Q&A_20190131.pdf

Attachment 1: Technical Description (TD)

Para 1., 1.2., and 1.3.

Q1. Gas Supply facilities such as internal gas lines, meters, governors and emergency shut‐off valves are under the General Gas Pipeline Service Provider’s control while new entrants takes account of promoting safe usage of gas consumption at the gas consuming facility. Therefore, the requirement 1.2 and 1.3 should be directed to existing the General Gas Pipeline Service Provider and sincerely hope to limit the role of Gas Retailer in accordance with Gas Business Act in Japan in order to promote competition that leads to a potential gas price reduction. Is it possible for you to change this clause in accordance with most recent version of Japanese Gas Business Act?

Q2 Based on the Gas Business Act, inspection and maintenance operations of the gas pipeline facilities in the base and emergency responses should be the responsibilities of a General Gas Pipeline Service

Provider (Tokyo Gas Co., Ltd.). It is difficult for us to submit the related technical documents.

Q3. Are we right to assume that we would be able to have discussions with you after the award regarding such requirements of the General Gas Pipeline Service Provider in the Technical Description

(TD) for the following items?

(a) Governor Maintenance – the General Gas Pipeline Service Provider conducts the governor maintenance every 76 months, not 36 months as shown in TD. Currently, no governor is installed at the natural gas facility.

(b) Inspection for Leak‐detection – the General Gas Pipeline Service Provider does not conduct leak‐ detections by closing the main valve for a middle pressure gas line. This inspection will be conducted at least once every 4 years, not 40 months according to Gas Utility Industry Law.

(c) Measurement of Potential at Each Magnesium‐Electrode – This inspection will be conducted at least once every 4 years by the General Gas Pipeline Service Provider. This Inspection will be conducted with

Leak‐detection.

(d) ESV Inspection – It is a preferred method to installed a bypass line, if possible, rather than interrupting the gas supply to conduct ESV inspection. The inspection items are operations, appearance, and batteries. Measurement of a horizontal check of seismometer will be performed if a seismometer is installed. This inspection period is every one year IAW the former METI guidance.

Q4. Do you kindly understand that you should ask Tokyo Gas, instead of the gas supplier, about the schedule of periodic inspection of gas supply line?

Q5. Do you kindly understand that Tokyo Gas, instead of us, will deal with any malfunctions of gas pipeline facilities?

Q6. The Technical Description sets forth that the contractor should implement the following:

‐ Inspections on the on‐base gas line (periodic and emergency)

‐ Gas meter reading

‐ Gas meter test

Could you acknowledge that the above duties should be implemented by Tokyo Gas, based on the

General Provisions for Retail Transportation Service set forth by a General Gas Pipeline Service

Provider on the request from us?

1.2.2

Q7 Gas supplier is able to receive trouble calls from the customers, 24 hours a day, 7 days a week, and respond within thirty minutes to an emergency call. However it should be PL Company’s responsibility to inspect the gas system when an emergency occurs.

Q8 Could you kindly acknowledge that the scope of responsibilities of each company in maintenance of gas pipeline facilities in the base is defined as bellow?

Tokyo Gas conduit ‐ Gas pipeline facilities in the base ‐ Service valve before gas equipment: Tokyo Gas

Service valve ‐ Gas equipment：Gas supplier. (A gas retailer will supply gas service under a gas transportation contract with Tokyo Gas.)

A1~8. The U.S. Government (USG) considers the General Gas Pipeline Service Provider as a subcontractor. The USG doesn’t contact the subcontractor directly unless it is emergency or any

Acts/Provisions stipulate so. The USG understand there are separate roles for the gas supplier and the

General Gas Pipeline Service Provider, and it is difficult for the gas supplier to ask the General Gas

Pipeline Service Provider other than the item specified in the transportation contact between the gas supplier and the General Gas Pipeline Service Provider. The USG respects the transportation contract between the gas supplier and the General Gas Pipeline Service Provider, and expect their performance is done in accordance with the transportation contact. (TD will be revised.)

In this contract, the Contractor shall request the subcontractor to submit the Inspection/Maintenance

Plan, the Emergency Response Plan for the USG. The USG confirmed with the General Gas Pipeline

Service Provider that the General Gas Pipeline Service Provider is able to provide the plans to the awarded gas supplier. Any issues arise regarding the USG’s requirements and the subcontractor’s role shall be decided by the conference between the both parties.

Q. Can we have the name of the General Gas Pipeline Service Provider’s POC whom the USG contacted?

A. We can provide the name to an awardee.

Q. Can any costs for dealings with the subcontractor be included in the proposal?

A. Yes.

Para 1.2.

Q. Does “10 business days after award” means that “10 business days after our receipt of the official written notice of the award”? Could you please tell us when you assume it will be?

A. Award date is the date the Contracting Officer issued a contract. Award date may not be the same as the date the Contractor “receives” the official written notice of the award. Award is scheduled in Apr.

Q. Would the Japanese version of “Inspection/Maintenance Plan” and “Emergency Response Plan,” that are required to submit under clause 1.2 of Technical Description, be acceptable?

A. Inspection/Maintenance Plan and Emergency Response Plan shall be submitted in English. Japanese version can be submitted with English version. (The USG will be flexible for the due date of the submission)

Q. Do the English version of documents from the General Gas Pipeline Service Provider, such as an inspection/maintenance plan, take precedence of the Japanese version?

A. Yes, they do.

Q. Regarding emergency responses, are we subject to any penalty in case that a response within 30 minutes is difficult?

A. There is no penalty. The Contractor meets the requirement when the Contractor is able coordinate with the USG for the emergency within 30 minutes.

Para 1.4.

Q. Meter installation, Meter reading, and meter test are conducted by General Gas Pipeline Service

Provider in accordance with the Japanese Gas Business Act. If this is your wish that the meter reading shall be conducted by the supplier, we are able to do so.

A. The USG’s understanding is the “General Gas Pipeline Service Provider” conducts meter readings based on the gas transportation contract between the gas supplier and the General Gas Pipeline Service

Provider”

Q. Regarding gas meter devices, in case of a meter repair cost being incurred, the Technical Description mentions that the metering equipment should be repaired at Contractor’s expense. However, the

General Provisions for Retail Transportation Service set forth by a General Gas Pipeline Service Provider

(Tokyo Gas) defines that a repair cost should be borne by a gas user. Could you agree that a cost to repair meter devices should be borne by the USG?

A. At the conference, the clarification was made that a gas meter is a property of the General Gas

Pipeline Service Provider. The General Gas Pipeline Service Provider will repair in case of any malfunctions of a meter at the provider’s cost. If a malfunction is caused by the USG, the repair cost shall be borne by the USG.

Para 1.5.

Q. When will the Annual Estimate Order be issued for the coming years? We request AEO will be furnished to the supplier one month prior to the start of each Contract Year.

A. Annual Estimate Order to be issued one month prior to the start of each contract year.

Para 2

Q. Are the rates and charges of the gas calculated, based on the “General Supply Provisions for large‐ volume customers” prepared by us?

A. Gas Resource Cost Adjustment can be calculated based on the Contractor’s General Supply Provisions for large‐volume customers (“Ooguchi Kyokyu Yakkan”) (Ref. par 2.3.)

Para 2.3. (and the solicitation Para 4.4)

Q. Is the Gas Resource Bas ¥57,300 (Technical Description para 2.3.) or ¥57,250 (PRP para 4)?

A. ¥57,300 is correct. (An amendment will be issued to correct the value.)

Para 2.4.1.

Q. What is the Minimum Order quantity each year? Is it possible to specify it?

A. Annual Minimum Order Amount is 44,100,000m3. (TD Para1)

Q. Regarding clause 2.4.1 (“Minimum Order”) and clause 2.4.3 (“Yearly Load Factor”) of the Technical

Description, we find that the settlement amount is not calculated in accordance with “Ooguchi Gas

Jukyuu Yakkan”.

Could you confirm if it is possible to change the calculation formula to be in accordance with “Ooguchi

Gas Jukyuu Yakkan”?

A. Yes. (TD will be revised.)

Para 2.4.2.

Q. Please note it is only Tokyo Gas who submits Ooguchi Gas Jukyuu Yakkan to METI. (The fee shall be calculated in accordance with Tokyo Gas’s rules and regulations, so called “Ooguchi Gas Jukyuu

Yakkan”.)

A. The USG’s understanding is all gas suppliers who provides “large gas volume (Ooguchi)”, submits their Ooguchi Gas Jukyuu Yakkan to METI.

Para. 2.4.3

Q. Will you accept that we do not incorporate an annual load factor in a billing process to our customers?

A. Yes

Para 2.4.4.

Q. Is there any deadline of the date the invoice should be issued each month?

A. There is no deadline for a monthly invoice submission. Please note that the payment due dates is

“The 30th day after the designated office responsible for acceptance of services receives a proper invoice from the contractor.” (Ref FAR 52.212‐4)

Solicitation FA520919R8000

Para 4.7

Q. Clause 4.7 only provides that “Minimum Guarantee Amount” is 44,100,000 m3 for the first year of the contract. What is the prospected Minimum Guarantee Amount for the subsequent contract years?

Would it be the same level as to the first year?

A. “Minimum Guarantee Amount for the first year” is established based FAR 52.216‐22‐ Indefinite

Quantity. Annual minimum order amount is 44,100,000 m3 for the rest of the contract years.

Para 7.

Q. Is only a consumption tax non‐taxable for gas supply?

A. Yes

Para 23.4

Q. Would the Japanese version of the financial statement (Kessan Hokoku‐Syo in Japanese) that is required to submit under clause 23.4 (c) of the Solicitation, be acceptable?

A. Submission of a copy of the financial statement in Japanese is acceptable.

Para 25

Q. Could you provide us a format for a proposal to be submitted on February 8, if you have any?

A. Please utilize Solicitation No. FA520919R8000 as a proposal. (Ref Para 23.4(a))

Exhibit A, Pricing Schedule

Q. In respect of calculation of estimated prices in the Pricing Schedule, can we round down any fractions less than one yen?

A. As a result of calculations (Estimate Consumption Amount multiply Unit Price) will not be after the decimal point.

Q. Is it possible to calculate a gas price by applying a two‐part tariff with setting a demand charge? Gas

Price = Demand Charge + Unit Price x Gas Consumption Volume

A. No.