AMENDMENT TO THE GAS PURCHASE AGREEMENT DATED MAY 3, 1994
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EXHIBIT 10.7
AMENDMENT TO THE
GAS PURCHASE AGREEMENT
DATED MAY 3, 1994
THIS AMENDMENT (the "July 1999 Amendment"), made and entered into as of the
1st day of July 1999, between Dominion Black Warrior Basin, Inc. ("Seller") and
Sonat Marketing Company L.P. ("Buyer").
WITNESSETH
WHEREAS, Buyer and Seller entered into a Gas Purchase Agreement dated May
3, 1994, as amended by Amendments dated April 1, 1996, May 16, 1996, and April
9, 1998 ("the 1994 Agreement"); and
WHEREAS, Buyer and Seller desire to further amend the 1994 Agreement to
establish Floor and Ceiling Prices for a given quantity and a fixed price for an
equal quantity and related procedures to be effective during the calendar year
2000;
NOW THEREFORE, in consideration of the premises and mutual covenants
contained herein, the parties hereby mutually understand and agree as follows:
1. Section 2.1 of the 1994 Agreement shall be deleted in its entirety
and the following Section 2.1 substituted therefor:
2.1 Subject to the terms and conditions hereinafter set forth,
commencing on the Effective Date, Seller agrees to sell and deliver,
and Buyer agrees to purchase and receive one hundred percent (100%) of
the gas produced in the Field attributable to Seller's interest therein
as described on Exhibit A hereto. On Revised Exhibit B attached hereto,
Seller has designated for each month of the primary term hereof
commencing on the Effective Date, the projected production for such
month (the "Monthly Base Quantity"). Any gas produced during a month in
excess of the Monthly Base Quantity shall be deemed the "Excess
Quantity".
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2. Effective January 1, 2000 through December 31, 2000, Sections 4.1,
4.2 and 4.3 of the 1994 Agreement shall be deleted in its entirety and the
following Sections 4.1, 4.2 and 4.3 shall be substituted therefor:
4.1 The price payable by Buyer for each MMBtu of Monthly Base quantity
purchased hereunder during each month of the primary term hereof
commencing on January 1, 2000 shall be divided into two categories, a
Fixed Price Quantity and an Index Price Quantity, as described in
Revised Exhibit D hereto. The price for each MMBtu of Fixed Price
Quantity shall be $2.45 per MMBtu (the "Monthly Fixed Contract
Price"). The price for each MMBtu of Index Price Quantity shall be the
sum of (a) the price published in the price table dated the first
(1st) day of the applicable month by Inside F.E.R.C.'s Gas Market
Report for "Prices of Spot Gas Delivered to Pipelines" "Southern
Natural Gas Co." "Louisiana" "Index" (the "Index Price") and (b) a
Premium per MMBtu as described below (the "Monthly Index Contract
Price"):
Index Price Premium
($/MMBtu) ($/MMBtu)
--------- ---------
Below 2.00 0.050
2.00 - 2.25 0.060
2.26 - 2.50 0.065
Above 2.50 0.070
4.2 The above Section 4.1 notwithstanding, the Index Price component
of the Monthly Index Contract Price payable during each month shall,
in no event, be less than $2.20 per MMBtu (the "Floor Price"), nor
more than $2.82 per MMBtu (the "Ceiling Price"); provided, however,
that the Premium shall be based on the actual Index Price regardless
whether such Index Price falls below the Floor Price.
4.3 The price payable by Buyer for each MMBtu of Excess Quantity
during the primary term hereof commencing on January 1, 2000 shall be
the sum of the Index Price and $.02 per MMBtu (the "Excess Quantity
Contract Price").
3. Exhibit B is deleted in its entirety and the attached Revised
Exhibit B is substituted therefor.
4. Exhibit D is deleted in its entirety and the attached Revised
Exhibit D is substituted therefor and is effective during the calendar
year 2000 only.
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IN WITNESS WHEREOF, the parties hereto have executed this July 1999
Amendment in duplicate originals as of date hereinabove first written.
Witness: SONAT MARKETING COMPANY L.P.
By /s/ Xxxxxx X. Xxxxxxxx
-------------------------- -------------------------------
Xxxxxx X. Xxxxxxxx
-------------------------- Vice President - Marketing
Witness: DOMINION BLACK WARRIOR BASIN, INC.
/s/ X.X. Xxxx, Xx.
-------------------------------
X.X. Xxxx, Xx.
0
0
XXXXXXX XXXXXXX X
DATED JULY 1, 1999
TO THE
GAS PURCHASE AGREEMENT
BETWEEN
DOMINION BLACK WARRIOR BASIN, INC.
AND
SONAT MARKETING COMPANY L.P., SUCCESSOR-IN-INTEREST
TO SONAT MARKETING COMPANY
DATED
MAY 3, 1994
Month/Year Monthly Base Quantity
---------- ---------------------
Jun-94 2,049,266
Jul-94 2,024,890
Aug-94 1,997,383
Sep-94 1,973,850
Oct-94 1,951,089
Nov-94 1,927,251
Dec-94 1,906,933
Jan-95 1,885,876
Feb-95 1,863,385
Mar-95 1,843,489
Apr-95 1,823,962
May-95 1,805,450
Jun-95 1,787,173
Jul-95 1,771,348
Aug-95 1,756,032
Sep-95 1,740,875
Oct-95 1,726,083
Nov-95 1,711,675
Dec-95 1,698,140
Jan-96 1,685,535
Feb-96 1,673,928
Mar-96 1,663,482
Apr-96 1,652,832
May-96 1,643,705
Jun-96 1,633,814
Jul-96 1,625,079
Aug-96 1,614,930
Sep-96 1,604,315
Oct-96 1,593,147
Nov-96 1,581,881
Dec-96 1,571,915
Jan-97 1,562,875
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Month/Year Monthly Base Quantity
---------- ---------------------
Feb-97 1,554,163
Mar-97 1,540,578
Apr-97 1,525,042
May-97 1,510,269
Jun-97 1,494,454
Jul-97 1,477,976
Aug-97 1,461,398
Sep-97 1,444,593
Oct-97 1,427,214
Nov-97 1,408,676
Dec-97 1,389,533
Jan-97 1,368,701
Feb-98 1,342,469
Mar-98 1,319,441
Apr-98 1,296,269
May-98 1,272,573
Jun-98 1,249,204
Jul-98 1,225,774
Aug-98 1,201,433
Sep-98 1,178,126
Oct-98 1,154,755
Nov-98 1,131,388
Dec-98 1,109,349
Jan-99 1,198,000
Feb-99 1,171,000
Mar-99 1,136,000
Apr-99 1,140,000
May-99 1,106,000
Jun-99 1,094,000
Jul-99 1,096,000
Aug-99 1,071,000
Sep-99 1,053,000
Oct-99 1,045,000
Nov-99 1,007,000
Dec-99 1,008,000
Jan-00 1,200,000
Feb-00 1,200,000
Mar-00 1,200,000
Apr-00 1,200,000
May-00 1,150,000
Jun-00 1,150,000
Jul-00 1,150,000
Aug-00 1,150,000
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Month/Year Monthly Base Quantity
---------- ---------------------
Sep-00 1,100,000
Oct-00 1,100,000
Nov-00 1,100,000
Dec-00 1,100,000
Jan-01 1,050,000
Feb-01 1,050,000
Mar-01 1,050,000
Apr-01 1,050,000
May-01 1,000,000
Jun-01 1,000,000
Jul-01 1,000,000
Aug-01 1,000,000
Sep-01 950,000
Oct-01 950,000
Nov-01 950,000
Dec-01 950,000
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REVISED EXHIBIT D
DATED JULY 1, 1999
TO THE
GAS PURCHASE AGREEMENT
BETWEEN
DOMINION BLACK WARRIOR BASIN, INC.
AND
SONAT MARKETING COMPANY L.P., SUCCESSOR-IN-INTEREST
TO SONAT MARKETING COMPANY
DATED
MAY 3, 1994
Fixed Price Quantities Index Quantities
Month/Year (MMBtu) (MMBtu)
---------- ---------------------- ----------------
Jan-00 600,000 600,000
Feb-00 600,000 600,000
Mar-00 600,000 600,000
Apr-00 600,000 600,000
May-00 575,000 575,000
Jun-00 575,000 575,000
Jul-00 575,000 575,000
Aug-00 575,000 575,000
Sep-00 550,000 550,000
Oct-00 550,000 550,000
Nov-00 550,000 550,000
Dec-00 550,000 550,000
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