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Home My WebLink About1992-075e wpdots\trinity ORDINANCE NO AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF DENTON, TEXAS, APPROVING AN INTERRUPTIBLE NATURAL GAS SALES AND PURCHASE AGREEMENT BETWEEN THE CITY OF DENTON AND TRINITY PIPELINE, INC FOR THE PURCHASE OF SPOT MARKET NATURAL GAS, AUTHORIZING THE EXPENDITURE OF FUNDS, AND PROVIDING FOR AN EFFECTIVE DATE WHEREAS; the City has a need for interruptible natural gas purchases to provide fuel for the Spencer Electrical Generating Station, and WHEREAS, the City could realize price savings by purchasing gas on the spot market, and WHEREAS, the City has solicited bids for one year contracts with spot market suppliers of natural gas, in accordance with Chapter 252 of the Local Government Code, NOW, THEREFORE, THE COUNCIL OF THE CITY OF DENTON HEREBY ORDAINS SECTION I. That it authorizes the Mayor to execute the attached Interruptible Natural Gas Sales and Purchase Agreement with Trinity Pipeline, Inc providing for the purchase of spot market natural gas SECTION II That it authorizes the expenditure of funds in accordance with the terms of the Agreement SECTION III That this ordinance shall become effective imme- diately upon its passage and approval - PASSED AND APPROVED this the � day of , 1992 BOB CASTLEBERRY, MA ATTESTS JENNIFER WALTERS, CITY SECRETARY BY APPROVED AS TO LEGAL FORM DEBRA A DRAYOVITCH, CITY ATTORNEY m PAGE 2 Standard Contract Standard Contract City of Denton Utilities Interruptible Natural Gas Sales And Purchase Contract Agreement Date April 212 1992 Trinity Pipeline, Inc (SELLER) a Texas Corporation agrees to deliver and sell gas to the City of Denton Texas (Buyer) and BUYER agrees to purchase and receive said natural gas from SELLER pursuant to the terms and conditions hereinafter set forth DEFINITIONS The term Agreement shall mean this Interruptible Natural Gas Sales and Purchase Contract including Attachment A which is incorporated herein The term "month" shall mean a calendar month The term MMBtu" shall mean one million (1000000) bntish thermal units The term Receiving Pipeline" shall mean the interstate intrastate or local distribution company immediately downstream of the Point Of Delivery The term "Buyers Notice shall mean the letter agreement a form copy of which is attached hereto as Attachment A, which may be executed by BUYER and SELLER from time to time and which shall bind BUYER and SELLER to particular transactions for the purchase and sale of natural gas in accordance with the terms thereof and this Agreement The term Point Of Delivery shall mean the location of the physical delivery to the Receiving Pipeline 2 TERM The initial term will be one year from the date hereof and month to month thereafter subject to the right of either party to terminate this Contract on 30 day s prior written notice to the other party 3 PRICE AND PAYMENT OF COSTS AND TAXES PRIOR TO DELIVERY On a monthly basis, the price to be paid by BUYER for gas delivered by SELLER shall be specified on the Buyers Notice" shown in Attachment A Prices shall include and SELLER shall be responsible for payment of all royalties production taxes property taxes severance taxes purchaser taxes, and all other taxes and license fees which attach to the gas prior to delivery hereunder Prices shall also include and SELLER shall be responsible for payment of gathering and transportation charges to the Point Of Delivery, payments or other charges thereon applicable before the title of gas passes to BUYER at the Point Of Delivery BUYER shall pay transportation charges on the Receiving Pipeline, downstream of the Point Of Delivery PAGE 1 4 QUANTITY AND POINTS OF DELIVERY Gas quantities and points of delivery will be specified on a monthly basis on the Buyers Notice as shown in Attachment A, signed by BUYER and by SELLER Requests for bids submission of bids or preliminary correspondence will not act as a Buyer's Notice and shall not be the basis for gas deliveries under this contract SELLER shall deliver gas quantities consistent with the quantity, Point Of Delivery, Receiving Pipeline and dates as specified in the Buyers Notice from the BUYER 5 BEST EFFORTS PERFORMANCE SELLER will make a best effort to deliver, and BUYER best effort to receive, the gas quantities as specified in the Buyer's Notice Either party may at any time curtail or interrupt service with no liability to either party The curtailing party will make diligent efforts to notify the other party of the situation within 48 hours 6 INCREASES IN QUANTITY AND CHANGES TO POINTS OF DELIVERY BUYER may request increases to gas quantities or changes in points of delivery by specifying these requests in a revised "Buyer's Notice" to the SELLER If accepted by SELLER SELLER shall male all arrangements needed to revise deliveries within 24 hours If SELLER wishes to increase gas quantities or change points of delivery, he must notify BUYER and receive a revised Buyer s Notice signed by BUYER to do so 7 OVER DELIVERIES If SELLER provides gas quantities for a month in excess of 4% above the quantities in the "Buyer's Notice or at points of delivery not specified in the Buyer s Notice" BUYER shall have the right to refuse the quantities of gas and shall be exempt from any payments on those gas quantities SELLER shall be liable for any penalties or excess storage or transportation charges owed by the BUYER as a result of the SELLER's deliveries in excess of 4% of the Buyer's Notice or at locations not specified in the "Buyer's Notice" 8 GAS AND PRICE UNITS All gas quantities and prices shall be in MMBtu adjusted to 14 650 psi at a temperature of 60 degrees Fahrenheit, with both Mcf and Btu free of water vapor (Dry) Prices will be in U S dollars 9 QUALITY AND PRESSURE The gas delivered by SELLER shall meet the pressure requirements and quality specifications of the Receiving Pipeline t0 TITLE SELLER warrants for itself its successors heirs and assigns title to all gas delivered and accepted by BUYER hereunder SELLER warrants it has the right and lawful authority tq sell the gas and that such gas is free from liens encumbrances and claims of every kind SELLER shall indemnify and save BUYER harmless from all suits claims liens damages costs losses expenses and encumbrances of whatsoever nature arising out of claims of any or all persons to said gas or the title of said gas SELLER shall be in control and possession of and responsible for any risk of loss damage, claim liability or injury caused thereby until the gas has been delivered to the BUYER at the Point Of Delivery Title and risk of loss shall pass at the Point Of Delivery from SELLER to BUYER PAGE 2 11 DETERMINING PAYMENT VOLUMES On approximately the 15th day following the end of each month of gas deliveries, SELLER shall furnish BUYER a statement specifying volume delivered location and Receiving Pipeline If these volumes differ from BUYER s independent monitoring of deliveries or Receiving Pipeline s records BUYER shall have the right to pay on the undisputed amount either (i) under protest or (it) upon final agreement being made on the delivered volumes by BUYER, SELLER and Receiving Pipeline BUYER and SELLER shall have the right to later revise payment volumes as a result of additional or revised volumetric data from the Receiving Pipeline or other companies associated with the production, sale, storage, or transportation of the gas 12 PAYMENT Within 15 days of receipt of the statement, BUYER shall make payment to SELLER for the gas quantities as determined in Paragraph 11 Payment statements should be directed to BUYER at City of Denton Utilities Electric Production Division 1701 A Spencer Road Denton, TX 76205 Attn Jim Thune, Manager Electric Production 13 NOTIFICATION Communications regarding the performance of this contract shall be directed to SELLER Trinity Pipeline, Inc BUYER 17101 Preston Rd Suite 240, LB 122 Dallas, Texas 75248 Attn Jeff L Singleton 14 PERFORMING NOMINATIONS City of Denton Utilities Electric Production Division 1701 A Spencer Road Denton TX 76205 Attn Jim Thune Manager Electric Production BUYER will be solely responsible for nomination of gas volumes to the Receiving Pipeline, unless SELLER is given specific written authorization from BUYER to perform these nominations SELLER shall be responsible for all necessary nominations to transporters and all others related to the supply of natural gas prior to Point Of Delivery 15 EXCIIANGE OF GAS QUANTITY INFORMATION During the period of actual gas deliveries SELLER and BUYER shall make available to each other current estimates of gas flows at the Point(s) of delivery under this agreement for the purposes of nomination to others and the monitoring of actual gas quantities delivered If Seller is unable to provide current estimates of gas activity to BUYER SELLER will assist BUYER in obtaining said information from pipeline transporters processing plant operators, well operators or upstream suppliers 16 GOVERNING STATE This agreement shall be construed pursuant to the laws of the State of Texas and venue for its construction and enforcement shall lie in the courts of Denton County Texas PAGE 3 SELLER TRINITY PIPELINE, INC By Norman Berthusen BUYER Tale Vice President, Gas Supply Title Date April 21, 1992 Date 5�-5 -9a- PAGE 4 BUYERS MOTILE GAS SALES AND PURCHASE AGREEMENT DATED Date Of Buyers Notice Buyers Notice Number BUYER SELLER Natural Gas purchase quantities for ALL volumes and prices are based on MMBtu adjusted to 14 650 Dry Prices are in U S dollars Total MMBTU Price Dates For Point of Receiving MMBtu/Day For Period (S/MMBtu) Delivery Delivery Facility (14.650 D/D) (14 650 D/D) (14,650 D/D) Accepted And Agreed (SELLER) Its Dated GASSID Accepted And Agreed (BUYER) Dated PAGE 5 u i a I � I