Contract for Sale and Purchase of LNG
Party
A:
Xinjiang Guanghui LNG Development Co., Ltd
Party
B:
Beijing Zhong Ran Wei Ye Gas Co., Ltd.
Signatory
Location: Urumqi
Date:
August 9, 2006
Party
A:
Address:
Xinjiang Digital Port Plaza, Urumqi.
Legal
Representative: Xxx Xxxxx
Party
B:
Beijing Zhong Ran Wei Ye Gas Co., Ltd.
Address:
Room2008, Tower A, Caizhi International Plaza, Xx.00, Xxxxxxxxxxxx Xxxx Xxxx,
Xxxxxxx Xxxxxxxx, Xxxxxxx.
Legal
Representative:
According
to The
Contract Law of the People's Republic of China,
Gas
Plan(1987)No.2001 the
Interim Measures Governing Natural Gas Commodity
and
present situation in LNG production, supply and consumption, both Parties agree
to enter into this Contract through consultation, and to comply with terms
and
conditions hereinafter set forth:
Article
One Definition
| 1. |
Standard
Conditions
shall mean an environment with a temperature of 20 degrees Celsius
and an
absolute pressure of 101.325 KPa (standard atmospheric
pressure).
|
| 2. |
Day
shall
mean the period of any calendar day starting at 8:00 and ending at
8:00 in
the next calendar day.
|
| 3. |
Delivery
point
shall mean the place where Party A delivers and Party B receives
LNG.
|
| 4. |
LNG
Price
shall mean the price for the LNG delivered by Party A to Party B
at
delivery point.
|
Article
Two Term of Contract
Both
Parties agree that the term of this Contract shall be three consecutive calendar
years starting from the effective day, that is from August 9, 2006 to December
31, 2009.
Article
Three Term of Gas Supply
The
term
of gas supply shall be from November 1, 2006 to December 31, 2007. Time for
simultaneous inspection shall be decided through consultation between the two
parties.
Article
Four Gas Supply
| 1. |
Planned
monthly gas consumption for Party B: 450
tons
|
| 2. |
Party
B shall provide Party A with gas consumption plans for the next week
in
written forms five days in advance, and pay deposits according to
Section
2 of Article Nine under this Contract. Party A shall decide daily
average
gas consumption after balancing gas consumption plans for all users.
Gas
delivery is done based on actual daily gas
supply.
|
Article
Five Gas Delivery
| 1. |
Delivery
point agreed under this Contract is: Party B’s city vaporizing gate
station, i.e. Xuzhou receiving
station.
|
| 2. |
Gas
supply shall be decided by weight lists provided by Party A and signed
by
both Parties. Should any dispute arise, it shall be resolved according
to
Section 3 of Article Seven under this Contract. The signature time
of
weight lists shall be the time when LNG tank containers are received.
Upon
such delivery, ownership and risk of LNG is shifted to Party
B.
|
Article
Six Gas Quality
| 1. |
Gas
quality shall meet the standards of Category
natural gas set forth in GB17820-1999 Natural Gas, the national standards
of the People’s Republic of China.
|
| 2. |
LNG
composition shall be analyzed by Shanshan LNG Plant, which shall
provide
gas composition reports.
|
Article
Seven Measurement
| 1. |
LNG
shall be measured in weight.
|
| 2. |
Measuring
instruments shall be tested regularly according to measurement and
testing
regulations issued by State Bureau of Technical Supervision and China
Natural Gas Group Co.. Legalized testing departments shall inform
Party A
and Party B to send representatives to witness tests of measuring
instruments.
|
Measurement
personnel must have operation certificates issued by provincial or ministerial
regulative departments or their authorized measurement technical
institutions.
| 3. |
Should
Party B has any objection to Party A’s measurement, Party B shall first
sign the weight lists and note down disputed content. Party B shall
make
payment based on Party A’s measurement. Both Parties shall make
simultaneous testing on measuring instruments within three days since
Party B makes written objection. Should Party A fail such tests,
Party A
shall correct the measurement value and adjust measurement starting
from
the day when Party B makes objection. At the end of each month, Party
A
shall refund for any overpayment or demand supplemental payment for
any
deficiency, based on the adjusted measurement agreed between the
two
Parties. Should Party A pass such tests, Party B shall bear the costs
for
testing measuring instruments and other meters, for personnel and
equipment.
|
Article
Eight Price
Price
for
Party A’s LNG is consisted of ex-plant price and transportation fee. Based on
the price structure of Party A, both Parties agree through consultation that,
the price for LNG provided by Party A to Party B shall be RMB 3950per ton (tax
included), among which RMB 1818 per ton is ex-plant price and RMB 2132 per
ton
is transportation fee.
Article
Nine Payment
| 1. |
Party
B shall pay Party A deposits ( Planned weekly gas consumption times
gas
price). And Party A shall deliver gas upon receiving the
payment.
|
| 2. |
Payment
shall be made through means such as remittance. Legal invoice shall
be
provided for ex-plant price and special invoice for transportation
shall
be provided according to regulations of transportation
industry.
|
Article
Ten Obligations and Responsibilities
1.
Party
A’s
Obligations and Responsibilities
| 1) |
Party
A shall provide Party B with stable and continuous gas supply according
to
the quality and quantity agreed under this
Contract.
|
| 2) |
Party
A shall carry out annual inspection on production equipment, regular
inspection on power lines and equipment, so as to ensure normal gas
supply. If gas supply needs to be suspended due to such regular
inspections, Party A shall inform Party B in writing 10-20 days in
advance, so that Party B has enough time to make gas reserve preparation
before the suspense.
|
| 3) |
Party
A shall promptly inform Party B of suspense of gas supply due to
sudden
failures in power lines, equipment and other aspects ( non- Force
Majeure
events).
|
2.
Party
B’s Obligations and Responsibilities
1)
Party
B shall accept gas according to planned amount in this Contract.
2)
Party
A shall make timely payment to Party B as agreed in this Contract, based on
weight lists signed by both Parties. If Party B fails to settle payment at
due
time, Party B shall pay late payment penalties to Party A (0.5‰ per
day)starting
from the second day since the day of delayed payment. If Party B’s delayed
payment exceeds 15 days, Party A can decrease daily gas supply, and does not
secure minimum daily supply. All the relevant losses and consequences shall
be
borne by Party B.
3)
As for
annual equipment simultaneous inspection, Party B shall inform Party A of such
inspection in writing 10-20 days in advance. After such inspections, Party
B
shall notify Party A in writing 10-20 days before using the gas.
4)
In
cases of sudden failures in equipment and device or emergency suspense of gas
supply in operation ( not due to Force Majeure), Party B shall timely inform
Party A in writing.
Article
Eleven Confidentiality
All
terms
and relevant information in this Contract shall be kept confidential, from
the
day when this Contract is signed to five years after its termination, as agreed
hereby.
Without
written approval from the other Party in advance, neither Party shall reveal
part or all of the terms of this Contract to a third Party during such period.
The breaching Party shall be liable for all the economic losses caused by its
breach.
Article
Twelve Force Majeure
When
Force Majeure events happen, such as war, earthquake, flood, sabotage, traffic
control or traffic ban adopted by relevant departments, road accident, severe
weather affecting transportation, natural disaster, etc., the Force Majeure
claiming party shall notify the other party promptly, provide documents within
reasonable time, and take measures to minimize losses.
The
Claiming Party shall be exempt from part or all of its obligations due to Force
Majeure according to the impact of Force Majeure.
Article
Thirteen Price Adjustment
| 1. |
During
the term of this Contract, should the price of natural gas source
be
adjusted by the National Development and Reform Committee, PetroChina
Company Limited and other relevant governmental departments, which
changes
the price of source natural gas of LNG supplied by Party A, Party
A shall
adjust LNG supply price in Article Eight, according to the adjusted
source
gas price. Supply which has already been executed before the adjustment
shall adopt the original price.
|
| 2. |
During
the term of this Contract, should the price of diesel used by Party
A for
LNG transport vehicles or the price of electricity used by Shanshan
LNG
Plant be adjusted by relevant governmental departments, which changes
the
transport and production cost for LNG supplied by Party A, Party
A shall
adjust LNG supply price in Article Eight, according to the adjusted
electricity and diesel prices. Supply which has already been executed
before the adjustment shall adopt the original
price.
|
The
price
adjustment for LNG according to the abovementioned two sections shall be: Sales
Price = Original Price+Source Gas Price Difference +Added Cost in Source Gas
and
Electricity+ Added Transport Cost in Diesel.
Article
Fourteen Miscellaneous
| 1. |
Should
any disputes or controversies arise from the implementation of this
Contract, the Parties shall attempt in the first instance to resolve
such
dispute through friendly consultations. Should such consultation
or
mediation fail, the Plaintiff shall file litigation at the Court
where the
plaintiff resides.
|
| 2. |
During
the term of this Contract, Party A and Party B shall sign contracts
annually starting from the second year. Annual contract for the next
year
shall be signed three months before the present year terminates.
If such
contract is not signed before the termination of the present contract,
Party A does not secure normal gas supply in the next year. Neither
Party
has the right to transfer any of its rights and obligations under
this
Contract.
|
| 3. |
Notice
and communication between the two parties shall be executed and confirmed
in written forms.
|
| 4. |
As
for the matters which have not been covered in this Contract, the
Parties
shall make supplementary provisions or agreements through consultation.
Such supplementary provisions or agreements shall have the same legal
effect as this Contract.
|
Article
Fifteen
This
Contract is executed in two originals and four copies. Party A and Party B
each
hold one original and two copies.
Article
Sixteen
After
this Contract is signed and sealed by legal representatives or duly authorized
agents of both Parties, Party B must pay RMB200,000 as deposit to Party A within
15 working days. This Contract shall enter into force when the payment is
received. The abovementioned deposit shall become Party B’s payment sum within
one month before this Contract is due.
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Party
A:
|
Party
B:
|
|
Xinjiang
Guanghui LNG Development Xx.Xxx
|
Beijing
Zhong Ran Wei Ye Gas Co., Ltd.
|
|
Sealed
|
Sealed
|
|
Representative:
|
Representative:
|
|
Signed
|
Signed
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