Common use of Performance Tests Clause in Contracts

Performance Tests. Seller shall conduct in accordance with Appendix F (Performance Tests) (a) the Liquefaction Train Performance Tests for an individual Liquefaction Train only after such Liquefaction Train has achieved Ready for Test and (b) the Liquefaction Train System Performance Tests only after the Liquefaction Train System has achieved Ready for Test. Seller shall conduct the Performance Tests for each of the Liquefaction Trains, individually, and the Liquefaction Train System, in its entirety, with all of the Liquefaction Trains operating simultaneously, under the conditions and in strict accordance with the requirements set forth in Appendix F (Performance Tests). If (A) the Liquefaction Train Performance Tests of an individual Liquefaction Train demonstrate that the Liquefaction Train Performance Guarantees for such Liquefaction Train System have been achieved or (B) the Liquefaction Train System Performance Tests demonstrate that the Liquefaction Train System Performance Guarantees have been achieved, then Seller shall provide Buyer with written notice of such occurrence and shall provide Buyer with a test report, together with supporting documentation, demonstrating the achievement of the applicable Performance Guarantees within ten (10) Days of the date of the completion of such Performance Tests and upon receipt of such documentation Buyer shall, within ten (10) Days, either (A) confirm in writing to Seller the successful completion of the Liquefaction Train Performance Tests or the Liquefaction Train System Performance Tests or (B) provide written notice to Seller of why Buyer disagrees that the Liquefaction Train Performance Guarantees or the Liquefaction Train System Performance Guarantees have been achieved. If any Performance Test indicates that an individual Liquefaction Train or the Liquefaction Train System fails to achieve any Performance Guarantee for reasons attributable to Seller, its Affiliates or Subcontractors, then Seller shall, at its own cost and expense, take appropriate corrective action and Seller shall thereafter reperform the Performance Test. Seller’s obligation to meet the Liquefaction Train Performance Guarantees under this Clause 25 shall be satisfied when (i) all the Liquefaction Train Performance Tests have been completed, and (ii) either (1) such tests demonstrate that all Liquefaction Train Performance Guarantees are met or (2) such tests demonstrate that the Liquefaction Train Power Demand Minimum Performance Guarantee is met and Seller has paid all payable liquidated damages for the Liquefaction Train Performance Guarantees that are not met. Seller’s obligation to meet the Liquefaction Train System Performance Guarantees under this Clause 25 shall be satisfied when (i) all the Liquefaction Train System Performance Tests have been completed, and (ii) either (1) such tests demonstrate that all Liquefaction Train System Performance Guarantees are met or (2) such tests demonstrate that the Liquefaction Train Power Demand Minimum Performance Guarantee and the Refrigerant Losses Performance Guarantee are met and Seller has paid all payable liquidated damages for the Liquefaction Train System Performance Guarantees that are not met. At all times during start-up, testing and commissioning of the Liquefaction Train System, Owner may, at no expense to Seller, arrange for the disposition of the Facility’s LNG. Owner shall have all right, title and interest to all LNG produced by the Facility and all of the proceeds from the sale thereof.

Performance Tests. Seller (a) The Borrower shall conduct not, without the prior written consent of the Administrative Agent (not to be unreasonably withheld or delayed) in consultation with the Independent Engineer, agree with the EPC Contractor on the protocol for Performance Tests. The Administrative Agent shall not be obligated to approve such protocols for Performance Tests unless all such Performance Tests are undertaken in all material respects in compliance with all Government Approvals as is or in the future shall be necessary for the Project under applicable Government Rules (except any such Government Rules and Government Approvals the non-compliance with which could not reasonably be expected to result in a Material Adverse Effect, with respect to the Project). (b) The Administrative Agent and the Independent Engineer have the right to witness and verify any Performance Tests in accordance with Appendix F the guidelines set forth in Exhibit C to the EPC Contract and Good Industry Practices. The Borrower shall give the Administrative Agent and the Independent Engineer notice regarding each proposed Performance Test no less than fifteen (15) Business Days prior to any Performance Test and shall deliver a copy of the Test Procedures (as defined in the EPC Contract) to the Administrative Agent and the Independent Engineer within one (1) Business Day of receipt from the EPC Contractor. If, upon completion of any Performance Tests, the Borrower has decided to use such Performance Tests as the basis for the issuance of the Partial Taking-Over Certificate or the Final Taking-Over Certificate, it shall so notify the Administrative Agent and the Independent Engineer and shall deliver a copy of all test results supporting the results of such Performance Test, accompanied by supporting data and calculations including a report that indicates the Borrower’s preliminary opinions as to the results of the Performance Tests (each, a “Performance Test Report”) and the Independent Engineer will, upon a thorough review of such Performance Test Report, certify in writing to the Administrative Agent, within five (5) Business Days of the receipt of such Performance Test Report, the results of the Performance Tests and confirming that such Performance Tests were performed in accordance with the EPC Contract and Good Industry Practices or deliver a report to the Administrative Agent and the Borrower setting forth in reasonable detail any objections of the Independent Engineer to such Performance Test Report. If any such valid objections are made, then the Borrower shall be permitted to address such objections to the reasonable satisfaction of the Independent Engineer or conduct additional Performance Tests in accordance with this Section 8.26. (c) The Borrower shall permit the EPC Contractor to complete Performance Tests, in accordance with sub-clauses (a) the Liquefaction Train Performance Tests for an individual Liquefaction Train only after such Liquefaction Train has achieved Ready for Test and (b) above, in order to achieve the Liquefaction Train System Performance Tests only after the Liquefaction Train System has achieved Ready for Test. Seller shall conduct the Performance Tests for each performance guarantee levels pursuant to Section 10.9 of the Liquefaction Trains, individually, and the Liquefaction Train System, in its entirety, with all of the Liquefaction Trains operating simultaneously, under the conditions and in strict accordance with the requirements set forth in Appendix F (Performance Tests). If (A) the Liquefaction Train Performance Tests of an individual Liquefaction Train demonstrate that the Liquefaction Train Performance Guarantees for such Liquefaction Train System have been achieved or (B) the Liquefaction Train System Performance Tests demonstrate that the Liquefaction Train System Performance Guarantees have been achieved, then Seller shall provide Buyer with written notice of such occurrence and shall provide Buyer with a test report, together with supporting documentation, demonstrating the achievement of the applicable Performance Guarantees within ten (10) Days of the date of the completion of such Performance Tests and upon receipt of such documentation Buyer shall, within ten (10) Days, either (A) confirm in writing to Seller the successful completion of the Liquefaction Train Performance Tests or the Liquefaction Train System Performance Tests or (B) provide written notice to Seller of why Buyer disagrees that the Liquefaction Train Performance Guarantees or the Liquefaction Train System Performance Guarantees have been achieved. If any Performance Test indicates that an individual Liquefaction Train or the Liquefaction Train System fails to achieve any Performance Guarantee for reasons attributable to Seller, its Affiliates or Subcontractors, then Seller shall, at its own cost and expense, take appropriate corrective action and Seller shall thereafter reperform the Performance Test. Seller’s obligation to meet the Liquefaction Train Performance Guarantees under this Clause 25 shall be satisfied when (i) all the Liquefaction Train Performance Tests have been completed, and (ii) either (1) such tests demonstrate that all Liquefaction Train Performance Guarantees are met or (2) such tests demonstrate that the Liquefaction Train Power Demand Minimum Performance Guarantee is met and Seller has paid all payable liquidated damages for the Liquefaction Train Performance Guarantees that are not met. Seller’s obligation to meet the Liquefaction Train System Performance Guarantees under this Clause 25 shall be satisfied when (i) all the Liquefaction Train System Performance Tests have been completed, and (ii) either (1) such tests demonstrate that all Liquefaction Train System Performance Guarantees are met or (2) such tests demonstrate that the Liquefaction Train Power Demand Minimum Performance Guarantee and the Refrigerant Losses Performance Guarantee are met and Seller has paid all payable liquidated damages for the Liquefaction Train System Performance Guarantees that are not met. At all times during start-up, testing and commissioning of the Liquefaction Train System, Owner may, at no expense to Seller, arrange for the disposition of the Facility’s LNG. Owner shall have all right, title and interest to all LNG produced by the Facility and all of the proceeds from the sale thereofEPC Contract.