EX-10.2



 






Exhibit
10.2




Contract #410260R1 FT-L




FIRM LATERAL TRANSPORTATION AGREEMENT

(For Use Under Rate Schedule FT-L)




     THIS AGREEMENT is made, entered into and effective as of this 27th day
of April, 2006, by and between East Tennessee Natural Gas, LLC,
a Tennessee limited liability company hereinafter referred to as “Transporter”, and CNX Gas
Company, LLC, a Virginia limited liability Company, hereinafter referred to as
“Shipper”. Transporter and Shipper shall be referred to herein individually as “Party” and
collectively as “Parties.”



ARTICLE I — DEFINITIONS




     The definitions found in Section 1 of Transporter’s General Terms and Conditions are
incorporated herein by reference.



ARTICLE II — SCOPE OF AGREEMENT




     Transporter agrees to accept and receive daily, on a firm basis, at the Receipt Point (s) on
the Jewell Ridge Lateral listed on Exhibit A attached hereto, from Shipper such quantity of gas as
Shipper makes available up to the applicable Maximum Daily Transportation Quantity, which shall be
210,000 dth per day, plus applicable fuel and loss quantities, and deliver for Shipper to the
Delivery Point(s) on the Jewell Ridge Lateral listed on Exhibit A attached hereto an Equivalent
Quantity of gas.



ARTICLE III — RECEIPT AND DELIVERY PRESSURES




     Shipper shall deliver, or cause to be delivered, to Transporter the gas to be
transported hereunder at pressures sufficient to deliver such gas into Transporter’s system at the
Receipt Point(s). Transporter shall deliver the gas to be transported hereunder to or for the
account of Shipper at the pressures existing in Transporter’s system at the Delivery Point (s)
unless otherwise specified on Exhibit A.



ARTICLE IV — QUALITY SPECIFICATIONS AND STANDARDS FOR MEASUREMENTS




     For all gas received, transported, and delivered hereunder, the Parties agree to the
quality specifications and standards for measurement as provided for in Transporter’s General
Terms and Conditions. Transporter shall be responsible for the operation of measurement facilities
at the Delivery Point(s) and Receipt Point(s). In the event that measurement facilities are not
operated by Transporter, the responsibility for operations shall be deemed to be Shipper’s.



ARTICLE V — FACILITIES




     At the time service commences pursuant to this Agreement, the facilities necessary to receive,
transport, and deliver gas as described herein are, or will be, in place and no additional
facilities are anticipated to be required.



 









 





Contract
#410260R1 FT-L




FIRM LATERAL TRANSPORTATION AGREEMENT

(For Use Under Rate Schedule FT-L)




ARTICLE VI — RATES FOR SERVICE





	 	6.1	 	Rates and Charges — Commencing on the date of implementation of this Agreement
under Section 10.1, the compensation to be paid by Shipper to Transporter shall be
in accordance with Transporter’s effective Rate Schedule FT-L. Where applicable,
Shipper shall also pay the Annual Charge Adjustment (“ACA”) surcharge as such rate
may change from time to time; provided, however, that the ACA surcharge shall not be
assessed on quantities transported under this Rate Schedule to the extent that such
quantities are also transported on Transporter’s system under one or more of
Transporter’s other Rate Schedules. Except as provided to the contrary in any
written or electronic agreement(s) between Transporter and Shipper in effect during
the term of this Agreement, Shipper shall pay Transporter the applicable maximum
rate(s) and all other applicable charges and surcharges specified in the Notice of
Rates in Transporter’s FERC Gas Tariff and in this Rate Schedule. Transporter and
Shipper may agree to a discounted rate pursuant to the provisions of Section 41 of
Transporter’s General Terms and Conditions, provided that the discounted rate is
between the applicable maximum and minimum rates for this service.






	6.2	 	Changes in Rates and Charges — Shipper agrees that Transporter shall have the unilateral
right to file with the appropriate regulatory authority and make changes effective in (a) the
rates and charges stated in this Article VI, (b) the rates and charges applicable to service
pursuant to Transporter’s Rate Schedule FT-L, and (c) any provisions of Transporter’s General
Terms and Conditions as they may be revised or replaced from time to time. Without prejudice
to Shipper’s right to contest such changes, Shipper agrees to pay the effective rates and
charges for service rendered pursuant to this Agreement. Transporter agrees that Shipper may
protest or contest the aforementioned filings, or may seek authorization from duly constituted
regulatory authorities for adjustment of Transporter’s existing FERC Gas Tariff as may be
found necessary to assure Transporter just and reasonable rates.




2









 











Contract #410260R1 FT-L




FIRM LATERAL TRANSPORTATION AGREEMENT

(For Use Under Rate Schedule FT-L)




ARTICLE VII — RESPONSIBILITY DURING TRANSPORTATION




     As between the Parties hereto, it is agreed that from the time gas is delivered by
Shipper to Transporter at the Receipt Point (s) and prior to delivery of such gas to or for the
account of Shipper at the Delivery Point (s), Transporter shall be responsible for such gas and
shall have the unqualified right to commingle such gas with other gas in its system and shall have
the unqualified right to handle and treat such gas as its own. Prior to receipt of gas at
Shipper’s Receipt Point (s) and after delivery of gas at Shipper’s Delivery Point (s), Shipper
shall have sole responsibility for such gas.



ARTICLE VIII — BILLINGS AND PAYMENTS




     Billings and payments under this Agreement shall be in accordance with Section 16 of
Transporter’s General Terms and Conditions as they may be revised or replaced from time to time.



ARTICLE IX — RATE SCHEDULE AND

GENERAL TERMS AND CONDITIONS





	9.1	 	This Agreement is subject to the effective provisions of Transporter’s
Rate Schedule FT-L, or any succeeding rate schedule and Transporter’s
General Terms and Conditions on file with the Commission, or other duly
constituted authorities having jurisdiction, as the same may be changed
or superseded from time to time in accordance with the rules and
regulations of the Commission, which Rate Schedule and General Terms
and Conditions are incorporated by reference and made a part hereof for
all purposes.






	9.2	 	In the event of a conflict between the provisions of this Agreement and
Transporter’s Rate Schedule FT-L, the provisions of Transporter’s Rate
Schedule FT-L shall govern. In the event of a conflict between the
provisions of this Agreement and Transporter’s General Terms and
Conditions, the provisions of Transporter’s General Terms and
Conditions shall govern.




3









 











Contract #410260R1 FT-L




FIRM LATERAL TRANSPORTATION AGREEMENT

(For Use Under Rate Schedule FT-L)




ARTICLE X — TERM OF CONTRACT





	10.1	 	This Agreement shall be effective as of the date that Transporter’s Jewell Ridge
Lateral is completed and placed in service, and shall remain in force and effect for a
primary term of fifteen (15) years
(“Primary Term”); provided, however, that if the Primary Term is one year or more, then the
contract shall remain in force and effect and the contract term will automatically
roll-over for additional five year increments (“Secondary Term”) unless Shipper, one year
prior to the expiration of the Primary Term or a Secondary Term, provides written notice to
Transporter of either (1) its intent to terminate the contract upon expiration of the then
current term or (2) its desire to exercise its right-of-first-refusal in accordance with
Section 7.3 of Transporter’s General Terms and Conditions. Provided further, if the
Commission or other governmental body having jurisdiction over the service rendered
pursuant to this Agreement authorizes abandonment of such service, this Agreement shall
terminate on the abandonment date permitted by the Commission or such other governmental
body.






	10.2	 	In addition to any other remedy Transporter may have, Transporter shall have the right to
terminate this Agreement in the event Shipper fails to pay all of the amount of any bill for
service rendered by Transporter hereunder when that amount is due, provided Transporter shall
give Shipper and the Commission thirty days notice prior to any termination of service.
Service may continue hereunder if, within the thirty day notice period, satisfactory
assurance of payment is made in accordance with Section 16 of Transporter’s General Terms and
Conditions.





ARTICLE XI — REGULATION





	11.1	 	This Agreement shall be subject to all applicable governmental
statutes, orders, rules, and regulations and is contingent upon the
receipt and continuation of all necessary regulatory approvals or
authorizations upon terms acceptable to Transporter and Shipper. This
Agreement shall be void and of no force and effect if any necessary
regulatory approval or authorization is not so obtained or continued.
All Parties hereto shall cooperate to obtain or continue all necessary
approvals or authorizations, but no Party shall be liable to any other
Party for failure to obtain or continue such approvals or
authorizations.
	 
	11.2	 	Promptly following the execution of this Agreement, the Parties will
file, or cause to be filed, and diligently prosecute, any necessary
applications or notices with all necessary regulatory bodies for
approval of the service provided for herein.
	 
	11.3	 	In the event the Parties are unable to obtain all necessary and
satisfactory regulatory approvals for service prior to the expiration
of two (2) years from the effective date hereof, then, prior to receipt
of such regulatory approvals, either Party may terminate this Agreement
by giving the other Party at least thirty (30) days prior written
notice, and the respective obligations hereunder, except for the
reimbursement of filing fees herein, shall be of no force and effect
from and after the effective date of such termination.
	 
	11.4	 	The transportation service described herein shall be provided subject
to the provisions of Part 284G of the Commission’s Regulations.




4









 











Contract #410260R1 FT-L




FIRM LATERAL TRANSPORTATION AGREEMENT

(For Use Under Rate Schedule FT-L)




ARTICLE XII — ASSIGNMENTS





	12.1	 	Either Party may assign or pledge this Agreement and all rights and
obligations hereunder under the provisions of any mortgage, deed of
trust, indenture or other instrument that it has executed or may
execute hereafter as security for indebtedness; otherwise, Shipper
shall not assign this Agreement or any of its rights and obligations
hereunder, except as set forth in Section 17 of Transporter’s General
Terms and Conditions.
	 
	12.2	 	Any person or entity that shall succeed by purchase, transfer, merger,
or consolidation to the properties, substantially or as an entirety, of
either Party hereto shall be entitled to the rights and shall be
subject to the obligations of its predecessor in interest under this
Agreement.





ARTICLE XIII — WARRANTIES




     In addition to the warranties set forth in Section 22 of Transporter’s General Terms and
Conditions, Shipper warrants the following:




	13.1	 	Shipper agrees to indemnify and hold Transporter harmless for refusal
to transport gas hereunder in the event any upstream or downstream
transporter fails to receive or deliver gas as contemplated by this
Agreement.
	 
	13.2	 	Shipper agrees to indemnify and hold Transporter harmless from all suit
actions, debts, accounts, damages, costs, losses, and expenses
(including reasonable attorney’s fees) arising from or out of breach of
any warranty, by Shipper herein.
	 
	13.3	 	Shipper warrants that it will have title to the gas delivered to
Transporter under this Agreement.
	 
	13.4	 	Transporter shall not be obligated to provide or continue service
hereunder in the event of any breach of warranty; provided, Transporter
shall give Shipper and the Commission thirty days notice prior to any
termination of service. Service will continue if, within the thirty
day notice period, Shipper cures the breach of warranty.




5









 











Contract #410260R1 FT-L




FIRM LATERAL TRANSPORTATION AGREEMENT

(For Use Under Rate Schedule FT-L)




ARTICLE XIV — MISCELLANEOUS





	14.1	 	Except for changes specifically authorized pursuant to this Agreement,
no modification of or supplement to the terms and conditions hereof
shall be or become effective until Shipper has submitted a request for
change via the LINK® System and Shipper has been notified via the LINK®
System of Transporter’s agreement to such change.
	 
	14.2	 	No waiver by any Party of any one or more defaults by the other in the
performance of any provision of this Agreement shall operate or be
construed as a waiver of any future default or defaults, whether of a
like or of a different character.
	 
	14.3	 	Except when notice is required via the LINK® System, pursuant to
Transporter’s Rate Schedule FT-L, or pursuant to Transporter’s General
Terms and Conditions, any notice, request, demand, statement or bill
provided for in this Agreement or any notice that either Party may
desire to give to the other shall be in writing and mailed by registered
mail to the post office address of the Party intended to receive the
same, as the case may be, as shown on Exhibit A hereto or to such other
address as either Party shall designate by formal written notice to the
other. Routine communications, including monthly statements and
payments, may be mailed by either registered or ordinary mail. Notice
shall be deemed given when sent.
	 
	14.4	 	THE INTERPRETATION AND PERFORMANCE OF THIS AGREEMENT SHALL BE IN
ACCORDANCE WITH AND CONTROLLED BY THE LAWS OF THE STATE OF TENNESSEE,
WITHOUT REGARD TO CHOICE OF LAW DOCTRINE THAT REFERS TO THE LAWS OF
ANOTHER JURISDICTION.
	 
	14.5	 	The Exhibit(s) attached hereto is/are incorporated herein by reference
and made a part of this Agreement for all purposes.
	 
	14.6	 	If any provision of this Agreement is declared null and void, or
voidable, by a court of competent jurisdiction, then that provision will
be considered severable at Transporter’s option; and if the severability
option is exercised, the remaining provisions of the Agreement shall
remain in full force and effect.
	 
	14.7	 	This Agreement supersedes and cancels, as of the effective date hereof,
the Firm Lateral Transportation Agreement(s) between Shipper and
Transporter dated N/A.




6









 











Contract #410260R1 FT-L




FIRM LATERAL TRANSPORTATION AGREEMENT

(For Use Under Rate Schedule FT-L)



IN WITNESS WHEREOF, the Parties hereto have caused this Agreement to be duly executed as of the
date first hereinabove written.




	 	 	 	 	 
	EAST TENNESSEE NATURAL GAS, LLC
	 
	BY:


	 	/s/ D. Patrick Whitty
 

	 	 
	TITLE:

	 	Vice President	 	 






	 	 	 	 	 
	(Shipper)	 	 
	CNX Gas Company, LLC	 	 
	 
	 	 	 	 
	BY:


	 	/s/ Ronald E. Smith
 


	 	 
	TITLE:

	 	President	 	 






7









 






	 	 	 	 	 	 	 
	 	 	Contract
#410260R1 FT-L    
	 
	 	 	 	 	 	 
	 

	 	Date:	 	The date that
transporter’s Jewell Ridge Lateral is completed and placed in service.






EXHIBIT A TO THE

FIRM LATERAL TRANSPORTATION AGREEMENT




DATED April 27, 2006




Shipper: CNX GAS COMPANY, LLC

Contract Number: 410260



Proposed Commencement Date: THE DATE THAT TRANSPORTER’S JEWELL RIDGE LATERAL
IS COMPLETED AND PLACED IN SERVICE



Termination Date: PRIMARY TERM OF FIFTEEN (15) YEARS




Incremental Lateral: JEWELL RIDGE LATERAL




Primary

Receipt Point(s):




	 	 	 	 	 	 	 	 	 	 	 
	 	 	Meter	 	 	 	Interconnect	 	Location
	Name	 	No.	 	MDRO	 	Party	 	County, State
	CNX-JEWELL RIDGE

	 	59334	 	 	210,000 DTH
	 	CNX GAS

COMPANY, LLC
	 	TAZEWELL, VA






Primary

Delivery Point (s):




	 	 	 	 	 	 	 	 	 	 	 
	 	 	Meter	 	 	 	Interconnect	 	Location
	Name	 	No.	 	MDDO	 	Party	 	County, State
	JEWELL RIDGE

	 	50091	 	 	210,000 DTH
	 	EAST TENNESSEE

NATURAL GAS,

LLC
	 	SMYTH, VA






Name of entity (s) to deliver gas to Transporter:

CNX GAS COMPANY, LLC


 


 




 


 





Name of entity(s) to receive gas from Transporter:

CNX GAS COMPANY, LLC



 


 




 


 






	•	 	Transporter shall not be obligated to deliver more cubic feet of gas to any Shipper than
the quantity calculated using 1.03 dth per million cubic feet.






8









 












Contract #410260R1 FT-L




EXHIBIT A TO THE

FIRM LATERAL TRANSPORTATION AGREEMENT

DATED April 27, 2006




Notices not made via LINK® shall be made to:




	 	 	 
	 

	 	                  Shipper
	 

	 	CNX GAS COMPANY, LLC
	 

	 	4000 BROWNSVILLE RD.
	 

	 	SOUTH PARK, PA 15129-9545
	 

	 	 Attn: DIRECTOR, MARKETING
	 
	 	 
	 

	 	                  Invoices
	 

	 	CNX GAS COMPANY, LLC
	 

	 	4000 BROWNSVILLE RD.
	 

	 	SOUTH PARK, PA 15129-9545 
Attn: GAS ACCOUNTING






New Facilities Required:

COMPLETION OF JEWELL RIDGE LATERAL



 


 




 


 





New Facilities Charge:

NEGOTIATED RATE AS SPECIFIED IN PRECEDENT AGREEMENT DATED JULY 29, 2005



 


 




 


 




(This Exhibit A supersedes and cancels Exhibit A dated N/A to the Firm Transportation Agreement
dated (N/A.)




	 	 	 	 	 
	EAST TENNESSEE NATURAL GAS, LLC
	 
	 	 	 	 
	BY:

TITLE:

	 	/s/ D. Patrick Whitty
 

Vice President
	 	 
	 
	 	 	 	 
	CNX GAS COMPANY, LLC	 	 
	 
	 	 	 	 
	BY:

TITLE:

	 	/s/ Ronald E. Smith
 

President
	 	 







9









 







	 	 	 
	

	 	East Tennessee

Natural Gas Company
	 
	 	 
	 

	 	Shipping Address
	 

	 	5400 Westheimer Court
	 

	 	Houston, TX 77056-5310
	 
	 	 
	 

	 	Mailing Address
	 

	 	P.O. Box 1642 
Houston, TX 77251-1642






March 13, 2006




CNX Gas Company, LLC
 4000
Brownsville Rd. 
South Park,
PA 15129-9545




RE:      Service Agreement (Rate Schedule FT-L) No. 410260




Dear Roland:




     East Tennessee Natural Gas, LLC (Transporter) and CNX Gas Company LLC (Shipper) are
parties to the above-referenced Service Agreement.



     Shipper and Transporter hereby agree to the rate provisions set forth on the attached pro
forma tariff sheet and acknowledge that, upon approval by the Federal Energy Regulatory Commission
of such tariff sheet, the rate contained therein will be the rate applicable to the Service
Agreement for the term set forth on the tariff sheet.



     If the foregoing accurately sets forth your understanding of the matters described herein,
please so indicate by having a duly authorized representative sign in the space provided below and
returning an original signed copy to the undersigned.



	 	 	 	 	 	 	 
	 	 	Sincerely,	 	 
	 
	 	 	 	 	 	 
	 	 	East Tennessee Natural Gas, LLC	 	 
	 
	 	 	 	 	 	 
	 

	 	By:

Name:
	 	/s/ D. Patrick Whitty
 

D. Patrick Whitty
	 	 
	 

	 	Title:
	 	Vice President	 	 






ACCEPTED AND AGREED TO

THIS 27th DAY OF APRIL 2006




CNX Gas Company LLC




	 	 	 	 	 
	By:

Name:

	 	/s/ Ronald E. Smith
 

Ronald E. Smith
	 	 
	Title:

	 	President	 	 






 









 






East Tennessee Natural Gas, LLC

FERC Gas Tariff




					
	Third Revised Volume No. 1
	 	 
	 	Original Sheet No.






STATEMENT OF NEGOTIATED RATES




	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	Term of Negotiated	 	 	 	 	 	 	 	 	 	 
	Customer Name	 	Contract Number	 	 	Rate Schedule	 	 	Demand Rate	 	 	Commodity Rate	 	 	Rate	 	 	Quantity	 	 	Receipt Points	 	 	Delivery Points	 
	CNX Gas Company,
LLC
	 	 	410260	 	 	FT-L	 	$	3.1141	 	 	$	0.00	 	 	 	3/	 	 	210,000 Dth/d	 	 	4/	 	 	 	5/	 








 




			
	1/	 	This negotiated rate agreement does not deviate in any material respect from the Form of
Service Agreement contained in Transporter’s Tariff. The negotiated rate is applicable
only to transportation service up to Customer’s MDTQ from the Primary Point of Receipt to
the Primary Point of Delivery.
	 
	2/	 	The primary term commences on the date that Transporter’s Jewell Ridge Lateral is
completed and placed in service and continues for 15 years thereafter.
	 
	3/	 	Customer may cause up to 210,000 Dth/d to be received on a primary basis at Meter No.59334.

	 
	4/	 	Customer may cause up to 210,000 Dth/d to be delivered on a primary basis at Meter No.50091





	 	 	 
	Issued by: D. A. McCallum, Director, Rates and Tariffs
	 	 
	Issued on:

	 	Effective on: