HomeMy WebLinkAbout0512.094City of Palo Alto
_. _______________ ~itxM~na_ger'! ~port
TO: HONORABLE CITY COVNClL
FROM: CITY MANAGER. DEPARTMENT: UI'ILITIES
AGENDA DATE: November ZI, 1994 CMR:S12:94
A=dm<D! No_ 1 Seni~ Agretm<nt Form 1: \MD No. 91J)
bet1>'",n the City of Palo "" d Moj ... Pipeline Operating Com pooy
REQURST
This report requests tr..at Council approve and amhori:re the Mayo! to execute Amendment No .
.1 k' the Transportarion $er.'ice Agreement (Agreemem) with Mojave Pipeline Comlfany
(Mojave). Amendment No.1 deletes ~tiOD 11. regarding conn-act ten:nination. in its entirety
.and repl:'lCeS it with a simple termiru.tion dau.~ that gives tire City a.nd Mojave uncooditkmal
termination rights. Amend.mt:ru No.1 also extends the deadline for exercising the termination
rights from November 1, 1994 to Aprit I, 1995.
m:OMMENDATIONS
SWf recommends that Council authorize the Mayor 10 execute Amendment No. 1 10 the
Ag=noat with Mojave Pipeline Company. The UtilitieS Advisory Commission (UAC)
reviewed Amendmenr No. 1 and unanlmoosly =mended it for City Council approval.
fOlJcY IMPJ.!CA TIONS
The ptoposed amendmem does not represent any change to eX1sV<Jg pOlicies.
EXl!CVTIVE SUMMARY .
Tho original Agt<emenr contains several major conctngencios, mO<! of them bave deadlines tie<!
to Nove-.nbcr 1, 1994, the date a! which Mojave would receive the Federal Energy Regulatory
Commission (PERC) certification to constrUCt the facilities, These contingencies aUow each
party to !erminate the AgreemeJ>t Ullder opeciftcd ciIcum.>Wx:es. Mojave's impetus for
Amendment No.1 is tli.tt their PERC ""rtifK:ate was delaye<! past November 1; therefore, under
Section 11.2 of the Agn:emeot the City could terminale the Agreement. In return for pro,;ding
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"" cr.o:mion. <lie City bas asked for the uniliucl1l! rigbt to termination as described in tile
IIIIOCh<d amemlment.
Oac< ....,..0.«1, the IIDC:XIroeuI "ill provide staff the oppol'llllli!)' to d<!erroine the ,'OS! effectS
O(the _ ""'jar COIJtinat:~: C.nadi.",·SOO!hwest U.S. 81' supply OOSI differenliol 2nd
PGI:E sundhy service """". During the wimer, the impact of the CanadiAn supply surplw will
be iOtaIifJOd. Also during !his time, PG&E will have the oppommil)' to clarity tbci! offer of
~ tI_Ialion~. Amendment No. J provides for.ller beoefif in that if protects
the C:"Y tpiDst III possible romingm:ies. ",tiler than only the major contingencies emuneraled
iD the exiJtmg Ag!=-t.
fJSCKIMPACT swr. _ malysi> estjm"ed .ning> to be 7 million dollar> over the !5·year term 0( the
Ag::tttliii:LC:. However. tbc-mlt:ndmeQ( '\\;11 allow staff the opportunity co gather more
iDf~'"'IIl about ~ of semce under t}1e Agreet'!lellt atxi reevaluate the ftSCal impact,
part:icuizzty in li~b! of recent m-eT production cf g"'r, In Canada.
r>:TIlill,~!P,TAL ASSESS~IDT
l~.pprcul of Amerximen! No.1 does 00! C()nstlMt d Pl'Oj~'t und~r me California Environmental
~lit:r Act. :\1'DjaYe I::' m:rJired to Gbiai:n an t-:tlv:mmncntal ass.es<;merH tmdt!l' the NatioruU
Emii('nTT'\e1!i.al Prote-':liorJ A~t U] l:n:kr to ':(lIT'pkte th~ projc-.-t,
An ACIDiL'<TS
Me!n(IrL'Xfum Rq:-',Jrl 10 the IJAC
Amendmeu.t: No. I to the .J\grttrr.ent t..:-CY.;«"n CPA and Moja .... e
PREPARED BY: Karlz Dall,,)' and Tom H,bashi
J.?//~' / DEPARTMENT HF.AD APPROVAL: -~ ~ EDW.~;
Di=or of Utilities
CITY MANAGER APPROVAL:
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AMENJ)JIIENT NO. ! TO SER\lCE AGREEME1>T
FOR.'" E (MD NO. 923)
(Al'PUCA.8ll TO nU.l'(SI'ORTAnON SER\lCE
UNDER RAT[ scm:DUU IT-2)
WHEREAS, 011 Jul; tl, 1994, d,. putia..-J<=I into I narur>J gas trwspol'Ution
.-. wbereunder ;~ .. is :<qui.o«l to tnn.';xm ".,Mal gL' pl.!reha.sed by
Shipper.from Topock. Arizor.a to il"r: Skipper's fW"litits in r..crthem 5.am:a aua County,
c.Jif0!"niA, &nd
\\"tfEREAS. T"""sr"~<r', 0,1,-,"0', lo v-r',.'TI' c""" 'c, .'er,;" Agre<-me,,' :s
conMgent upon the receipt ,')f 5-at!~f~,'c,-:..-r~u!~l"'~l O-,J!r",:1Ul:0.'1S, f';'lf the c)::par.s;on of
it:. Mruul gas tJ~'1"P,-':1'1!i0n fa~:,~,t;e-s frCl~ l!:~ Fe-Ct",;iJ fr.:!";: }:,!"g,.!a~N",.' CCljrJ'Tl15s;on,
1.."}{j
\VHEREAS, Tr~.r . .s:>0r:~.· ,a,".j 5-:-::Pf,e' ';.\,~;h I..:, oi'r;{:f,d l)-,L~~r Sen;.;:e A~e-eT!lent to
account for the rr.anner irl W~dl th Se!"\i.:-c ,io.,gre-eiT:e·:~ 5:":::1 t-e rerrnir..atcd,
NOW, TI1E1lEFORE, in conS:de'1""".ll!on c,ft~e f('ft(lw.r,~ (-:)\'enanu. tt:.T1S, and
conditions. the pMties agree
~.!":Ll, Se"ir:>M II I 1.1u ou.gh 'I': , .u~ hC'H:'cy de:c'ed :lrI the'jr e!1l~rety, and
the foilo.....mg SeaiOIl I! 1 is herf'tl)" rub~itu, ed
"II ~ L. At in)! time plior to .A.p~J 1. 199 5, either T rlr'.s?ortef Of Shipper
may gi,,'(:, in tdvanc~ me; in , .. ,.iting. thirt)' (30) .days n'olice of le,rrr.in.a.tion to the
other part} to thll.~ The notice of termination shajl N: effccti .... -e whether
or DOt good cause for ternUnation .shall =xi$! "
SECTION 2. Any &nd!l! CO\'UW'lU, terms and coooi~f\S ofth.! ~ic:
Agreemem not ~ delet" Qr modifie<j '-=!>y sn.u r""';n in fuU fOT« and effe"t
EXECUTED by the pa."'~s on tnl dare fi!"Sl ~bo\'t s.1atc:d in PaJD .Alto, Santa Clara
County, Caltfom..
ATIEST: THE CITY OF PALO Al.TO
City Clerk }.lJl'cr
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APPROVED AS TO FORM:
City Attorney
APPROVED:
Director of Utilities
Di~ector of Finam:e
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MOJAVE ?lPELlNE COMPANY ''1J>f
B~ M~;peli"" Operating Company
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..,dC'!1! and CEO
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CERTIFICATE OF A CKNOWLIDGME!'IT
(CM! Cod. § \ 189)
STATEOF &fAA ~
COUNTYOF~~~~I ____ ~
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On 1~.eJ# . before me, ~ ~ ~.
notary public in and fof said County, personally appeaI~;: 3M '
pen.onany kno......." to me (or proved to me on the baslS ofS2.tisfactory evidence) to be the P«SO¥ry .. ~s!""","bS<ribed 10 the wi!rur. instrumen(d~ ~Ji,~ ~~~~%j . 4
and acknowledged to me tJ-o.at heJsJ;1t'/~· execuled Ih~ same in ~Jsf!Jo'!'f/tbeir lL!thorized
capa.cityOes). and that by his/beri~i sign4tlJre?) Of} tht,>: ~I"!stl"\lment ihe persvl"lW, OJ the
~tirJ u!X)tl behalf of which the person~ actE-d, e~ec:uted the tIlstrument
-WITNESS my hand and offici~ ~al
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