2000-001 O ANCENO
AGREEMENT BETWEEN THE CITY OF DENTON AND TEXAS ENERGY TRANSFER
CO, LTD FOR THE PURCHASE OF SPOT MARKET NATURAL GAS, AUTHORIZING
THE EXPENDITURE OF FUNDS THEREFORE, AND PROVIDING AN EFFECTIVE DATE
(BID 243S-NATURAL GAS AWARDED TO TEXAS ENERGY TRANSFER CO, LTD, FOR
THE MOll THLY CONSIDERATION FOR THE SPOT PURCHASE OF NATURAL GAS)
IV -IEREAS, the City has a need for lntermpt,ble natural gas purchases to prov, de fuel for
the Spent, Elecmcal Generating Station, and
IV ~IEREAS, the City could realize pnee sawngs by purchasing gas on the spot market,
and
W tEREAS, the City has solicited bids for one year contracts with spot market supphers
of natura gas, m accordance with Chapter 252 of the Local Government Code NOW,
THEREF~ )RE,
THE COl rNCIL OF THE CITY OF DENTON HEREBY ORDAINS
St CTION I That at anthonzes the Mayor to execute the attached Intermptlble Natural
Gas Sale~ and Purchase Agreement vath Texas Energy Transfer Co, Ltd prowd~ng for the
purchase, ,f spot market natural gas
SI ;CTION II That the C~ty Manager m anthonzed to expend funds m accordance with
the terms ~fthe Agreement
SI ~ That this ordinance shall become effective ~mmedmtely upon its passage
and appr¢ val
PASSED AND APPROVED thts the -- day of ,2000
JAC~
ATTEST
JENNIF[ R WALTERS, CITY SECRETARY
T-"
APtO~RO'~ ED ~S TO LEGAL FORM
HERBE~ r L PROUTY, CITY ATTORNEY
2438 NAT[ ~Lt~L GAS ORDi~NANC~
Standard
Contract
Standard Comract
City of Denton Ut~httes
lmerrupuble Natural Gas Sales And Purchase Comract Agreemem
Date 11-18-99
Texas Energy Transfer Company, Ltd
(SELLER) Lumted Partnersbap Corporation
agrees to dehver and sell gas to the City of Demon, Texas (Buyer) and BUYER agrees to purchase
and recewe md natural gas from SELLER pursuant to the terms and conditions heremai~er set forth
1. DEFI3IlTIONS:
The term "Asreement" shall mean tius Imerrupuble Natural Gas Sales and Purchase Contract
mcluchng Attachmem A which ns incorporated here~n
The term "month" shall mean a calendar month
The team "MMBtu" shall mean one mghon (1,000,000) British thermal units
The term "Receiwng P,pelme" shall mean the interstate, intrastate, or local dlsmbuuon
company ~mmedlately downstream of the Point Of Dehvery
The te~m "Buyers Notice" shall mean the letter agreement a form copy of which u attached
he~'eto as Attachment A, which may be executed by BUYER and SELLER from unie to time
and which shall b,nd BUYER and SELLER to pantcular transacuons for the purchase and
sale ofnatur~ gas in accordance w~th the terms thereof and this Agreement
The term "Point Of Dehvety" shall mean the locauon of the physical delivery to the Receiwng
P,pelme
The uuual term wdl be one year from the date hereof, and month to month thereaiter, subject
to the right of enher party to terrmnate this Contract on .30 day's prior written not,ce to the
other party
page 18
PRICE AND PAYMENT OF COSTS AND TAXES PRIOR TO DELIVERY:
On a monthly bas~s, the price to be prod by BUYER for gas delivered by SELLER shall be
specflied on the "Buyers NoUce" shown m 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 hcense fees which attach to the gas prior to
dehvery hereunder Prices shall also include and SI~I~I .ER shall be responsible for payment
ofgatheitn8 and tramportation charges to the Point Of Dehvery, payments or other charges
thereon apphcable before the title of gas pal~ses to BUYER at the Point Of Dehvery BUYER
shall pay transportation charges on the Receiving Pipeline, downstream of the Point Of
Dehvery
4. QUANTITY AND POINTS OF DELIVERY:
Gas quantities and points of dehvery wdl be specified on a monthly basis on the "Buyers
Nouce", as shown m Attachment A, s~ined by BUYER and by SELLER Requests for bids,
submission of bids, or prehnunary correspondence wdl not act as a Buyers Notice and shall
not be the basis for gas dehvenes under this contract SELLER shall deliver gas quantmes
consistent with the quantity, Point Of Dehvery, Receiving Pipeline, and dates as specified in
the "Buyers Notice" fi.om the BUYER
5. BEST EFFORTS PERFORMANCE:
SELLER ~ make a best effort to deliver, and BUYER best effort to receive, the gas
quantities as speafled m the Buyers Notice Either party may at any time cunad or interrupt
service with no habflity to either party The curtAdmg par~ will make diligent efforts to notify
the other party of the sttuation w~thin 48 hours
6. INCREASES IN QUANTITY AND CHANGES TO POINTS OF DELIVERY.
BUYER may request mcreases to gas quanuues or cha~es in points of dehvery by spec,Sylng
these requests m a re~sod "Buyers Notice" to the SELLER If accepted by SELLER,
S171.1.1TR. shall make ail alTan~ements needed to revise dehvenes uattun 24 hours If SELLER
wishes to increase gas quantities or change points ofdehvery, he must notify BUYER, and
receive a re~nsed Buyers Notice slined by BUYER to do so
7. OVER-DELIVERIES
ff SELLER provides g~s quantities for a month in excess of 4% above the quantmes ~n the
"Buyers Notice" or at points ofdehve~y not specified in the "Buyers Notice", BUYER shall
have the nght to refuse the quantities of gas and shall be exempt from any payments on those
gas quantit~as SELLER shall be hahle for any penalties or excess storage or transportation
chi~es owed by the BUYER as a result of the SELLERS dehvenes in excess of 4% of the
Buyers Not~ce or at locations not specffied in the "Buyers Notice"
page 19
8. GAS AND PRICE UNITS:
All gas quantities and pnces shall be in MMBtu adjusted to 14 650 psi, at a temperature of
60 del~es Fahrenheit, with both Mcfand Btu free of water vapor (Dry) Pnces wdl be in
U S dollars
9. QUALITY AND PRESSURE:
The 8as delivered by SI~!.T.~R shall meel the pressure requirements and quahty specifications
of the Receiving Pipeline
10. TITLE:
SELLER warrants for itself; its successors, he~rs and assigns, title to all gas delivered and
a~cepted by BUYER hereunder SELLER warrants n has the right and lawful authority to
sell the gas and that such gas is free from liens, encumbrances and clmms of eveE~ land
SELLER shall mdemmfy and save BUYER harmless from ail suits, claims, liens, damages,
costs, losses, expenses and encumbrances of whatsoever nature arising out of clmms of any
or all persons to said ~as or the title ofsatd gas SELLER shall be m control and possession
of and re~ponsthle for any nsk of loss, damage, claim, hablhty or injury caused thereby until
the gas has been dehvered to the BUYER at the Point Of Dehvery Title and risk of loss shall
pass at the Point Of Delwery from SELLER to BUYER
Il. DETERMINING PAYMENT VOLUMES:
On approxh'nately the lSth day follovang the end of each month of gas deliveries, SELLER
shall furmsh BUYER a statement speclf!ang volume delivered, location, and R. ecelvmg
Pipeline If these volumes dtFer from BUYER's independent momtonng of dehvenes or
Receivm$ Plpehne's records, BUYER shall have the right to pay on the undisputed amount
either (0 under protest, or (u) upon final agreement bemg made on the delivered volumes by
BUYER, SI~.I.I.~P. and Recelvm$ P~pehne BUYER and SELLER shall have the right to later
revise payment volumes as a result of adchtional or rewsed volumetnc data from the
Keceiving Plpehne or other compames associated with the production, sale, storage, or
transponauon of the gas
12. PAYMENT
Withal 12 days of receipt of the statement, BUYER shall make payment to SELLER for the
gas quantities as detenmned m Paragraph 11 Payments statements should be directed to
BUYER at City of Denton Utflmes
Electnc ProducUon Dw~sion
1701 -A Spencer Road
Denton, TX ?6205
Attn Phil Rennaker
Manager, Electric Production
page 20
13. NOTI~CATION:
Commumcauons re~trdm$ the performance oftlus contract shall be tflrected to
SI~T.T]=R BUYER City of Denton Utthues
Texas Energy Transfer Company, Ltd Electric Production Division
2838 Woods]de 170I-A Spencer Road
Dallas, TX 75204 Denton, TX 76205
Attn John Nolan, Partner Atto Phil Reaaakar
Man.er, Electr]c Product,on
14. PERFORMING NOMINATIONS:
B~ wdl be sol,dy responsible for nomma~on of ps volumes to the Rece[vln8 P,pei,ne.
unless SI~-t'-]'-]:R is pven speedi¢ wnttan author---on from BUYER to perform these
nominations $1~]']::R. shall be responsible for ail necesmu7 nommataons to transporters and
ail others related to the supply of natural gas prior to Point Of Dehvery
15. F-,XCHANGE OF GAS QUANTITY IlVFORMATION:
Dutm8 the period of actual Bm dehvenes, Slq'.l'.]~. and BUYER sh. II make avadabie to each
other cutrcflt estmmtes of~l~ flows at the Point(s) of dehvery under tJus a~reement for the
purposes of nomination to others aad the momtorm8 ofa_etual g~s quan-ues dehvered If
Seller,s unable to provide current esmnates ofg~s acuvity to BLTYE~ SF_LI'.ER will assist
BUYER In obtmna~ said mformanon fi'om pipehne transporters, processm8 plant operators,
well operators, or upstream suppliers
16. GOVEI~TING STAT~:
Tlns ap-cement shaft be construed pursuant to the laws of the State of Texas and venue for
its construct]on and enforcement shall he m the courts of Denton County, Texas
$F.T.T.]~R BUYER
Texas Enersy Transfer Company, Ltd ~Clty of Dentoan
By l~ 0~ P~er, ~TC, ~c ~lc~&el
Tide Nlacloe McCrea, Attorney-in-Fact Tide city Manager
Date 11 - 18-99 Date 1 - 4- 00
page 21
A~'FACHMENT A
DENTON MUNICIPAL UTILITIES- SPENCER STATION
1701 A ~PENCER ROAO
Ord~o~, ~ 7~'05
Fax 940-349-7555
Date.
Firm Address
Dear
Below m a Buyers Notice for (month, year) supply to the Csty of Denton, Texas Under thss
purchase the City of Denton, Texas, mH take title to the gas at the point of delivery and be responsible
for payments subject to the terms of the purchase contract.
BUYERS NOTICE
GAS SALES AND PURCHASE AGREEMENT
Buyers Notice Number: Contract Date
BUYER: City of Denton, SELLER
Electric ProducUon Division
All volumes and pnces are based on mmBtu's, adjusted to 14 6-( dr~/dry
Prices are in U.S. dollars.
Dates for Point of Pipehne Volume Price
delivery delivery (MmBtu/ ($/mmBtu
14 6-g D/D) 14 65 D/D)
Lone Star
Accepted and Agreed Accepted and Agreed
(Seller) (Buyer)
Dated: Dated
To facthtate payment, please sign the above Buyers Notice and return vm fax, attn Phil Renuaker
page 22