FIRM TRANSPORTATION SERVICE AGREEMENT
THIS AGREEMENT is made and entered into this 13th day of October,
1994 by and between
PACIFIC GAS TRANSMISSION COMPANY, a California corporation
(hereinafter referred to as "PGT")
and
SAN DIEGO GAS & ELECTRIC COMPANY, a California corporation existing
under the laws of the State of California, (hereinafter referred to
as "Shipper").
WHEREAS, PGT owns and operates a natural gas pipeline transmission
system which extends from a point of interconnection with the
pipeline facilities of Alberta Natural Gas Company Ltd. (ANG) at
the International Boundary near Kingsgate, British Columbia, through
the states of Idaho, Washington and Oregon to a point of
interconnection with Pacific Gas and Electric Company at the Oregon-
California border near Malin, Oregon; and
WHEREAS, Shipper desires PGT, on a firm basis, to transport certain
quantities of natural gas as specified on Exhibit A of this
Agreement; and
WHEREAS, PGT is willing to transport certain quantities of natural
gas for Shipper, on a firm basis,
NOW, THEREFORE, the parties agree as follows:
I. GOVERNMENTAL AUTHORITY
1.1 This Firm Transportation Agreement ("Agreement") is made
pursuant to the regulations of the Federal Energy Regulatory
Commission (FERC) contained in 18 CFR Part 284, as amended from time
to time.
1.2 This Agreement is subject to all valid legislation with
respect to the subject matters hereof, either state or federal, and
to all valid present and future decisions, orders, rules, regulations
and ordinances of all duly constituted governmental authorities having
jurisdiction.
I. GOVERNMENTAL AUTHORITY
(continued)
1.3 Shipper shall reimburse PGT for any and all FERC filing fees
incurred by PGT in seeking governmental authorization for the
initiation, extension, or termination of service under this Agreement
and Rate Schedule FTS-1. Shipper shall reimburse PGT for such fees at
PGT's designated office within ten (10) days of receipt of notice from
PGT that such fees are due and payable. Additionally, Shipper shall
reimburse PGT for any and all penalty fees or fines assessed PGT by
either the government of the United States or Canada caused strictly by
the negligence of Shipper or Shipper's Agent in not obtaining all proper
Canadian and U.S. domestic import/export licenses, surety bonds or any
other documents and approvals related to the Canadian exportation and
subsequent domestic importation of natural gas transported by PGT
hereunder.
II. QUANTITY OF GAS AND PRIORITY OF SERVICE
2.1 Subject to the terms and provisions of this Agreement and
PGT's Transportation General Terms and Conditions contained in PGT's
FERC Gas Tariff, First Revised Volume No. 1-A or superseding tariff(s)
(Transportation General Terms and Conditions) applicable to Rate
Schedule FTS-1 or superseding rate schedule(s) (Effective Rate Schedule)
daily receipts of gas by PGT from Shipper at the point(s) of receipt
shall be equal to daily deliveries of gas by PGT to Shipper at the
point(s) of delivery; provided, however, Shipper shall deliver to PGT an
additional quantity of natural gas at the point(s) of receipt as
compressor station fuel, line loss and unaccounted for gas as specified
in the Statement of Effective Rates and Charges of PGT's FERC Gas
Tariff, First Revised Volume No. 1-A or superseding tariff(s) (Statement
of Effective Rates and Charges). Any limitations of the quantities to
be received from each point of receipt and/or delivered to each point of
delivery shall be as specified on the Exhibit A attached hereto.
2.2 The maximum quantities of gas to be delivered by PGT for
Shipper's account at the point(s) of delivery are set forth in Exhibit
A.
2.3 In providing service to its existing or new customers, PGT
will use the priorities of service specified in Paragraph 18 of PGT's
Transportation General Terms and Conditions on file with the FERC.
2.4 Prior to initiation of service, Shipper shall provide PGT with
any information required by the FERC, as well as all information
identified in PGT's Transportation General Terms and Conditions
applicable to the Effective Rate Schedule.
III. TERM OF AGREEMENT
3.1 This Agreement shall become effective _________________, and
shall continue in full force and effect until October 31, 2023 (Initial
Term). Thereafter, this Agreement shall continue in full force and
effect from year to year (Subsequent Term) unless either party gives
twelve (12) months prior written notice of its desire to terminate this
Agreement.
3.2 Neither party may terminate this Agreement during the Initial
Term except as provided by Paragraph 6.9 of this Agreement.
IV. POINTS OF RECEIPT AND DELIVERY
4.1 The point(s) of receipt of gas deliveries to PGT is/are as
designated in Exhibit A, attached hereto.
4.2 The point(s) of delivery of gas to Shipper is/are as
designated in Exhibit A, attached hereto.
4.3 Shipper shall deliver or cause to be delivered to PGT the gas
to be transported hereunder at pressures sufficient to deliver such gas
into PGT's system at the point(s) of receipt. PGT shall deliver the gas
to be transported hereunder to or for the account of Shipper at the
pressures existing in PGT's system at the point(s) of delivery.
4.4 Pursuant to PGT's Transportation General Terms and Conditions,
Shipper may designate other receipt and/or delivery points as secondary
receipt and/or delivery points.
V. OPERATING PROCEDURES
5.1 Both PGT's and Shipper's performance hereunder shall be
subject to and must conform with all applicable operating procedures
contained in PGT's Transportation General Terms and Conditions.
5.2 PGT shall have the right to interrupt or curtail the transport
of gas for the account of Shipper pursuant to PGT's Transportation
General Terms and Conditions.
VI. RATE(S), RATE SCHEDULES, AND
GENERAL TERMS AND CONDITIONS OF SERVICE
6.1 Shipper shall pay PGT each month for services rendered
pursuant to this Agreement in accordance with the, Effective Rate
Schedule, on file with and subject to the jurisdiction of the FERC.
6.2 Shipper shall provide PGT each month with gas for compressor
station fuel, line loss and other unaccounted for gas associated with
this transportation service provided herein in accordance with PGT's
Statement of Effective Rates and Charges on file with. and subject to
the jurisdiction of the FERC.
6.3 This Agreement in all respects shall be and remains subject to
the applicable provisions of the Effective Rate Schedule and of the
applicable Transportation General Terms and Conditions , all of which
are by this reference made a part hereof.
6.4 PGT shall have the right from time to time to propose and file
with the FERC such changes in the rates and charges applicable to
transportation services pursuant to this Agreement, the rate schedule(s)
under which this service is hereunder provided, or any provisions of
PGT's Transportation General Terms and Conditions applicable to such
services. Shipper shall have the right to protest any such changes
proposed by PGT and to exercise any other rights that Shipper may have
with respect thereto.
6.5 If PGT fails to deliver to Malin, Oregon ninety-five percent
(95%) or more of the aggregate Confirmed Daily Nominations (as
hereinafter defined) of all Converting Shippers with a Malin primary
delivery point receiving service under the Effective Rate Schedule
(hereinafter referred to as the "Non-Deficiency Amount") for more than
twenty-five (25) days in any given Contract Year, then for each day
during that Contract Year in excess of twenty-five (25) days that PGT so
fails to deliver the Non-Deficiency Amount (a "Credit Day"), Converting
Shipper shall be entitled to a Reservation Charge Credit calculated in
the manner hereinafter set forth.
For the purpose of this Paragraph 6.5, Confirmed Daily
Nomination shall mean for any day, the lesser of (i) Converting
Shipper's Maximum Daily Quantity or (ii) the actual quantity of gas that
the connecting pipeline upstream of PGT is capable of delivering for
Converting Shipper's account to PGT at Converting Shipper's primary
point(s) of receipt on PGT less Converting Shipper's requirement to
provide compressor fuel and line losses under PGT's Statement of
Effective Rates and Charges or (iii) the quantity of gas that Pacific
Gas and Electric Company (PG&E) is capable of accepting at Malin for
Converting Shipper's account, or (iv) Converting Shipper's nomination to
PGT.
VI. RATE(S), RATE SCHEDULES, AND
GENERAL TERMS AND CONDITIONS OF SERVICE
(continued)
The Reservation Charge Credit for each Credit Day for a particular
Converting Shipper shall be computed as follows:
Reservation Charge
Credit for Each = A x B - C
------- ------
Credit Day 30.4 B
where A = Converting Shipper's Monthly Reservation Charge
B = Converting Shipper's confirmed daily nomination for the
Credit Day
C = Actual quantity of gas delivered by PGT to PG&E at Malin for
Converting Shipper's account for the Credit Day
Except as provided for in Paragraphs 6.6 and 6.9 of this
Agreement, these circumstances are the only circumstances are the only
circumstances under which a Reservation Charge Credit will be provided
and except to this limited extent, the provisions of Paragraph 10.3 of
PGT's General Terms and Conditions continue to apply.
6.6 If PGT fails to deliver to a primary delivery point on its
system other than Malin, Oregon ninety-five percent (95%) or more of the
aggregate Confirmed Daily Nominations (as hereinafter defined) of all
Converting Shippers at such primary delivery point other than Malin
receiving service under this rate schedule (hereinafter referred to as
the "Non-Deficiency Amount") for more than twenty-five (25) days that
PGT so fails to deliver the Non-Deficiency Amount (a "Credit Day"),
Converting Shipper shall be entitled to a Reservation Charge Credit
calculated in the manner hereinafter set forth.
For the purpose of this Paragraph 6.6, Confirmed Daily
Nomination shall mean for any day, the lesser of (I) Converting
Shipper's Maximum Daily Quantity or (ii) the quantity of gas that the
connecting downstream pipeline(s), local distribution company
pipeline(s), or end-user(s) is/are capable of accepting for Converting
Shipper's account at Converting Shipper's primary point(s) of delivery
on PGT or (iii) the quantity of gas that the connecting pipeline
upstream of PGT is capable of delivering for the Converting Shipper's
primary point(s) of receipt on PGT less Converting Shipper's requirement
to provide compressor fuel and line losses under PGT's Statement of
Effective Rates and Charges, or (iv) Converting Shipper's nomination to
PGT.
VI. RATE(S), RATE SCHEDULES, AND
GENERAL TERMS AND CONDITIONS OF SERVICE
(continued)
The Reservation Charge Credit for each Credit Day for a
particular Converting Shipper shall be computed as follows:
Reservation Charge
Credit for Each = A x B - C
----- -----
Credit Day 30.4 B
where A = Converting Shipper's Monthly Reservation Charge
B = Converting Shipper's confirmed daily nomination for the
Credit Day
C = Actual quantity of gas delivered by PGT to a Converting
Shipper's primary delivery point(s) (other than Malin)
for Converting Shipper's account for the Credit Day
Except as provided for in Paragraphs 6.5 and 6.9 of this
Agreement, these circumstances are the only circumstances under which a
Reservation Charge Credit will be provided and except to this limited
extent, the provisions of Paragraph 10.3 of PGT's General Terms and
Conditions continue to apply.
6.7 For the purposes of Paragraphs 6.5, 6.6, 6.9, and 7.9 of this
Agreement, (i) the term "Converting Shipper" shall mean any Shipper
receiving service under PGT's Effective Rate Schedule which has
converted its firm transportation service from Rate Schedule T-3 in
accordance with the FERC's July 2, 1993 order at Docket No. RS92-46, and
(ii) the term "Contract Year" shall be the period of twelve (I 2)
consecutive months commencing the first month that this Agreement
becomes effective and each such consecutive twelve (I 2) month period
thereafter during the term of this Agreement.
6.8 The Reservation Charge Credit contemplated in Paragraphs 6.5,
6.6 and 6.9 of this Agreement shall only apply to the reservation
charges associated with the firm capacity that Shipper has not
permanently released in accordance with PGT's Transportation General
Terms and Conditions.
VI. RATE(S), RATE SCHEDULES, AND
GENERAL TERMS AND CONDITIONS OF SERVICE
(continued)
6.9 Shipper shall be relieved from its Reservation Charge payment
obligation for any period ("Relief Period") when an unforeseeable
action, after service commences on the PGT Expansion Project, by the
federal or provincial governments of Canada or the United States having
jurisdiction ("Event") occurs which: (1) prohibits directly all gas
exports or imports through the PGT Expansion Project, or (2) prohibits
through economic means intended to have prohibitory effect, all gas
exports or imports from Canada to the U.S.. This provision shall only
apply, however, if the Event: is equally applicable to all Converting
Shippers subject to such governmental jurisdiction; is not peculiar to
the circumstances of a particular Converting Shipper; and is not
attributable to the actions or non-actions of any particular Converting
Shipper. In order for Shipper to invoke this provision, Shipper must
notify PGT of such Event within four weeks after Shipper becomes aware
of such Event. The Relief Period shall commence twelve months after
service is curtailed as a result of such Event'("Commencement Date")
provided Shipper has resisted such Event by all reasonable means
(including appeals) within the twelve month period whether or not all
such appeals have been resolved as of the Commencement Date.
If this provision is invoked by a Shipper to relieve its
Reservation Charge payment obligations, PGT shall have the unilateral
right during the first two years of the Relief Period to terminate the
Firm Transportation Service Agreement with that Shipper, however, such
right to terminate may be exercised by PGT only if the PG&E and ANG Firm
Transportation Service Agreements are coincidentally terminated.
6.10 The Reservation Charge Relief contemplated in Paragraph 6.9
of this Agreement shall terminate and have no force or effect if the
FERC should require PGT to offer such relief to any Part 284 firm
shipper on PGT which is not a "Converting Shipper" as that term is
defined in Paragraph 6.7 of this Agreement.
VII. MISCELLANEOUS
7.1 This Agreement shall be interpreted according to the laws of
the State of California.
7.2 Unless otherwise stated in this Agreement, in the case of
inconsistencies between this Agreement, the applicable Transportation
General Terms and Conditions, and PGT's Effective Rate Schedule , the
applicable Transportation General Terms and Conditions and PGT's
Effective Rate Schedule shall control. In the case of inconsistencies
between PGT's Effective Rate Schedule and the applicable Transportation
General Terms and Conditions, PGT's Effective Rate Schedule shall
control.
VII. MISCELLANEOUS
(continued)
7.3 Shipper agrees to indemnify and hold PGT harmless for refusal
to transport gas hereunder in the event any upstream or downstream
transporter fails to receive or deliver gas as contemplated by this
Agreement, except to the extent such failure to receive or deliver gas
by the upstream or downstream transporter is a direct result of PGT's
failure to perform according to the terms and conditions of this
Agreement.
7.4 Unless herein provided to the contrary, any notice called for
in this Agreement shall be in writing and shall be considered as having
been given if delivered by facsimile or registered mail with all postage
or charges prepaid, to either PGT or Shipper at the place designated
below. Routine communications, including monthly statements , shall be
considered duly delivered when received by ordinary mail or facsimile.
Payments shall be considered duly delivered when received by ordinary
mail, registered mail, or electronic wire transfer. Shipper's daily
nomination shall be considered as duly delivered when received by
electronic data interchange when such system(s) is/are available. If
such system(s) is/are not available, Shipper's daily nominations shall
be considered duly delivered when received by facsimile. Unless
changed, the addresses of the parties are as
follows:
"PGT" PACIFIC GAS TRANSMISSION COMPANY
160 Spear Street
Room 1900
San Francisco, California 94105-1570
Attention: President & CEO
"Shipper" SAN DIEGO GAS & ELECTRIC COMPANY
101 Ash Street
San Diego, California 92101
Attention: Manager, Fuels Department
7.5 A waiver by either party of any one or more defaults by the
other hereunder shall not operate as waiver of any future default or
defaults, whether of a like or of a different character.
7.6 This Agreement may only be amended by an instrument in writing
executed by both parties hereto.
7.7 Nothing in this Agreement shall be deemed to create any rights
or obligations between the parties hereto after the expiration of the
Initial or Subsequent Terms set forth herein, except that termination of
this Agreement shall not relieve either party of the obligation to
correct any quantity imbalances or Shipper of the obligation -.to pay
any amounts due hereunder to PGT.
VII. MISCELLANEOUS
(continued)
7.8 Exhibits A and C attached hereto are incorporated herein by
reference and made a part hereof for all purposes.
7.9 If PGT modified or changes any term or condition specified in
an effective Firm Transportation Service Agreement with any Converting
Shipper receiving service under PGT's Effective Rate Schedule, within
sixty (60) days thereafter, PGT shall offer to make the same term(s) and
condition(s) applicable to any other Converting Shipper then receiving
service under the Effective Rate Schedule.
IN WITNESS WHEREOF the parties hereto have caused this Agreement to
be executed as of the day and year first above written.
PACIFIC GAS TRANSMISSION COMPANY
By: __________________________________
Name: Stephen P. Reynolds
Title: President & CEO
SAN DIEGO GAS & ELECTRIC COMPANY
By: __________________________________
Name: Edwin A. Guiles
Title: Senior Vice President - Energy Supply
Date: October 11, 1994
EXHIBIT A
To the
FIRM TRANSPORTATION SERVICE AGREEMENT
Dated Between
PACIFIC GAS TRANSMISSION COMPANY
And
SAN DIEGO GAS & ELECTRIC COMPANY
Primary Primary Maximum Daily Quantity (MDQ)
Receipt Delivery (Delivered) MMBtu/d(1)
Point(4) Point(4)
Summer(2) Winter(3)
Kingsgate, Malin, Oregon 52,508 52,508
British Columbia
(1) Shipper's Maximum Daily Quantity or MDQ for service under this
Agreement, the Effective Rate Schedule, and the Transportation
General Terms and Conditions shall be based on the quantity of gas
delivered at Shipper's point(s) of delivery as stated in this
Exhibit A.
(2) Summer = April through September
(3) Winter = October through March
(4) Shipper may designate secondary points of receipt and/or delivery
in accordance with Paragraph 29 of the Transportation General Terms
and Conditions.
TO BE COMPLETED WHEN SHIPPER RELEASES CAPACITY
EXHIBIT C
To the
FIRM TRANSPORTATION SERVICE AGREEMENT
Dated Between
PACIFIC GAS TRANSMISSION COMPANY
And
SAN DIEGO GAS & ELECTRIC COMPANY
Type of Replacement Service:
Replacement Shipper:
Receipt Point:
Delivery Point:
Maximum Daily Quantity:
Commencement of Credit:
Termination of Credit:
Level of Credit: __________percent of the maximum rate defined as
__________________________________________
__________________________________________
applicable for service under Rate Schedule FTS-1
Other Terms and Conditions:
1)_______________________________________________________________
2)_______________________________________________________________
3)_______________________________________________________________