Exhibit 10.46
Contract # .4188
SERVICE AGREEMENT
between
TRANSCONTINENTAL GAS PIPE LINE CORPORATION
and
NORTH CAROLINA NATURAL GAS CORPORATION
DATED
November 1, 1998
SERVICE AGREEMENT
THIS AGREEMENT entered into this first day of November, 1998, by and
between TRANSCONTINENTAL GAS PIPE LINE CORPORATION, a Delaware corporation,
hereinafter referred to as "Seller," first party, and NORTH CAROLINA NATURAL GAS
CORPORATION, hereinafter referred to as "Buyer," second party,
WITNESSETH
WHEREAS, pursuant to Order Nos. 636, issued by the Federal Energy
Regulatory Commission (Commission), Buyer has notified Seller of its desire to
convert its firm transportation service under Seller's Rate Schedule X-302 from
Service under Part 157 of the Commission's regulations to service under Part
284(G) of the Commission's regulations; and
WHEREAS, Buyer has designated that such 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 X-302
NOW, THEREFORE, Seller and Buyer agree as follows:
ARTlCLE 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
a. 16,300 Mcf per day for the peak winter months of December,
January, and February, and
b. 14.670 Mcf per day for the shoulder winter months of
November and March
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 point(s) 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, that such 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
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:
2
SERVICE AGREEMENT (CONTINUED)
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 point(s) 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 November 1, 1998 and shall
remain in force and effect until 9:00 a.m. Central Clock Time November 1, 2005
and thereafter until terminated by Seller or Buyer upon at least nine (9) months
prior 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 or 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. In the event Buyer and
Seller mutually agree to a negotiated rate and specified term for service
hereunder, provisions governing such negotiated rate (including surcharges) and
term shall be set forth on Exhibit C to the service agreement.
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
will be specified in the currently effective Sheet No. 44 of Volume No. 1 of
this Tariff which relates to service under this agreement and which is
incorporated herein.
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 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.
3
SERVICE AGREEMENT (CONTINUED)
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 X-302 Service Agreement between Seller and
buyer, dated July 2, 1990, as amended on February 1, 1992 and
as amended on 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
X.X. Xxx 0000
Xxxxxxx, Xxxxx, 00000
Attention: Customer Services
(b) If to Buyer:
North Carolina Natural Gas Corporation
P. O. Box 909
(150 Rowan)
Fayetteville, North Carolina 28302-0-0-0
Attn: Vice President, Gas Supply & Transportation
4
SERVICE AGREEMENT (CONTINUED)
IN WITNESS WHEREOF, the parties hereto have caused this agreement to
be signed by their respective officers or representatives thereunto duly
authorized.
TRANSCONTINENTAL GAS PIPE LINE CORPORATION
(Seller)
By /s/ Xxxxx X. Xxxxxxx
--------------------
Xxxxx X. Xxxxxxx
Vice President - Customer Service
Rates
NORTH CAROLINA NATURAL GAS CORPORATION
(Buyer)
By /s/ Xxxxxx X. Xxxxx
-------------------
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EXHIBIT A
Buyer's Buyer's
Mainline Capacity Mainline Capacity
Entitlement Entitlement
Receipt Peak Months Shoulder Months
Month (2/) (Mcf per day) (3/) (Mcf per day) (3/)
--------- ------------------ -------------------
TIER 1 (1/) Holmesville 14,162 12,746
TIER 11 (1/) Xxxxxxxxx Xxxxx County- 14,162 12,746
Miss Fuels
Bass Exchange-FGT
Bassfield-ANR
Holiday Creek
Xxxxxx-Xxxxxx
West Oakvale
Oakvale-Amoco
Oakvale-Amoco Xxxxxx
Xxxxxxxxxx-First Reserve
Xxxxxxxx-United
Greens Creek
Xxxxx County-Gitano
Xxxx Xxxxx Creek
Holiday Creek-ANR
TIER 111 (1/) Xxxxx County-Miss Fuels 16,300 14,670
Magnolia Pipeline Interconnect
Jonesboro-SNG
Heidelberg
Station 85 Main Line Pool
---------------------
(1/) TIER 1 - Transco's mainline between Holmesville and Station 70
TIER 11 - Transco's mainline between Station 70 and Station 80
TIER 111 -Transco's mainline downstream of Station 80
(2/) Transco's ability to receive gas under this Rate Schedule at specific
point(s) of receipt is subject to the operating limitations of Transco
and the upstream party at such point(s) and the availability of
capacity at such point(s) of receipt.
(3/) 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. The volume
provided for each tier represents the maximum allowable firm capacity
entitlement to be transported through the associated tier from all
receipt points within that tier. However, the total cumulative capacity
entitlement for all receipt points provided herein shall not exceed the
specified capacity entitlement provided for Tier 111, which amount
shall equal Shipper's transportation contract demand quantity. To the
extent that on any day other participants in Transco's Southern
Expansion Project are not utilizing their total daily TCDQ within a
Tier, Transco is willing to receive additional quantities of gas from
Shipper at such points within such Tier, on an interruptible basis, not
to exceed Shipper's total daily TCDQ.
EXHIBIT B
Transportation Transportation
Contract Quantity Contract Quantity
Delivery Peak Months Shoulder Months
Point(s) of Delivery and Pressure* (Mcf per Day) (Mcf per Day)
---------------------------------- ----------------- -----------------
N. C. Natural Tidewater 10,000 9,000
Pleasant Hill 6,300 5,670
Total Transportation
Contract Demand Quantity: 16,300 14,670
------ ------
* Subject to the conditions contained in this Agreement, Seller shall
make deliveries of gas for the account of Buyer at the Point(s) of
Delivery specified above at such pressures as may be available from
time to time in Seller's line serving such Point(s) of Delivery not to
exceed maximum allowable operating pressure, but not less than fifty
(50) psig or at such other pressures as may be agreed upon in the
day-to-day operations of Buyer and Seller.
Deliveries of gas to the Point(s) of Delivery shall be subject to the
limitations of Shipper's Delivery Point Entitlements (DPE) at such
points as set forth in Transco's FERC Gas Tariff.
