EXHIBIT 10.6.20
June 18, 2002
Selkirk Cogen Partners, L. P.
c/o PG&E NEG
0000 Xxxxxxxxx Xxxxxx
Xxxxxxxx, XX 00000
Attention: Xx Xxxxxx
RE: Firm Transportation Negotiated Rate Letter Agreement
Tennessee FT-A Service Package No. 40295
Dear Ed:
In consideration for Selkirk Cogen Partners, L. P.'s (Selkirk) conversion from
firm transportation service under Tennessee Gas Pipeline Company's (Tennessee)
NET 284 Rate Schedule to firm transportation service under Tennessee's Rate
Schedule FT-A, and pursuant to Section 5.7 of the FT-A Rate Schedule, Tennessee
hereby agrees to adjust its applicable FT-A Transportation rate, as it may
change from time-to-time, for service provided under the above referenced
service package (the Service Package) as follows:
1. For the period commencing on the later of the day after an order approving
this Negotiated Rate Agreement by the Federal Energy Regulatory Commission
("FERC") or August 1, 2002 ("Commencement Date"), and extending for two (2)
years from the Commencement Date ("First Period") for transportation
service provided by Tennessee on behalf of Shipper under the Service
Package, the applicable FT-A rates will be:
i) A monthly reservation rate equal to the effective maximum monthly FT-A
reservation rate, as it may change, plus a monthly surcharge of
$0.1356 per Dth, and a daily commodity rate equal to the effective
maximum FT-A commodity rate, as it may change. These rates are
inclusive of surcharges.
ii) In addition, Shipper shall furnish a quantity of gas for fuel and
losses equal to the applicable FT-A fuel and loss percentage, as it
may change.
2. For the period commencing on the second anniversary of the Commencement
Date and extending for three (3) years thereafter ("Second Period") for
transportation service provided by Tennessee on behalf of Shipper under the
Service Package, the applicable FT-A rates will be:
i) A monthly reservation rate equal to the effective maximum monthly FT-A
reservation rate, as it may change, plus a monthly surcharge of
$0.1043 per Dth, and a daily commodity rate equal to the effective
maximum FT-A commodity rate, as it may change. These rates are
inclusive of surcharges.
ii) In addition, Shipper shall furnish a quantity of gas for fuel and
losses equal to the applicable FT-A fuel and loss percentage, as it
may change.
After the end of the Second Period, the transportation rate under this Agreement
shall be the effective maximum FT-A reservation and commodity rates, as they may
change from time-to-time. In addition, Shipper shall pay any applicable
surcharges under Rate Schedule FT-A as well as furnish a quantity of gas for
fuel and losses applicable under Rate Schedule FT-A
3. Shipper shall maintain, for a period of 42 months commencing on the
Commencement Date of the Service Package (Throughput Commitment Period), an
annual throughput of 3,173,310 Dth under the Service Package (Throughput
Commitment). The Throughput Commitment Period shall be comprised of three
twelve-month sub-periods followed by one six-month sub-period during which
the Throughput Commitment shall be one half the annual Throughput
Commitment. Each Dth of gas flowing under the Service Package on each
segment utilized, whether by Shipper or a Replacement Shipper, will be
counted towards the Throughput Commitment. To the extent that the
Throughput Commitment is not met by the end of each sub-period of the
Throughput Commitment Period, Tennessee shall adjust the rate paid during
that sub-period, such that Shipper shall pay Tennessee an additional rate
equal to the weighted average FT-A commodity rate in effect for the
applicable period plus $0.0285 per Dth multiplied by the Dth deficiency
between the Throughput Commitment and the actual throughput. Shipper shall
pay this additional rate in one lump sum payment within 10 days of receipt
of an invoice from Tennessee. To determine whether Shipper has met its
Throughout Commitment during a given sub-period, Tennessee shall consider
Xxxxxxx’s overall actual throughput during that sub-period. Shipper
will not have met its Throughput Commitment only if Xxxxxxx’s
throughput in the aggregate fell below the Throughput Commitment during the
relevant sub-period.
4. This Negotiated Rate Agreement shall be filed with the FERC and is subject
to approval by the FERC. For five (5) years from the Commencement Date,
Shipper shall not file or support any filing at the FERC that proposes to
decrease the rate under this Negotiated Rate Agreement.
5. If any material term of this Negotiated Rate Agreement, as determined by
Tennessee or Shipper at its reasonable discretion, is disallowed or
modified by any order, rulemaking, regulation or policy of the FERC and
such disallowance or modification has a material adverse effect on the
economic positions of Tennessee and/or Shipper under this Agreement, as
determined by the reasonable discretion of either party, then the Parties
shall meet to negotiate mutually agreeable substitute terms to amend this
Negotiated Rate Agreement in order to ensure that the original commercial
intent of the Parties is preserved, including but not limited to
consideration of the balance of benefits and the timing of implementation.
Please acknowledge your acceptance of this proposal by signing both originals
and returning to the undersigned. One fully executed original will be returned
for your records.
Sincerely,
Tennessee Gas Pipeline Company Selkirk Cogen Partners, L. P.
By: JMC Selkirk, Inc., Managing General Partner
By: /s/ X.X. XXXXXXXXX Date: 6/28/02 By: /s/ X.X. XXXXXX Date: 6/28/02
--------------------------------- ------- --------------------------- -------
NAME: X.X. Xxxxxxxxx NAME: Xxxxxx X. Xxxxxx
TITLE: Vice President TITLE: Senior Vice President
Agent and Attorney-In-Fact
