Exhibit 10.54
AMENDMENT TO FS SERVICE AGREEMENT
Recitals
Transcontinental Gas Pipe Line Corporation ("TGPL") and Atlanta Gas Light
Company are parties to two FS Agreements dated August 1, 1991, for Daily Sales
Entitlements of 20,000 Mcf/day and 33,800 Mcf/day, with termination dates of
March 31, 1997 and March 31, 2001, respectively.
The Federal Energy Regulatory Commission issued an "Order on Compliance Filing
and on Rehearing and Accepting Settlement Subject to Clarification" on October
4, 1993, in Dockets RS92-86-000, et al. which, among other things, required the
modification of TGPL's form of Service Agreement under Rate Schedule FS;
TGPL made a Compliance filing reflecting the modifications required by the
October 4 Order;
Accordingly, Article IV, Section 2 and Section 3(d)(ii) of Exhibit A of the FS
Agreement is amended as follows:
ARTICLE IV
POINT(S) OF DELIVERY AND AGENCY AUTHORITY
2. Buyer hereby appoints Seller as its agent for the purpose of arranging for
the transportation of gas (a) purchased and sold hereunder from the Delivery
Point(s) to the ultimate point(s) of delivery ("Redelivery Points") to Buyer
listed on Exhibit "B" attached hereto and/or (b) pursuant to the agency
authority granted in the immediately following paragraph of this Section 2
relating to Buyer's Eminence storage service. In consideration of Buyer's
obligation under this Service Agreement, including the payment of certain fees
pursuant to Article III hereof, Seller agrees to accept such agency appointment.
Pursuant to this agency authority Seller may nominate and schedule
transportation service under Buyer's IT and FT Agreements as an agent for Buyer.
Seller shall be responsible for all imbalance penalties incurred in connection
with such transportation under this Service Agreement.
In addition, Buyer hereby appoints Seller as its exclusive agent for the purpose
of managing storage services received by Buyer under the terms of Seller's Rate
Schedule ESS. In consideration of Buyer's obligation under this Service
Agreement, including the payment of certain fees pursuant to Article III hereof,
Seller agrees to accept such agency appointment. Pursuant to this agency
authority, Seller shall perform all functions necessary to manage Buyer's
Eminence storage service, including but not limited to submitting nominations,
scheduling storage injections and withdrawals and receipt and payment of
injection and withdrawal charges for such service. Buyer understands and
acknowledges that Seller will perform such agency functions on an aggregated
basis for all Buyers under Seller's Rate Schedule FS.
Buyer agrees not to exercise any rights it has under the FT Agreement or
otherwise which would interfere in any way with Seller's ability to utilize a
pro rata share of capacity entitlements under the FT Agreement(s), as set forth
in Transco's FT Rate Schedule, ("Telescoped Rights") (including any associated
upstream Rate Schedule IT or third party pipeline capacity entitlements) to
arrange for the transportation of gas purchased and sold to Buyer hereunder. For
purposes of the preceding sentence, Seller's pro rata share at Station 65 shall
be equal to the product of (i) a percentage calculated by dividing Buyer's Daily
Sales Entitlement by Buyer's Total Daily Transportation Contract Quantity under
the FT Agreement(s) and (ii) a percentage calculated by dividing the quantity of
gas requested hereunder from Seller on such day by Buyer's total daily sales
entitlement under the FS Agreement. For purposes of determining Seller's pro
rata share of capacity at any point on Seller's system the product of (i) and
(ii) above shall be multiplied by Buyer's Transportation Contract Quantity under
the FT Agreement at the applicable point.
Buyer hereby appoints Seller as its agent under Buyer's FT or IT arrangements
with Seller for the purpose of accomplishing the transportation of gas to the
Eminence storage field. In furtherance of that purpose, Buyer shall notify
Seller at or before 3 p.m. each day of any FT capacity upstream of the Eminence
storage field which will be unscheduled under Buyer's FT Agreement with Seller
for the second day following. Seller shall use such information to schedule, as
agent, firm injections into the Eminence storage field. These firm injections
into the Eminence storage field are subject to being preempted by Buyer's actual
use of its FT entitlements on any given day.
If Seller is unable to accomplish all the injections into the Eminence storage
field through use of all Buyers' FT capacity, the remaining injections (IT
Quantity) shall be accomplished by Seller, as agent, under IT arrangements. In
such event, Seller as agent shall be reimbursed by Buyer for IT charges incurred
on Buyer's behalf pursuant to the following formula: Buyer shall reimburse
Seller an amount equal to the product of (i) a percentage, computed by dividing
Buyer's then current Daily FS and OFS Sales Entitlements (limited to FS and OFS
sales agreements in existence on August 1, 1993) by the sum of all of Seller's
then current FS and OFS sales obligations (limited to FS and OFS sales
agreements in existence on August 1, 1993), times Seller's IT quantity not to
exceed 50,000 Mcf/day, as same may change from time to time, multiplied by (ii)
any IT charges in excess of the FT rate level incurred by Seller for such
injections.
Buyer may direct Seller to nominate and schedule at the Delivery Point(s) gas
purchased under this Agreement utilizing Buyer's long haul IT agreements with
Seller (IT Agreements). If Buyer's IT capacity is not sufficient for Seller to
effect the delivery of any or a portion of such gas at the Redelivery Point(s),
Buyer shall advise Seller what portion, if any, of its FS purchases to deliver
utilizing (a) Buyer's IT Agreements, not to exceed the extent of IT capacity
available to Buyer, and (b) Buyer's long haul FT agreements with Seller (FT
Agreements). Seller will not be in breech of any of its obligations under
Articles I, IV, or V of this Agreement if Seller is unable to effect delivery of
such gas at the Redelivery Point(s)
because of insufficient IT capacity, nor shall Seller be deemed to have failed
to deliver the quantities requested by Buyer which Seller is unable to redeliver
for such reason. The availability of gas supplies for sales hereunder which are
to be transported using IT Agreements shall be determined on the same basis as
if they were being transported under FT Agreements.
EXHIBIT A
3(d)(ii)
The three arbitrators shall meet and hear the parties with respect to matters
relevant to which proposed Firm Service Fee will compensate Seller for the value
of providing and maintaining long term gas supplies, on terms and conditions
consistent with a "swing service, which shall include but not be limited to
executed long term sales agreements between other Sellers serving the same or
similar markets and their customers. In deciding which proposed Firm Service Fee
will compensate Seller for the value of providing the foregoing service, the
arbitrators shall consider as part of Seller's compensation the Non-Gas Demand
charges and Rate Schedule ESS charges (for capacity for which Seller has agency
authority) to be paid by Buyer to Seller. The jurisdiction of the arbitrators
shall be limited to the selection, based on all relevant evidence presented, of
either the Final Offer or the Final Counter Offer proposed either by Seller or
by Buyer pursuant to the provisions of this subsection (d). No other Service Fee
will be selected by the arbitrators. The decision by the arbitrators shall be in
writing, signed by the arbitrators or a majority of them, rendered within
seventy (70) days of the appointment of the third arbitrator, and final, binding
and non-appealable, except as set forth in the Uniform Arbitration Act of
Delaware as to the parties hereto. The provisions adopted by the arbitrators
shall be effective as of the first day of the applicable year, regardless of the
actual date of decision of the arbitrators. During any period prior to a
decision by the arbitrators but after commencement of the Contract Year for
which the Service Fee is being renegotiated, Buyer shall continue to pay the
Service Fee that was in effect during the previous Contract Year. Such Service
Fee shall be adjusted retroactively, as necessary, to conform to the arbitrators
decision.
TRANSCO GAS MARKETING COMPANY
Agent for
TRANSCONTINENTAL GAS PIPE LINE
CORPORATION
Name: /S/ H. Xxxx Xxxxx II
H. Xxxx Xxxxx II
Title: Senior Vice President
Date: May 2, 1994
(Signatures Continued on Next Page)
(Signatures Concluded from Previous Page)
ATLANTA GAS LIGHT COMPANY
Name: /S/ Xxxxxxx X. Xxxxxxx
Title: Vice President
Date: September 13, 1994
