Exhibit
10.31


AMENDED
AND RESTATED
  NATURAL
GAS PURCHASE AGREEMENT
  
  By and
Between
  TARGA GAS
MARKETING LLC
  (“Buyer”)
  And
  TARGA
TEXAS FIELD SERVICES
LP
  (“Seller”)
  
  
  Effective
as of March 1, 2009
   
  AMENDED
AND RESTATED NATURAL GAS PURCHASE AGREEMENT
  This
Amended and Restated Natural Gas Purchase Agreement is executed on January 25,
2010, but effective as of March 1, 2009, by and between TARGA GAS MARKETING LLC
("Buyer") and TARGA TEXAS FIELD SERVICES LP ("Seller") (each a “Party,” and
together, the “Parties”), and sets forth the terms and conditions pursuant to
which Seller will sell to Buyer, and Buyer will purchase from Seller, certain
Gas (as hereinafter defined) produced at natural gas processing facilities owned
and operated by Seller.  This Agreement amends and restates in its
entirety that certain Natural Gas Purchase Agreement dated and effective as of
December 1, 2005.
  1.
              Definitions.
  As used
in this Agreement, the following terms shall have the following
meaning:
  “Affiliate” means any
Person that directly or indirectly through one or more intermediaries, controls
or is controlled by or is under common control with the Person specified, with
the term “control” (including the terms “controlled by” or “under common control
with”) meaning the possession, directly or indirectly, of the power to direct or
cause the direction of the management and policies of a Person, whether through
ownership, by contract, or otherwise.  Any Person shall be deemed to
be an Affiliate of any specified Person if (i) such Person owns fifty percent
(50%) or more of the voting securities of the specified Person, if the specified
Person owns fifty percent (50%) or more of the voting securities of such Person,
or if fifty percent (50%) or more of the voting securities of the specified
Person and such Person are under common control, or (ii) such Person has
operational control of the specified Person pursuant to an operating agreement,
management agreement or other contractual rights.
  "Business Day" means
any day except Saturday, Sunday or Federal Reserve Bank holidays.
  “Claims” means any and
all claims, liabilities, losses, damages, demands, penalties, fines, causes of
action, remediation expenses, suits, judgments, arbitration awards, court
orders, directives, injunctions, decrees or awards of any jurisdiction, and any
costs and expenses related to the same (including court costs, reasonable
attorneys’ fees, and other reasonable expenses of litigation).
  “Early Termination
Date” is defined in Section 14.2.
  “Excess Gas” means Gas
delivered by Seller at any Receipt Point during a Month that is greater than the
Nominated Quantity at such Receipt Point for such Month.
  “Gas” means all
residue gas owned or controlled by Seller that is produced from and/or processed
at the Plants and is not now or hereafter committed by Seller for sale to third
parties.
  “Gas Proceeds” means
the aggregate proceeds received by Buyer from its first of Month baseload sales
at the relevant Near Market Point to Buyer’s customers, including third parties
and Affiliates of Buyer.
  “Index Price” means
the price per MMBtu reported in the first publication of Inside
FERC’s Gas Market Report for such Month for the applicable Near Market
Point.  Notwithstanding the foregoing, if there is no single price
published for such day, but there is published a range of prices, then the Index
Price for such day will be the average of the high and low prices in that
range.
   
  "MMBtu"means 1,000,000 British
thermal units.
  "Month" shall mean the
period beginning at 7:00 AM Central Standard Time (as adjusted for Central
Daylight Time) on the first day of a calendar month and ending at 6:59 AM on the
last day of such calendar month.
  “Near Market Point”
means one or more available delivery points for each Plant using applicable
transportation, as set forth on Exhibit “B” attached hereto.
  “Near Market Price”
means the applicable price for Gas for the first of Month baseload sales sold at
each Near Market Point, as set forth on Exhibit “B” attached
hereto.
  “Net Index Price”
means the applicable Index Price, less applicable Transportation
Costs.
  “Nominated Quantity”
means the quantity of Gas for any Month that is nominated by Seller prior to the
first day of such Month with respect to any Receipt Point.
  “Person” means any
individual, corporation, partnership, limited liability company, association,
joint venture, trust, or other organization of any nature or kind.
  “Plant” or “Plants” means one or
more natural gas processing plants that are now or hereafter owned or operated
by Seller, including but not limited to the plants identified on Exhibit “A,”
attached hereto.
  “Receipt Point” is
defined in Section 5.
  "Receiving Transporter"
means the transporter receiving Gas at a Receipt Point.
  “Remote Market Point”
means, for any Plant, one or more delivery points that are further away from
such Plant than the applicable Near Market Point.
  “Remote Market Price”
means the applicable price for Gas for the first of Month baseload sales sold at
Remote Market Points, as set forth in Exhibit “B” attached hereto.
  “Taxes” means any or
all ad valorem, property, occupation, severance, generation, first use,
conversion, Btu or Gas, transport, transmission, utility, gross receipts,
privilege, sales, use, consumption, excise, lease, transaction, and other taxes,
governmental charges, regulatory assessments by federal, state or local agencies
or commissions (including, but not limited to, FERC assessments), license fees,
permits or assessments or increases therein, other than taxes based on net
income or net worth
  “Termination Payment”
is defined in Section 14.2.
  “Transportation Costs”
means all transportation costs incurred by Buyer (or deemed to be incurred) for
first of Month baseload Gas sales at the applicable Near Market Point, including
any pipeline tariff charges, fuel, and any demand charges for firm
capacity.  Any additional transportation costs incurred by Buyer for
delivery of Gas to a Remote Market Point shall be at the sole expense of
Buyer.
  “Weighted Average Sales
Price” or “WASP” means, for each
applicable Near Market Point, a price per MMBtu for each Month equal to (i) Gas
Proceeds for such Month, less Transportation
   
  Costs for
such Month, divided by (ii) the total number of first of Month baseload MMBtus
of Gas sold at such Near Market Point during such Month.
  2.
              Term;
      Termination.
  2.1           This
Agreement shall commence on March 1, 2009 and shall continue in full force and
effect for a term of fifteen (15) years (the “Initial Term”).  At the
expiration of the Initial Term, this Agreement shall be automatically extended
for consecutive sixty (60) month terms (the “Renewal Term”), unless either Party
shall have given written notice of termination to the other Party at least one
hundred twenty (120) days prior to the expiration of the Initial Term
or  the applicable Renewal Term (the Initial Term and any Renewal
Term(s) shall collectively be referred to as the “Term”).
  2.2           In
the event that either Party ceases to be an Affiliate of Targa Resources, Inc.,
then either Party may, at its sole discretion, elect to terminate this Agreement
upon one hundred twenty (120) days notice to the other Party.
  3.
              Quantity.
  Subject
to the terms and conditions of this Agreement, for each Month during the Term,
Seller agrees to sell and deliver and Buyer agrees to purchase and receive all
of Seller’s Gas.
  4.
              Price.
  4.1           The
price per MMBtu for all Gas sold by Buyer at any Near Market Point during each
Month shall be the applicable Near Market Price for such Month.
  4.2           The
price per MMBtu for all Gas sold by Buyer at any Remote Market Point during each
Month shall be the applicable Remote Market Price for such Month.
  4.3           The
price per MMBtu for all Excess Gas sold by Buyer at any Near Market Point or
Remote Market Point during each Month shall be the same as the Remote Market
Price for such market delivery point.
  5.
              Receipt Point;
      Transportation:
  The
receipt point (“Receipt Point”) for each Plant shall be a point at or near (i)
the tailgate of such Plant or (ii) the interconnection of the Plant and its
transporting pipelines.
  Seller
shallhave the sole
responsibility for delivering the Gas to the Receipt Points.Buyer shall have the
sole responsibility for transporting the Gas from the Receipt
Points.
  6.
              Nominations.
  Seller
will nominate the total quantity of Plant Gas (in MMBtu per day) to be delivered
to each Receipt Point for each Plant during any Month, giving sufficient time to
meet the applicable pipeline company’s nomination deadlines for such Month, and
will also provide Buyer with any other operational information which could have
a significant effect on the quantity of Gas delivered from each Plant for the
Month. Seller and Buyer will cooperate in communicating throughout each Month
regarding any changes in the quantity of Plant Gas to be delivered at each
Receipt Point for the Month of flow and the following Month. Should Seller
become aware
   
  that
actual deliveries at any Receipt Point on any day will be more or less than the
Nominated Quantity, Seller shall promptly notify Buyer.
  7.
              Operational
      Procedures.
  For its
first of month sales of Gas from each Plant, Buyer agrees to utilize operational
procedures agreed to by Seller and Buyer from time to time based upon available
transportation, current market conditions and other relevant
factors.
  8.
              Quality; Delivery
      Pressure.
  All Gas
delivered by Seller hereunder shall meet the pressure, quality and heat content
requirements of the Receiving Transporter, unless otherwise agreed by the
parties.  The unit of quantity measurement for purposes of this
Agreement shall be one MMBtu dry.  Measurement of Gas quantities
hereunder shall be in accordance with the established procedures of the
Receiving Transporter.
  9.
              Taxes and Other
      Charges.
  Seller is
liable for and shall pay, or cause to be paid, all Taxes applicable to the
purchase or sale of Gas at a particular Receipt Point arising prior to the
Receipt Points.  Seller will release, indemnify, defend and save Buyer
harmless from and against all Claims for such Taxes.  In the event
Buyer is required to remit such Taxes, Seller shall reimburse Buyer for such
amount.  Buyer is liable for and shall pay or cause to be paid all
Taxes applicable to the purchase or sale of Gas at a particular Receipt Point
arising at or after the Receipt Points.  Buyer shall release,
indemnify, defend and save Seller harmless from and against all Claims for such
Taxes.  In the event Seller is required to remit such Taxes, Buyer
shall reimburse Seller for such amount.
  10.
              Billing and
      Payments.
  10.1           On
or before the fifteenth (15th) day following each Month during the Term (and for
the first Month following the expiration or termination of this Agreement),
Buyer shall deliver to Seller a statement for the preceding Month showing the
daily and total volume of Gas delivered to each Receipt Point, the applicable
price for such Gas, and any other amounts and adjustments due hereunder, and the
total amount due from Buyer to Seller.  In the event that the quantity
of gas delivered at any Receipt Point is less than the Nominated Quantity for
such Month, there shall be no adjustment to the price per MMBtu payable by Buyer
to Seller for Gas.  If the actual volume delivered is not available by
such billing date, Buyer shall use an estimated volume based on
nominations.  The estimated volume will then be corrected to the
actual volume on the following Month’s billing or as soon thereafter as
transport information is available.
  10.2           On
or before the twenty-fifth (25th) day
of each Month, Buyer will pay Seller at the notice address set forth in Section
11, in immediately available funds, for Gas delivered during the preceding
Month.  In the event that either Party discovers any underpayment or
overpayment, such Party shall promptly notify the other Party, and Seller or
Buyer, as applicable shall make a payment to the other Party in the amount of
any undisputed overpayment or underpayment, as applicable, no later than thirty
(30) days after receipt of such notice.  The Parties agree that,
notwithstanding the provisions of this Section 11, no retroactive adjustment
shall be made for any overpayment or underpayment more than twenty-four
(24)
   
  months
from the date of the original payment to which such overpayment or underpayment
relates.
  11.
              Notices.
  Every
notice, request, statement or bill provided for in this Agreement shall be in
writing directed to the Party to whom given, made or delivered at such Party's
address as set forth below and as such address may be changed from time to time
with written notice to the other Party.
  Buyer:
TARGA GAS MARKETING LLC
  Invoices and
Statements:                                                      Notices and
Correspondence:
  Targa Gas
Marketing
LLC                                                     Targa
Gas Marketing LLC
 1000
Louisiana, Suite
4300                                                     1000
Louisiana, Suite 4300
 Houston,
TX  77002                                                                Houston,
TX  77002
 Attn:  Contract
Administration                                             Attn:  Gas
Marketing Accounting
 Phone:  (713)
584-1000                                                            Phone:  (713)
584-1000
 Fax:  (713)
584-1503                                                                 Fax:  (713)
584-1100
  Operational
Matters:                                                               Duns
No.: 61-094-6290
  Targa Gas
Marketing
LLC                                                      Federal
Tax ID:  20-1884884
 1000
Louisiana, Suite 4300
 Houston,
TX  77002
 Attn:  Manager,
Gas Scheduling
 Phone:  (713)
584-1354
 After
Hours Number:  (713) 584-1354
  Seller:  TARGA TEXAS FIELD SERVICES
LP
  Notices and
Correspondence:
  Targa
Texas Field Services
LP                                              Duns
No.:  15-389-7215
 1000
Louisiana, Suite
4300                                                     Federal
Tax ID: 86-1099713
 Houston,
TX  77002
 Attn:  Contract
Administration                                             Wire
Transfer:
 JP Morgan Chase
 Phone:  (713)
584-1000                                                            Account
#304-189839
 Fax:  (713)
584-1503                                                                 ABA#021-000-021
 
 
 12.
              Title, Warranty and
      Indemnity.
  12.1           Seller
shall have title, custody and control of the Gas and shall assume liability and
risk of loss with respect to the Gas prior to the applicable Receipt
Point.  Buyer shall have title, custody and control of the Gas and
shall assume liability and risk of loss with respect to the Gas at and after the
applicable Receipt Point.
  12.2           Seller
warrants that it will have the right to convey and will transfer good and
merchantable title to all Gas sold hereunder and delivered by Seller to Buyer,
free and clear of
   
  all
liens, encumbrances, and claims.  EXCEPT AS PROVIDED IN THIS SECTION
12.2 AND IN SECTION 15.5, SELLER DISCLAIMS ALL OTHER WARRANTIES, EXPRESS OR
IMPLIED, INCLUDING ANY WARRANTY OF MERCHANTABILITY OR OF FITNESS FOR ANY
PARTICULAR PURPOSE.
  12.3           Seller
shall release, indemnify, defend and hold harmless Buyer from and against all
Claims arising from or relating to the Gas prior to the Receipt
Points.  Buyer shall release, indemnify, defend and hold harmless
Seller from and against all Claims arising from and relating to the Gas at and
after the Receipt Points.
  12.4           Notwithstanding
the other provisions of this Article 12, as between Seller and Buyer, Seller
will be liable for, and shall release, indemnify, defend and hold harmless Buyer
from and against all Claims arising from or related to the failure of Gas
delivered by Seller to meet the quality requirements of Section 8.
  12.5           EXCEPT
AS OTHERWISE PROVIDED HEREIN, NEITHER PARTY SHALL BE LIABLE TO THE OTHER PARTY
FOR CONSEQUENTIAL, INCIDENTAL, PUNITIVE, EXEMPLARY OR INDIRECT DAMAGES, LOST
PROFITS OR OTHER BUSINESS INTERRUPTION DAMAGES, BY STATUTE, IN TORT OR
AGREEMENT, UNDER ANY INDEMNITY PROVISION OR OTHERWISE.  IT IS THE
INTENT OF THE PARTIES THAT THE LIMITATIONS HEREIN IMPOSED ON REMEDIES AND THE
MEASURE OF DAMAGES BE WITHOUT REGARD TO THE CAUSE OR CAUSES RELATED THERETO,
INCLUDING THE NEGLIGENCE OF ANY PARTY, WHETHER SUCH NEGLIGENCE BE SOLE, JOINT OR
CONCURRENT, OR ACTIVE OR PASSIVE.
  13.
              Force
      Majeure.
  13.1           In
the event that either Party is rendered unable, by reason of an event of force
majeure, to perform, wholly or in part, any obligation or commitment set forth
in this Agreement, then upon such Party's giving notice and full particulars of
such event of force majeure, this Agreement shall be suspended, except for the
payment of monies owed hereunder, to the extent and for the period that such
ability to perform is prevented by such force majeure
condition.  Initial notice may be given orally; however, written
notification with reasonably full particulars of the event or occurrence is
required as soon as reasonably possible.
  13.2           The
term "force
majeure" as employed in this Agreement shall mean acts of God,
landslides, lightening, earthquakes, fires, storms or storm warnings, such as
hurricanes, which result in evacuation of the affected areas, floods, washouts,
explosions, breakage or accident or necessity of repairs to machinery or
equipment or lines of pipe, weather related events affecting an entire
geographic region (which include freezing wells or pipelines), strikes, lockouts
or industrial disputes or disturbances, civil disturbances, governmental actions
such as necessity for compliance with any court order, law, statute, ordinance,
regulation, or policy having the effect of law promulgated by a government
authority having jurisdiction, failure or inability to secure or maintain
capacity for purposes of transportation of gas on any pipeline system, or any
other cause, whether of the kind herein enumerated or otherwise, not reasonably
within the control of the Party claiming force majeure.
  14.
              Events of Default;
      Termination.
  14.1           It
shall be an “Event of Default” if:
   
 
 a.           Either
Party becomes insolvent, makes an assignment for the benefit of creditors, or a
receiver or trustee is appointed for the benefit of such Party’s creditors, or a
Party makes a filing for protection from creditors under any bankruptcy or
insolvency laws, or such filing is made against a Party;
  b.          Buyer
fails to make any payment when due and such nonpayment shall have continued for
ten (10) Days or more after written notice of same from Seller; or
  c.          Either
Party fails to perform any of its material obligations hereunder and such
nonperformance shall have continued for thirty (30) Days or more after notice of
same from the other Party.
  14.2           If
an Event of Default occurs and is continuing, the non-defaulting Party may, by
written notice to the defaulting Party, designate a day no earlier than the day
such notice is effective as an early termination date ("Early Termination
Date").  On the Early Termination Date, all obligations due on or
after the Early Termination Date under the Agreement shall be terminated except
as provided herein.  If an Early Termination Date has been designated,
the non-defaulting Party shall in good faith calculate the amount due between
the parties as of the Early Termination Date. The non-defaulting party shall
notify the defaulting Party in writing of the amount due and whether it is owed
to or from the defaulting Party (the “Termination Payment”).  The
party owing the Termination Payment shall pay it to the other party within two
(2) Business Days after the effective date of such notice, with interest at the
Base Rate from the Early Termination Date until paid.
  In
addition, the defaulting Party hereunder shall reimburse the non-defaulting
Party, on demand, for actual, reasonable out-of-pocket expenses (with interest
at a rate equal to the lower of (i) the then-effective prime rate of interest
published under “Money Rate” by The Wall Street Journal, plus two percent per
annum; or (ii) the maximum applicable lawful interest rate), including, without
limitation, reasonable legal fees and expenses incurred by the other Party in
connection with the enforcement of the Agreement.
  If an
Early Termination Date is designated, the non-defaulting party shall be
entitled, in its sole discretion, to set-off any amount payable by the
non-defaulting Party to the defaulting Party under the Agreement or otherwise,
against any amounts payable by the defaulting Party to the non-defaulting Party
under this Agreement or otherwise.  This provision shall be in
addition to any right of setoff or other right and remedies to which any party
is otherwise entitled (whether by operation of law, contract or
otherwise).  If an obligation is unascertained, the non-defaulting
party may in good faith estimate that obligation and set-off in respect of the
estimate, subject to the non-defaulting party accounting to the defaulting Party
when the obligation is ascertained.
  15.
              Miscellaneous.
  15.1           This
Agreement shall be binding upon and inure to the benefit of the successors and
assigns of the respective Parties hereto, and the covenants, conditions, rights
and obligations of this Agreement shall run for the full term of this
Agreement.  No assignment of this Agreement, in whole or in part, will
be made without the prior written consent of the non-assigning Party, which
consent will not be unreasonably withheld or delayed; provided, either Party may
(i) transfer, sell, pledge, encumber, or assign this Agreement or the accounts,
revenues, or proceeds hereof in connection with any financing or other financial
arrangements, or (ii) transfer its interest to any parent or Affiliate by
assignment, merger or otherwise without
   
  the prior
approval of the other Party.  Upon any such assignment, transfer and
assumption, the transferor shall remain principally liable for and shall not be
relieved of or discharged from any obligations hereunder.
  15.2           The
invalidity of any one or more covenants or provisions of this Agreement shall
not affect the validity of any other provisions hereof or this Agreement as a
whole, and in case of any such invalidity, this Agreement shall be construed to
the maximum extent possible as if such invalid provision had not been included
herein.  No waiver of any breach of this Agreement shall be held to be
a waiver of any other or subsequent breach.
  15.3           This
Agreement sets forth all understandings between the Parties respecting each
transaction subject hereto, and any prior Agreements, understandings and
representations, whether oral or written, relating to such transactions are
merged into and superseded by this Agreement and any effective
transaction(s).  This Agreement may be amended only by a writing
executed by both Parties.  Each Party shall take such acts and execute
and deliver such documents as may be reasonably required to effectuate the
purposes of this Agreement.
  15.4           The
interpretation and performance of this Agreement shall be governed by the laws
of the State of Texas, excluding, however, any conflict of laws rule which would
apply the law of another jurisdiction.  This Agreement and all
provisions herein will be subject to all applicable and valid statutes, rules,
orders and regulations of any governmental authority having jurisdiction over
the Parties, their facilities, Gas supply, this Agreement or transaction or any
provisions thereof.  The Parties shall comply with all applicable laws
in the performance of their respective obligations under this
Agreement.
  15.5           Each
Party to this Agreement represents and warrants that it has full and complete
authority to enter into and perform this Agreement.  Each person who
executes this Agreement on behalf of either Party represents and warrants that
it has full and complete authority to do so and that such Party will be bound
thereby.
  15.6           The
provisions of Section 14.2 and Article 12, shall survive any expiration or
termination of this Agreement.
  15.7           Nothing
in this Agreement shall entitle any person other than Seller or Buyer, or their
successors or assigns, to any claim, cause of action, remedy or right of any
kind relating to the transaction(s) contemplated by this Agreement.
  15.8           In
construing this Agreement, the following principles shall be followed: (i) no
consideration shall be given to the fact or presumption that one Party had a
greater or lesser hand in drafting this Agreement; (ii) examples shall not be
construed to limit, expressly or by implication, the matter they illustrate;
(iii) the word “includes” and its syntactical variants mean “includes, but is
not limited to” and corresponding syntactical variant expressions; (iv) the
plural shall be deemed to include the singular and vice versa, as applicable,
and (v) unless the context otherwise requires, any reference to a statutory
provision (including those contained in subordinate legislation) is a reference
to the provision as amended or re-enacted, or as modified by other
statutory  provisions from time to time, and includes subsequent
legislation made under the relevant statute.
   
  
  EXECUTEDJanuary 25, 2010, but
effective as of March 1, 2009.
   "BUYER"                                                                            “SELLER”
  TARGA
GAS MARKETING
LLC                                                                                     TARGA TEXAS FIELD SERVICES
LP,
  By: Targa
Resources Texas GP LLC,
 its general
partner
    By: 
      /s/ Stacy
    Duke
                
                
                By: 
      /s/ Dan C.
      MiddlebrooksName: 
      Stacy Duke
                
                
                Name: 
      Dan C.
      MiddlebrooksTitle: 
      Vice
    President
                
                
                Title: 
      Assistant Vice President -
      Supply
                  and Business Development, San
                  Angelo
      Operating Unit
   
  
   
  EXHIBIT
“A”
  TO
NATURAL GAS SALES AGREEMENT
 Between
Targa Gas Marketing LLC, Buyer
 and
 Targa
Texas Field Services LP, Seller
 Effective
as of March 1, 2009
 
  
  Plants:
  Mertzon
Gas Processing Plant
  Sterling
Gas Processing Plant
   
  EXHIBIT
“B”
  TO
NATURAL GAS SALES AGREEMENT
 Between
Targa Gas Marketing LLC, Buyer
 and
 Targa
Texas Field Services LP, Seller
 Effective
as of March 1, 2009
 
  
  Mertzon
      PlantApplicable
      Transport
              
              Near
      Market Point
              Near
      Market Price
              
              Remote
      Market PriceEPNG
              
              Permian
      Pool
              Net
      Permian Index Price
              
              Net
      Permian Index PriceKM
              
              Houston
      Ship
                Channel
      Pool
              Net
      HSC Index PriceN/A
              
              Tailgate
      of Plant
              WASP
      of Tailgate Sales
              
              
              N/A
 
  
  Sterling
      PlantApplicable
      Transport
              Near
      Market Point
              Near
      Market Price
              Remote
      Market PriceET
      Fuel
              Waha
      Hub
              Waha
      Index Price
              Waha
      IndexPriceEPNG/ET
      Fuel
              Permian
      Pool
                (Keystone)
              Waha
      Index PriceEPNG/ET
      Fuel
              Waha
      Pool
              Waha
      Index Price
              Waha
      Index PriceN/A
              Tailgate
      of Plant
              WASP
      of Tailgate Sales
              N/A