5-2. Sample Gas Purchase Agrmt 2025.pdf

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Form Revised March 2020-MWN

GAS PURCHASE AGREEMENT

The City of Amarillo (“CITY”), a municipal corporation located in Potter and Randall Counties, Texas, whose address is 623 S. Johnson St. Amarillo, Texas 79101 and _______________ (“SELLER”), whose address is _____________________________, hereby agree as follows:

ARTICLE I. Definitions

For purposes of this Agreement, unless the context hereof requires otherwise, the following definitions shall be applicable to the words shown, whether capitalized or not here or in body of the Agreement:

"BTU" shall mean British Thermal Unit and represents the quantity of heat required to raise the temperature of one (1) pound avoirdupois of pure water from 58.5° Fahrenheit to 59.5° Fahrenheit.

"Day" shall mean the twenty-four (24) hour period commencing at 8:00 a.m.., Central Time, on one calendar day and ending at 8:00 a.m., Central Time, on the following calendar day.

“Delivery Point” shall mean the Point of connection between the Buyer’s facilities and the Seller’s facilities. The Delivery Point for CITY’s Hollywood Road Wastewater Treatment Plant shall be the meter located approximately at the northwest corner of Section 117, Block 2, A.B. & M. Survey, Randall

County, Texas adjacent to the plant entrance road. The Delivery Point for CITY’s River Road Wastewater

Treatment Plant shall be the meter located at the treatment plant which is approximately five miles north of St. Francis Avenue and two miles east of U.S. Highway 87/287 in Section 14, Block 1, BS&F Survey, Potter County, Texas.

"Gas" shall mean natural gas produced from gas wells (i.e., gas-well gas), gas produced in association with oil (i.e., casinghead gas), and the residue gas resulting from the processing of both casinghead gas and gas-well gas.

"Heating value" shall mean the number of BTUs produced by the complete combustion, at a constant pressure, of the amount of gas that would occupy a volume of one (1) cubic foot at a temperature of 60 Fahrenheit if saturated with water vapor and at a constant pressure of 14.73 psia and under standard gravitational force (acceleration 980.665 cm per sec. per sec.) with air of the same temperature and pressure as the gas when the products of combustion are cooled to the initial temperature of the gas and air when the water formed by combustion is condensed to the liquid state.

"Mcf" shall mean the volume of gas which occupies a space of one thousand (1,000) cubic feet at a temperature of 60° Fahrenheit and at an absolute pressure equal to the pressure set forth in Subparagraph

3(a) of this Agreement.

"MMBtu" shall mean one million (1,000,000 ) BTUs.

"Month" or "Billing Month" shall mean the period extending from 8:00 a.m., Central Time, on the first day of one calendar month to 8:00 a.m., Central Time, on the first day of the next succeeding calendar

-2-month, except that the first Billing Month shall commence on the date of the initial delivery of gas hereunder and shall end at 8:00 a.m., Central Time, on the first day of the next succeeding calendar month.

"psia" shall mean pounds per square inch absolute.

ARTICLE II. Term

CITY agrees to purchase its gas supply for the Hollywood Road and River Road Wastewater Treatment

Plants from SELLER, for a period of one year, beginning on _______________________, 20___ and ending on ______________________, 20___. The parties may renew this Agreement by mutual consent for 4 additional one-year terms. Each one-year renewal must be agreed to in writing prior to the end of the then current one-year term.

ARTICLE III. Price

Each month, the city pays for natural gas delivered a monthly gas price equal to the Market Center Spot-

Gas Price for West Texas Waha as quoted at the beginning of each month in the "Inside F.E.R.C. 's Gas

Market Report under the column marked "Index" plus $______ per MM BTU measured at a pressure of

14. 73 psia and a standard temperature of 60 degrees Fahrenheit plus a 1.25% fuel charge. .

ARTICLE IV. Payment

CITY shall pay SELLER monthly within thirty-one days after receipt of SELLER’S statement of account for the Billing Month. The statement shall be accompanied by a schedule showing the Pressure Factor computation, the Temperature Factor computation, and the BTU Multiplier for the Billing Month. Any amount owed by the CITY and not paid before the due date shall thereafter bear interest at a rate provided by law. Any error discovered in a statement shall be promptly corrected.

ARTICLE V. Delivery Points

The Delivery Points are the outlet side of SELLER’S measuring facilities that connect both the CITY’S

Hollywood Road and River Road Wastewater Treatment Plants to SELLER’S gas transmission facilities.

The parties acknowledge that SELLER has no obligation under this Agreement to sell or deliver gas to

CITY in excess of Eight Hundred (800) MMBTU per day, the Maximum Daily Quantity.

ARTICLE VI. Pressure

SELLER shall deliver the gas sold hereunder, or cause such gas to be delivered, at the pressure requested by CITY provided the requested pressure does not exceed SELLER’S system pressure.

ARTICLE VII. Measurement of Gas

7.1. Unless otherwise specifically provided herein, the unit of volume for purposes of the measurement of gas delivered hereunder at the Delivery Points shall be one (1) Mcf.

7.2. The computation of the volumes of gas delivered hereunder shall be made in accordance with the

American Gas Association Measurement Committee Report No.3, including the Appendix thereto, as published in April, 1955, and amended or revised from time to time.

7.3. For purposes of the measurement of gas and calibration of meters, the average atmospheric

(barometric) pressure at the Delivery Points shall be assumed to be the local pressure as determined by

SELLER for the area in which the Delivery Points is located unless otherwise specified by SELLER.

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7.4. The measuring facilities currently located at the Delivery Points shall be the Official Billing

Measurement Station for purposes of this Agreement. SELLER shall perform the reading, calibrating, and adjusting of, and the changing of charts on the equipment in the Official Billing Measurement Station and shall perform all gas analyses relating to the gas delivered pursuant to this Agreement. The measuring facilities shall be tested quarterly for accuracy. The CITY shall have the right, at its expense, to perform its own testing of the measuring facilities upon ten (10) days prior written notice to SELLER.

7.5. If, upon testing, any measuring equipment is found to be inaccurate by two percent (2%) or less, previous readings of such equipment shall be considered accurate in computing deliveries hereunder. If, upon such testing, any such measuring equipment shall be found to be inaccurate by more than plus or minus two percent (2%), then any previous readings of such billing equipment shall be corrected to zero error for any part of the period since the last test during which such error is known to have existed or which may be agreed upon in actual practice by the parties. In case the period of such error is not definitely known or agreed upon, such correction shall be for a period of one-half of the time elapsed since the date of the last such test but not exceeding a correction period of fifteen (15) days.

7.6. CITY shall have the right to be present at the time of any installing, reading, cleaning, changing, repairing, inspecting, testing, calibrating, or adjusting done in connection with the measuring equipment at the Official Billing Measurement Station.

ARTICLE VIII. Maintenance of Equipment and Measuring Facilities

SELLER will maintain any equipment owned by it and used in the performance of its obligations herein, including but not limited to the Official Building Measurement Station, in good, safe, and efficient operating condition and repair.

ARTICLE IX. Quality of Gas

All gas delivered by SELLER at the Delivery Point(s) shall be of good and merchantable quality and consistent with the quality of gas generally available in the pipeline system of the transporter delivering the gas at the Delivery Points. The gas shall have a gross heating value of not less than nine hundred fifty

(950) BTUs per cubic foot at 14.73 psia and a standard temperature of 60 degrees.

ARTICLE X. Heating Value

The gross heating value as determined by SELLER shall be corrected from the conditions of testing and analysis to that of the actual condition of the gas as delivered, expressed in BTUs per cubic foot and reported at a standard pressure of 14.73 psia a standard temperature of 60° Fahrenheit on a dry basis when the gas as delivered contains seven (7) pounds of water or less per one million cubic feet.

ARTICLE XI. Ownership and Control

11.1. SELLER warrants that (i) it has good title to all gas delivered to SELLER, (ii) it has the right to sell such gas, and (iii) all such gas is free from any and all liens, encumbrances, and adverse claims. Seller agrees to hold CITY harmless from and against any adverse; claims asserted with respect to any gas delivered hereunder to the Delivery Points.

11.2. Title to the gas shall pass from SELLER to CITY, upon the delivery thereof at the Delivery Points.

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11.3. As between the parties hereto SELLER shall be in exclusive control and possession of the gas deliverable hereunder at all times prior to the delivery thereof to or for the account of CITY and shall be responsible for any damages, losses, or injuries caused thereby or by SELLER’S handling or delivery thereof (except to the extent such damages, losses, or injuries shall have been caused by the act or omission of CITY), after which delivery CITY shall be in exclusive control and possession thereof and responsible for any damages, losses, or injuries caused thereby or by CITY’S handling or receipt thereof (except to the extent such damages, losses, or injuries shall have been caused by the act or omission of SELLER).

ARTICLE XII. Governmental Regulations

12.1. This Agreement is subject to (i) all applicable and valid statutes, ordinances, rules, regulations, and orders of any federal, state, or local governmental authority having jurisdiction over either of the parties, the facilities used in the delivery of the gas sold hereunder, or the subject matter of this Agreement and

(ii) the provisions of the applicable franchises, if any, under which SELLER and any transporter of the gas operates. SELLER and CITY will obtain, if possible, any necessary authority to effectuate the purchase and sale of gas hereunder in the event this Agreement or the purchase and sale of gas hereunder for any reason becomes subject to the jurisdiction of any governmental authority that, as of the date hereof, does not have such jurisdiction.

12.2. CITY hereby warrants and represents to SELLER that none of the gas purchased hereunder will be resold, transported, used, or consumed in any state other than the State of Texas in such a manner or under any circumstances that would cause the gas covered hereunder, SELLER, any transporter of the gas, or the facilities associated with the sale and delivery of such gas to become subject to the jurisdiction and regulations of the Federal Energy Regulatory Commission or any successor body having jurisdiction.

CITY recognizes and acknowledges that SELLER entered into this Agreement in reliance upon such warranty and representation and that SELLER would have been unwilling to enter into this Agreement in the absences of such warranty and representation. CITY agrees that it will not voluntarily commit the gas purchased hereunder to interstate commerce as that term is defined in the Natural Gas Act but would do so only under compulsion of governmental authority. CITY further agrees that, in the event SELLER becomes or believes in its sole judgment that it, the transporter, any facilities used or the gas sold hereunder may become subject to the jurisdiction of the Federal Energy Regulatory Commission or any successor body as a result of the performance of its obligations hereunder, SELLER may terminate this Agreement immediately and without any prior notice to CITY.

ARTICLE XIII. Force Majeure

13.1. In the event that either SELLER or CITY is rendered unable, wholly or in part, by reason of an event of force majeure, to perform its obligations under this Agreement, other than to make payment due hereunder, and such party has given notice and full particulars of such force majeure in writing to the other party as soon as possible after the occurrence of the cause relied on, then the obligations of the parties, insofar as they are affected by such force majeure, shall be suspended during the continuance of such inability, but for no longer period, and such cause shall, insofar as possible, be remedied with all reasonable dispatch; provided, however, that the settlement of strikes or lock-outs shall be entirely within the discretion of the party having such difficulty, and the above requirement that any force majeure be remedied with all reasonable dispatch shall not require the settlement of strikes or lock-outs by acceding to the demands of the opposing party when such course is inadvisable in the discretion of the party having the difficulty.

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13.2. The term "force majeure" as used in this Agreement shall mean any cause not reasonably within the control of the party claiming suspension and includes, but is not limited to, acts of God; strikes; lock-outs;

wars; riots; orders or decrees of any lawfully constituted federal, state, or local body; fires; storms; floods;

wash-outs; explosions; breakage or accident to machinery or lines of pipe; inability to obtain or delay in obtaining rights-of-way, material, supplies, or labor permits; temporary or permanent failure of gas supply or transportation services; repair, maintenance, or replacement of facilities used in the performance of the obligations contained in this Agreement; or any other cause whether of the kind herein enumerated or otherwise.

ARTICLE XIV. Remedies Upon Material Default

14.1. If either party hereto shall fail to perform any material covenant or obligation imposed upon it under this Agreement, then in such event the non-defaulting party may, at its option, terminate this Agreement upon acting in accordance with the procedures hereafter set forth. The non-defaulting party shall cause a written notice to be served on the defaulting party, which notice shall state specifically the cause of terminating this Agreement and shall declare it to be the intention of the non-defaulting party to terminate this Agreement if the default is not cured. The defaulting party shall have thirty days after receipt of the aforesaid notice in which to remedy or remove the cause or causes stated in the termination notice, and, if within such thirty-day period, the defaulting party does so remedy or remove said cause or causes and fully indemnifies the non-defaulting party for any and all consequences of such breach, then such termination notice shall be withdrawn and this Agreement shall continue in full force and effect. In the event that the defaulting party fails to remedy or remove the cause or causes or to indemnify the non-defaulting party for any and all consequences of such breach within such thirty-day period, this Agreement shall be terminated and of no further force or effect from and after the expiration of such thirty-day period.

14.2. Any termination of this Agreement pursuant to the provisions of this Article shall be (i) without prejudice to the rights of SELLER to collect any amounts then due SELLER for gas delivered prior to the time of termination, (ii) without prejudice to the rights of CITY to receive any gas for which it has paid but not received prior to the time of termination, and (iii) without waiver of any other remedy to which the non-defaulting party may be entitled.

ARTICLE XV. Miscellaneous

15.1. This Agreement shall be governed by and construed in accordance with the laws of the State of

Texas, except to the extent that any law, rule, or regulation of the federal government of the United States of America may be applicable, in which case such federal law, rule, or regulation shall govern or control.

15.2. This Agreement may not be modified or amended except by the written agreement of the parties hereto.

15.3. No waiver by either party hereto of any default of the other party under this Agreement shall operate as, or be deemed to be, a waiver of any other or subsequent default, whether of a like or different nature.

15.4. Each provision of this Agreement is intended to be several. If any term or provision hereof is illegal or invalid for any reason whatsoever, such illegality or invalidity shall not affect the validity of the remainder of this Agreement.

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15.5. Any notice required under the terms of this Agreement shall be in writing and either hand delivered or sent by certified mail, return receipt requested to the parties’ address as listed above.

15.6. All charts and calculations upon which a statement is based and SELLER’S books and records insofar as they pertain to measurements and statement of the accounts under this Agreement shall be retained by SELLER for a period of three (3) years from the date of such statement and shall be available for inspection and copying by CITY on reasonable prior notice during normal office hours of SELLER.

15.7. This Agreement shall be binding upon and shall inure to the benefit of and be enforceable by the parties hereto and their respective successors and permitted assigns and is intended solely for the benefit of Seller and Buyer and their respective successors and permitted assigns and not for the benefit of any other person or entity not a party hereto.

15.8. This Agreement constitutes the entire agreement between the parties hereto with respect to the subject matter hereof and supersedes all prior agreements and understandings, oral and written, between the parties hereto with respect to the subject matter hereof.

15.9. The descriptive headings of the provisions of this Agreement are formulated and used for convenience only and shall not be deemed to affect the meaning or construction of any of such provisions.

EXECUTED this ________ day of _________________________, 20___.

ATTEST: CITY OF AMARILLO

_________________________ By_______________________________

Stephanie Coggins, City Secretary Grayson Path, City Manager

ATTEST: SELLER: _________________________

__________________________ By_________________________________

Print Name:________________ Print Name:__________________________

Title:______________________ Title:_______________________________