REASONABLY PRUDENT
OPERATOR, PROVIDED, IN THE EVENT OWNER SHOULD COMMENCE GAS FLOW FROM A NEW WELL,
OR WORK TO REPAIR, REWORK, OR PLUG ANY WELL, OWNER WILL USE ITS COMMERCIALLY
REASONABLE EFFORTS TO PROVIDE REASONABLE NOTICE OF SAME TO GATHERER; AND
B.
TO SEPARATE OR PROCESS THE GAS USING
ONLY MECHANICAL, AMBIENT TEMPERATURE EQUIPMENT LOCATED AT SURFACE PRODUCTION
FACILITIES AT THE WELL LOCATION; AND
C.
TO POD, POOL, COMMUNITIZE OR UNITIZE
OWNER'S RESERVES, IN WHICH EVENT THIS AGREEMENT SHALL COVER OWNER'S INTERESTS
THEREIN.
ARTICLE II
OBLIGATIONS OF GATHERER
2.1
GATHERING SERVICES. IN ACCORDANCE WITH THE
TERMS AND SUBJECT TO THE REQUIREMENTS OF THIS AGREEMENT, GATHERER, OR GATHERER'S
AUTHORIZED REPRESENTATIVE, SHALL TAKE DELIVERY OF 100% OF OWNER'S RESERVES
DELIVERED TO GATHERER AT THE RECEIPT POINT(S), NOW THROUGH THE TERM, SUBJECT
ONLY TO FORCE MAJEURE EVENTS, NORMAL AND ROUTINE MAINTENANCE, AND CAPACITY
CONSTRAINTS CAUSED BY DOWNSTREAM PIPELINE(S) AND RE-DELIVER EQUIVALENT
QUANTITIES OF GAS (LESS OWNER'S PRO RATA SHARE OF LOST AND UNACCOUNTED FOR GAS
AND FUEL) FOR OWNER'S ACCOUNT AT THE DELIVERY POINT(S).
2.2
GATHERING FACILITIES. IN ORDER TO PERFORM
THE GATHERING SERVICES, GATHERER AGREES TO PURCHASE, LEASE, BUILD, OWN, OPERATE
OR CAUSE TO BE PROVIDED THE
2
GATHERING FACILITIES AS ARE NECESSARY TO PERFORM THE GATHERING SERVICES IN
ACCORDANCE WITH THE FACILITIES DEVELOPMENT PLAN ATTACHED HERETO AS EXHIBIT B.
2.3
RECEIPT POINTS. THE POINTS AT WHICH OWNER
SHALL DELIVER GAS TO GATHERER ("RECEIPT POINTS") ARE AS SPECIFIED IN EXHIBIT C
ATTACHED HERETO.
2.4
DELIVERY POINTS. THE POINTS AT WHICH
GATHERER SHALL REDELIVER TO OWNER EQUIVALENT QUANTITIES OF GAS DELIVERED BY
OWNER TO THE RECEIPT POINTS (LESS OWNER'S PRO RATA SHARE OF LOST AND UNACCOUNTED
FOR GAS AND FUEL) ("DELIVERY POINTS") ARE AS SPECIFIED IN EXHIBIT D ATTACHED
HERETO. MAXIMUM VOLUMES, IF ANY, THAT MAY BE REDELIVERED TO ANY DELIVERY POINT
SHALL BE AS SET FORTH ON EXHIBIT D.
ARTICLE III
TERM OF AGREEMENT
This Agreement shall be effective on January 1, 2006 (the "Effective Date"),
and, unless otherwise terminated in accordance with the terms of this Agreement
shall remain in effect for a period of ten (10) Years (the "Primary Term"), and
thereafter continue in effect from Year to Year, unless terminated by either
Party upon written notice to the other Party given thirty (30) Days prior to the
end of the Primary Term or any Year thereafter. Notwithstanding the foregoing,
in the event Owner, at any time after the first five (5) years of this
Agreement, reasonably determines, acting as a prudent operator, that continued
deliveries under this Agreement are uneconomic, upon ninety (90) days' advance
written notice to Gatherer, Owner may terminate this Agreement without
liability. For the purposes hereof, "uneconomic" shall mean circumstances under
which Owner's revenues from Owner's Reserves are insufficient to offset Owner's
operating costs attributable to Owner's Reserves, including the cost of
Gathering Services. All indemnity, confidentiality obligations, and audit rights
shall survive the termination or expiration hereof.
ARTICLE IV
GATHERING CHARGE AND PAYMENT
4.1
GATHERING FEE. OWNER WILL PAY GATHERER A
GATHERING FEE