EXHIBIT 10.31
SERVICE AGREEMENT
between
TRANSCONTINENTAL GAS PIPE LINE CORPORATION
and
UGI UTILITIES, INC.
SERVICE AGREEMENT (CONTINUED)
SERVICE AGREEMENT
THIS AGREEMENT entered into this 1st day of October, 1996, by and between
TRANSCONTINENTAL GAS PIPE LINE CORPORATION, a Delaware corporation, hereinafter
referred to as "Seller," first party, and UGI UTILITIES, INC., hereinafter
referred to as "Buyer," second party,
WITNESSETH
WHEREAS, pursuant to the Federal Energy Regulatory Commission's
(Commission) Order No. 636 and Seller's procedures set forth on page 7 of
Seller's August 4, 1993 Order No. 636 Compliance Filing in Docket No. RS92-86,
Buyer has notified Seller of its desire to unbundle its bundled firm
transportation service under Seller's Rate Schedule FT-NT and convert such
service from Part 157 of the Commission's regulations to service with Seller and
the upstream pipeline(s) under Part 284(g) of the Commission's regulations; and
WHEREAS, Buyer has designated that Seller's Part 284(g) service will be
rendered under Seller's Rate Schedule FT; and
WHEREAS, Seller has prepared this agreement for service for Buyer under
Rate Schedule FT, and this agreement will supersede and terminate the existing
service agreement between Seller and Buyer under Rate Schedule FT-NT; and
WHEREAS, this agreement shall not be effective until Seller's service
agreements) with the upstream transporter(s) has (have) been amended to reflect
Seller's reduced transportation service entitlement.
NOW, THEREFORE, Seller and Buyer agree as follows:
ARTICLE I
GAS TRANSPORTATION SERVICE
1. Subject to the terms and provisions of this agreement and of Seller's
Rate Schedule FT, Buyer agrees to deliver or cause to be delivered to Seller gas
for transportation and Seller agrees to receive, transport and redeliver natural
gas to Buyer or for the account of Buyer, on a firm basis, up to the dekatherm
equivalent of a Transportation Contract Quantity ("TCQ") of ) 22,000 Mcf per
day.
2. Transportation service rendered hereunder shall not be subject to
curtailment or interruption except as provided in Section 11 of the General
Terms and Conditions of Seller's FERC Gas Tariff.
ARTICLE II
POINT(S) OF RECEIPT
Buyer shall deliver or cause to be delivered gas at the points) of receipt
hereunder at a pressure sufficient to allow the gas to enter Seller's pipeline
system at the varying pressures that may exist in such system from time to time;
provided, however, the pressure of the gas delivered or caused to be delivered
by Buyer shall not exceed the maximum operating pressure(s) of Seller's pipeline
system at such point(s) of receipt. In the event the maximum
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SERVICE AGREEMENT (CONTINUED)
operating, pressure(s) of Seller's pipeline system, at the point(s) of receipt
hereunder, is from time to time increased or decreased, then the maximum
allowable pressure(s) of the gas delivered or caused to be delivered by Buyer to
Seller at the point(s) of receipt shall be correspondingly increased or
decreased upon written notification of Seller to Buyer. The point(s) of receipt
for natural gas received for transportation pursuant to this agreement shall be:
See Exhibit A, attached hereto, for points of receipt.
ARTICLE III
POINT(S) OF DELIVERY
Seller shall redeliver to Buyer or for the account of Buyer the gas
transported hereunder at the following points) of delivery and at a pressure(s)
of:
See Exhibit B, attached hereto, for points of delivery and pressures.
ARTICLE IV
TERM OF AGREEMENT
This agreement shall be effective as of October 1, 1996 and shall remain
in force and effect until 8:00 a.m. Eastern Standard Time October 31, 2006 and
thereafter until terminated by Seller or Buyer upon at least twelve (12) months
written notice; provided, however, this agreement shall terminate immediately
and, subject to the receipt of necessary authorizations, if any. Seller may
discontinue service hereunder if (a) Buyer, in Seller's reasonable judgement
fails to demonstrate credit worthiness, and (b) Buyer fails to provide adequate
security in accordance with Section 32 of the General Terms and Conditions of
Seller's Volume No. 1 Tariff. As set forth in Section 8 of Article II of
Seller's August 7, 1989 revised Stipulation and Agreement in Docket Nos. RP88-68
et. al., (a) pregranted abandonment under Section 284.221 (d) of the
Commission's Regulations shall not apply to any long term conversions from firm
sales service to transportation service under Seller's Rate Schedule FT and (b)
Seller shall not exercise its right to terminate this service agreement as it
applies to transportation service resulting from conversions from firm sales
service so long as Buyer is willing to pay rates no less favorable than Seller
is otherwise able to collect from third parties for such service.
ARTICLE V
RATE SCHEDULE AND PRICE
1. Buyer shall pay Seller for natural gas delivered to Buyer hereunder in
accordance with Seller's Rate Schedule FT and the applicable provisions of the
General Terms and Conditions of Seller's FERC Gas Tariff as filed with the
Federal Energy Regulatory Commission, and as the same may be legally amended or
superseded from time to time. Such Rate Schedule and General Terms and
Conditions are by this reference made a part hereof.
2. Seller and Buyer agree that the quantity of gas that Buyer delivers or
causes to be delivered to Seller shall include the quantity of gas retained by
Seller for applicable compressor fuel, line loss make-up (and injection fuel
under Seller's Rate Schedule GSS, if applicable) in providing the transportation
service hereunder, which quantity may be changed from time to time and which
3. In addition to the applicable charges for firm transportation service
pursuant to Section 3 of Seller's Rate Schedule FT, Buyer shall reimburse Seller
for any and all filing fees
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SERVICE AGREEMENT (CONTINUED)
incurred as a result of Buyer's request for service under Seller's Rate Schedule
FT, to the extent such fees are imposed upon Seller by the Federal Energy
Regulatory Commission or any successor governmental authority having
jurisdiction.
ARTICLE VI
MISCELLANEOUS
1. This Agreement supersedes and cancels as of the effective date hereof
the following contract(s) between the parties hereto:
Rate Schedule FT-NT Service Agreement between Seller and Buyer dated July
20, 1992 as amended October 1, 1992 and February 1, 1993.
2. No waiver by either party of any one or more defaults by the other in
the performance of any provisions of this agreement shall operate or be
construed as a waiver of any future default or defaults, whether of a like or
different character.
3. The interpretation and performance of this agreement shall be in
accordance with the laws of the State of Texas, without recourse to the law
governing conflict of laws, and to all present and future valid laws with
respect to the subject matter, including present and future orders, rules and
regulations of duly constituted authorities.
4. This agreement shall be binding upon, and inure to the benefit of the
parties hereto and their respective successors and assigns.
5. Notices to either party shall be in writing and shall be considered as
duly delivered when mailed to the other party at the following address:
(a) If to Seller:
Transcontinental Gas Pipe Line Corporation
P.O. Box 1396
Houston, Texas, 77251
Attention: Customer Services
(b) If to Buyer:
UGI UTILITIES, INC.
P.O. Box 13009
Reading, Pennsylvania 19612-3009
Attention: Vice President - Gas Supply
Such addresses may be changed from time to time by mailing appropriate notice
thereof to the other party by certified or registered mail.
IN WITNESS WHEREOF, the parties hereto have caused this agreement to be
signed by their respective officers or representatives thereunto duly
authorized.
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SERVICE AGREEMENT (CONTINUED)
TRANSCONTINENTAL GAS PIPE LINE CORPORATION
(Seller)
By: /s/ Rosemary W. Schatzman
-----------------------------------------
Rosemary W. Schatzman
Director of Customer Service & Scheduling
UGI UTILITIES, INC.
(Buyer)
By: /s/ R.J. Chaney
-----------------------------------------
Title:
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EXHIBIT A
BUYER'S CAPACITY
POINT(S) OF RECEIPT ENTITLEMENT (Mcf/d) 1/
------------------- ----------------------
The point of interconnection between the 22,000
facilities of Seller and CNG Transmission
Corporation at Leidy in Clinton County,
Pennsylvania.
1/ These quantities do not include the additional quantities of gas retained by
Seller for applicable compressor fuel and line loss make-up provided for in
Article V, 2 of this Service Agreement, which are subject to change as provided
for in Article V, 2 hereof.
EXHIBIT B
POINT(S) OF DELIVERY PRESSURE(S)
-------------------- -----------
Hazelton District Meter Station, located at Not less than fifty (50) pounds per square
mile post 61.73 on Seller's Leidy inch gauge or at such other pressures as
may
Transmission Line approximately 3,400 feet be agreed upon in the day to day operations
east of Junction of Pennsylvania Highways of Buyer and Seller.
940 and 115 in Tobyhanna Township, Monroe
County, Pennsylvania.
TEVCO-UGI Meter Station (Humbolt), Luzerne Not less than fifty (50) pounds per square
County, Pennsylvania. inch gauge or at such other pressures as
may
be agreed upon in the day to day operations
of Buyer and Seller.
Quarryville Meter Station, Lancaster County, Not less than fifty (50) pounds per square
Pennsylvania. inch gauge or at such other pressures as
may
be agreed upon in the day to day operations
of Buyer and Seller.