ATTACH.Attachment.pdf

B19.33 Economic Price Adjustment – Published Market Price – DLA Energy Domestic Bulk. (DLA Energy JUNE 2017)

(a) Warranties. The Contractor warrants that—

(1) The base unit prices set forth in the Schedule do not include allowances for any portion of the contingency covered by this contract text; and

(2) The prices to be invoiced shall be computed in accordance with the wording of this contract text.

(b) Definitions. As used throughout this contract text, the term—

(1) Base unit price means the unit price set forth opposite the item in the Schedule.

(2) Market price means the price to be used in determining an economic price adjustment of the base unit price of an individual product for the market area and time period specified in this contract text. The market price is derived from quotes, assessments, or sales prices in the market place for one or several items or commodity groups as reported in a consistent manner in a publication, electronic data base, or other form, as determined by an independent trade association, governmental body, or other third party independent of the Contractor.

(i) Base market price means the price as shown in Column V of the table below, which is the market price from which economic price adjustments are calculated pursuant to this contract text.

(ii) Adjusting market price means the market price for deliveries during the most recent period, as defined in the table below.

(3) Date of delivery is defined as follows:

(i) For tanker or barge deliveries.

(A) Free on board (f.o.b.) origin. The date and time vessel commences loading.

(B) F.o.b. destination. The date and time vessel commences discharging.

(ii) For pipeline deliveries. The date and time product commences to move past the specified f.o.b. point.

(iii) For all other types of deliveries. The date product is received.

(c) Adjustments.

(1) Subject to the wording of this contract text, the price payable shall be the base unit price in effect on the date of delivery increased or decreased by the same number of cents, or fraction thereof, that the adjusting market price applicable at date of delivery increases or decreases, per like unit of measure, from the base market price.

(2) Calculations. All calculations shall be rounded to six decimal places.

(3) Modifications. Any resultant price changes to the base market price and base unit price shall be executed by the Contracting Officer through a weekly price adjustment modification effective each Tuesday.

(4) Failure to deliver. Notwithstanding any other wording of this contract text, no upward adjustment shall apply to product scheduled under the contract to be delivered before the effective date of the adjustment, unless the Contractor’s failure to deliver according to the delivery schedule results from causes beyond the Contractor’s control and without its fault or negligence, within the meaning of paragraphs (f), Excusable Delays, and (m), Termination for Cause, of the Contract Terms And Conditions - Commercial Items clause of this contract, in which case the contract shall be amended to make an equitable extension of the delivery schedule.

(5) Upward ceiling on economic price adjustment. The Contractor agrees that the total increase in any contract unit price, pursuant to these economic price adjustment contract texts shall not exceed 330 percent of the original base unit price in any applicable program year (whether a single year or multiyear program), except as provided hereafter.

(i) If at any time the Contractor has reason to believe that within the near future a price adjustment under the wording of this contract text will be required that will exceed the current contract ceiling price for any item, the Contractor shall promptly notify the Contracting Officer in writing of the expected increase. The notification shall include a revised ceiling which the Contractor believes is sufficient to permit completion of remaining contract performance, along with appropriate explanation and documentation as required by the Contracting Officer.

(ii) If an actual increase in the established market price would raise a contract unit price for an item above the current ceiling, the Contractor shall have no obligation under this contract to fill pending or future orders for such item, as of the effective date of the increase, unless the Contracting Officer issues a contract modification to raise the ceiling. If the contract ceiling will not be raised, the Contracting Officer shall so promptly notify the Contractor in writing.

(6) Revision of market price indicator. In the event—

(i) Any applicable market price indicator is discontinued or its method of derivation is altered substantially;

or

(ii) The Contracting Officer determines that the market price indicator consistently and substantially fails to reflect market conditions,-the parties shall mutually agree upon an appropriate and comparable substitute and the contract shall be modified to reflect such substitute effective on the date the indicator was discontinued, altered, or began to consistently and substantially fail to reflect market conditions. If the parties fail to agree on an appropriate substitute, the matter shall be resolved in accordance with paragraph (d), Disputes, of the Contract Terms And Conditions - Commercial Items contract text of this contract.

(d) Conversion factors. If this contract text requires quantity conversions for economic price adjustment purposes, the conversion factors for applicable products, as specified in the DLA Energy conversion factor instruction, apply unless otherwise specified in the Schedule.

(e) Examination of records. The Contractor agrees that the Contracting Officer or designated representative shall have the right to examine the Contractor's books, records, documents, or other data the Contracting Officer deems necessary to verify Contractor adherence to the wording of this contract text.

(f) Final invoice. The Contractor shall include a statement on the final invoice that the amounts invoiced hereunder have applied all decreases required by this contract text.

I II III IV V

Item No.

Name of Publication

Heading under which market indicator is published and name of product

Location where market price is applicable

Base market price as of May 9, 2017 (excludes all taxes) (see note(s) below)

EAST/GULF/INLAND/

OFFSHORE JP5/JP8/JAA

PLATT’S

OILGRAM

PRICE REPORT

JET KERO 54

US GULF PIPE

U.S. GULF COAST

$1.357960

The reference price shall be determined as follows: 100% Average of the Low and High U.S. Gulf Coast

NOTE: Prices based on this escalator will change on Tuesdays based on the prior week average. The simple average of the daily average highs and lows of the prices effective Monday through Friday (excluding any days prices are not published) shall be the adjusting market price effective for the following Tuesday through Monday.

PLATT’S

OILGRAM

PRICE REPORT

JET KERO 54 COAST

PIPELINE

U.S. GULF COAST $1.339600

The reference price shall be determined as follows: 100% Average of the Low and High U.S. Gulf Coast

NOTE: Offers based on this Jet Kero 54 Coast Pipeline market price indicator will be subject to a positive factor of $0.022078 for evaluation purposes only. This evaluation factor represents the spread between the difference of the two reference prices and the 12-month averages of both market price indicators.

Prices based on this escalator will change daily based on the published price for that day and use the last available daily price on days a price is not published.

ARGUS US

PRODUCTS

JET KERO 54

COLONIAL

PIPELINE

HOUSTON $1.359660

The reference price shall be determined as follows: 100% Average of the Low and High Houston - Colonial Pipeline

NOTE: Offers based on this Jet Kero 54 Colonial Pipeline market price indicator will be subject to a negative factor of $-0.002196 for evaluation purposes only. This evaluation factor represents the spread between the difference of the two reference prices and the 12-month averages of both market price indicators.

Prices based on this escalator will change on Tuesdays based on the prior week average. The simple average of the daily average highs and lows of the prices effective Monday through Friday (excluding any days prices are not published) shall be the adjusting market price effective for the following Tuesday through Monday.

ARGUS US

PRODUCTS

JET KERO 54

COLONIAL

PIPELINE

HOUSTON $1.356170

The reference price shall be determined as follows: 100% Average of the Low and High Houston - Colonial Pipeline

NOTE: Offers based on this Jet Kero 54 Colonial Pipeline market price indicator will be subject to a positive factor of $0.005169 purposes only. This evaluation factor represents the spread between the difference of the two reference prices and the 12-month averages of both market price indicators.

Adjusting contract prices using this escalator would be using a 5 day wrap (2-1-2). The pricing would be the average of the 2 days prior to the lifting date, the day of, and 2 days after the lifting date.

PLATT’S

OILGRAM

PRICE REPORT

JET KERO NEW

YORK HARBOR

BARGE

NEW YORK

HARBOR

$1.384360

The reference price shall be determined as follows: 100% Average of the Low and High NYHB

NOTE: Offers based on the Jet Kero NYHB market price indicator will be subject to a positive factor of $0.014196 for evaluation purposes only. This evaluation factor represents the spread between the difference of the two reference prices and the 12-month averages of both market price indicators.

Prices based on this escalator will change on Tuesdays based on the prior week average. The simple average of the daily average highs and lows of the prices effective Monday through Friday (excluding any days prices are not published) shall be the adjusting market price

PLATT’S

OILGRAM

PRICE REPORT

JET KERO GROUP 3

SPOT

GROUP 3 $1.425160

The reference price shall be determined as follows: 100% Average of the Low and High Group 3

NOTE: Offers based on the Jet Kero Group 3 Spot market price indicator will be subject to a negative factor of $-0.048735 for evaluation purposes only. This evaluation factor represents the spread between the difference of the two reference prices and the 12-month averages of both market price indicators.

Prices based on this escalator will change on Tuesdays based on the prior week average. The simple average of the daily average highs and lows of the prices effective Monday through Friday (excluding any days prices are not published) shall be the adjusting market price

ARGUS

PRODUCTS

JET KERO NEW

YORK HARBOR

BARGE

NEW YORK

HARBOR

$1.382910

The reference price shall be determined as follows: 100% Average of the Low and High NYHB

NOTE: Offers based on this Jet Kero NYHB market price indicator will be subject to a positive factor of $0.013925 for evaluation purposes only. This evaluation factor represents the spread between the difference of the two reference prices and the 12-month averages of both market price indicators.

Prices based on this escalator will change on Tuesdays based on the prior week average. The simple average of the daily average highs and lows of the prices effective Monday through Friday (excluding any days prices are not published) shall be the adjusting market price

ARGUS

PRODUCTS

JET KERO NEW

YORK HARBOR

BARGE

NEW YORK

HARBOR

$1.394170

The reference price shall be determined as follows: 100% Average of the Low and High NYHB

NOTE: Offers based on this Jet Kero NYHB market price indicator will be subject to a positive factor of $0.006020 for evaluation purposes only. This evaluation factor represents the spread between the difference of the two reference prices and the 12-month averages of both market price indicators.

Adjusting contract prices using this escalator would be using a 5 day wrap (2-1-2). The pricing would be the average of the 2 days prior to the lifting date, the day of, and 2 days after the lifting date.

EAST/GULF/INLAND

PLATT’S

OILGRAM

PRICE REPORT

JET KERO BUCKEYE

PIPELINE

NEW JERSEY $1.384360

The reference price shall be determined as follows: 100% Average of the Low and High New Jersey – Buckeye Pipeline

Note: Offers based on the Jet Kero Buckeye Pipeline market price indicator will be subject to a positive factor of $0.014196 for evaluation purposes only. This evaluation factor represents the spread between the difference of the two reference prices and the 12-month averages of both market price indicators.

Prices based on this escalator will change on Tuesdays based on the prior week average. The simple average of the daily average highs and lows of the prices effective Monday through Friday (excluding any days prices are not published) shall be the adjusting market price

PLATT’S

OILGRAM

PRICE REPORT

JET KERO 54

WATERBORNE

USGC $1.375460

The reference price shall be determined as follows: 100% Average of the Low and High US Gulf Coast

Note: Offers based on this Jet Kero 54 US Gulf Coast Waterborne market price indicator will be subject to a positive factor of $0.000596 for evaluation purposes only. This evaluation factor represents the spread between the difference of the two reference prices and the 12-month averages of both market price indicators.

Prices based on this escalator will change on Tuesdays based on the prior week average. The simple average of the daily average highs and lows of the prices effective Monday through Friday (excluding any days prices are not published) shall be the adjusting market price

PLATT’S

OILGRAM

PRICE REPORT

JET KERO 54

WATERBORNE

USGC $1.371867

The reference price shall be determined as follows: 100% Average of the Low and High US Gulf Coast

Note: Offers based on this Jet Kero 54 US Gulf Coast Waterborne market price indicator will be subject to a positive factor of $0.007881 for evaluation purposes only. This evaluation factor represents the spread between the difference of the two reference prices and the 12-month averages of both market price indicators.

Prices based on this escalator will change daily based on a 3-day wrap average (last published price prior to the lift date, published price on the lift date, and first published price following the lift date). On dates when a price is not published, the escalator will remain unchanged from the prior day.

EAST/GULF /

OFFSHORE F76

ARGUS

PRODUCTS

ULSD NEW YORK

HARBOR BARGE

NEW YORK $1.453160

The reference price shall be determined as follows: 100% Average of the Low and High NYHB

NOTE: Offers based on this ULSD NYHB market price indicator will be subject to a negative factor of $-0.002848 for evaluation purposes only. This evaluation factor represents the spread between the difference of the two reference prices and the 12-month averages of both market price indicators.

Prices based on this escalator will change on Tuesdays based on the prior week average. The simple average of the daily average highs and lows of the prices effective Monday through Friday (excluding any days prices are not published) shall be the adjusting market price

ARGUS

PRODUCTS

ULSD NEW YORK

HARBOR BARGE

NEW YORK $1.455520

The reference price shall be determined as follows: 100% Average of the Low and High NYHB

NOTE: Offers based on this ULSD NYHB market price indicator will be subject to a negative factor of $-0.002593 for evaluation purposes only. This evaluation factor represents the spread between the difference of the two reference prices and the 12-month averages of both market price indicators.

Prices based on this escalator will change daily based on a 5-day wrap average (2 published prices prior to the lift date, published price on the lift date, and 2 published prices following the lift date). On dates when a price is not published, the escalator will remain unchanged from the prior day.

ARGUS

PRODUCTS

ULSD NEW YORK

HARBOR BARGE

NEW YORK $1.452867

The reference price shall be determined as follows: 100% Average of the Low and High NYHB

NOTE: Offers based on this ULSD NYHB market price indicator will be subject to a positive factor of $0.000026 for evaluation purposes only. This evaluation factor represents the spread between the difference of the two reference prices and the 12-month averages of both market price indicators.

Prices based on this escalator will change daily based on a 3-day wrap average (1 published price prior to the lift date, published price on the lift date, and 1 published price following the lift date). On dates when a price is not published, the escalator will remain unchanged from the prior day.

The following note provides an explanation on how DLA Energy uses and calculates evaluation factors. The note is applicable to the entire provision:

DLA-Energy chooses a "default" or "recommended" escalator for each product based on which published price we believe will most accurately reflect price movements for that product in the specified location. Uncommon escalators are any other escalators being proposed as the basis for economic price adjustments besides the "default" escalator. Offers based on uncommon escalators receive adjustment factors in order to account for the difference in volatility between the uncommon escalator and the default escalator. Applying the adjustment factor to uncommon escalators allow us to evaluate offers based on the relationship between the uncommon escalator and the default escalator for a 12-month period, as opposed to the difference between the escalators on a single day (the base reference date). The problem with only comparing escalators on a single date is there may be something causing a market abnormality on that date, and using a full 12-month average for the comparison allows us to see the "normal" relationship between the two escalators. The adjustment factor is calculated by finding the difference between each price on the Base Reference Date and that price's 12-month average. Then, the difference between the uncommon escalator's BRP and 12-month average is subtracted from the difference between the "default" escalator's BRP and 12-month average to find the adjustment factor for the uncommon escalator. That value is then applied to the offer price of the offer using the uncommon escalator. Offers based on "preferred" or "default" escalators do not receive an adjustment factor.