Destin Pipeline Company, L.L.C.
Original Volume No. 1
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Effective Date: 09/01/1998, Docket: CP96-655-003, Status: Effective
Original Sheet No. 247 Original Sheet No. 247 : Effective
FORM OF RESERVE COMMITMENT AGREEMENT
(Continued)
transfer or assignment will be made subject to the terms of this
Agreement, it being the intent of the parties hereto subject to the
provisions of Article V and this Article II, that the Committed
Lease(s) remain dedicated for purposes of transportation under Rate
Schedule FT-2 and/or Rate Schedule IT to Company's pipeline
facilities for the economic life of the Committed Lease(s). All of
the provisions of this Agreement shall be applicable to assignees of
Shipper's interests in the Committed Lease(s), and such assignees
shall receive a proportionate assignment of the rights and
obligations hereunder with respect to the Committed Lease(s) so
assigned. Upon such assignment, Shipper shall be relieved of its
obligations under this Agreement to the extent, and only to the
extent, so assigned to a third party.
2.4 From the obligations in Section 2.1, Shipper expressly reserves unto itself,
its successors and assigns, the following rights and quantities of production
sufficient to satisfy such rights:
(a) The right to operate the Committed Lease(s) free from any control by
Company including, without limitation, the right (but never the
obligation) to drill new wells, to repair and rework old wells, to
plug and abandon any well and to renew, surrender, release or
terminate any lease (in whole or in part) covering the affected
lands;
(b) The right to deliver production to lessors of the Committed Leases in
quantities sufficient to fulfill lease obligations from time to time,
including the right to take royalty in kind;
(c) The rights to use production for development and operations of the
Committed Lease(s) or other leases in the vicinity (regardless of
ownership), including (but not limited to) the use of gas for fuel,
drilling (including gas drilling), deepening, reworking development
system installation and startup, compressing, gas lifting, pumping