliver Periodic AQ ASAP We will start analysis on Project Nexus requirements as soon as they are defined & signed off