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. 250 Original Sheet No. 250 : Effective

 

 

FORM OF RESERVE COMMITMENT AGREEMENT

(Continued)

 

 

Release Quantities shall be deemed to be the last quantities produced so that

any release under this Section 2.7 is applicable only to the daily production

quantity in excess of the level of FT-2 TDs that were made available to

Shipper during such review. Upon such notification and immediately after the

end of the six (6) month period set forth above, Company will release the

Permanent Release Quantities from the obligations under Section 2.1. An

illustrative example of the permanent release provisions of this Section 2.7

is provided at Exhibit B to this Agreement. Shipper may deliver the

Permanent Release Quantities from any Connected Fields of Shipper's choice.

 

2.8 Permanent Release -- New Fields

 

This Section 2.8 pertains to the permanent release of gas that is to be

produced from Committed Lease(s) composing an OCS field that are not yet

connected to deepwater laterals or deepwater hubs which are connected to

Company's pipeline facilities ("New Fields"). Shipper shall notify Company

of its plans to produce from New Field(s), and of any additional TDs (by

delivery period) that Shipper will require for such field as early as

practicable, but not earlier than 48 months prior to the anticipated start-up

of deliveries from the field. If Shipper wishes to increase its TDs to

accommodate such production, it shall provide to Company supporting technical

data for the TDs requested, including a production development plan and the

facilities design capacity as provided in Appendix A to the General Terms and

Conditions of Company's Tariff. As soon as practicable after the date

Company receives Shipper's request for increased TDs, but in no event later

than four (4) months after receiving such request, Company shall notify

Shipper whether it can provide the increased TDs requested with existing

facilities or whether it is willing to expand its system, subject to

obtaining the appropriate level of contractual commitments and any necessary

FERC and other regulatory approvals, to provide the increased TDs requested.

If Company (i) is unable, with existing facilities, to provide to Shipper an

average of at least 90% of the increased TDs requested throughout any four

consecutive 3-month delivery periods or (ii) is unable or unwilling to expand

its system, by the later of (a) 24 months after the date Company receives