Exhibit 10.29
ORWELL-TRUMBULL PIPELINE CO., LLC
OPERATIONS AGREEMENT
     This Operations Agreement (hereinafter the “Agreement”) entered into as of
this 1st day of January, 2006, by and between ORWELL NATURAL GAS COMPANY,
(hereinafter referenced to as “Operator”), and ORWELL-TRUMBULL PIPELINE CO.,
LLC, (hereinafter referred to as “Owner”).
RECITALS
     WHEREAS, Owner is the owner of certain natural gas facilities, equipment,
pipeline and pipeline easements as more specifically described on Exhibit A,
attached hereto and made a part hereof by reference (such facilities, equipment,
pipeline and pipeline easements hereinafter referred to as Facilities).
     WHEREAS, Operator desires to operate the Facilities for Owner according to
the terms and conditions specified herein, it being understood that Operator is
a public utility regulated by The Public Utilities Commission of Ohio
(PUCO) pursuant to Title 49 of the Ohio Revised Code; and,
     NOW, THEREFORE, in consideration of the covenants and mutual promises
contained herein, Owner and Operator agree as follows:

1.   TERM

  1.1   This Agreement shall be effective January 1, 2006, and shall continue in
full force and effect terminating on December 31, 2006, and shall continue from
year to year thereafter, unless cancelled by either party upon thirty (30) days
written notice.

2.   OPERATING PAYMENT

  2.1   Owner shall pay to Operator a monthly operating payment for operation of
the Facilities in an amount as set forth below:

  A)   A Base Operating Charge per month of: $2,500.00     B)   Additional
monthly charges pursuant to Exhibit B     C)   Any actual third party cost
incurred by Operator during the previous month’s operation of the Facilities
pursuant to Section 3.3 of this agreement.

  2.2   All operating payments shall be due and payable within 30 days of
Owner’s receipt of Operator’s invoice for charges under 2.1 above.

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  2.3   To the extent Owner fails to make payments by such date, the operating
payments due and payable shall be increased by one percent (1%) of the unpaid
balance due each month.

3.   OPERATING AND MAINTENANCE DUTIES AND EXPENSES

  3.1   Operator will provide an Operations and Maintenance Plan (hereinafter
referred to as the “O&M Plan”) and will perform those duties and
responsibilities as set forth in Exhibit B, attached hereto and made a part of
this Agreement. It is understood that Operator may elect to subcontract with
others for operations, maintenance and repair services; provided that in such
event, Owner shall have the right to approve any subcontractor who will be
providing significant services. In the event of a subcontract, Operator still
remains responsible to Owner for said services.     3.2   For those duties to be
performed in Exhibit B, Operator shall inspect, survey and maintain the
Facilities in a manner consistent with the O&M Plan and good natural gas
industry practices and in compliance with all state and federal pipeline safety
codes.     3.3   Owner shall be responsible to pay for all other necessary
maintenance and repairs during the term of the Agreement, except for cost
incurred due to Operator’s negligence. Operator shall not conduct any activity
on behalf of Owner on the Facilities in excess of $2,500 per item per instance,
nor in excess of an aggregate of $5,000 per month, without obtaining the prior
consent of Owner; provided, however, that in the case of explosion, fire, flood
or other sudden emergency, whether of the same or different nature, Operator may
take such steps and incur such expenses as in its opinion are required to deal
with the emergency and to safeguard life and property, but Operator shall, as
promptly as possible, report such emergency and such expenses to Owner.

4.   USE OF PROPERTY

  4.1   Operator shall operate the Facilities in a careful and proper manner and
shall not permit the Facilities to be operated or used in violation of any
applicable federal, state or local statute, law, ordinance, rule or regulation
relating to the possession, use or maintenance of such property. Operator agrees
to reimburse Owner in full for all damage to the Facilities arising from any
misuse or negligent act by Operator, its employees, and its agents.     4.2  
Owner will indemnify and hold the Operator harmless against any and all claims
for damages or losses arising out of the performance or non-performance by the
Owner, its employees, or its agents, of Owner’s obligations. Operator will
indemnify and hold the Owner harmless against

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      any and all claims for damages or losses arising from the operation of the
Facilities by the Operator, its employees, or its agents.     4.3   Owner, at
its discretion, shall have the right to enter upon and inspect the Facilities
and audit any records of Operator having any relationship to the operations,
maintenance or payments provided for in this Agreement.     4.4   Prior to
Operator commencing any modification or alteration to the Facilities, other than
in an emergency, Operator shall first secure Owner’s specific written consent
thereof and supply Owner with such information regarding such proposed actions
as Owner may reasonably request. Owner, at its sole discretion, may withhold its
consent to any such modifications or alterations unless such modifications or
alterations are required for safety or to comply with lawful orders of a court
or governmental regulatory agency.     4.5   Operator shall pay and settle all
expenses arising out of or in any way connected to the operation and maintenance
of the Facilities and shall keep the Facilities free and clear or all liens and
encumbrances. All such reasonable expenses so incurred by Operator shall be
reimbursed by Owner.

5.   TAXES AND OTHER CHARGES.

  5.1   Owner shall be responsible for and pay any and all personal property and
real property taxes imposed upon the Facilities.

6.   INSURANCE

  6.1   Operator shall procure and cause to remain in effect insurance coverage
for the services to be performed as Operator, meeting the following minimum
specifications:

  A)   Workers’ Compensation insurance in full compliance with the laws of the
State of Ohio;     B)   General liability insurance, as to bodily injury and
property damage combined, with limits of not less that $2,000,000 per occurrence
and Excess Liability Insurance subject to a $4,000,000 annual aggregate limit;
which specifically names Lessor as an additional insured.     C)   Automobile
liability insurance as to bodily injury and property damage combined, of not
less that $1,000,000 per accident, which specifically names Lessor as an
additional insured.

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7.   LIABILITY FOR LOSS, DAMAGE OR INJURY

  7.1   If the Facilities are damaged or destroyed, or if any person is injured
or dies, or if any property is damaged as a result of the operation or
maintenance of the Facilities, Operator shall promptly notify Owner of the
occurrence, and shall file all necessary accident reports or property damage
reports, including those required by law and those required by interested
insurance companies.     7.2   In the event an action shall occur due to the
negligence of Operator, Operator shall protect, defend, indemnify and hold Owner
harmless against any and all losses, claims, damages, liabilities, costs or
expenses, arising out of or resulting from any damage to property or any injury
to or death of any person to which Owner may become subject, including, without
limitation, amounts paid in settlement of any claim or litigation, commenced or
threatened, reasonable attorneys’ fees, expert witness fees and other costs and
expenses incidental thereto, that be occasioned by any cause whatsoever,
pertaining to Operator’s operation, maintenance and/or control of the
Facilities. Owner reserves the right to participate in any and all proceedings,
at Owner’s own cost and expense, relative to this Paragraph 7.2 if Operator
deems its participation necessary to protect its interest relative to the
Facilities or this Agreement. Operator shall promptly deliver to Owner any and
all papers, notices and documents served on or delivered to Operator or their
employees and agents in conjunction with any claim, suit, action or proceeding
commenced to threatened against Operator, Owner or both Operator and Owner
jointly concerning the Facilities or its operation.     7.3   Except as provided
for in Paragraph 7.2 above, Owner shall protect, defend, indemnify and hold
Operator harmless against any and all losses, claims, damages, liabilities,
costs or expenses arising out of or resulting from any damage to property or any
injury to or death of any person to which Owner may become subject, including,
without limitation, amounts paid in settlement of any claim or litigation,
commenced or threatened, reasonable attorneys’ fees, expert witness fees and
other costs and expenses incidental thereto, pertaining to Operator’s operation,
maintenance and or control of the Facilities. Operator reserves the right to
participate in any and all proceedings, at Operator’s own cost and expense,
relative to this Paragraph 7.3 if Operator deems its participation necessary to
protect its interest relative to the Facilities or this Agreement. Owner shall
promptly deliver to Operator any and all papers, notices and documents served on
of delivered to Owner or its employees and agents in conjunction with any claim,
suit, action or proceeding commenced or threatened against Operator, Owner or
both Operator and Owner jointly concerning the Facilities or its operation.

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8.   ASSIGNMENT

  8.1   Operator may not assign this Agreement or any rights hereunder without
the prior written consent of Owner.

9.   DEFAULT AND RIGHT TO TERMINATE

  9.1   Owner, at its option, may, by written notice to Operator, declare
Operator in default on the occurrence of any of the following: (1) failure of
the Operator to perform any of its obligations under this Agreement, including,
without limitation, failure to properly operate and maintain the Facilities;
(2) institution by or against the Operator of any proceeding in bankruptcy or
insolvency, or the reorganization of the Operator under any law, or the
appointment of a receiver or trustee for the property of the Operator, or any
assignment by the Operator of the benefit of creditors; (3) involuntary transfer
of the Operator’s interest in the Agreement by operation of law.     9.2  
Notwithstanding any other provision contained herein, Owner shall also have the
right to terminate this Agreement by sixty (60) days’ written notice if Owner
determines after a diligent review that any of the following events occur:

  A)   A regulatory authority conducts or holds a proceeding for the purpose (in
whole or part) of determining if any person or entity, other than Operator is a
public utility or is otherwise subject to the jurisdiction of such authority as
a result of the ownership of the Facilities, or     B)   Any regulatory body
exercises jurisdiction over the Facilities in a manner where there is a
substantial or material change in the rights, responsibilities and duties of
Operator or Owner, or its affiliates.     C)   The Operator, Operator’s parent
corporation or its stockholders enter into one or more agreements to dispose of
all or substantially all of the assets or 50% or more of the outstanding capital
stock of either of the Operator or Operator’s parent corporation, by means of a
sale, (whether as a result of a tender offer or otherwise), merger,
reorganization, or liquidation in one or a series of related transactions; or in
the event there is a change in control of Operator’s parent.

  9.3   In the event Operator has not cured or reasonably commenced to cure (as
determined by Owner) any default specified in Section 9.1 within sixty
(60) day’s written notice given by Owner to Operator of such default,

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      Owner may terminate the Agreement and Operator’s rights under the
Agreement, and shall have the right to take possession and operation of the
Facilities and for that purpose to enter upon any premises where the property is
located without being liable in any suit, action, defense, or other proceedings
to Operator.     9.4   The remedies of Owner shall be cumulative to the extent
permitted by law, and may be exercised partially, concurrently or separately.
The exercise of one remedy shall not be deemed to preclude the exercise of any
other remedy.     9.5   No failure on the part of Owner to exercise any remedy
or right and no delay in the exercise of any remedy or right shall operate as a
waiver. No single or partial exercise by Owner of any remedy or right shall
prelude any other or future exercise of that remedy or right or the exercise of
any other rights or remedies. No forbearance by Owner to exercise any rights or
privileges under this Agreement shall be construed as a waiver, but all rights
and privileges shall continue in effect as if no forbearance had occurred.

10.   OPERATOR’S RIGHT TO TERMINATE

  10.1   Operator at its option may, by sixty (60) day’s written notice to
Owner, terminate this Agreement in the event of institution by or against Owner
of any proceeding in bankruptcy or insolvency, or the reorganization of Owner
under any law, or the appointment of a receiver or trustee for the property of
Owner, or any assignment by Owner for the benefit of creditors.     10.2  
Operator at its option may, after giving sixty (60) days’ written notice,
terminate this Agreement in the event any regulatory body having jurisdiction
over Operator should by any action or inaction cause a substantial or material
change in the responsibilities and duties of either party to this Agreement.
Operator’s performances and obligations pursuant to this Agreement shall also be
excused by Owner at Operator’s request if such performance and obligations, or
the performance and obligations under any agreements concerning service provided
or to be provided by Operator by means of the Facilities, are restricted,
altered or modified by regulatory, governmental or court action.     10.3   No
failure on the part of Operator to exercise any remedy or right and no delay in
the exercise of any remedy or right shall operate as a waiver. No single or
partial exercise by Operator of any remedy or right shall preclude the exercise
of any other rights or remedies. No forbearance by Operator to exercise any
rights or privileges under this Agreement shall be

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      construed as a waiver, but all rights and privileges shall continue in
effect as if no forbearance had occurred.

11.   RETURN OF PROPERTY

  11.1   Upon the expiration of the term of this Agreement, or upon termination
under Sections 9 and 10 hereof, Operator shall transfer to Owner all records and
files or copies thereof, pertaining to the Facilities and its operation. If
Operator fails or refuses to return the Facilities and its records to Owner,
Owner shall have the right to take possession of the property and for that
purpose to enter upon any premises where the property is located without being
liable in any suit, action, defense or other proceedings to Operator. Upon
expiration of the term of this Agreement, or upon termination under Sections 9
and 10 hereof, Operator shall have the right to remove and retain all equipment
and facilities owned by Operator that have been installed on the Facilities
during the term of this Agreement. Upon expiration or termination of this
Agreement, Owner shall have the right to purchase any or all of such equipment
and facilities at a price equal to the fair market value less the cost to remove
said equipment and facilities.

12.   NOTICES

  12.1   All notices required under this Agreement shall be given by certified
or registered mail with postage prepaid to the party to be notified and shall be
deemed given when mailed to the address specified below or, in the event of a
changed address, to the address specified by the party whose address is changed.
        ORWELL NATURAL GAS COMPANY
8500 Station Street, Suite 100
Mentor, Ohio 44060
Attention: President         ORWELL-TRUMBULL PIPELINE CO., LLC.
8500 Station Street, Suite 113
Mentor, Ohio 44060
Attention: President

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13.   MISCELLANEOUS

  13.1   All amendments to this Agreement must be in writing and signed by both
parties.     13.2   This Agreement and the exhibits attached hereto and
incorporated herein by reference, constitute the entire Agreement between Owner
and Operator. No agreements, representations or warranties other than those
specifically set forth in this Agreement shall be binding on any of the parties
unless set forth in writing and signed by both parties.     13.3   This
Agreement shall be deemed to be executed and delivered in the State of Ohio and
shall be interpreted under and governed by the laws of the State of Ohio.    
13.4   If any provisions of this Agreement or the application of any provision
to any party or circumstance is held invalid or unenforceable, the remainder of
this Agreement and the application of the provision to the other parties or
circumstances shall remain valid and in full force and effect.

IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the
date hereinabove first written.

                      ORWELL NATURAL GAS COMPANY       ORWELL-TRUMBULL PIPELINE
CO., LLC    
 
                   
BY:
  /s/ Stephen G. Rigo
 
Stephen G. Rigo, Executive Vice President       BY:   /s/ Thomas J. Smith
 
Thomas J. Smith, Secretary, Treasurer    

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EXHIBIT A
For the purpose of this Agreement, Orwell-Trumbull Pipeline Co., LLC Facilities
shall include the following:

1.   Mantua town border station/North Coast Gas Transmission interconnect   2.  
Approximately 39 miles of 4” and 8” high pressure steel distribution pipelines
located in Portage, Geauga, and Lake Counties owned by Owner and known as the
“Little Inch” pipeline system.   3.   All receipt and delivery points along the
Little Inch pipeline system.   4.   All pipeline equipment and appurtenances
associated with the pipeline.

A map of the facilities follows.

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Exhibit A
ORWELL-TRUMBULL PIPELINE CO., LLC
(MAP) [p76543p7654304.gif]

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EXHIBIT B
ORWELL-TRUMBULL PIPELINE CO., LLC
OPERATIONAL DUTIES
performed by Orwell Natural Gas Company

1.   Perform annual cathodic protection surveys*   2.   Perform bi-monthly
rectifier inspections*   3.   Troubleshoot and repair cathodic protection
deficiencies*   4.   Perform annual regulator/relief inspections*   5.   Rebuild
regulators as required *   6.   Perform annual relief device inspections*   7.  
Rebuild relief devices as required*   8.   Perform monthly odorant level
testing*   9.   Maintain odorizer and refill with odorant*   10.   Inspect and
maintain filter/separators*   11.   Perform accident/failure investigations if
required*   12.   Provide and update written DOT compliant Drug Abuse Plan   13.
  Perform DOT compliant pre-employment, random, due cause and post-accident drug
testing   14.   Provide and update written DOT compliant Alcohol Abuse Plan  
15.   Perform DOT compliant due cause and post-accident alcohol tests   16.  
Provide DOT compliant drug and alcohol EAP supervisor training   17.   Provide
and update written DOT compliant Operator Qualification Plan   18.   Qualify
personnel and maintain DOT compliant records for Operator Qualification Plan  
19.   Provide and update written DOT compliant Operations and Maintenance (O&M)
Plan   20.   Provide and update forms for O&M Plan   21.   Provide an Emergency
Plan   22.   Provide Emergency Plan training   23.   Provide a continuing Public
Education program   24.   Provide a continuing liaison with fire, police and
other appropriate public officials   25.   Provide and update a DOT compliant
Steel Pipeline Construction Manual   26.   Provide and update a DOT compliant
Steel Welding Manual   27.   Report any Safety Related Conditions if required  
28.   Provide MAOP design and verification   29.   Provide written DOT compliant
Uprating Plan and uprating assistance if required   30.   Provide DOT compliant
emergency response for pipeline   31.   Provide emergency repair assistance  
32.   Provide engineering assistance and support as required   33.   Represent
Owner during DOT/PUCO audits   34.   Audit any work performed by others for code
compliance   35.   Perform leak surveys on pipeline*   36.   Perform pipeline
patrols*   37.   Locate pipeline per OUPS requirements*

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38.   Perform abandonment of facilities if required*   39.   Perform atmospheric
corrosion inspections as required*   40.   Oversee right of way clearing*   41.
  Oversee remedial painting of facilities*   42.   Provide PUCO construction
reporting as required   43.   Provide continuing surveillance   44.   Install
and repair RTU’s*   45.   Troubleshoot RTU problems*   46.   Update RTU
software*   47.   Provide annual class location survey*   48.   Provide annual
key valve inspections*   49.   Monitor/repair/record leaks on the pipeline*  
50.   Oversee/monitor/record any required pipeline pressure tests for DOT
compliance   51.   Perform appropriate interval checks and monitoring of major
facilities*   52.   Monitor volumes into pipeline to balance local/interstate
supplies   53.   Make appropriate pressure/volume changes to accommodate supply
requirements*   54.   Respond to any reports of leakage*   55.   Perform steel
line inspections per O&M plan*   56.   Provide construction inspection*   57.  
Submit annual RSPA F7100.2-1 reports   58.   Submit RSPA F7100.2 incident
reports if required   59.   Submit pipeline mileage information to DOT for
annual pipeline assessment   60.   Submit annual PUCO Important Additions report
  61.   Submit annual PUCO Incident and Service Failure report   62.   Submit
annual PUCO Emergency Telephone listings   63.   Submit throughput information
to PUCO for annual pipeline assessment   64.   Maintain DOT compliant records
for all pipeline construction, operations and maintenance functions   65.   Keep
Owner informed of any regulatory changes affecting pipeline safety   66.  
Provide Owner with appropriate records/reports for all pipeline activities   67.
  Perform all accounting functions for pipeline

  •   Calculate Rates — Bill Customers     •   Cash Receipts — Track Accounts
Receivable     •   Accounts Payable—Cash Management     •   General Ledger —
Financial Statements

68.   Regulatory Reporting

  •   PUCO Annual Report     •   Gross Receipts Tax Return     •   Property Tax
Return

69.   Perform T&E functions for make-up gas into system   70.   Gas nomination
and balancing as required

 

*   indicates field time/material/third-party cost will be charged in addition
to monthly fee

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