exv10w1



    Exhibit
10.1

     

    Sixth Amended and
Restated

     

    Gas Gathering and
Processing Agreement

     

    Between

     

    QUICKSILVER
RESOURCES INC.,

     

    COWTOWN PIPELINE
PARTNERS L.P.

     

    and

     

    COWTOWN GAS
PROCESSING PARTNERS L.P.

     

    Cowtown Gas
Facilities

     

     

    Effective Date
September 1, 2008

     

    
         



          

        









 


        
  


    TABLE OF
CONTENTS


    
      
        	 	 	
                Page

              
	
                ARTICLE I
      -

              	
                DEFINITIONS

              	
                1

              
	
                ARTICLE II
      -

              	
                COMMITMENT OF
      PROCESSING RIGHTS

              	
                5

              
	
                ARTICLE III
      -

              	
                RESERVATIONS
      OF PARTIES

              	
                6

              
	
                ARTICLE IV
      -

              	
                GATHERING
      SYSTEM DELIVERY POINT(S), PLANT DELIVERY POINT(S) AND
    PRESSURE

              	
                7

              
	
                ARTICLE V
      -

              	
                REGULATION OF
      PRODUCTION

              	
                7

              
	
                ARTICLE VI
      -

              	
                QUANTITY

              	
                8

              
	
                ARTICLE VII
      -

              	
                QUALITY

              	
                9

              
	
                ARTICLE VIII
      -

              	
                TESTS

              	
                10

              
	
                ARTICLE IX
      -

              	
                MEASUREMENT
      AND METER TESTING

              	
                11

              
	
                ARTICLE X
      -

              	
                ALLOCATION
      PROCEDURE

              	
                14

              
	
                ARTICLE XI
      -

              	
                DISPOSITION
      OF PRODUCER'S PORTION OF PLANT PRODUCTS

              	
                14

              
	
                ARTICLE XII
      -

              	
                GATHERING AND
      PROCESSING FEES

              	
                15

              
	
                ARTICLE XIII
      -

              	
                DISPOSITION
      OF PRODUCER'S PORTION OF RESIDUE GAS

              	
                15

              
	
                ARTICLE XIV
      -

              	
                ACCOUNTING,
      PAYMENTS AND CREDIT ASSURANCES

              	
                15

              
	
                ARTICLE XV
      -

              	
                WARRANTY

              	
                18

              
	
                ARTICLE XVI
      -

              	
                TAXES

              	
                18

              
	
                ARTICLE XVII
      -

              	
                INDEMNITY

              	
                19

              
	
                ARTICLE XVIII
      -

              	
                FORCE
      MAJEURE

              	
                21

              
	
                ARTICLE XIX
      -

              	
                UNPROFITABLE
      OPERATIONS AND RIGHTS OF TERMINATION

              	
                21

              
	
                ARTICLE XX
      -

              	
                TERM

              	
                22

              
	
                ARTICLE XXI
      -

              	
                REGULATORY
      BODIES

              	
                23

              
	
                ARTICLE XXII
      -

              	
                ARBITRATION

              	
                23

              
	
                ARTICLE XXIII
      -

              	
                DISPUTES

              	
                24

              
	
                ARTICLE XXIV
      -

              	
                NOTICES AND
      PAYMENTS

              	
                24

              
	
                ARTICLE XXV
      -

              	
                ASSIGNMENT

              	
                26

              
	
                ARTICLE XXVI
      -

              	
                MISCELLANEOUS

              	
                27

              


      

    

     

    EXHIBITS

    

      
        	
                EXHIBIT
      A

              	
                Contract
      Area

              
	
                EXHIBIT
      B

              	
                Gathering
      System Delivery Point(s); Plant Delivery Point(s)

              
	
                EXHIBIT
      C

              	
                Residue Gas
      Delivery Point(s); Plant Products Delivery Point(s)

              
	
                EXHIBIT
      D

              	
                Compression
      Fee

              


      


      
           


          i

          
            

          

        







 


          
 


      

     

    Sixth Amended and
Restated

     

    Gas Gathering and
Processing Agreement

     

     

    THIS SIXTH AMENDED
AND RESTATED GAS GATHERING AND PROCESSING AGREEMENT (the “Agreement”)
is  made and entered into as of the 1st day of September, 2008 (the
“Effective Date”), by and among COWTOWN PIPELINE PARTNERS L.P., a Texas limited
partnership (“Gatherer”), COWTOWN GAS PROCESSING PARTNERS L.P., a Texas limited
partnership, (“Processor”), and QUICKSILVER RESOURCES INC., a Delaware
corporation, (“Producer").  Gatherer, Processor and Producer are
sometimes referred to herein, individually, as a “Party” and, collectively, as
the “Parties”.

     

    WITNESSETH,
THAT:

     

    WHEREAS, the
Parties entered into that certain Fifth Amended and Restated Gas Gathering and
Processing Agreement dated effective August 10, 2007 (the “Fifth
Restatement”);

     

    WHEREAS, the
Parties desire to amend certain terms in the Fifth Restatement and to provide
for revised and supplemental Exhibits to be made a part of the
Agreement;

     

    NOW, THEREFORE, in
consideration of the representations, warranties and mutual premises and
benefits contained herein and for other good and valuable consideration, the
adequacy, receipt and sufficiency of which are hereby acknowledged, Gatherer,
Processor and Producer agree to amend and restate the Fifth Restatement as
follows:

     

    ARTICLE I
-

    DEFINITIONS

     

    1.1    For the purpose of
this Agreement, the following terms and expressions used herein are defined as
follows:

     

    
      	
               
      

            	
              a.

            	
              "Btu" shall
      mean one British thermal unit, which is the quantity of
      heat  required to raise one pound avoirdupois of pure water from
      58.5 degrees Fahrenheit to 59.5 degrees Fahrenheit at a constant pressure
      of 14.73 pounds per square inch
absolute.

            


    

     

    
      	
               
      

            	
              b.

            	
              "Component"
      shall mean those hydrocarbon and non-hydrocarbon molecular constituents
      which are definable by industry standards and procedures.  Such
      Components as used in this Agreement shall
be:

            


    

     

    N2  -
Nitrogen

    CO2
- Carbon Dioxide

    H2S - Hydrogen
Sulfide

     

    
        
        

        
        

        
          

        

      







 


        

        

    

     

    C1  -
Methane

    C2  -
Ethane

    C3  -
Propane

    iC4 -
Iso-butane

    nC4 - Normal
Butane

    iC5 -
Iso-pentane

    nC5 - Normal
Pentane

    C6+ - Hexanes and
Heavier Compounds

     

    
      	
               
      

            	
              c.

            	
              “Compression
      Fee” shall have the meaning set forth in Section 12.3 of this
      Agreement.

            


    

     

    
      	
               
      

            	
              d.

            	
              "Contract
      Area" shall mean that area as described or outlined on Exhibit A which is
      attached hereto and made a part hereof for all
  purposes.

            


    

     

    
      	
               
      

            	
              e.

            	
              “CPI
      Adjustment” shall mean that percentage equal to the percentage increase
      between:

            


    

     

    
      	
               
      

            	
              (i)

            	
              the
      seasonally unadjusted Consumer Price Index for All Urban Consumers (all
      items), U.S. city Average (1982-84 =100), as published by the U.S.
      Department of Labor, Bureau of Labor Statistics (“CPI-U”) for the month of
      December of the second year prior to the Escalation Date;
    and

            


    

     

    
      	
               
      

            	
              (ii)

            	
              the
      seasonally unadjusted CPI-U for the month of December immediately
      preceding the Escalation Date.

            


    

     

    
      	
               
      

            	
              f.

            	
              "Day" shall
      mean a period of twenty-four (24) consecutive hours beginning and ending
      at seven o'clock a.m. Central Time.

            


    

     

    
      	
               
      

            	
              g.

            	
              “Escalation
      Date” shall mean the January 1st
      following the Effective Date and each January 1st
    thereafter.

            


    

     

    
      	
               
      

            	
              h.

            	
              "Facilities"
      shall mean the Plant and the Gathering
System.

            


    

     

    
      	
               
      

            	
              i.

            	
              "Gas" shall
      mean natural gas which is owned or controlled by Producer or its
      successors and assigns and produced from wells drilled on lands within the
      Contract Area, including casinghead gas produced with crude oil, gas from
      gas wells produced in association with crude oil (associated gas), and gas
      from condensate wells (non-associated gas), and shall include any inerts
      or impurities contained therein.

            


    

     

    
      	
               
      

            	
              j.

            	
              “Gathering
      Fee” shall have the meaning set forth in Section 12.1 of this
      Agreement.

            


    

     

    
        
        

        2

        
          

        

        
        

    







 


    
 

    
      	
               
      

            	
              k.

            	
              "Gathering
      System" shall mean, but shall in no way be limited to, the gas gathering
      pipelines, fuel gas pipelines, dehydration facilities, compression
      facilities, junctions, heaters, meters, separators, electric power lines,
      communications cables, roads, and other related facilities and equipment,
      including all easements located thereon, from the inlet flange of the
      pipeline metering facility installed up to the inlet flange of the
      separation facilities installed upstream of the Plant inlet meter,
      necessary to gather and transport gas from the Gathering System Delivery
      Point(s) to the Plant Delivery Point(s) and shall include any expansion of
      the Gathering System as provided in Section
4.4.

            


    

     

    
      	
               
      

            	
              l.

            	
              "Gathering
      System Delivery Point(s)" shall mean the inlet flange of Gatherer's
      metering facilities located at or near each of Producer’s wells located
      within the Contract Area or such other point as may be mutually agreed
      upon by the Parties.  The Gathering System Delivery Point(s) are
      listed on Exhibit B to this Agreement which is attached hereto and made a
      part hereof for all purposes and which may be amended from time to time to
      reflect the addition or deletion of a Gathering System Delivery
      Point.

            


    

     

    
      	
               
      

            	
              m.

            	
              "Liquefiable
      Hydrocarbons" shall mean ethane, propane, iso-butanes, normal butanes,
      iso-pentanes, normal pentanes, hexanes and heavier hydrocarbons, and
      incidental methane, or any mixtures thereof, which can be recovered or
      extracted in the Gathering System or the Plant and sold as Plant
      Products.

            


    

     

    
      	
               
      

            	
              n.

            	
              "MCF" shall
      mean 1,000 standard cubic feet of
gas.

            


    

     

    
      	
               
      

            	
              o.

            	
              "MMBtu" shall
      mean 1,000,000 Btu’s.

            


    

     

    
      	
               
      

            	
              p.

            	
              “MMCF” shall
      mean 1,000,000 standard cubic feet of
gas.

            


    

     

    
      	
               
      

            	
              q.

            	
              “MMCFD” shall
      mean 1,000,000 standard cubic feet of gas per
  day.

            


    

     

    
      	
               
      

            	
              r.

            	
              "Month,"
      "billing month," "period," and "accounting period" shall mean the period
      beginning at seven o'clock a.m. on the first day of a calendar month and
      ending at seven o'clock a.m. on the first day of the next succeeding
      calendar month.

            


    

     

    
      	
               
      

            	
              s.

            	
              "Plant" shall
      mean, but shall in no way be limited to, all tanks, machinery, equipment,
      buildings, structures, fixtures, appliances, pipe, valves, fittings, and
      materials of any nature or kind whatsoever located on the site at which
      the processing, compression, and recompression facilities of Processor are
      currently located in Hood County, Texas (generally known as the Cowtown
      Plant), or any other site where such facilities may later be located,
      including by way of additions to, expansion or new development of the
      Plant or such

            


    

     

    
        
        

        3

        
          

        

        
        

    







 


    
 

    
      	
               
      

            	
               

            	
              related
      facilities, which shall include, without limitation, the Corvette Plant
      constructed in 2008; including appropriate storage, compression, metering,
      shipping, dehydration, and delivery facilities for Plant Products; all
      easements pertaining to rights-of-way, the site or sites, and the
      operation of the Plant; and any and all other facilities and appurtenances
      located, or to be located, on or away from such site or sites deemed by
      Processor to be necessary for the successful operation of the Plant,
      including inlet compression, if any, but not including the Residue Gas
      Delivery Facility.

            


    

     

    
      	
               
      

            	
              t.

            	
              “Plant
      Delivery Point(s)” shall mean the point(s) of interconnect between the
      Gathering System and the Plant which point(s) are shown on Exhibit "B"
      which is attached hereto and made a part hereof for all
      purposes.

            


    

     

    
      	
               
      

            	
              u.

            	
              "Plant Fuel"
      shall mean the MMBtu's of Gas consumed at the Plant for fuel which shall
      include, but shall in no way be limited to, fuel used for Gas compression,
      conditioning and treating; recovery, extraction, and removal of Plant
      Products; and the recompression of the Residue
  Gas.

            


    

     

    
      	
               
      

            	
              v.

            	
              "Plant
      Products" shall mean all Liquefiable Hydrocarbons recovered, extracted, or
      otherwise removed from the Gas after the Plant Delivery Point(s),
      including, but not limited to, plant condensate (sometimes referred to as
      pentanes plus, heavier than butanes, or natural gasoline), and all
      commercial non-hydrocarbon substances recovered, extracted, or otherwise
      removed from the Gas in the Gathering System or the
  Plant.

            


    

     

    
      	
               
      

            	
              w.

            	
              “Plant
      Products Delivery Point” shall mean either (a) the point(s) of
      interconnect between that certain liquids pipeline owned and operated by
      Gatherer, and the facilities of third party pipeline(s) to which the Plant
      Products are delivered and which point(s) are shown on Exhibit "C" which
      is attached hereto and made a part hereof for all purposes or (b) the
      truck loading facilities of the
Plant.

            


    

     

    
      	
               
      

            	
              x.

            	
              "Plant
      Tailgate" shall mean the point of interconnect between the Plant and the
      Residue Gas Delivery Facility located at the downstream flange of the
      block valve which is downstream of the Plant residue meter and emergency
      shutdown valve.

            


    

     

    
      	
               
      

            	
              v.

            	
              “Primary
      Term” shall have meaning set forth in ARTICLE
  XX.

            


    

     

    
      	
               
      

            	
              z.

            	
              "Process
      Flare" shall mean any MMBtu's of Gas dispersed or lost at the Plant as
      flare which shall include, but shall in no way be limited to, flare
      dispersed or lost in the compression, conditioning and treating
      of

            


    

     

    
        
        

        4

        
          

        

        
        

    







 


    
 

    
      	
               
      

            	
               

            	
              Gas;
      recovery, extraction, and removal of Plant Products; and the recompression
      of Residue Gas.

            


    

     

    
      	
               
      

            	
              aa.

            	
              “Processing
      Fee” shall have the meaning set forth in Section 12.2 of this
      Agreement.

            


    

     

    
      	
               
      

            	
              bb.

            	
              “psia” shall
      mean pounds per square inch
absolute.

            


    

     

    
      	
               
      

            	
              cc.

            	
              “psig” shall
      mean pounds per square inch gauge.

            


    

     

    
      	
               
      

            	
              dd.

            	
              "Residue Gas"
      shall mean that hydrocarbon and non-hydrocarbon stream of Gas remaining
      after the recovery, extraction, and removal of Plant Products, and after
      reduction for Gas used for Plant Fuel, Process Flare, and other incidental
      losses, including line loss.

            


    

     

    
      	
               
      

            	
              ee.

            	
              "Residue Gas
      Delivery Facility" shall mean the residue gas pipeline and associated
      equipment that are located at the Plant Tailgate and are used to deliver
      residue gas to the Residue Gas Delivery
  Point(s).

            


    

     

    
      	
               
      

            	
              ff.

            	
              "Residue Gas
      Delivery Point(s)" shall mean the point(s) of interconnect between the
      Residue Gas Delivery Facility and the facilities of third party
      pipeline(s) to which the Residue Gas is delivered and which point(s) are
      shown on Exhibit C which is attached hereto and made a part hereof for all
      purposes.

            


    

     

    
      	
               
      

            	
              gg.

            	
              SCF" or
      "standard cubic foot of gas" shall mean the amount of Gas necessary to
      fill a cubic foot of space when the Gas is at a pressure of 14.65 pounds
      per square inch absolute and a temperature of sixty (60) degrees
      Fahrenheit.

            


    

     

    
      	
               
      

            	
              hh.

            	
              “Term” shall
      have the meaning set forth in ARTICLE XX of this
  Agreement.

            


    

     

    
      	
               
      

            	
              ii.

            	
              “Treating
      Fee” shall have the meaning set forth in Section 12.4 of this
      Agreement.

            


    

     

    ARTICLE II
-

    COMMITMENT
OF PROCESSING RIGHTS

     

    2.1    Subject
to the terms and provisions hereof, Producer dedicates and agrees to deliver to
Gatherer for gathering and to Processor for processing, at the Gathering System
Delivery Point(s), the total volume of Gas owned or controlled by Producer or
its successors and assigns, lawfully produced from wells now or hereafter
drilled on the lands within the Contract Area or lands pooled therewith,
excluding Gas reserved or utilized by Producer or its successors and assigns in
accordance with the terms of ARTICLE III.  Any transfer by Producer of
its right, title, or interest in the Gas to a third party, whether by farmout,
contract, or otherwise, shall be made specifically subject to this
Agreement.  Producer will notify any person to whom Producer transfers
all or a portion of its right, title,

     

    
        
        

        5

        
          

        

      







 


      

        
        
or interest in the
Gas that such Gas is dedicated pursuant to the terms of this
Agreement  to be gathered and processed in the Facilities, and
Producer shall obtain such third party's agreement to continue delivering such
Gas to Gatherer and Processor during the Term of and in accordance with this
Agreement.  Producer will notify Gatherer and Processor of any such
transfer within ten (10) days of the effective date.  Failure of
Producer to so notify Gatherer and Processor will not impair Gatherer’s and
Processor's rights under this Agreement.

     

    2.2    Gas
shall be delivered to the Gathering System Delivery Point(s) after mechanical
separation by Producer for the removal of free water and free liquid
hydrocarbons, but shall not otherwise be processed by Producer for the removal
of Liquefiable Hydrocarbons.

     

    2.3    Gatherer
agrees that subject to the provisions hereof, it will take and gather Gas from
the Gathering System Delivery Point(s) and will cause such Gas to be delivered
to the Plant Delivery Point(s) for processing.

     

    2.4    Processor
agrees that subject to the provisions hereof, it will receive the Gas at the
Plant Delivery Point(s) and will cause such Gas to be processed in the Plant for
the recovery and delivery of Plant Products.  Processor also agrees to
deliver at the Residue Gas Delivery Point(s) to Producer or Producer's nominee
the Residue Gas as determined under the provisions of Section 10.2.

     

    ARTICLE III
-

    RESERVATIONS
OF PARTIES

     

    3.1    Producer
reserves all liquid hydrocarbons, oil, or condensate removed by Producer by
means of mechanical gas-liquid separators (including heater-treaters), drips,
and/or lines from the Gas prior to delivery to Gatherer.  If
mechanical cooling is performed by Producer to meet the temperature
specifications of this Agreement, Producer shall not reduce the temperature of
the Gas below one hundred and twenty (120) degrees Fahrenheit.

     

    3.2    Producer
reserves all Gas that may be required for cycling, repressuring, pressure
maintenance, and gas lift operations with respect to gas reservoirs on the
premises committed hereunder; provided, however, that the Gas used in such
operations shall be subject to the terms of this Agreement (to the extent that
such Gas can be economically saved) and delivered to Processor following the
cessation of such operations.

     

    3.3    Producer
reserves that amount of Gas which is required for above ground development and
operation within the Contract Area.

     

    3.4    Producer
expressly reserves the right to deliver or furnish to Producer's lessor Gas as
required to satisfy the terms of Producer's oil and gas leases.

     

    
        
        

        6

        
          

        

      







 


        

        

     

    ARTICLE
IV -

    GATHERING SYSTEM
DELIVERY POINT(S),

    PLANT
DELIVERY POINT(S) AND PRESSURE

     

    4.1    Producer,
at its own expense, shall construct, equip, maintain, and operate all facilities
(including, but not limited to, all necessary separation, dehydration, and/or
compression equipment) necessary to deliver the Gas to Gatherer at the Gathering
System Delivery Point(s) at such pressure as is required and sufficient to enter
the Gathering System, but not to exceed one thousand two-hundred (1,200)
psig.

     

    4.2    Whether
to facilitate the movement of the Gas on the Gathering System or for other
reasons, Gatherer may, but shall have no obligation to, provide compression for
the Gas (other than Plant recompression which shall be provided by Processor),
on such basis and for the Compression Fee as more particularly provided and
described in Section 12.3 below.  In such event, Producer will provide
its pro rata share of fuel required for operating such compression equipment and
any related facilities.

     

    4.3    Gatherer,
at Producer’s expense, shall install, construct and equip all meters and
facilities necessary to measure the Gas at the Gathering System Delivery
Point(s).  Gatherer, at its own expense, shall maintain and operate
such meters throughout the term of this Agreement.

     

    4.4    Gatherer,
in its sole and absolute discretion, may decline to construct a Gathering System
expansion if it determines that it would not be profitable to do
so.  In such event, Producer may construct a Gathering System
expansion at its sole cost and expense.  The Gathering System
expansion must meet all of Gatherer’s specifications, and Gatherer will be
responsible for the meter station and connection to the existing Gathering
System.  Gatherer may, at its election, but within two years (2) of
the initial delivery of production from the Gathering System expansion acquire
the ownership of the Gathering System expansion installed by the Producer by
reimbursing Producer for the actual cost of the Gathering System expansion with
no allowance for inflation or depreciation.  In such event, Producer
agrees to execute all assignments or contracts deemed necessary to accomplish
the transfer to Gatherer of title to the Gathering System expansion, including
rights-of-way and easements.  In the event neither Gatherer nor
Producer elect to construct the necessary Gathering System expansion to connect
the Gathering System Delivery Point to the existing Gathering System, then this
Agreement shall terminate as to the Gas from the well or wells to be connected
to that Gathering System Delivery Point.

     

    4.5    Gatherer
hereby agrees to deliver the Gas to the Processor at the Plant Delivery Point(s)
at a pressure sufficient to enter the Plant, but in no way greater than five
hundred (500) psig unless Gatherer is providing compression pursuant to Section
4.2.

     

    ARTICLE V
-

    REGULATION
OF PRODUCTION

     

    It is understood
and agreed by the Parties that in order for Gatherer and Processor to maintain
maximum efficiency in the Facilities, and in order to prevent flaring
and/or

     

    
        
        

        7

        
          

        

      







 


      

        
        
bypassing of Gas,
it will be necessary to maintain a uniform rate of flow of Gas to the Facilities
from all sources during each twenty-four (24) hour period.  Therefore,
Producer agrees that it will cooperate with Gatherer and Processor in regulating
the flow rate of the Gas and in establishing a producing schedule to deliver on
a best efforts basis the Gas at a uniform and continuous flow
rate.  In the event that Gatherer enters into an operational balancing
agreement with a third party pipeline, Producer hereby agrees to be bound by the
terms set forth therein.

     

    ARTICLE
VI -

    QUANTITY

     

    6.1    Subject
to Gathering System and Plant capacity, Gatherer shall gather and Processor
shall process that volume of Gas legally allowed to be produced which is
attributable to the interest owned or controlled by Producer or its successors
and assigns in wells drilled on lands within the Contract Area or lands pooled
therewith; provided, after processing, Producer or Producer's nominee will
accept the Residue Gas.  Processor shall regulate the flow of gas at
the Plant in the quantities and at the times desired by Processor to prudently
operate the Plant and/or to meet the fluctuating condition of Processor’s and
Producer’s markets.  Gatherer or Processor may, from time to time,
find it necessary to shut off entirely or restrict the flow of gas to the
Gathering System or Plant, respectively; notwithstanding anything herein to the
contrary, in such event, neither Gatherer nor Processor shall be liable to
Producer for the resulting effect thereof.  Gatherer and Processor
shall provide Producer prior notice of any shut down due to routine maintenance
and shall prudently work to minimize the amount of such downtime.

     

    6.2    Producer
shall nominate to Gatherer in writing, not less than three (3) business Days
prior to the first day of each Month during the term of the Agreement, the daily
quantity of Gas (expressed in MCF’s and MMBtu’s) that Producer shall deliver to
Gatherer at the Gathering System Delivery Point(s) for gathering during such
Month.   Producer shall also nominate to Processor in writing,
not less than three (3) business Days prior to the first day of each Month
during the term of the Agreement, the daily quantity of Residue Gas (expressed
in MCF’s and MMBtu’s) that Producer or Producer’s nominee shall receive at the
Residue Gas Delivery Point(s) following processing at the Plant.

     

    6.3    Gatherer,
Processor, and Producer shall designate a dispatcher(s) who shall be
continuously on call for nomination purposes, and shall notify each other in
writing of such dispatcher(s) and their telephone number(s).

     

    6.4    Producer’s
dispatcher shall notify Gatherer’s and Processor’s dispatchers in advance of any
anticipated decrease in delivery rate below the daily nominated
quantity.  Producer’s dispatcher must obtain the prior written
approval from Gatherer’s and Processor’s dispatchers for any delivery rate in
excess of the daily quantity rate.  Gatherer’s and Processor’s
dispatcher shall notify Producer’s dispatcher of any anticipated inability to
receive the Gas at a delivery rate less than (a) the daily nominated quantity
rate; or (b) a previously orally authorized delivery rate in excess of the daily
nominated quantity rate.

     

    
        
        

        8

        
          

        

      







 


        

        

     

    6.5    If
insufficient Plant or pipeline capacity exists to process all the Gas,
the  Plant processing capacity will be prorated for all gas dedicated
to the Plant, without undue discrimination, and the Gas unable to be processed
will be bypassed ratably, if allowed.

     

    6.6    Processor
shall have the right, but not the obligation, to expand the Plant or build a new
gas processing plant at a different location, and in such event, the Gas, or a
portion thereof, may be processed by Processor in the expanded Plant or the new
gas processing plant in accordance with the terms of this
Agreement.  The Parties acknowledge and agree that the Corvette Plant
located in Hood County, Texas (undergoing construction in 2008), is deemed part
of the Plant and the Facilities for purposes of this Agreement, and the terms of
this Agreement shall be applicable and effective with respect
thereto.

     

    ARTICLE VII
-

    QUALITY

     

    7.1    Gatherer
and Processor shall not be obligated to receive, gather and/or process (as the
case may be), Gas delivered hereunder that fails to meet (i) the quality
specifications of any transporter at any of the Residue Gas Delivery Point(s) or
Plant Products Delivery Point(s), or (ii) the following
specifications:

     

    
      	
               
      

            	
              a.

            	
              The Gas must
      be commercial in quality and free from any foreign materials such as dirt,
      dust, iron particles, crude oil, dark condensate, free water, and other
      impurities; and substances which may be injurious to pipelines or which
      may interfere with the gathering, processing, transmission, or commercial
      utilization of said Gas;

            


    

     

    
      	
               
      

            	
              b.

            	
              The Gas shall
      contain no free water;

            


    

     

    
      	
               
      

            	
              c.

            	
              The Gas
      delivered hereunder shall not exceed a temperature of one hundred forty
      (140) degrees Fahrenheit at the Gathering System Delivery Point(s), as
      well as the Plant Delivery
Point(s);

            


    

     

    
      	
               
      

            	
              d.

            	
              The Gas
      delivered hereunder shall not contain more
than:

            


    

     

    
      	
               
      

            	
              (i)

            	
              One-fourth
      grain of hydrogen sulfide, or five grains of total sulfur, or one grain
      mercaptan per one hundred (100) cubic
feet;

            


    

     

    
      	
               
      

            	
              (ii)

            	
              one part per
      million by volume of oxygen;

            
	 	 	 


    

    
      	
               
      

            	
              (iii)

            	
              that percent
      by volume of carbon dioxide which would result in the failure of the
      Residue Gas or the Plant Products to meet the specifications of any
      transporter at any of the Delivery Points, but in no event more than two
      percent by volume;

            


    

     

    
      	
               
      

            	
              (iv)

            	
              two percent
      by volume of nitrogen; or

            
	 	 	 


    

    
      	
               
      

            	
              (v)

            	
              three percent
      by volume of a combined total of inerts,
  including,

            


    

     

    
        
        

        9

        
          

        

      







 


        

        

    
       

      
        	
                 
      

              	
                 

              	
                but not
      limited to, carbon dioxide and nitrogen
  Components;

              


      

       

    

    
      	
               
      

            	
              e.

            	
              No diluents
      such as carbon dioxide, air, or nitrogen shall be added to the
      Gas;

            


    

     

    
      	
               
      

            	
              f.

            	
              The Gas shall
      contain no carbon monoxide, halogens, or unsaturated hydrocarbons, and no
      more than 0.1 parts per million of hydrogen;
and

            


    

     

    
      	
               
      

            	
              g.

            	
              The Gas shall
      contain no less than 1,100 Btu and 2 GPM ethane and heavier
      hydrocarbons.

            


    

     

    In the event of any
conflict as between a transporter’s specifications and those appearing above in
this Section 7.1, the most stringent or restrictive specifications shall be
applicable to the Gas proffered under this Agreement.

     

    7.2    If
any of the Gas delivered by Producer hereunder should fail to meet the quality
specifications set forth in this ARTICLE VII, Gatherer and Processor may elect
to either (i) accept and process such Gas, (ii) accept, but treat and/or
condition such Gas prior to gathering or processing at an additional cost, or
(iii) refuse to accept such Gas.  The acceptance of Gas not meeting
the quality specifications set forth in ARTICLE VII shall not be deemed a waiver
of Gatherer’s and Processor's right to reject such Gas at any later time, and
Gatherer and Processor shall be entitled, at any time and from time to time, to
decline to accept proffered deliveries of Gas not meeting the quality
specifications set forth herein.

     

    7.3    If
Gatherer and Processor elect to accept but treat and/or condition the
non-conforming Gas prior to gathering and processing, Gatherer and Processor
shall advise the Producer of such election and associated
fees.  Producer shall then have a maximum of thirty (30) days to
advise Gatherer and Processor if it will treat and/or condition such
non-conforming Gas and the cost associated with such treatment.  If
Producer does not elect to treat and/or condition such non-conforming Gas or
fails to make such election within the specified time period, then the Gatherer
and Processor shall have the right to (a) proceed with gathering and processing
such non-conforming Gas and Producer shall pay to Gatherer and Processor all
costs associated with such actions or (b) reject and release such non-conforming
Gas from the terms of the Agreement.  Notwithstanding
anything in this Section 7.3 to the contrary, Producer agrees that to the extent
non-conforming Gas at a Gathering System Delivery Point is accepted and
subsequently treated or conditioned with respect to its CO2
Component, such treating shall be done for the Treating Fee described and
provided in Section 12.4 below.

     

    ARTICLE VIII
-

    TESTS

     

    8.1    Producer,
Gatherer and Processor do hereby agree as follows:

     

    
      
        	
                 
      

              	
                a.

              	
                Gatherer
      shall procure or cause to be procured a sample of Gas at each Gathering
      System Delivery Point and Plant Delivery
Point,

              


      

       

    

    
        
        

        10

        
          

        

      







 


        

        

     

    
      	
               
      

            	
               

            	
              respectively,
      and analyze the samples by chromatographic analysis to determine the
      Component content (mole percent), specific gravity, the BTU content, and
      the Plant Product content (expressed in gallons per MCF)
      thereof.

            


    

     

    
      	
               
      

            	
              b.

            	
              The
      individual Plant Products contained in the commingled stream of plant
      products delivered from the Plant each month shall be determined from a
      chromatographic analysis of either (a) a spot sample or a sample taken
      from a continuous sampling device or (b) from an online
      chromatograph.  The results of the chromatographic analysis
      shall be applied to the commingled stream of plant products to determine
      the volume of each individual Plant Product delivered from the
      Plant.

            


    

     

    
      	
               
      

            	
              c.

            	
              Tests
      provided for in Subparagraphs (a) and (b) of this Section 8.1 shall be
      made by Gatherer and Processor using their own equipment or by an
      independent testing service at least once in each six month period, or
      more frequently in their sole discretion.  All such tests shall
      be made in accordance with approved engineering
      practices.  Representatives of Producer shall be entitled to
      witness such tests, and Producer shall give advance written notice to
      Gatherer and Processor in the event that it exercises such
      right.

            


    

     

    8.2    Physical
constants required for making calculations hereunder shall be taken from the Gas
Processors Association Physical Constants Publication No. 2145-03 (as amended
from time to time).  Physical constants for the hexanes and heavier
hydrocarbons portion of hydrocarbon mixtures shall be assumed to be the same as
the physical constants for hexane.  The heat content per gallon of
each liquid hydrocarbon Component shall be determined by multiplying the cubic
feet per gallon of such liquid hydrocarbon Component by the heat content per
cubic foot thereof.

     

    ARTICLE
IX -

    MEASUREMENT
AND METER TESTING

     

    9.1    The
unit of volume for measurement of Gas delivered hereunder shall be one thousand
(1,000) cubic feet of Gas at a base temperature of sixty (60) degrees Fahrenheit
and at an absolute pressure of 14.65 psia and saturated with water
vapor.  All fundamental constants, observations, records, and
procedures involved in determining the quantity of Gas delivered hereunder shall
be in accordance with the standards prescribed in Report Nos. 3 and 8, of the
American Gas Association, as amended or supplemented from time to time,
respectively.  It is agreed that for the purpose of measurement and
computations hereunder, the atmospheric pressure shall be assumed to be 14.7
psia regardless of the atmospheric pressure at which the Gas is measured and
that the Gas obeys the Ideal Gas Laws as to variations of volume with pressure
and specific gravity, including the deviation from Boyle's law, shall all be
made by Gatherer and Processor in accordance with applicable rules, regulations,
and orders.  It is also agreed that the Gatherer and
Processor

     

    
        
        

        11

        
          

        

      







 


      

        
        
may apply a uniform
correction factor for water vapor if they deem necessary in their sole and
absolute discretion.

     

    9.2    Gatherer
shall install, maintain, and operate, or cause to be maintained and operated, a
measuring station located at each Gathering System Delivery Point, the Residue
Gas Delivery Point(s) and the Plant Products Delivery Point. Processor shall
install, maintain, and operate a measuring station located downstream of the
separation facilities at each Plant Delivery Point.   Said
measuring station(s) shall be so equipped with orifice meters, recording gauges,
or other types of meter or meters of standard make and design commonly
acceptable in the industry, and of suitable size and design, as to accomplish
the accurate measurement of Gas delivered hereunder.  The changing and
integration of the charts (if utilized for measurement purposes hereunder) and
calibrating and adjusting of meters shall be done by Gatherer or Processor, as
appropriate.  Gatherer and Processor shall have the right to utilize
electronic gas measuring equipment should they so desire.

     

    9.3    Processor
shall measure or cause to be measured the volume of Plant Products in
gallons.

     

    9.4    Producer
may, at its option and expense, install check meters for checking Gatherer’s
metering equipment at each Gathering System Delivery Point; and the same shall
be so installed as not to interfere with the operation of the
Facilities.

     

    9.5    The
temperature of the Gas flowing through the meter shall be determined by the
continuous use of a recording thermometer or device installed by Gatherer or
Processor, as the case may be, so that it will properly record the temperature
of the Gas flowing through the meter.

     

    9.6    The
specific gravity of the Gas flowing through the meter shall be determined by
methods commonly accepted in the industry.  Specific gravities so
determined will be used in calculating Gas deliveries until the next specific
gravity test is made.

     

    9.7    Each
Party shall have the right to be present at the time of any installing, reading,
sampling, cleaning, changing, repairing, inspecting, testing, calibrating, or
adjusting done in connection with the other's measuring equipment used in
measuring deliveries hereunder.  The records from such measuring
equipment shall remain the property of their owner, but upon request, each will
submit to the other its records and charts, together with calculations therefrom
subject to return within thirty (30) days after receipt thereof.  If
meters utilizing charts are used to measure Gas hereunder, then the charts shall
be kept on file for a period of two (2) years, or such longer period as may be
required by law.  In addition, any other measurement data shall also
be kept for the same time period.  Each Party, during each of the
first three production months, and after that at least semi-annually, or more
often if necessary, shall calibrate the meters and instruments installed by it
or cause the same to be calibrated.  Gatherer shall
give  Producer ten (10) days notice in advance of such tests so that
the latter may, at its election, be present in person or by its representative
to observe adjustments, if any are made.

     

    
        
        

        12

        
          

        

      







 


        

        

     

    9.8    If
the metering equipment is found to be inaccurate by two percent (2%) or more,
registration thereof and any payment based upon such registration shall be
corrected at the rate of such inaccuracy for any period of inaccuracy which is
definitely known or agreed upon, or if not known or agreed upon, then for a
period extending back one-half of the time elapsed since the last day of the
calibration. Unless conclusively determined that either Gatherer’s or
Processor's measurement equipment is inaccurate by two percent (2%) or more,
Gatherer’s or Processor's, as the case may be, measurement shall be deemed to be
correct for all purposes hereunder, and no adjustment shall be made to the
previous volumes.  Following any test, any metering equipment found to
be inaccurate to any degree shall be adjusted immediately to measure
accurately.  If for any reason any meter is out of service or out of
repair so that the quantity of Gas delivered through such meter cannot be
ascertained or computed from the readings thereof, the quantity of Gas so
delivered during such period shall be estimated and agreed upon by the Parties
hereto upon the basis of the best available data using the first of the
following methods which is feasible:

     

    
      	
               
      

            	
              a.

            	
              By using the
      registration of any check measuring equipment of Producer, if installed
      and registering accurately;

            


    

     

    
      	
               
      

            	
              b.

            	
              By correcting
      the error if the percentage of error is ascertainable by calibration,
      test, or mathematical calculation;
or

            


    

     

    
      	
               
      

            	
              c.

            	
              By estimating
      the quantity of deliveries during preceding periods under similar
      conditions when the meter was registering
  accurately.

            


    

     

    9.9    If
Producer shall notify Gatherer, or if Gatherer shall notify Producer, at any
time that a special test of any Gathering System Delivery Point meter is
desired, the Parties shall cooperate to secure an immediate verification of the
accuracy of such meter and joint observation of any adjustments.  All
tests of Gatherer’s measuring equipment at any Gathering System Delivery Point
shall be made at Gatherer’s expense, except that the Producer shall bear the
expense of tests made at its request if the inaccuracy found is less than two
percent (2%).  Expense as used in this Section 9.9 shall be limited to
actual costs of Gatherer as the result of testing and shall not include any
costs incurred by Producer as the result of witnessing said
testing.

     

    9.10      
If during any month less than 1,000 MCF of Gas is delivered to a Gathering
System Delivery Point, (except for reasons of Force Majeure), then Gatherer
shall charge a meter fee applicable to any such Gathering System Delivery Point
equal to four hundred dollars ($400.00).  Such fee shall be deducted
from the compensation otherwise due Producer under this Agreement; or, at
Gatherer’s election, Producer may be invoiced for such amount payable thirty
(30) days after receipt.

     

    9.11      
The Parties hereto recognize and acknowledge that technological advances may
occur over the term of this Agreement which may render certain measurement
devices obsolete, or less accurate, or less efficient than that which may be
available.  In such event, Gatherer or Processor may, with Producer's
approval, substitute or utilize such

     

    
        
        

        13

        
          

        

      







 


      

        
        
available
measurement equipment in lieu of any measurement equipment described above in
this ARTICLE IX.

     

    9.12      
If for any reason the Gas is delivered to Gatherer at a Gathering System
Delivery Point with pulsations that affect the accuracy of the measurement,
Producer shall be responsible for installing necessary pulsation dampeners, or
other devices, to eliminate or reduce the pulsations to an acceptable level
determined by Gatherer.

     

    ARTICLE X
-

    ALLOCATION
PROCEDURE

     

    10.1    With
regard to the allocation of Plant Products, for each accounting period, the
actual Plant Products will be allocated to each Gathering System Delivery
Point in
the ratio of the Theoretical Plant Product Content of each Gathering System
Delivery Point over the sum of the Theoretical Plant Product Content for all
Gathering System Delivery Points.  The Component amount will be
determined by analysis at the Plant Products Delivery Point.

     

    The “Theoretical Plant Product
Content of each Gathering System Delivery Point” shall equal the product of the
Gathering System Delivery Point’s share
of plant inlet MCF multiplied by the GPM (Gallons per MCF) as determined by the
chromatograph analysis of a sample of the Gathering System Delivery Point.

     

    10.2    With
regard to the allocation of Residue Gas, for each accounting period, the actual
metered residue gas at each Residue Gas Delivery Point shall be allocated to
each Gathering System Delivery Point in
the ratio of the calculated Theoretical Residue Remaining for the Gathering
System Delivery Point over the sum of Calculated Theoretical Residue Remaining
for all Gathering System Delivery Points.

     

    The “Calculated
Theoretical Residue Remaining” shall equal each Gathering System
Delivery Point’s share of plant inlet volume MCF\MMBtu, minus each Gathering
System Delivery Point Plant Product
shrinkage (product shrinkage factors based on GPA 2145-03 bulletin), minus the
allocated Plant Fuel.

     

    ARTICLE
XI -

    DISPOSITION
OF PRODUCER'S PORTION OF PLANT PRODUCTS

     

    On behalf of
Producer, Processor shall have the right to sell all Plant Products removed or
extracted from the Facilities after Gas is delivered at the Plant Delivery
Point(s).  Processor shall sell the Plant Products at the Plant
Products Delivery Point(s), and Producer shall have no right to take the Plant
Products in kind at the Plant Products Delivery Point(s).  Processor
shall remit to Producer its share of the net proceeds received by Processor at
the Plant Product Delivery Point(s).

     

    
        
        

        14

        
          

        

      







 


        

        

     

    ARTICLE
XII -

    GATHERING
AND PROCESSING FEES

     

    12.1    Producer
shall pay to Gatherer 41.63 cents ($0.4163) per MMBtu of Gas gathered pursuant
to this Agreement (the “Gathering Fee”).

     

    12.2    Producer
shall pay to Processor 52.04 cents ($0.5204) per MMBtu of Gas processed pursuant
to this Agreement (the “Processing Fee”).

     

    12.3    Producer
shall pay to Gatherer a compression fee or fees (the “Compression Fee”) computed
by multiplying the MMBtu’s of Producer’s Gas metered at each Gathering System
Delivery Point by the compression rate applicable to such Gathering System
Delivery Point, which shall be based upon the average monthly operating pressure
registered at such Gathering System Delivery Point as more particularly provided
and described in Exhibit D, attached hereto and incorporated
herein.  Notwithstanding
anything herein to the contrary, Producer agrees that the Compression Fee
payable by Producer at a Gathering System Delivery Point shall never be less
than Gatherer’s actual cost to perform such compression
service.

     

    12.4    In
the event Gas is treated as provided by Section 7.3, Producer shall pay a
treating fee (the “Treating Fee”) computed by multiplying 3.5 cents ($0.035) per
mole percent of CO2  (based
on tests conducted pursuant to Section 8.1), per MMBtu of Gas metered at the
applicable Gathering System Delivery Point where such Gas was
delivered.

     

    12.5    On
each Escalation Date, the Gathering Fee, the Processing Fee, the Treating Fee
and the rates provided in Exhibit D (pertaining to the Compression Fee) will
increase by a percentage equal to the CPI Adjustment.

     

    12.6.   At
any time during the term of this Agreement, Producer may request that the
Parties enter into negotiations to reduce either the Gathering Fee or Processing
Fee, or both, and Gatherer and Processor agree to participate fully and
reasonably in such negotiations.

     

    ARTICLE
XIII -

    DISPOSITION
OF PRODUCER'S PORTION OF RESIDUE GAS

     

    Processor will
deliver the Residue Gas to the Residue Gas Delivery
Point(s).  Processor agrees to deliver Producer's Residue Gas at a
pressure sufficient to enter the third party natural gas pipeline(s), but in no
event shall Processor be obligated to deliver Residue Gas at a pressure which
exceeds the Plant discharge pressure of one thousand and sixty (1,060)
psig.  Producer will separately contract with a third party regarding
the transportation and sale of their Residue Gas.

     

    ARTICLE XIV
-

    ACCOUNTING,
PAYMENTS AND CREDIT ASSURANCES

     

    14.1    Gatherer
and Processor shall furnish to Producer on or before the twenty-fifth (25th) day
of each month a report or statement disclosing information necessary to
enable

     

    
        
        

        15

        
          

        

      







 


      

        
        
Producer to make
reasonable and accurate statistical and accounting entries upon its books
concerning all phases of this Agreement related to the preceding month,
including an allocation statement of Residue Gas delivered for Producer's
account to its Residue Gas purchaser and the amounts due Gatherer and Processor
for the services provided hereunder.  Producer shall remit the amounts
due Gatherer and Processor within thirty (30) days after the receipt of
Gatherer’s and Processor’s statement.  PRODUCER
SHALL INDEMNIFY AND HOLD GATHERER AND PROCESSOR HARMLESS FROM ANY ALL CHARGES,
PENALTIES, COSTS AND EXPENSES OF WHATEVER KIND OR NATURE ARISING FROM PRODUCER’S
FAILURE TO PAY SUCH PAYMENTS, INCLUDING COSTS AND EXPENSES OF ANY LITIGATION AND
REASONABLE ATTORNEYS’ FEES ASSOCIATED THEREWITH. Unpaid amounts due shall
accrue interest at the lesser of a rate equal to one and one half percent (1.5%)
per Month or the maximum rate permitted by law, until the balance is paid in
full.

     

    14.2    Each
Party shall have the right during reasonable hours to examine books, records,
charts, and original test data of another Party to the extent necessary to
verify the accuracy of any statement, charge, credit, computation, test, or
delivery made pursuant to any provision hereof.  If any such
examination reveals any inaccuracy in any such statement, charge, credit,
computation, test, or delivery, the necessary adjustment shall be promptly made
without interest or penalty. No Party will have any right to recoup or recover
prior overpayments or under payments that result from error that occur in spite
of good faith performance if the amounts involved do not exceed one thousand
dollars ($1,000.00).

     

    14.3    Processor
shall pay to Producer monthly, on or before the sixtieth (60th) day after the
end of the production month, but in no case sooner than Processor receives
payment from its purchaser, the sums due under ARTICLE XI for Producer's Plant
Products marketed by Processor during the preceding month less the amount of any
taxes actually paid by Processor which are applicable to such
quantities.  This payment shall be made irrespective of the interest,
title, or lien of any royalty or mineral owner or any third party or parties in
and to the Gas delivered by Producer to Processor hereunder, the Plant Products,
or Residue Gas derived therefrom, or proceeds accruing from the sale
thereof.

     

    14.4    Producer
shall be responsible for the payment of all royalties due on the Gas. PRODUCER
SHALL INDEMNIFY AND HOLD GATHERER AND PROCESSOR HARMLESS FROM ANY AND ALL
CLAIMS, ACTIONS, CAUSES OF ACTION, DAMAGES, LIABILITY, OR OBLIGATIONS ARISING
OUT OF OR IN ANY WAY RELATED TO THE PAYMENT OF THE LESSOR'S ROYALTY OR ANY OTHER
BURDEN OR ENCUMBRANCE AFFECTING THE GAS.

     

    14.5    Notwithstanding
any change in ownership of Producer's properties, Gatherer and Processor shall
never be required to make payments or to give notices required under the
provisions of this Agreement to more than one party, and, in the event that the
properties subject to this Agreement shall ever be owned by more than one party,
Gatherer and Processor may withhold (without interest) further payments and
notices until all of the owners of such properties have designated one party to
act for them in all respects relating to said properties and this Agreement,
including the rendering of bills, the submission of charts, and the receipt of
payments and notices hereunder.

     

    
        
        

        16

        
          

        

      







 


        

        

     

    14.6    Processor,
at its election, may deduct from its payment to Producer sums, if any, due to
Gatherer or Processor under the terms of this Agreement.

     

    14.7    All
accounting records and documents directly related to this Agreement prepared by
any Party hereto shall be retained for a period of not less than two (2) years
following the end of the calendar year of their origination.  The
Parties further agree that all matters relating to the accounting hereunder for
any calendar year shall be considered correct and not subject to further audit
or legal challenge after two years following the end of the calendar
year.

     

    Producer must
maintain such creditworthiness as Gatherer and Processor shall reasonably
require.  Gatherer and Processor’s creditworthiness requirements shall
be substantially similar to the requirements set forth below:

     

    
      	
               
      

            	
              a.

            	
              Producer will
      be deemed creditworthy if its long-term unsecured debt securities are
      rated at least BB- by Standard & Poor’s Corporation (“S&P”) and at
      least Ba3 by Moody’s Investor Service (“Moody’s”); provided, however, that
      if the Producer’s rating is at BB- or Ba3 and the short-term or long-term
      outlook is negative, Gatherer and Processor may require further
      analysis.

            


    

     

    
      	
               
      

            	
              b.

            	
              If Producer
      does not meet the criteria described above, then Producer may request that
      Gatherer and Processor evaluate its creditworthiness based upon the level
      of service requested relative to the Producer’s current and future ability
      to meet its obligations.  Further, if Producer’s
      creditworthiness does not meet any of the foregoing criteria, Producer
      will be considered creditworthy if Producer maintains and delivers to
      Gatherer and Processor an irrevocable guaranty of payment in form
      acceptable to Gatherer and Processor, or an irrevocable letter of credit
      from a financial institution rated at least A- by S&P or at least A3
      by Moody’s, in a form acceptable to Gatherer and Processor, in either case
      of the guaranty or the letter of credit in an amount satisfactory to
      Gatherer and Processor.  The obligation to maintain such credit
      assurance shall extend until such time as Producer is deemed creditworthy
      as defined herein.  Producer shall provide the guaranty or the
      letter of credit within twenty (20) days of written notice by Gatherer and
      Processor that such financial assurance is
  required.

            


    

     

    
      	
               
      

            	
              c.

            	
              The
      creditworthiness requirements set forth in this Section 14.8 shall apply
      to any permitted assignment (in whole or in part), and to any permitted
      permanent release, as applicable, of this Agreement.  Gatherer
      and Processor shall apply consistent evaluation practices to all similarly
      situated producers to determine the Producer’s financial ability to
      perform the payment obligations due to Gatherer and
    Processor.

            


    

     

    
        
        

        17

        
          

        

      







 


        

        

     

    ARTICLE
XV -

    WARRANTY

     

    15.1    Producer
warrants the title to all Gas and all Components thereof which shall be
delivered by Producer to Gatherer and Processor hereunder, the right to enter
into this Agreement with reference to such Gas, and that such Gas is free from
all liens and adverse claims; AND
AGREES, IF NOTIFIED THEREOF BY GATHERER OR PROCESSOR, TO INDEMNIFY, DEFEND AND
HOLD GATHERER AND PROCESSOR HARMLESS FROM AND AGAINST ANY AND ALL SUITS,
ACTIONS, LOSSES, DEBTS, ACCOUNTS, DAMAGES, COSTS, AND EXPENSES ARISING FROM OR
OUT OF ANY ADVERSE CLAIM AS TO PRODUCER’S TITLE, INCLUDING, BUT NOT LIMITED TO,
ANY ADVERSE CLAIM BROUGHT BY OR THROUGH A MINERAL INTEREST OR ROYALTY OWNER, TO
OR AGAINST THE GAS AND AGAINST THE PLANT PRODUCTS DERIVED
THEREFROM.  Producer agrees to make settlement for all
royalties, overriding royalty interests, and/or production payments due and
payable on the Gas delivered to Gatherer and Processor hereunder, the Plant
Products extracted and saved therefrom, and the sale and disposition of the
Residue Gas thereof, all in accordance with the terms of the leases from which
Gas processed hereunder is produced, applicable instruments of title, and all
amendments thereto.

     

    15.2    If
Producer's title to the Gas, Plant Products derived therefrom, or Residue Gas is
questioned, Processor may withhold payments of proceeds due hereunder without
interest up to the amount of the claim until title is free from such questions
or until Producer furnishes a bond satisfactory to Processor conditioned to save
Gatherer and Processor harmless, or other surety satisfactory to Gatherer or
Processor.

     

    15.3    Producer
also represents and warrants that it has full authority to receive payment for
the sum of all Gas delivered hereunder.

     

    ARTICLE
XVI -

    TAXES

     

    16.1    Producer
shall pay or cause to be paid all production, severance and ad valorem taxes,
assessments, and other charges levied or assessed against the Gas delivered by
Producer hereunder, and against Producer's portion of the Plant Products,
against Producer's Residue Gas, and against the sale thereof, and all taxes and
statutory charges levied or assessed against any of Producer's properties,
facilities, or operations.

     

    16.2    Processor
shall pay all taxes and statutory charges levied or assessed against the Plant
and operations concerning such plant.

     

    16.3    Gatherer
shall pay all taxes and statutory charges levied or assessed against the
Gathering System and operations concerning such system.

     

    16.4    The
price paid under ARTICLE XII of this Agreement includes reimbursement for state
severance taxes paid by Producer and Processor under this ARTICLE XVI of the
Agreement.

     

    
        
        

        18

        
          

        

      







 


        

        

     

    ARTICLE
XVII -

    INDEMNITY

     

    17.1    As
between the Parties, and as to liability, if any, accruing to a Party hereto, or
to any third party, Producer shall be solely liable for and in control and
possession of the Gas deliverable hereunder until the Gas is delivered to
Gatherer at the Gathering System Delivery Point(s).  Gatherer shall be
solely liable for and in control and possession of the Gas deliverable hereunder
until the Gas is delivered to Processor at the Plant Delivery
Point(s).  Processor shall be solely liable for and in control and
possession of the Gas and the Plant Products until Processor has delivered
Residue Gas to Producer at the Residue Gas Delivery Point(s) whereupon Producer
shall again be in control and possession thereof and bear the risk of loss of
the Residue Gas.

     

    17.2    PRODUCER
SHALL BE AFFORDED ACCESS TO GATHERER’S AND PROCESSOR’S PROPERTY AND THE
FACILITIES TO THE EXTENT NECESSARY TO CARRY OUT ITS RIGHTS AND OBLIGATIONS UNDER
THIS AGREEMENT, AND PRODUCER SHALL FULLY OBSERVE AND COMPLY WITH ALL OF
GATHERER’S AND PROCESSOR’S SAFETY PRACTICES AND PROCEDURES WHILE ON THE
PREMISES.  PRODUCER HEREBY AGREES TO INDEMNIFY, HOLD HARMLESS,
PROTECT, DEFEND, AND DISCHARGE GATHERER AND PROCESSOR AND THEIR AFFILIATED
COMPANIES, PARTNERS, SUCCESSORS, ASSIGNS, OFFICERS, DIRECTORS, SHAREHOLDERS,
EMPLOYEES AND AGENTS FOR, FROM AND AGAINST ANY AND ALL JUDGMENTS, EXECUTIONS,
CAUSES OF ACTION, DEMANDS, RIGHTS, SUITS, DEBTS AND SUMS OF MONEY, ACCOUNTINGS,
DUES, PENALTIES, FINES, CLAIMS (INCLUDING, WITHOUT LIMITATION, CLAIMS FOR
CONTRIBUTION), LIABILITIES, LOSSES, COSTS, DAMAGES AND EXPENSES (INCLUDING COURT
COSTS, REASONABLE COSTS OF INVESTIGATION, DEFENSE AND ATTORNEY’S FEES) FOR THE
INJURY TO OR DEATH OF ANY PERSON (INCLUDING, WITHOUT LIMITATION, EACH OF
PRODUCER’S, GATHERER’S AND PROCESSOR’S EMPLOYEES, AGENTS AND CONTRACTORS) OR
PROPERTY DAMAGE OF ANY NATURE, KIND OR DESCRIPTION OR ANY OTHER CLAIM OF ANY
NATURE, KIND OR DESCRIPTION BROUGHT BY ANY PERSON OR ENTITY, WHETHER LEGAL OR
EQUITABLE, WHICH ARISES OUT OF, RESULTS FROM OR IS IN ANY WAY RELATED TO (i)
PRODUCER’S OWNERSHIP AND CONTROL OF THE GAS PRIOR TO THE TIME THAT THE GAS
PASSES THROUGH THE GATHERING SYSTEM DELIVERY POINT(S) AND AFTER THE RESIDUE GAS
PASSES THROUGH THE RESIDUE GAS DELIVERY POINT(S), (ii)  PRODUCER’S
OWNERSHIP AND OPERATION OF THE WELLS LOCATED WITHIN THE CONTRACT AREA AND ANY
FACILITIES OR EQUIPMENT INSTALLED OR MAINTAINED BY PRODUCER UPSTREAM OF THE
GATHERING SYSTEM DELIVERY POINT, REGARDLESS OF WHETHER SUCH WAS REQUIRED BY THE
TERMS OF THIS AGREEMENT, (iii) THE PERFORMANCE OF ANY OBLIGATIONS, RIGHTS OR
DUTIES HEREUNDER, (iv) PRODUCER’S BREACH OF THIS AGREEMENT, OR (v) ANY
VIOLATION OF THE LAW, REGARDLESS OF EITHER GATHERER’S OR PROCESSOR’S SOLE,
CONCURRENT OR COMPARATIVE NEGLIGENCE.  GATHERER HEREBY AGREES TO
INDEMNIFY, HOLD HARMLESS, PROTECT, DEFEND AND DISCHARGE
PROCESSOR

     

    
        
        

        19

        
          

        

      







 


      

        
        
AND
PRODUCER AND THEIR AFFILIATED COMPANIES, PARTNERS, SUCCESSORS, ASSIGNS,
OFFICERS, DIRECTORS, SHAREHOLDERS, EMPLOYEES AND AGENTS, FOR, FROM AND AGAINST
ANY AND ALL JUDGMENTS, EXECUTIONS, CAUSES OF ACTION, DEMANDS, RIGHTS, SUITS,
DEBTS AND SUMS OF MONEY, ACCOUNTINGS, DUES, PENALTIES, FINES, CLAIMS (INCLUDING,
WITHOUT LIMITATION, CLAIMS FOR CONTRIBUTION), LIABILITIES, LOSSES, COSTS,
DAMAGES AND EXPENSES (INCLUDING COURT COSTS, REASONABLE COSTS OR INVESTIGATION,
DEFENSE AND ATTORNEY’S FEES) OF ANY NATURE, KIND OR DESCRIPTION BROUGHT BY ANY
PERSON OR ENTITY, WHETHER LEGAL OR EQUITABLE, WHICH ARISE OUT OF, RESULT FROM OR
ARE IN ANY WAY RELATED TO (i) GATHERER’S OWNERSHIP AND CONTROL OF THE GAS AFTER
THE GAS PASSES THROUGH  THE GATHERING SYSTEM DELIVERY POINT(S) AND
PRIOR TO THE TIME THAT THE GAS PASSES THROUGH THE PLANT DELIVERY POINT(S),
(ii) GATHERER’S OWNERSHIP AND OPERATION OF THE GATHERING SYSTEM,
(iii) THE SERVICES PROVIDED BY GATHERER PURSUANT TO THIS AGREEMENT,
(iv) GATHERER’S BREACH OF THIS AGREEMENT, OR (v) ANY VIOLATION OF THE LAW,
REGARDLESS OF PRODUCER’S OR PROCESSOR’S SOLE, CONCURRENT OR COMPARATIVE
NEGLIGENCE.  PROCESSOR HEREBY AGREES TO INDEMNIFY, HOLD HARMLESS,
PROTECT, DEFEND AND DISCHARGE GATHERER AND PRODUCER AND THEIR AFFILIATED
COMPANIES, PARTNERS, SUCCESSORS, ASSIGNS, OFFICERS, DIRECTORS, SHAREHOLDERS,
EMPLOYEES AND AGENTS, FOR, FROM AND AGAINST ANY AND ALL JUDGMENTS, EXECUTIONS,
CAUSES OF ACTION, DEMANDS, RIGHTS, SUITS, DEBTS AND SUMS OF MONEY, ACCOUNTINGS,
DUES, PENALTIES, FINES, CLAIMS (INCLUDING, WITHOUT LIMITATION, CLAIMS FOR
CONTRIBUTION), LIABILITIES, LOSSES, COSTS, DAMAGES AND EXPENSES (INCLUDING COURT
COSTS, REASONABLE COSTS OR INVESTIGATION, DEFENSE AND ATTORNEY’S FEES) OF ANY
NATURE, KIND OR DESCRIPTION BROUGHT BY ANY PERSON OR ENTITY, WHETHER LEGAL OR
EQUITABLE, WHICH ARISE OUT OF, RESULT FROM OR ARE IN ANY WAY RELATED TO (i)
PROCESSOR’S OWNERSHIP AND CONTROL OF THE GAS AFTER THE GAS PASSES THROUGH THE
PLANT DELIVERY POINT(S) AND PRIOR TO THE TIME THAT THE RESIDUE GAS PASSES
THROUGH THE RESIDUE GAS DELIVERY POINT(S) AND THE PLANT PRODUCTS PASS THROUGH
THE PLANT PRODUCTS DELIVERY POINT , (ii) PROCESSOR’S OWNERSHIP AND OPERATION OF
THE PLANT, (iii) THE SERVICES PROVIDED BY PROCESSOR PURSUANT TO THIS AGREEMENT,
(iv) PROCESSOR’S BREACH OF THIS AGREEMENT, OR (v) ANY VIOLATION OF THE LAW,
REGARDLESS OF GATHERER’S OR PRODUCER’S SOLE, CONCURRENT OR COMPARATIVE
NEGLIGENCE.  THE INDEMNIFICATION RIGHTS HEREIN SHALL BE CUMULATIVE OF,
AND IN ADDITION TO, ANY AND ALL OTHER RIGHTS, REMEDIES OR RECOURSE OF THE
PARTIES AND SHALL SURVIVE ANY EXPIRATION OR TERMINATION OF THIS
AGREEMENT.  TO THE EXTENT AND ONLY TO THE EXTENT THE FOREGOING
INDEMNIFICATION RIGHTS ARE BY LAW, EITHER INAPPLICABLE OR NOT ENFORCEABLE,
PRODUCER, GATHERER AND PROCESSOR SHALL EACH BE RESPONSIBLE FOR THE RESULTS OF
ITS OWN

     

    
        
        

        20

        
          

        

      







 


      

        
        
ACTIONS
AND FOR THE ACTIONS OF THOSE PERSONS AND ENTITIES OVER WHICH IT EXERCISES
CONTROL.

     

    ARTICLE
XVIII -

    FORCE
MAJEURE

     

    In the event any
Party is rendered unable, either wholly or in part, by force majeure to carry
out its obligations under this Agreement, other than the obligation to make
payments due hereunder, it is agreed that on such Party giving notice and full
particulars of such inability by telephone and in writing to the other Parties
as soon as possible after the occurrence of the cause relied on, then the
obligations of the Party giving such notice, so far as they are affected by such
force majeure, shall be suspended during the continuance of any inability so
caused, but for no longer period, and such cause shall, as far as possible, be
remedied with all reasonable dispatch.  The term "force majeure" as
employed herein shall mean any act or event which wholly or partially prevents
or delays the performance of obligations arising under this Agreement if such
act or event is not reasonably within the control of and not caused by the fault
or negligence of the Party claiming force majeure and which by the exercise of
due diligence such Party is unable to prevent or overcome, including, without
limitation, by the following enumeration:  acts of God; strikes;
lockouts; or other industrial disturbances; acts of the public enemy; wars;
blockades; insurrections; riots; epidemics; landslides; lightning; earthquakes;
fires; storms; floods; washouts; arrests and restraints of governments and
people; civil disturbances; explosion, breakage, or accidents to machinery,
plant facilities, or lines of pipe; the necessity for making repairs to or
alterations of machinery, plant facilities, or lines of pipe; freezing of wells
or lines of pipe; partial or entire failure of wells; and the inability of
either Producer, Gatherer or Processor to acquire, or the delays on the part of
either Producer, Gatherer or Processor in acquiring, at reasonable cost and
after the exercise of reasonable diligence:  (a) any servitude,
rights-of-way grants, permits, or licenses; (b) any materials or supplies for
the construction or maintenance of facilities; and (c) any permits or
permissions from any governmental agency if such are required.  It is
understood and agreed that the settlement of strikes or lockouts shall be
entirely within the discretion of the Party having the difficulty and that the
above requirements that any force majeure shall be remedied with all reasonable
dispatch shall not require the settlement of strikes or lockouts by acceding to
the demands of the opposing party when such course is inadvisable in the sole
discretion of the Party having the difficulty.

     

    ARTICLE
XIX -

    UNPROFITABLE
OPERATIONS AND RIGHTS OF TERMINATION

     

    19.1    If,
in the sole and absolute opinion of Gatherer, the gathering of Gas from any well
or wells, or any Gathering System Delivery Point, under this Agreement, is or
becomes uneconomical due to its volume, government regulations, or any cause
other than force majeure, Gatherer shall not be obligated to gather or may cease
gathering the Gas therefrom so long as such condition
exists.  Gatherer agrees that in its determination of uneconomical
gathering, the same criteria shall be used for the Gas as for all other gas
being gathered through the Gathering System.  In the event that
Gatherer refuses to gather the Gas, Producer may dispose of the Gas not gathered
as it sees fit; provided that

     

    
        
        

        21

        
          

        

      







 


      

        
        
Gatherer at any
time thereafter shall have the right to gather all of the Gas refused, if
refused for reason or reasons resulting from an act of Producer or lack of
action on the part of Producer, conditioned upon Gatherer giving Producer at
least two (2) months' notice of its election so to do.  In the event
that Gatherer refuses to gather the Gas for a period of sixty (60) consecutive
days causing Producer’s well(s) to be shut-in, Producer shall have the option,
exercised solely at its discretion, to terminate the Agreement in its entirety
insofar and only insofar as it pertains to Gas produced from the affected
well(s) by providing to Gatherer a thirty (30) days’ advance written notice of
such termination.

     

    19.2    If,
in the sole and absolute opinion of Processor, the processing of Gas from any
well or wells, or any Gathering System Delivery Point, under this Agreement, is
or becomes uneconomical due to its volume, Plant Product content, government
regulations, or any cause other than force majeure, Processor shall not be
obligated to process or may cease processing the Gas therefrom so long as such
condition exists.  Processor agrees that in its determination of
uneconomical processing, the same criteria shall be used for the Gas as for all
other gas being processed through the Plant.  In the event that
Processor refuses to process the Gas, Producer may dispose of the Gas not
processed as it sees fit; provided that Processor at any time thereafter shall
have the right to process all of the Gas refused, if refused for reason or
reasons resulting from an act of Producer or lack of action on the part of
Producer, conditioned upon Processor giving Producer at least two (2) months'
notice of its election so to do.  In the event that Processor refuses
to process the Gas for a period of sixty (60) consecutive days and Gatherer is
unable to by-pass the Plant in order to deliver Producer’s gas to an alternative
pipeline willing to accept Producer’s unprocessed Gas causing Producer’s well(s)
to be shut-in, Producer shall have the option, exercised solely at its
discretion, to terminate this Agreement insofar as it pertains to Gas produced
from the affected well(s) by providing to Processor a thirty (30) days’ advance
written notice of such termination.

     

    19.3    In
the event Processor should at any time hereafter elect to permanently
discontinue the operation of the Plant, Gatherer, Processor and Producer shall
each have the option, exercised solely at its discretion, of terminating this
Agreement in its entirety upon one hundred twenty (120) days advance written
notice of such termination notice to the other Parties.

     

    19.4    Nothing
herein shall be construed to require Producer to drill any well or to continue
to operate any well which a prudent operator would not in like circumstances
drill or continue to operate.

     

    19.5    It
is agreed that neither Gatherer nor Processor shall be obligated to expand the
Facilities in order to provide capacity hereunder.

     

    ARTICLE XX
-

    TERM

     

    This Agreement
shall be effective from the Effective Date and, subject to the other provisions
hereof, shall continue in full force and effect until August 10, 2017 (the
“Primary Term”) and shall be automatically renewed for one (1) year periods
thereafter unless on or

     

    
        
        

        22

        
          

        

      







 


      

        
        
before ninety (90)
days prior to the expiration of the Primary Term or the expiration of a one (1)
year renewal period a Party hereto provides written notice of termination (the
“Term”).

     

    ARTICLE XXI
-

    REGULATORY
BODIES

     

    This Agreement and
the provisions hereof shall be subject to all valid applicable federal, state,
and local laws, order, rules, and regulations.  Producer, Gatherer and
Processor have entered into this Agreement with the understanding, and in
reliance on the fact, that this Agreement and/or performance of this Agreement
are not and will not be subject to the jurisdiction or regulation of the Federal
Energy Regulatory Commission ("FERC").  If this Agreement and/or
performance of this Agreement becomes subject to such jurisdiction and/or
regulation, this Agreement shall automatically terminate unless Producer,
Gatherer and Processor agree, in writing, within thirty (30) days of the
effective date of the attachment of any such jurisdiction and/or regulation,
that this Agreement shall continue after such effective date.

     

    ARTICLE XXII
-

    ARBITRATION

     

    Any controversy
between the Parties arising under ARTICLE X of this Agreement and not resolved
by agreement shall be determined by a board of arbitration upon notice of
submission given either by Processor, Gatherer or Producer, which request shall
also name one arbitrator.  The Parties receiving such notice shall,
within ten (10) days thereafter, by notice to the others, jointly name the
second arbitrator, or failing so to do, the Party giving notice of submission
shall name the second.  The two arbitrators so appointed shall name
the third, or failing so to do within ten (10) days, then upon the written
application of any Party, such third arbitrator may be appointed by the American
Arbitration Association.  The arbitrators selected to act hereunder
shall be qualified by education, experience, and training to pass upon the
particular question in dispute.  The jurisdiction of the arbitrators
will be limited to the single issue referred to arbitration, and the arbitration
shall be conducted pursuant to the guidelines set forth by the American
Arbitration Association; provided, however, that should there be any conflict
between the guidelines and the procedures set forth in this Agreement, the terms
of this Agreement shall control.  Within fifteen (15) days following
selection of the third arbitrator, each Party shall furnish the arbitrators in
writing its position regarding the issue being arbitrated.  The
arbitrators may, if they deem necessary, convene a hearing regarding the issue
being arbitrated.  The arbitrators shall render their decision in
writing within thirty (30) days after the appointment of the third arbitrator or
the conclusion of the hearing, if one is held.  If within said period
a decision is not rendered by the arbitrators, new arbitrators may be named and
shall act hereunder at the election of any of Processor, Gatherer or Producer in
like manner as if none has been previously named.  The arbitrators’
decision shall be final and binding upon the Parties as to the issue submitted
and the Parties will abide by and comply with such decision.  The
expenses of arbitration shall be borne equally by the Parties, except that each
Party shall bear the compensation and expenses of its counsel, witnesses, and
employees.

     

    
        
        

        23

        
          

        

      







 


        

        

     

    ARTICLE XXIII
-

    DISPUTES

     

    23.1    Subject
to the terms as set forth in ARTICLE XXII of this Agreement, should a dispute
arise between the Parties, the Parties shall promptly seek to resolve any such
dispute by negotiations among the senior executives of the Parties who have the
authority to settle such dispute (“Senior Executives”) prior to the initiation
of any lawsuit.  The Senior Executives shall meet at a mutually
acceptable time and place within fifteen (15) days and thereafter as often as
they reasonably deem necessary to exchange relevant information and to attempt
to resolve the dispute.  All negotiations and communications pursuant
to this ARTICLE XXIII shall be treated and maintained by the Parties as
confidential information and shall be treated as compromise and settlement
negotiations for purposes of the federal and state Rules of
Evidence.  If the matter has not been resolved within thirty (30) days
after the initial meeting of the Senior Executives, or such longer period as may
be mutually agreed upon, either Party may initiate a lawsuit.

     

    23.2    THIS
AGREEMENT, AND ALL QUESTIONS RELATING TO ITS VALIDITY, INTERPRETATION,
PERFORMANCE AND ENFORCEMENT (INCLUDING, WITHOUT LIMITATION, PROVISIONS
CONCERNING LIMITATIONS OF ACTIONS) SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF TEXAS, NOTWITHSTANDING ANY
CONFLICT-OF-LAWS DOCTRINES OF SUCH STATE OR OTHER JURISDICTION TO THE
CONTRARY.  ALL MATTERS LITIGATED BY OR BETWEEN THE PARTIES THAT
INVOLVE THIS AGREEMENT, THE RELATIONSHIP OF THE PARTIES, OR ANY RELATED
DOCUMENTS OR MATTERS HEREUNDER SHALL BE BROUGHT ONLY IN FORT WORTH, TARRANT
COUNTY, TEXAS.

     

    23.3    In
any suit filed by a Party hereto to resolve a dispute arising under this
Agreement or related to the services provided hereunder, each Party hereby
covenants and agrees to take all steps necessary to waive a trial by
jury.

     

    ARTICLE
XXIV -

    NOTICES
AND PAYMENTS

     

    Any notice,
request, demand, statement, or bill provided for in this Agreement shall be in
writing and delivered by hand, mail, or facsimile.  All such written
communications shall be effective upon receipt by the other party at the address
of the parties hereto as follow:

     

    Producer

     

    
      
        
          	
                  Statements:

                	
                  Quicksilver
      Resources Inc.

                  777 West
      Rosedale Street

                  Fort Worth,
      TX  76104

                  Attn:  Revenue
      Accounting

                   

                
	
                  Payments:

                	
                  Quicksilver
      Resources Inc.

                   

                


        

         

      

    

    
        
        

        24

        
          

        

      







 


        

        

     

    
      
        	
                 

              	
                777 West
      Rosedale Street

                Fort Worth,
      TX  76104

                Attn:  Accounting

                 

              
	
                Contractual:

              	
                Quicksilver
      Resources Inc.

                777 West
      Rosedale Street

                Fort Worth,
      TX  76104

                Attn:  Marketing

              


      

       

      
          
          

          25

          
            

          

        







 


          

          

      

       

      Gatherer

       

      
        	
                Statements:

              	
                Cowtown
      Pipeline Partners L.P.

                777 West
      Rosedale Street

                Fort Worth,
      TX  76104

                Attn:  Revenue
      Accounting

                 

              
	
                Payments:

              	
                Cowtown
      Pipeline Partners L.P.

                777 West
      Rosedale

                Fort Worth,
      TX  76104

                Attn:  Accounting

                 

              
	
                Contractual:

              	
                Cowtown
      Pipeline Partners L.P.

                777 West
      Rosedale

                Fort Worth,
      TX  76104

                Attn:  Marketing

              


      

       

      Processor

       

      
        	
                Statements:

              	
                Cowtown Gas
      Processing Partners L.P.

                777 West
      Rosedale

                Fort Worth,
      TX  76104

                Attn:  Revenue
      Accounting

                 

              
	
                Payments:

              	
                Cowtown Gas
      Processing Partners L.P.

                777 West
      Rosedale

                Fort Worth,
      TX  76104

                Attn:  Accounting

                 

              
	
                Contractual:

              	
                Cowtown Gas
      Processing Partners L.P.

                777 West
      Rosedale

                Fort Worth,
      TX  76104

                Attn:  Marketing

              


      

       

    Any of the Parties
may designate a further or different address by giving written notice to the
other Parties.

     

    ARTICLE
XXV -

    ASSIGNMENT

     

    This Agreement (and
a Party’s rights and obligations hereunder) is assignable in whole or in
part.  This Agreement shall be binding upon and inure to the benefit
of the heirs, executors, administrators, successors, and assigns of the
respective Parties hereto; provided that no transfer of or succession to the
interest of any Party hereunder, either wholly or partially, shall affect or
bind the other Parties until it shall have been furnished with the original
instrument or with the proper proof that the claimant is legally entitled to
such interest.

     

    
        
        

        26

        
          

        

      







 


        

        

     

    ARTICLE XXVI
-

    MISCELLANEOUS

     

    26.1    No
waiver by any Party of any one or more defaults in the performance of any
provision of this Agreement shall operate or be construed as a waiver of
any  default or future defaults, whether of a like or different
character.

     

    26.2    This
Agreement contains the entire agreement between the Parties and there are no
oral promises, agreements, or warranties affecting it.  This Agreement
may be amended or modified from time to time only by the written agreement of
all the Parties hereto; provided, however, that the Parties may not, without the
prior approval of the Conflicts Committee (as such term is defined in the
partnership agreement for Quicksilver Gas Services L.P.(“MLP”), the parent of
Gatherer and Processor, agree to any amendment or modification of this Agreement
that the general partner of MLP determines will adversely affect the holders of
common units of MLP.

     

    26.3    The
provisions of this Agreement are enforceable by the Parties hereto and MLP,
which is an intended third party beneficiary hereof. Except as described in the
immediately preceding sentence, nothing in this Agreement, express or implied,
is intended to confer upon any person other than the Parties hereto and MLP and
their respective successors and assigns, any rights, benefits or obligations
hereunder.  No limited partner of the MLP shall have the right, separate
and apart from MLP, to enforce any provision of this Agreement or to compel any
Party to this Agreement to comply with the terms of this Agreement.

     

    26.4    The
descriptive headings of the provisions of these general provisions are
formulated and used for convenience only and shall not be deemed to affect the
meaning or construction of any such provisions.

     

    26.5    This
Agreement supersedes and replaces any other contract(s) or agreements(s) which
may exist between the Parties covering the gathering and processing of the Gas
dedicated hereunder; provided
the Parties agree that a separate gathering agreement may be executed in
substitution of this Agreement to provide for the gathering by Gatherer of gas
produced from some portion of the dedicated Contract Area but which is deemed
“dry” and not otherwise desirable or acceptable for processing at the
Facilities.

     

    26.6    Nothing
in this Agreement is intended to create a partnership or joint venture under
state law or to render the Parties hereto jointly and severally liable to any
third party.  Each of the Parties elects to be excluded from the
provisions of Subchapter K, Chapter 1 of Subtitle A, of the Internal Revenue
Code of 1986 pursuant to the provisions of Article 761(a) of such code and from
any similar provisions of state law.  Processor shall timely file such
evidence of this election as may be required under applicable law.

     

    26.7    Should
any section, paragraph, subparagraph, or other portion of this Agreement be
found invalid as a matter of law in a duly authorized court, or by a duly
authorized government agency, then only that portion of the Agreement shall be
invalid.

     

    
        
        

        27

        
          

        

      







 


      

        
        
The remainder of
the Agreement which shall not have been found invalid shall remain in full force
and effect.

     

    26.8    This
Agreement was prepared jointly by the Parties hereunder and not by any Party to
the exclusion of the other.

     

    26.9    Producer
recognizes and acknowledges Gatherer’s and Processor's proprietary interest in
this Agreement, and Producer agrees not to divulge any of the contents hereof to
any other person, firm, corporation, or other entity.  Producer agrees
to be responsible for enforcing the confidentiality of this Agreement and agrees
to take such action as necessary to prevent any disclosure by any of its agents
or employees.

     

     

     

    (SIGNATURE PAGE
FOLLOWS)


    
         


        28

        
          

        

      







 


        
 


    IN WITNESS WHEREOF,
the Parties hereto have executed this Agreement in several originals to be
effective as of the Effective Date.

     

    
      
        	 	PRODUCER	 
	 	 	 
	 	Quicksilver Resources
      Inc., a
      Delaware corporation	 
	 	 	 	 
	
                 

              	
                By:
      

              	/s/ Stan
      Page	 
	 	 	Stan
      Page	 
	 	 	Vice
      President - U.S. Operations	 


      

    

    
      	 	 	 
	 	 	 
	 	GATHERER	 
	 	 	 
	 	Cowtown Pipeline Partners
      L.P., a Texas
      limited partnership	 
	 	 	 	 
	
               

            	
              By:
      

            	Quicksilver
      Gas Services Operating GP LLC, its general partner	 


    

    
      	 	 	 	 
	
               

            	
              By:
      

            	/s/ Thomas
      F. Darden	 
	 	 	Thomas F.
      Darden	 
	 	 	President and
      Chief Executive Officer	 


    

    
      	 	 	 
	 	 	 
	 	PROCESSOR	 
	 	 	 
	 	Cowtown Gas Processing
      Partners L.P., a Texas
      limited partnership	 
	 	 	 	 
	
               

            	
              By:
      

            	Quicksilver
      Gas Services Operating GP LLC, its general partner	 


    

    
      	 	 	 	 
	
               

            	
              By:
      

            	/s/ Thomas
      F. Darden	 
	 	 	Thomas F.
      Darden	 
	 	 	President and
      Chief Executive Officer