NATURAL GAS AGREEMENTS (033)
TO:
FROM:
COPIES:
SUBJECT:
DATE:
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CITY] OF CLEARWATER
Interdepartment Correspondence Sheet
Cindy Goudeau - City Clerk
J. Teny Neen,n - Ge, '"p", inecndene J':1a#"] ~
Coastal Gas Marketing Company Agreement
October 16, 1990
Please find attached one fully executed original Coastal
Gas Marketing Company Agreement for your files,
JTN:nt
REC~EI'~lED
OCT .1 3 13S0
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Coastal Gas
Marketing Company
A SUBSIDIARY OF TH~ CO;\STAL CORPORA TION
DCi 15 1990
The Energy People
UTILITY DEPARTMENT
Date: October 8, 1990
Name: Bob Brumback
Company: City of Clearwater
Address: 400 N. Myrtle Avenue - Clearwater, Florida 34618
RE: Property:
period:
Attached:
Original Contracts(s) for execution
Original Exhibit (s) for execution
Fully executed Contract(s)
Fully executed Exhibit(s)
Other
Action:
Return fully executed copy(ies)
Retain goldenrod copy for your files
Return two partially executed originals
for execution on behalf of Coastal Gas
Marketing Company
X Other Wire transfer address chanqe on
page 7.
Please feel free to direct any questions regarding the status
of these documents to Brenda BUCkley at the letterhead address or
telephone 713/877-3581.
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UTILiTlfS GROUP
COASTAL TOWER
NINE GREENWAY PLAZA
HOUSTON, TEXAS 77046-0995
713/877-1400
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INTERRUPrIBLE GAS SALES AGREEMENT
GENERAL TERMS AND CONDITIONS
AS OF THIS 20th DAY OF JULY, 1990, COASTAL GAS MARKETING COMPANY, a
Delaware corporation ("Seller") and CITY OF CLEARWATER, a municipal
corporation , of the State of Florida ("Buyer") which may hereinafter
be referred to collectively as "Parties" or individually as "Party":
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WHEREAS, Buyer and Seller wish to enter into an Interruptible
agreement covering the sale, delivery and purchase of natural gas.
NOW, THEREFORE, in consideration of the premises and mutual
covenants set forth herein, the Parties agree as follows:
ARTICLE 1.
DEFINITIONS
1.1 "Agreement" shall mean these General Terms and
Conditions and the Exhibit "A" hereto both of which have been
completed and executed by the Parties.
1.2 "Interruptible, Interrupt or Interruption" shall mean
that Buyer has no obligation to purchase or take delivery of natural
gas that Buyer, for any reason, does not desire to purchase from
Seller, and that Seller has no obligation to sell or deliver natural
gas that Seller, for any reason, does not desire to sell to Buyer.
Neither Buyer nor Seller shall be liable to the other for not
selling, delivering or purchasing any natural gas pursuant to this
Agreement and failure to do so shall not constitute a breach of this
Agreement by either Buyer or Seller.
1. 3 "Transporter" shall mean the transporting pipeline
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downstream of the po~nt(s) of Sale.
1.4 "point(s) of Sale" shall mean the point(s) at which
natural gas is first delivered to the first Transporter, which
point(s) are designated in the Transportation Agreement(s) to be
executed by such Transporter and Buyer with respect to the
transportation of the natural gas purchased.
ARTICLE II.
OUANTITY
2.1 By executing Exhibit "A", Buyer shall have agreed to
maximum daily and monthly quantities of natural gas that Buyer may
desire to purchase from Seller. To permit Seller to schedule
delivery of natural gas supplies for Buyer in an orderly manner,
Buyer shall provide Seller with oral notice of both daily and monthly
nominated quantities provided by Buyer to the first Transporter for
all deliveries of natural gas and shall confirm that notice by
providing Seller with a duplicate copy of the completed gas
nomination form(s) used by Buyer to make nominations to the first
Transporter by no later than one (1) working day prior to the date(s)
required by the first Transporter for such nominations.
2.2 Buyer may decrease or Interrupt the nominated quantity
established pursuant to Paragraph 2.1, from time to time upon twenty-
four (24) hour notice to any Transporter and Seller, which notice of
decrease or Interruption of such nominated quantity may be oral, but
which notice must be confirmed in writing. Buyer may increase its
nominated quantity within the maximums on Exhibit "A" from time to
time upon (i) twenty-four (24) hour notice to any Transporter and
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Seller, which notice of increase of such nominated quantity initially
may be oral, and (ii) Seller's written confirmation and approval of
said increase in writing. Seller may decrease or Interrupt sales of
natural gas for any time and from time to time upon twenty-four (24)
hour notice to Buyer, which notice of decrease or Interruption of
nominated quantity initially may be oral, but which notice must be
confirmed in writing. Buyer and Seller may also at any time request
an increase or decrease in the maximum daily and/or monthly
quantities, which proposed increase or decrease shall become
effective only according to the terms of a newly executed Exhibit
"A".
2.3 The Parties agree that if any penal ties are imposed
upon a Party hereto by the transporting pipel ine (s), in accordance
with the provisions of its applicable Federal Energy Regulatory
Commission approved transportation tariff(s), as a result of other
Party's failure to deliver or accept an agreed upon, nominated
quantity or as a result of the other party's failure to perform any
of its obligations hereunder, the failing Party shall, upon receipt
of an invoice from the non-failing Party reasonably detailing such
penalties, reimburse the non-failure Party the dollar amount of such
penalties (or the failing Party's portion thereof) within thirty
(30) days following receipt of said invoice.
ARTICLE III.
PRICE OF NATURAL GAS
3.1 Exhibit "A" shall state the price for the natural gas
that is sold by Seller to Buyer. The price of natural gas includes
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all charges and costs of compression, gathering, processing,
treating, liquefying or transporting the natural gas, or other
similar cost, and taxes (except taxes described in Paragraph 3.3),
which are incurred prior to he Point(s) of Sale. Seller shall
compress, gather, process, treat, liquefy or transport the natural
gas, or cause the same, as necessary to deliver the natural gas.
Buyer shall compensate Seller for all costs of compressing,
gathering, processing, treating, liquefying or transporting such gas,
or other similar costs, as allowed pursuant to SilO of the Natural
Gas Policy Act of 1978 (NGPA) or 18 C.F.R. SS270.202 and 271.1104 or
as otherwise allowed by law, to the extent such costs are incurred by
S.eller or by Seller I s suppliers; provided however, the price shall
not exceed the price stated on Exhibit "A". The price shall remain
in effect until Buyer and Seller have agreed upon a new price and
have executed a new Exhibit "A".
~ (a) "Regulated Gas" means gas subject to a maximum
lawful price.
(b) "Contract Price" means the price payable for
gas under this Agreement in the absence of any applicable maximum
lawful price.
(c) In the event that Seller delivers and Buyer
purchases Regulated Gas under this Agreement which is subj ect to a
maximum lawful price lower than the Contract Price, Buyer shall, to
the extent lawfully permitted, pay Seller for other gas delivered and
purchased hereunder a price (not to exceed any applicable maximum
lawful price) which is sufficiently in excess of the Contract Price
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to cause the weighted average price of gas delivered and purchased
hereunder to equal the Contract Price as nearly as practicable, but
the weighted average price of all gas delivered and purchased
hereunder shall never exceed the Contract Price.
3.3 Buyer warrants that the gas purchased hereunder is
purchased for resale and Buyer believes that no federal, state, or
local sales, use, consumption, or similar tax or franchise fee will
be levied at and after the Point(s) of Sale on any gas sold
hereunder. However Buyer is responsible for and hereby agrees to pay
all such taxes or charges arising out of or that may be levied upon
any gas sold under this Agreement. Buyer recognizes that Seller is
relying on Buyer's representation of exemption and Buyer agrees to
indemnify and hold harmless Seller from any and all costs, charges
and expenses of any nature incurred by Seller as a result of Seller's
reliance on Buyer's representation.
ARTICLE IV.
TERM
4.1 This Agreement shall be effective as of the date
written herein above and shall remain in effect for one (1) month,
and month to month thereafter subject to the other provisions hereof,
and shall furthermore remain in effect until terminated by either
Party upon at least then (10) days prior written notice given to the
other Party; such termination to be effective as of the first day of
the month following the month of the receipt of the termination
notice.
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ARTICLE V.
POINTS OF SALE: TITLE: RIGHTS OF POSSESSION
5.1 Title and right of possession to all natural gas
delivered and sold hereunder shall pass to Buyer at the Point(s) of
Sale. Seller shall be deemed to be in exclusive control and
possession of the natural gas and shall be fully responsible for and
shall defend and indemnify Buyer, its successors and assigns, against
any damages or injury resulting from the transportation, handling or
use of or caused by the natural gas or the operation of facilities
used to deliver natural gas to the Point(s) of Sale. Buyer shall be
deemed to be in exclusive control and possession of the natural gas
and shall be fully responsible for and shall defend and indemnify
Seller, its successors and assigns, against any damages or injury
resulting from the transportation, handling or use of or caused by
the natural gas or the operation of facilities used to receive
natural gas after the Point(s) of Sale.
ARTICLE VI.
TRANSPORTATION
6.1 Seller shall be responsible for arranging and paying
for all transportation of the natural gas to the Point(s) of Sale.
Buyer shall be responsible for arranging and paying for all
transportation of the natural gas from the Point(s) of Sale. Buyer
shall provide to Seller a copy of any transportation agreement(s)
entered into pursuant to this paragraph.
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quality specifications set forth in the Transportation Agreement
governing the transportation of the natural gas by the Transporter,
as measured and/or calculated by the Transporter.
ARTICLE VIII.
BILLING AND PAYMENT
8.1 On or before the twelfth (12th) day of each month during
the term of this Agreement, Seller shall render a statement to Buyer
for the total volume of natural gas nominated or delivered to Buyer
during the preceding month. Buyer shall pay to Seller, on or before
the twentieth (20th) day of each month, the amount due on Seller's
statement.
All such payments shall be made to Seller by wire
transfer directed to:
Coastal Gas Marketing Company
Account #4055 2643
citibank, N.A.
New York, New York
T/R #0210 0008 9
To the extent that supporting data is not available to Seller by the
twelfth (12) day of each month, Seller may bill Buyer based on
nominated volumes, subject to reduction for any known periods when
nominated volumes were not delivered and subject to later correction
based on actual supporting data. If a statement is rendered based on
nominated volumes rather than actual deliveries, Seller shall
promptly render a corrected statement after it has an accounting for
the volumes actually delivered during the month in question.
8.2 Buyer and Seller shall have the right during normal
business hours to examine the books, records and charts of the other
Party to the extent necessary to verify any statement, charge or
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8.2 Buyer and Seller shall have the right during normal
business hours to examine the books, records and charts of the other
Party to the extent necessary to verify any statement, charge or
computation made pursuant to this Agreement.
8.3 If Buyer fails to pay when due the amount of any
statement rendered by Seller, interest thereon shall accrue from the
due date until the date of payment, at the then current prime rate of
interest charged by Citibank, N.A. to its commercial and industrial
borrowers. This Paragraph 8.3 shall not bar either Party from
asserting any other remedy it may have at law or in equity.
8.4 If presentation of a statement by Seller is delayed
after the twelfth (12th) day of a month, then the time for payment
shall be extended correspondingly.
8.5 If Buyer finds within twenty-four (24) months after
the date of any statement rendered by Seller that it has been
overcharged and if Buyer pays and makes a claim within the
twenty-four months, the overcharge, if verified by Seller or
otherwise ordered, shall be refunded within thirty (30) days with
interest at the then current prime rate of interest charged by
citibank, N.A. to its best commercial and industrial borrowers. If
Seller finds within twenty-four (24) months after the date of any
statement rendered by it that there has been an undercharge in the
amount billed in such statement, it may submit a statement for such
undercharge to Buyer, and Buyer, upon verifying the same or otherwise
ordered, shall pay the undercharge to Seller within 30 days, with
interest at the then current prime rate of interest charged by
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citibank, N.A. to its best commercial and industrial borrowers.
ARTICLE IX.
REGULATION
9.1 This Agreement shall be subject to all valid applicable and
effective laws, orders, rules, regulations and directives of all duly
constituted Federal, state and local governmental authorities having
jurisdiction.
ARTICLE X.
WARRANTIES OF TITLE
10.1 Seller warrants title to the natural gas sold and
delivered to Buyer free and clear of all liens, encumbrances and
claims to the natural gas, for royalties, or taxes, except as
provided in Paragraph 3.3. Seller shall indemnify Buyer and save it
harmless from suits, actions, debts, accounts, damages, costs, losses
and expenses arising from or out of this warranty.
ARTICLE XI.
CREDIT WORTHINESS
11.1 Prior to the commencement of deliveries and sales of
natural gas under this Agreement, and from time to time thereafter
Buyer shall furnish Seller with credit information as may be
reasonably required to determine Buyer's credit worthiness. Buyer
may be required to furnish Seller with a satisfactory letter of
credit, guarantee or other good and sufficient security of a
continuing nature and in a satisfactory amount as determined by
Seller in its sole discretion.
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ARTICLE XII.
NOTICES
12.1 Notices to Buyer under this Agreement shall be
addressed as follows:
City of Clearwater
400 N. Myrtle Avenue
Clearwater, Florida 34618
Notices to Seller shall be addressed as follows:
Coastal Gas Marketing
Coastal Tower
Nine Greenway Plaza
Houston, Texas 77046
Attention: Marketing
Either Party may change its address under this Article, or under
the payment provisions of Article VIII, by written notice to the
other Party.
Unless otherwise provided, all notices given by one
Party to the other shall be sent by registered mail, overnight mail
service or by telegraph or telecopy and shall be effective upon
receipt.
However,
routine communications,
inclUding monthly
statements, shall be considered as delivered when mailed, properly
addressed, by either registered or ordinary mail.
ARTICLE XIII.
TRANSFER AND ASSIGNMENT
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Any company that shall succeed by purchase, merger, or
consolidation to the properties, substantially, or in their entirety,
of either Party shall be entitled to the rights and shall be Subject
to the obligations of its predecessor in title under this Agreement.
No assignment of this Agreement or of any rights or obligations
hereunder shall be made by either Party without the written consent
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of the other Party, except that either Party may assign this
Agreement to a financially capable affiliate upon written notice to
the other Party. This Article XIII shall not prevent either Party
from pledging or mortgaging its rights hereunder as security for its
indebtedness. This Agreement shall be binding upon and inure to the
benefit of the respective successors and assigns of the Parties.
ARTICLE XIV.
NON-WAIVER OF l'U'!'uHE DEFAULTS
14.1 No waiver by either Party of anyone or more defaults by
the other Party in the performance of this Agreement shall operate or
be construed as a waiver of any future default or defaults, whether
of a like or of a different character.
ARTICLE XV.
ENTIRE AGREEMENT
15.1 This Agreement constitutes the entire agreement between
Seller and Buyer for the sale and delivery and purchase of natural
gas. THIS AGRBEIIEN'l' SUPERSEDES ALL PRIOR NEGOTIATIONS, REPRESENTA-
TIONS, CONTRACTS OR AGREEMENTS, EITHER WRITTEN OR ORAL, REGARDING THE
SUBJECT MATTER HEREOF. EXCEPl' AS PROVIDED IN ARTICLE VII AND ARTICLE
X, THERE ARE NO OTHER WARRANTIES EXPRESSED OR IMPLIED REGARDING THE
PURCHASE AND SALE OF NATURAL GAS PROVIDED FOR HEREIN. Except as
provided in Article II, no modification, alterations, amendments,
instruction or interpretation of this Agreement and/or Exhibit "A"
shall be binding upon either Party unless executed in writing by the
party to be bound.
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ARTICLE XVI.
DAMAGES
16.1 Neither Party shall be liable for any damages for any
breach of this Agreement, unless a claim is presented in writing
within two (2) years after the alleged damages occurred, or within
two (2) years after the injured Party should have known of such
damage by exercise of reasonably prudent care to discover same,
whichever occurs later.
The claim shall set forth in full the
nature, character, cause, and amount of the damage.
ARTICLE XVII.
17.1
THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF TEXAS.
IN WITNESS WHEREOF,
the Parties have caused these presents to
be executed by their proper officers duly authorized in that behalf,
as of the day and year first above written.
Seller:
W1:S:
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G COMPANY
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M.A. Heim ~~
Title: Executive vice President
Buyer:
CITY OF CLEARWATER,
a municipal corporation of the
State of Florida
issioner
By: ~ -# ~.
Title: Ron H. Rabun. ri~y MRnRgpr
Attest~:
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APprove~s ~or f.Erm and
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M. A. Galbrai)th,jJr.
City AttorneYl.....J
correctness:
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~_c:[~)~o.,.
hia E..~. Goudeau
Clerk:
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EXHIBIT "A" TO INTERRUPrIBLE GAS SALES AGREEMENT
DATED JULY 20, 1990 BETWEEN
COASTAL GAS MARKETING COMPANY AS "SELLER"
AND CITY OF CLEARWATER AS "BUYER"
Pursuant to the terms of the Interruptible Gas Sales Agreement dated
July 20, 1990, this Exhibit "A" shall provide the necessary
specifications under which Buyer agrees to purchase and Seller agrees
to sell gas:
1. Maximum Daily Quantity (MMBtu):
2. Maximum Monthly Quantity (MMBtu):
3. Gas Price per MMBtu ($jMMBtu): $
(gas price set forth herein is stated on a "dry" basis)
4. Effective Period of Exhibit "A":
5. First Transporter:
6. Point(s) of Sale:
BUYER:
SELLER:
CITY OF CLEARWATER
COASTAL GAS MARKETING COMPANY
By:
-a~~
By:
Title:
Ron H. Rabun, City Manaqer
Title:
Date:
~/;;l119D
Date: